Update: Mayor Finch & “Education Reformers” spend record amount in bid to take away Bridgeport voters’ rights!

Bad enough that Bridgeport political and business leaders are trying to reduce the democratic rights of Bridgeport voters, but the next most shocking factor is they are using the people’s money to do it.

In addition to all the time Mayor Finch has dedicated to the effort, a major portion of the money that is paying for all the mailings and television ads have been donated by United Illuminating, Bridgeport Hospital, St. Vincent Medical Center, Aquarion Water Company and Harbor Yard, all entities funded, at least in part, by Bridgeport residents and Connecticut taxpayers.

Add $20,000 from New York Mayor Michael Bloomberg, and Residents For A Better Bridgeport, the political action committee behind the campaign to support Mayor Bill Finch’s power grab to eliminate a democratically elected school board and replace it with one appointed by him, will break all the records when it comes to spending money on behalf of a charter change.

Bridgeport Hospital donated $14,422.90

St. Vincent Medical Center donated $14,400

United Illuminating donated $10,000

Aquarion Water Company donated $14,000

Harbor Yard Sports & Entertainment donated $14,442.90

Think about it…

Bridgeport’s two hospitals that are dedicated to providing emergency and critical care to the people Bridgeport and Fairfield County.

Last year, Bridgeport Hospital provided $13.6 million in care to people who had no health insurance.  Add in the bad debts from people who couldn’t pay their full bill, and Bridgeport’s total level of uncompensated care exceeded $41.9 million

Meanwhile, St. Vincent Medical Center provided $9 million in care to those with no health insurance.  Add in their bad patient debts and St. Vincent’s total uncompensated care was $41.8 million.

However, apparently they both have the financial resources to make maximum donations to an effort to undermine democracy in the city that they call home.

And yet, every year, these two hospitals beg the Governor and General Assembly for financial support to stay in business.

So how do these hospitals stay in business?

The State of Connecticut provides these hospitals with major subsidies, using taxpayer funds.

Meanwhile, storm or no storm, UI can find an extra $10,000, the regional water company $14,000 and the publicly funded Harbor Yard can find just over $14,400.  All receive direct funding from taxpayers, rate payers, tax breaks or money from the hard working families of the region.

But without your knowledge or support, some of these funds are being diverted from providing services to paying for Mayor Finch’s immoral political power grab.

Of course, when it comes to using scarce resources, corporate executives, like those at the two hospitals Bridgeport hospitals find other favorite ways to spend your money:

Bridgeport Hospital:  Total salary and compensation for top corporate executives

President/CEO William Jennings:             $764,770
Senior Vice President of Finance/CFO    $688,999
Senior VP of Human Resources                  $468,241
Senior VP/COO                                                  $458,001
Vice President                                                   $452,611
 

St. Vincent Medical Center:  Total salary and compensation for top corporate executives

President/CEO Susan David                        $1,484,755
Senior VP of Finance/CFO                           $567,478
Senior VP $                                                        $456,215
Vice President                                                  $455,920

So next time you pay your taxes, or write out your health insurance premium payment, or pay your water bill or simply try to come up with the money to take your kids to an entertainment event, remember just where some of that money is going.

And it’s not like there is no one who could step in and stop this madness.

All of these organizations have Boards of Trustees or executive leadership teams who could be speaking out for the people of the region…but they aren’t.

Bridgeport Hospital Board of Trustees:

David Bindelglass
Emily E. Blair
Gayle L. Capozzalo
George P. Carter
John Falconi
Robert S. Folman
Richard M. Freedman
Janet M. Hansen
Richard M. Hoyt
William G. Hulcher
Peter F. Hurst
William M. Jennings
Newman Marsilius, III
Patricia L. McDermott
Ronald B. Noren
Jeffrey P. Pino
Meredith B. Reuben
Howard L. Taubin
 

St. Vincent Medical Center Board of Trustees

Sr. Martha Beaudoin
Peter Boone
Susan L. Davis
George Goldfarb
Daniel Gottschall
Edward T. Grossman
Sr. Maura Hobart
Anthony Milano
Manuel Pun
Ruben Rodriguez
Charles Strauss
Anthony Vallillo
Brian Worrell
 

