Saturday, October 24, 2009

Fact Check, Keith Wilkowski, Can a Leopard change his spots?

First he was against it…. then he was for it. Again, Mr. Wilkowski has flip-flopped on a critical issue: how to incentivize businesses to Toledo. He was opposed to tax abatements in 1986 – 1988 when he was on the Toledo public school board, but now, when running for Mayor, he pronounces the wisdom of this policy.

Which Wilkowski will lead as Mayor, the elected official who set policy in the 1980’s or today’s candidate running for office? Actions definitely speak louder than words, and it is doubtful this leopard will change his spots. If elected, businesses will again be skeptical of locating in Toledo.

Synopsis of Mr. Wilkowski’s history on tax abatements/incentives.
· 10/5/86 Opposes tax abatements for homeowners in enterprise zone stating the school board should have some control over abatement requests.
· 6/19/87 As a member of committee studying the city’s use of tax abatements, writes draft outlining controls on tax abatements.
· 11/4/88 States: “Tax abatement is counterproductive”, … questions “its usefulness in attracting business”
· 10/23/09 Reply to question during forum on value of incentives for downtown development: “I would look to every kind of incentive that is reasonably possible in order to help bring businesses downtown.”

Detail of articles and forum:
Tax abatement on new construction and renovation work is now available not only to businesses but to hundreds of homeowners in the enterprise zone district. … But the program is not without critics. Keith Wilkowski, a member of the Toledo board of education, sees the tax breaks for home improvements in the enterprise zone as ill conceived. “[Tax abatement] is not an incentive for homes at all,” he said. “Taking $30 off my taxes to put vinyl siding on my house is not an incentive.” … Mr. Wilkowski believes the school board should have some control over abatement requests. … Even though it is the schools that lose the most revenue; boards of education have not authority to accept or reject individual requests. City Council and officials in the community development department control tax abatement.

A committee studying the city’s use of tax abatements is considering proposals that would restrict and change the way it is given, a working draft of the panel’s report to City Manager Philip Hawkey shows. … The city has used tax abatement – a process that exempts businesses from paying taxes on the value of a new investment for a specified period of time – to spur development, but it has not had any local policy governing use of the devise. … The draft proposal shows the panel is discussing:
· Limiting tax abatements in enterprise zones to manufacturing facilities.
· Offering tax abatement on either the value of the real estate or the value of the machinery and equipment in the factory, but not on both.
· The need to monitor the number of jobs created by tax abatement.
· Requiring that the city pay for half the cost of projects that in the past were paid for entirely with tax abatement funds, such as downtown pedestrian concourses.
· Establishing a committee to study the possibility of the city sharing economic gains resulting from tax abatement with Toledo public and Washington Local schools.
· Requiring businesses seeking tax abatement to apply for it before construction begins.
“While City Council grants real and personal property tax abatement,” the draft says, “other governmental entities, primarily school districts, either lose revenue or have their revenues temporarily frozen. At the same time, the city will actually gain revenue from the city income tax or the wages of the new employees hired as a result of the project.”

Keith Wilkowski, a member of the Toledo board of education who wrote the report, said the schools lose revenue every time Council approves abatement. He said Toledo schools have so far lost about $2.5 million a year. Mr. Wilkowski said the committee had narrowly defeated an effort to limit tax breaks to five years. The recommendations, as they now stand, would allow tax abatement for periods ranging from 10 to 20 years.

… The second-term Toledo school board member insists, however, that there are important differences between his views and those of his Republican opponent. … Mr. Wilkowski says his opponent’s support of tax abatements for businesses has been wrong, too. “Tax abatement is counterproductive, it takes from the schools. And I question its usefulness in attracting business. As a general principle, the costs of things like labor and transportation and the quality of the schools are more important [to a business] than tax abatements. … I would be opposed to any county-level enterprise zone that uses it.”

WGTE Candidate Forum 2009, 10/23/09
Mr. Lessenberry: “Mr. Wilkowski, what are your thoughts on a potential tax free district in downtown Toledo to attract businesses, would you favor it or not?”

Mr. Wilkowski: “I would, indeed I would look to every kind of incentive that is reasonably possible in order to help bring businesses downtown. A great city has to have a great downtown and if you look at the research here will tell you that a well functioning downtown on the whole is going to generate $20 in taxes for every $1 in service that it consumes. So this is something that is in our own economic self-interest . I think we need to look at every possible incentive… “

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