It’s good to see large organizations work together when there’s a high-profile controversy with lots at stake.
Such has been the process of negotiating new tax breaks for Bath Iron Works. Roundly criticized for seeking public money at a time it is cutting jobs, the shipyard owned by General Dynamics has been working with city officials to amend its initial proposal to something slightly more palatable to Bath’s elected officials and staff, who sit in the crossfire between shipyard and city.
The TIF, as originally proposed, would give the city and BIW a 50-50 split for all new taxes garnered by the construction of a new outfitting hall. BIW would get back some $250,000 in taxes annually, for a total of about $6.5 million over the life of the TIF.
As reported Tuesday at www.timesrecord.com, the city now proposes a 50-50 split only for 10 years, followed by 40 percent for BIW over the next five years. The remaining term would grant the city 100 percent of new taxes.
According to figures provided by the city, total projected earnings for Bath over the 24-year life of that TIF would be $9,014,760 — 71 percent of the total. BIW would receive $3,711,960 — 29 percent.
For the city, that seems like a more equitable cut — and $9 million in revenue it does not have today.
But, ultimately, the City Council is charged with deciding what level of taxation they’re comfortable losing — and for what gain. And that decision is still due tonight.
No one believes BIW’s threat to pull up anchor is all that credible, yet who wants to risk it? And, besides, neighbors help neighbors. In Bath, BIW is everyone’s neighbor.
Bath undoubtedly wants to help win any project that helps create new construction jobs and the ability to anticipate future growth. The question is how expensive it should be to secure that growth — and what BIW can reliably promise by way of future employment.
We’ve come out previously against the TIF as originally proposed, saying in this space on Aug. 16 that, “if you balance the need for a class of overpriced submarines against a variety of pressing local needs, we’d take the money and re-do the viaduct area, open new areas for public recreation, refurbish or relocate Morse High School and a host of other local projects that could put local people to work.”
Given the spirit of negotiation, we’re not as dead set against the TIF as we were (though it is still worth noting the CEO of General Dynamics makes more per year than the entire city of Bath — raising the ever-present question of how urgently the shipyard really needs the money).
We also said, on Sept. 5, that tax-supported development is good when it’s done right, but “(w)hen it’s done wrong, monopoly interests with connections in high places get free cash, supply meager jobs at poor wages and put taxpayers on the hook for their own private gain should the investment go sour.” Those concerns remain valid.
Perhaps the best thing would be for the residents of Bath to weigh in on the matter in a citywide referendum after the City Council casts its votes tonight.