United Illuminating Board of Directors

Thelma R. Albright
Arnold L. Chase
Betsy Henley-Cohn
Suedeen G. Kelly
John L. Lahey
Daniel J. Miglio
William F. Murdy
Donald R. Shassian
James P. Torgerson
 

Aquarion Water Company Executives

Charles V. Firlotte , President and Chief Executive Officer
Donald J. Morrissey, Chief Financial Officer and Corporate Secretary
Howard J. Dunn, Vice President, Operations – Aquarion Company
Bruce T. Silverstone, Vice President, Corporate Communications
Doug Kniffin, Vice President and Chief Information Officer
 

Here are just a few of the companies and organizations that are funding the anti-democracy campaign.  More names to come…

Company/Organization Amount
Aquarium Water Company: $14,000
AT&T Connecticut Employee PAC $2,000
Benchmark Trademark Ltd $5,000
Bradford Evans (Senior Advisor Morgan Stanley) $25,000
Bismark Construction Company $3,500
Bridgeport and Port Jefferson Company $14,000
Bridgeport Hospital $14,442.90
Charles Valentino, State Marshall $1,000
CT Coalition for Advancement Now (ConnAD) $14,000
Hal Rosnick (Attorney) $500
Harbor Yard Sports and Entertainment LLC $14,442.90
Jarvis Group LLC, NY (in-kind video) $14,376.40
Juda Epstein (Attorney) $1,000.00
Mark Tillenger $2,500
Merit Insurance $2,500
Michael Bloomberg, Mayor of  New York City $25,000
Michael Halperin, Washington, CT $2,500
Poko Core Builders, Farmington, CT $2,500
Pullman & Comley (law firm with significant state business) $7,000
St. Vincent’s Hospital $14,400
Steven Simmons, Greenwich, CT $1,000
United Illuminating 10,000
WC & F Real Estate and Development $1,000
Zachary Zeitlin (Silver Point Capital, Westport) $2,000
2 Dog Media (in-kind web design) $1,200
*The Latest from the CT Post can be found here:http://www.ctpost.com/default/article/Ed-board-charter-change-divides-voters-4007166.php

Angry! (But grateful to be back on line, worried for the 239,000 who aren’t and the thousands who have lost so much)

But since there are still a few days until Election Day, I’d like to re-post a comment that I made earlier this week on Facebook, thanks to the generator at the local community center.

Let us take a moment to IMAGINE a world in which instead of giving $115 million in taxpayer funds to hedge fund criminals, or tens of millions to UBS who then lay-off 10,000 people or giving scarce public funds to the carrion-birds called “ticket-re-sellers,” all the while postponing vital transportation projects so the money could be shifted to the transportation fund to cover up the deficit in the General Fund, we actually invested in real infrastructure upgrades like burying key electric lines or creating these so-called micro-grids.

Yes, there would still be many people who would have lost power.  There might even be many still without power, but we’d have created thousands of jobs for the workers and crews and suppliers burying those lines or creating those grids and tens of thousands of people would have been able to have spent their week at their jobs, making money and paying taxes.

Instead, we have a $3.9 billion dollar hedge fund CEO and insurance and corporate CEOs collecting extra bonuses, for their ability to make even more money, thanks to our corporate welfare.

And I’m pretty sure none of those CEOs sat in dark houses and lamented the few hundred dollars of food that was rotting in their refrigerators.

If you come across a candidate in the next few days – ask them, tell them, order them – that if they win, they need to place a moratorium on the distribution of corporate welfare and, instead, demand that public funds to be used to create and enhance public benefits.

That is not to say that government should never play a role in helping leverage capital, but Malloy’s list of corporate welfare is monstrous and growing, and in many cases will lead to little or no longer-term public benefit.   Malloy’s list includes;

Alexion: $51 million

Bridgewater Associates: $115 million

CareCentrix:  $24 million

Cigna: $71 million

ESPN: $25 million

Jackson Labs $291 million

NBC Sports: $20 million

Sustainable Building Systems/Steel Buildings Systems International:  $19 million

TicketMaster: ($ 6 million, removed itself after CEO arrested)

UBS AG $20 million

Blue Sky Studios $3 million

 

Created a variety of smaller corporate grant programs totaling over $150 million and expanded the Urban and Industrial Site Reinvestment Tax Credit program from $500 million to $750 million.

** More than $800 million of these “investments” are being financed by borrowing the money, meaning taxpayers will be on the hook for about $400 million more in interest payments.

Sanity is fleeting: Jackson (Black Hole) Lab’s job pledge version #22

Yesterday’s New Haven Register included an editorial lauding State Senator Len Suzio, R-Meriden for forcing the Malloy Administration to back down on a decision to “count 10, state-paid jobs at the University of Connecticut as part of the 300 jobs The Jackson Laboratory has promised to create in exchange for up to $291 million in aid.”

The Register’s editorial noted that, “At nearly $1 million in state aid per job, the biotech company can afford to hire and pay for its workers.”

But before we take a collective sigh of relief, and bask in the knowledge that sanity has prevailed, at least on this one, readers should know that the New Haven Register’s editorial is wrong.  Apparently they didn’t catch that the Malloy Administration had reversed the position it had previously reversed itself on.

In fact, the Malloy Administration will credit Jackson Labs with the 10 state funded UConn faculty positions, and Jackson Labs need only create 290 jobs in order to qualify for its entire taxpayer funded subsidy.

According to the Associated Press, in round one, Catherine Smith, Malloy’s Commissioner of Economic and Community Development defended their decision to count the jobs by saying, “It is true that 10 employees will count toward Jackson Lab’s job creation goals, but I would argue this is a small cost relative to the long-term financial benefits this project will generate.’’

While the Governor’s office began by defending Smith, it later announced that “there had been a misunderstanding,” and the 10 faculty positions would be on top of the 300 jobs that will be created by the Jackson Laboratory

It was with that news that the New Haven Register entered the fray, editorializing that some degree of sanity had returned to the publicly funded “economic development” project.

See editorial at: http://nhregister.com/articles/2012/10/22/opinion/doc5085d6942929c570382976.txt

But alas, the editorial writer at the New Haven Register missed a later Associated Press story, written by veteran Connecticut reporter, Pat Eaton-Robb, that began with, “Gov. Dannel P. Malloy’s administration reversed itself for the third time in two days Thursday, and said a bio-science firm will get credit for creating jobs that will be funded by the University of Connecticut.”

Malloy’s Economic Development Commissioner announced that the jobs would count and that it was she who had provided the Governor’s Office with the wrong information.

Smith told the AP,   “I was less worried about who is paying for these jobs, and am much more concerned in making sure these jobs are created and not just the 300, but a long-term partnership that is being established and will create many more ancillary positions.”

Malloy’s spokesperson summed up their decision by saying, “That’s 10 new jobs, in addition to the 290 other new jobs that will be created for a total of 300 jobs.”

The good news is that observers can now say with confidence that Connecticut’s $291 million investment will create 290 jobs, or exactly $1 million per job, as opposed to the more awkward phraseology of “nearly $1 million in state aid per job.”

CHARTER COMMUNICATIONS: About that $10 million we’re giving you…

Earlier this week, Charter Communications, Inc., “a Fortune 500 company and the fourth-largest cable operator in the United States,” became Governor Malloy’s ‘Next Five’ Corporate Welfare recipients.  With revenue of $1.9 billion during the last financial quarter, the company did lose $83 million, but that was an improvement over the same quarter the year before, when Charter lost $107 million.

For most of us, not enough revenue to cover expenses poses a problem.  As I can attest, banks seem to frown on giving, or even loaning money to people whose income is deemed inadequate or insufficient.

But we don’t call our economic system “advanced capitalism” for nothing.

In return for promising to create 200 jobs, Charter will receive a taxpayer-funded 10-year loan of $6.5 million with an interest rate of 2 percent.  Even better, the Connecticut Department of Economic Development will defer principal payments for the first three years.  If the company does create the jobs, the entire loan will be forgiven.

The St. Louis Business Journal wrote a detailed article following the announcement.  The good news for them is that the company has said that moving its corporate headquarters will not lead to any lay-offs.  In fact, apparently without any state funds, Charter’s social media specialist explained that the company will be adding 300 new jobs in their St. Louis offices.

Ten years ago, Charter purchased their present St, Louis headquarters for $43.5 million.  With approximately 16,800 employees nationwide, about 3,000 of Charter’s employees are now working in St. Louis.

According to Governor Malloy’s press release, Charter is the ninth company to participate in the “Next Five” Corporate Welfare program, which is one of a number of economic development programs administered by the Connecticut Department of Economic and Community Development (DECD).

The press release explains that the $6.5 million will go toward Charter’s costs for tenant improvements and the purchase of furnishings and office equipment.  Considering the company will start with about 100 employees at the site, those keeping track will realize that our taxpayer subsidy equates to about $65,000 worth of furniture and improvements per employee.

The Stamford location must come as especially good news to Charter’s new chief executive officer, chief operating officer and chief marketing officer.  All three left Cablevision Systems Corporation in Bethpage, New York, earlier this year, but never moved their homes to St. Louis.

As an aside, the final sentence of the Governor’s press release states that the package, “also includes funding provisions for future job growth,” but for some unknown reason, it doesn’t quite get to explaining what that might mean.

They’re BACK! TicketNetwork moves to “corner” the world market by controlling domain names ending with “.tickets”

And now for something completely different…

Tickets TLD LLC, a subsidiary of TicketNetwork Inc., has applied to purchase the “Top-Level Domain” name; .tickets. Tickets TLD LLC, a Delaware company, was registered in Connecticut on April 10, 2012.  Tickets TLD LLC uses the TicketNetwork’s headquarters as its business address.  TicketNetwork Inc., which is also a Delaware company, was registered, in Connecticut, by Don Vaccaro in 1996,

Internet Corporation for Assigned Names and Numbers (ICANN), who controls all domain names (i.e. .com, .org, .net), is in the process of selling off additional domain endings.

Tickets TLD LLC is one of five companies angling for control of the domain ending; .tickets

Although ICANN allows the public to comments on applications such as the one put in by TicketNetwork, and the period for making such comments was extended, the period ends tomorrow, September 26, 2012.  The link to make comments is:   https://gtldcomment.icann.org/comments-feedback/applicationcomment/viewcomments

For many Connecticut residents, TicketNetwork is known as Governor Malloy’s “First Five #2.”

In July 2011, Governor Malloy and Department of Economic and Community Development Commissioner Catherine Smith traveled to South Windsor to give TicketNetwork a $6 million dollar publicly funded economic development package in return for agreeing to create a least 250 jobs.”

Malloy used the event as opportunity to call Don Vaccaro, TicketNetwork’s CEO,  a “serial entrepreneur” and claimed Connecticut needed more people like Vaccaro because, “in their very fiber, their very bone marrow, have the ability to come up with great ideas, great concepts, bring to the market place, prove them and grow them.”

The “love fest” would have gone off smoothly, if Hugh McQuaid, of CT Newsjunkie, hadn’t asked Malloy and handlers about the fact that Vaccaro and TicketNetwork were suing the Bushnell’s CEO David Fay because Fay, speaking at a legislative hearing, had referred to TicketNetwork as ticket scalpers.  Apparently they prefer to be called ticket resellers, and so they sued the Bushnell for slander.

In addition, Vaccaro was facing a very serious sexual harassment lawsuit from a former employee.

But the Malloy Administration dismissed the concerns, claiming that they weren’t aware of these publicly known lawsuits.   Malloy’s spokesperson went so far as dismissing the sexual harassment issue saying it was irrelevant.

Fast-forward to February 2012, and TicketNetwork’s CEO is back in the news, this time for getting himself arrested and charged with a hate crime, threatening, breach of peace, first-degree criminal trespass and interfering with a police officer at an Oscar party at the Real Art Ways in Hartford.

At that point, the Malloy Administration apparently had enough. TicketNetwork announced that it was withdrawing its application for economic development funds and giving up the $6 million in state grants, and Governor Malloy directed Economic Development Commissioner Catherine Smith, “along with Consumer Protection Commissioner William Rubenstein and his top legal adviser, Andrew McDonald, to examine the state’s relationship with TicketNetwork.”

Commissioner Smith told reporters that “After this occasion, if we do another deal with a privately held company, I think, yeah, you’ll probably see us do a little bit more due diligence around both the CEO and potentially other members of the staff.”

Now, comes the late news that TicketNetwork is reaching for world-domination, by purchasing the rights to control the domain name ending, “.tickets”

In their application to control the .tickets domain, Tickets TLD LLC writes, “The .TICKETS TLD would create an easily identifiable Internet space where venues, performers, performances, and booking agents can create websites dedicated to ticketing for any given event, and Internet users know they can go to find precisely the tickets they are seeking. This creates value for registrants in that they can streamline the ticket sales process, offering greater diversity and more targeted value to ticket seekers. Ticket seekers would save time and gain greater access to tickets for events and performances they were seeking.”

By owning the rights to .tickets, Tickets TLD LLC would not only be able to control and sell any domain that ends with the words .tickets, but would be able to, “designate a set of premium domain names” that would be, “set aside for distribution via special mechanisms.”

Public comments to date include endorsements from former New Jersey Attorney General Peter Harvey, Rufus Edmisten, North Carolina’s former Attorney General and former Secretary of the State, and Connecticut’s own State Representative Tim Larson.  Larson writes, “Today I want to add my name to the list of supporters for Tickets TLD LLC to administer .tickets web site requests…The creativity and drive that the employees and leadership of TicketNetwork possess have always been a great source of new innovation and leading-edge technologies in their industry.”

Meanwhile, opposition to the application submitted by Tickets TLD LLC comes from the Featured Artists Coalition (FAC).   FAC writes, “We would like to draw the evaluators’ attention to the fact that Tickets TLD LLC, through its parent, Ticket Network, or subsidiaries of Ticket Network or affiliated companies of Ticket Network, has registered 100s of domain names that include artist, sports teams or venue names.”

Another critical comment comes from the group that represents Broadway venues.  They claim that, “The parent company of Tickets TLD, LLC is TicketNetwork, Inc., a well-known operator of ticket resale sites. TicketNetwork and its affiliates have registered over 3000 domain names.”  The group continues, “We are concerned that TicketNetwork has a long history of registering domains that incorporate the names of Broadway shows. Incorporating the names of well-known Broadway shows and other brands into domain name registrations evidences a disregard for the rights of the owners of these brands. We are of the opinion that the practices of TicketNetwork with regard to domain name registrations make the applicant unfit to be the registry operator of .Tickets.

As noted above, public Comments on the request by the TicketNetwork group to control the domain, .tickets, can only be made through tomorrow, September 26, 2012.  The site to make comments is: https://gtldcomment.icann.org/comments-feedback/applicationcomment/viewcomments

A special thanks to a Wait, What reader who sent in this tip.

A search on the word TicketNetwork will bring up earlier Wait, What? posts on this company, its CEO and the their relationship with Malloy Administration.

Hedge Fund vs. Paint Balls… Why Choose?

If Connecticut taxpayers are going to subsidize the world’s largest hedge fund, why shouldn’t we invest in a paint ball gun battle field?

Now don’t get me wrong…

I’m all for helping small businesses survive and grow in these difficult economic times.

Having owned a few of my own small businesses, I appreciate that they are the true engines of economic activity.   Connecticut needs jobs and most jobs are created by small business.

In fact, the $115 million the taxpayers of Connecticut recently gave to the world’s biggest hedge fund (Bridgewater) would probably have created a lot more jobs if we’d have used those dollars to support hundreds of small business around the state.

And furthermore, let me be clear, I don’t have anything against paint guns and weekend warriors who go out there and blast each other with balls of paint, although I have heard it can hurt, if you hit someone in just the right (or wrong) place.

Why, back in the day, when I was a just a boy, we’d go down to the sandpit off of Brookside Lane, build some forts, and pelt each other with handmade mud or clay balls until enough kids were bleeding that it was time to go home.

But times change, this is the 21st century, so no self-respecting kid (or adult) is going to accept anything short of replicas of real guns, full battle gear and CO2 cartridges that propel pant ball at 300 feet (91 m) per second. (I don’t know how fast that is, but it sounds pretty damn impressive.)

But more importantly, Connecticut’s Department of Economic and Community Development knows a good investment when it sees one.  And so just last March, Gov. Dannel P. Malloy, announced that one of the first businesses to qualify for the new $100 million, “Small Business Express Program,” would be Fields of Fire, a proposed 50-acre paintball facility in Mystic, Connecticut.

Fields of Fire received a $100,000 grant to help them buy the equipment and materials needed to create a full paintball battlefield.

Yes, you read it right, a grant, not a loan.

No need to pay the taxpayers back.

Count it as a donation toward Connecticut’s “Still Revolutionary” Tourism program.

Some people might quibble about why we’d fund a paintball battlefield, when we are laying off teachers and schools are going without supplies.

But those people clearly miss the point.

And some people might complain that we provided the money as a grant and not a low-interest loan.

But, then again, those are probably the same people who’d complain that the $100 million program proposed by the Governor and approved by the Legislature last October, is actually paid for out of bond funds (that is borrowed money.)  This means that although the true cost to taxpayers is eventually principal AND interest, we’ve got a few decades to pay the money back, so it’s the best of all worlds.  We get to use it facility now and our children will actually have to pay the bill.

And more good news, the facility is open and getting great reviews.

The cost to get into the paintball battlefield is $20 for admission, $20 for gun rental and $45 for paint balls (they come in cases of 2,000).  Camo Jumpsuits and paint grenades are also available.  And birthday parties start at just $400.

Unfortunately, the website doesn’t say whether taxpayers get a discount, considering we’re sort of like silent partners for the venture.

But I highly recommend you go to http://www.fieldsoffiremystic.com/, just make sure you have the sound turned up.  Too low and you really lose the effect.

The only sad part of the whole story is that the website doesn’t have pictures of this governor, or any governor, rowing around in a canoe, or even ducking an in-coming paint grenade.

Connecticut: The State of Modern Capitalism:

The concept that Connecticut taxpayers need to pay the world’s biggest hedge fund $115 million dollars to stay in Connecticut is, understandably, a hard thing to truly understand.  They managed to pay their CEO $3.9 billion last year and we have to cough up $115, or they’ll move?

But of course, Bridgewater is not the only private corporation that taxpayers are subsidizing.

In fact, while cuts are being made to vital services, more and more companies are demanding what is, in essence, a ransom.  If we taxpayers don’t pay the ransom, they won’t relocate to Connecticut, or even worse, they’ll leave and take their jobs with them.

Take, for example, the situation that occurred two months ago, when on Sunday, July 8, 2012, more than 400 people joined Governor Dannel Malloy, Mayor Bill Finch, Johnny Morris, the founder of Bass Pro Shops and a “host of outdoors celebrities from the world of fishing, bullriding and NASCAR,” for a press conference at Bridgeport’s Steelpointe Harbor industrial site.

The event was to announce that Pro Bass will build a 150,000 square-foot store, a store that will serve as the anchor tenant of Bridgeport’s plan to develop the now vacant Steelpointe area.

According to press reports, the agreement was the product of nearly a year of negotiations between the State, the City and Bass Pro Shops.  The full subsidy package remains vague, but according to the Malloy Administration, the project “is expected to generate at least 250-300 jobs.”

Governor Malloy proudly proclaimed, “This is about jobs, and its great news for the City of Bridgeport…Bass Pro will be a draw for people from throughout the region, one that will help revive the local economy.”

And Mayor Bill Finch added, “Today’s announcement marks a historic moment for the City of Bridgeport and Steelpointe Harbor. Bass Pro Shops’ investment in Bridgeport will create hundreds of jobs, generate new tax revenues and bring economic growth to the City. They are a proven brand that will generate interest and attract customers from throughout the region. Bass Pro Shops is committed to Bridgeport and we are proud to have them as a major anchor tenant at Steelpointe Harbor.”

On behalf of the business community, Joe McGee, vice president of public policy with the Business Council of Fairfield County, and a former commissioner of the Connecticut Development Authority (the state agency responsible for attracting business to the state) said, “Bass Pro is not just a Bridgeport opportunity. It’s a regional opportunity. A Bass Pro competitor — Cabela’s — continues to enjoy significant success at the other end of the state in East Hartford several years after opening.”

For the politicians and business leaders in attendance, the day could not have gone better.

So what about the Cabela’s story:

Six years ago, almost to the day, a different Connecticut governor and a different major outdoor retailer held a similar press conference.  Governor M. Jodi Rell, the Mayor of East Hartford and the corporate leadership of United Technologies Corporation and Cabela’s, held a press conference at East Hartford’s Rentschler Field to announce an agreement that Cabela’s would build a 200,000-square-foot “superstore,” its first store in New England.

The onlookers were told that Cabela’s is “a significant cash generator” and the new store at Rentschler would “benefit the Hartford area.”

In Cabela’s situation, the Connecticut Development Authority wooed Cabela’s with a $10 million incentive package for the company and another $12 million to build roads and make other infrastructure improvements on the site.  To sweeten the deal, East Hartford’s Town Council approved a ten-year tax abatement plan that would save Cabela’s $6.7 million in property tax payments.

As with Bridgeport’s Steelpointe Harbor site, The Rentschler Field plan was looking to Cabela’s to be the anchor tenant for a $2 billion development that would include stores, hotels, offices and high-tech companies. A study conducted by the University of Connecticut predicted that the Rentschler Field project would create 6,000 to 8,000 jobs and generate $40 million in state revenue and $57 million in local taxes, every year.

It wasn’t long before officials had to admit that, “The presence of Cabela’s, considered a retail super magnet, hasn’t been enough to persuade companies and developers to invest money at Rentschler.”

By the beginning of 2009, East Hartford Mayor Melody Curry was quoted as saying “I think we were expecting to see more growth and development than we’ve seen so far.”

Now, six years after the State of Connecticut and East Hartford “invested” nearly $32 million in public funds to attract Cabela’s, there is no sign of the projected $40 million, a year, in state revenue, nor is East Hartford getting its $57 million.  In fact, after letting Cabela’s keep nearly $7 million in what would have been their share of local property taxes, in about 2016, Cabela’s will finally start paying East Hartford about $750,000 a year in real estate taxes.  At that rate the taxpayers of East Hartford won’t even recoup their investment until 2026.

The question arises, if Connecticut’s taxpayers got burned in 2006, why did Governor Malloy and Mayor Finch engage in the very same strategy in 2012?

Was the 2006 experience just bad luck?

The answer can be found in an investigative report conducted by the Franklin Center for Government and Public Integrity, a non-partisan, independent watch-dog group outside of Washington D.C.

The Franklin Center found that Bass Pro shops and Cabela’s “received or are promised more than $2.2 billion from American taxpayers” over the past 15 years.

The study found that, “The stores are billed as job generators by both companies when they are fishing for development dollars. But the firms’ economic benefits are minimal and costs to taxpayers are great.”

The researchers noted, with some irony, that, “the amount of tax dollars that have been poured into these two companies would be enough to purchase every man, woman and child in the United States their own fishing pole.”

The Franklin Center report, released in August, found that:

  • “Cabela’s has received $551 million in local and state assistance during the past 15 years.
  • Bass Pro Shops received $1.3 billion in local and state assistance during the same period.
  • The federal government helped ensure liquidity for Cabela’s’ credit card division by providing $400 million in financing for the purchase of the company’s securitized debt.
  • Both firms have a history of targeting rural or smaller suburban communities and negotiating deals that involve extensive borrowing on the part of the municipality to build a store.
  • In fact, Bass Pro Shops often pays comparably little toward the construction of its own stores. While this sometimes is the case with Cabela’s, its development schemes tend to involve elaborate agreements that include massive outlays for public spectacles in the midst of the retail setting.”

According to the report, Stacy Mitchell, author of Big Box Swindle, said that Cabela’s and Bass Pro always seek to convince elected officials that the store will be a major tourist attraction.

And even as Connecticut and Bridgeport were signing on the dotted line, it turns out the Franklin Center had discovered that, at least Cabela’s, has “begun to rethink its strategy, which has reaped it hundreds of millions of dollars in incentives.”  According to a top Cabela’s corporate official, “We have come to the conclusion that the places that are most likely to offer incentives are the places we are least likely to want to build.”

And as to the claim that the new Bass Pro will lead to jobs for Bridgeport residents, an investigative report by Brian Lockhart, a Connecticut reporter for the Connecticut Post and Hearst newspapers, discovered that both the Malloy Administration and the Finch Administration knew, but did not reveal, that Bass Pro was facing allegations that, “the company since at least November 2005 has denied qualified blacks and Hispanics retail positions.”

As the Federal Government’s lead attorney wrote, “Our investigation lasted over two years…(there was) a pattern or practice of discrimination…going on at virtually all Bass Pro stores across the country.”

So, despite knowing that the promised economic nirvana that would come with helping build a Cabela’s in East Hartford never occurred and that Bass Pro was facing discrimination charges for refusing to hire blanks and Hispanics, Governor Malloy and Mayor Finch told the assembled on July 8th of this year, “Bass Pro Shops’ investment in Bridgeport will create hundreds of jobs, generate new tax revenues and bring economic growth to the City.”

And on top of that, we still don’t know what Malloy and Finch promised Bass Pro in order to get them to say they’d build a new store in Bridgeport.

Creating Quality Jobs vs. Creating Quality Workers

File this one under:  Speaking out for a dying breed – The American Middle Class

August 29, 2012

Having completed the task of dropping my child off at college, I’m reminded of the challenge that faces our chief elected officials, whether in Washington, or here at home in Connecticut.

In particular, as the effects of the Great Recession continue to take its toll on the nation; those of us in the trenches are left to ponder about what is the proper balance when it comes to using public resources to create quality jobs versus creating quality workers.

In one of my old college economic textbooks, I found a definition of a public subsidy as, “the provision of economic value by a public entity to a private entity for purposes beneficial to the public…”

That is, government, on behalf of the people, spends money, not to purchase goods and services, but to induce actions that have a longer-term benefit for society.

It might be providing grants, loans, or tax benefits to businesses to get them to maintain or expand the number of quality jobs they provide.

On the other hand, it might be providing grants, loans, or tax benefits to individuals, so they can go to college and have better, more productive lives and become part of a quality workforce that allows our economy to be successful.

Like many middle-class families, paying for college has eclipsed the challenge of buying and maintaining a home.  Earlier this summer, I once again signed the federal government’s Parent Plus Loan promissory note to borrow $30,000 (at 5.9 percent); an amount the government formula said was my “share” of the bill.  Grants and subsidized loans covered the rest.

At this point, it looks like I’ll need to borrow about $120,000 for the undergraduate degree.  With interest, the total cost over ten years will be $159,000,000, just over $39,000 of which will be interest on the loan.

At about the same time, Connecticut’s governor signed a “promissory note” on behalf of Connecticut’s taxpayers to pay the world’s largest hedge fund, Bridgewater, $115,000,000.  Although Bridgewater had enough money to pay its CEO $3.9 billion last year, making him the highest paid employee in the world, apparently the public funds were needed to persuade Bridgewater to stay in Connecticut, build a new headquarters and add 800 new jobs over the next ten years.

The public subsidy included a ten-year, $25 million forgivable loan, with an interest rate of one percent, $5 million in grant funds for job training, $5 million for an alternative energy system, and $80 million in Tax Credits.

If Bridgewater fails to create the 800 new jobs over the next decade, it will have to repay the $25 million dollar loan, but will be allowed to keep the other $90 million in public subsidies. The one percent interest rate on that $25 million loan means the company would have to pay about $1.3 million dollars in interest.

In the end, when you calculate the numbers, it really means that as a middle class family, I pay a carrying cost of 26 percent to get the funds I need while the world’s biggest hedge fund pays a carrying cost of 5 percent.

Or put a different way, to create that quality job, Connecticut’s taxpayers are giving Bridgewater about $150,000 per job, while I’m paying (after the various public subsidies) about $160,000 to help “create” a quality worker.

Truth be told, I’ve given up trying to figure out the fairness in all this, but as part of the ever-shrinking middle class, the modern phrase, “I’m just saying,” seems particularly appropriate.

I’m just saying…