Commentary: Before Austin offers tax incentives, let’s see if they work

The current Austin mayor and City Council have largely avoided the big tax incentive battles of their predecessors. However, now they are signaling that they are ready to start giving tax incentives to compete for Amazon to create a new headquarters here, employing up to 50,000 people in high-paying $100,000-average-paying jobs.

I don’t see enough questioning by our leaders of whether our local governments should fan the flames of more growth of 50,000 new Amazon residents plus their families. There is a false assumption that growth is always good — and that the faster and bigger that growth is, the better.

How is any Amazon deal good for people who already live in Austin?

CITY HALL: Council revives talk of reneging on Domain deal as budget vote nears.

What do you think happens to the real estate market and cost of living for current residents when tens of thousands of people move here who are wealthier and have more buying power than current Austin residents? You don’t have to guess; just look around. What has this kind of growth promotion by Austin done to housing affordability, traffic, schools, gentrification, the environment, or increasing need for expansion of government budgets and property tax increases? Give an honest, informed answer to this question: How have tax incentives and the resulting growth benefited common folks who lived here already?

History shows that this growth does not pay for itself. It drives up the cost of living for current residents. These big-shot corporations brag about building expensive buildings — $5 billion in Amazon’s case — but do they pay property taxes based on those values? Of course not; they either get property tax breaks to begin with or they protest at the appraisal district the same values they bragged about when making their pitch to the City Council. Look at Circuit of the America’s contested tax appraisal; it got $14 million cut from its property tax bill over three years after a settlement.

The net effect is that the rest of us pay more in taxes and utility fees when our elected officials offer freeloader status to companies who cause growth that does not pay for itself. If voters use their votes to protect themselves, they will never vote for a candidate who supports government incentives to pile this expensive inflationary growth on Austin. Logically, it should be political suicide for a politician to vote for tax incentives for Amazon while refusing to support a homestead exemption or tax freeze for Austin homeowners. All voters should be united in opposing such tax incentives.

We’ve seen this movie and it’s lying script before. Here we go again with the fuzzy math hype; the lack of any true-up to see if past promises of direct or indirect benefits to local residents ever occurred; continuing secrecy about ethnic and gender statistics of the employment practices of tax-benefitted companies; unenforceable and unaudited tricky concessions in the tax deal that give knee-jerk politicians some cover for practicing suck-up politics with potential campaign contributors; and the stoked frenzy of prideful image puffing, ego-based “competition” with other cities.

FOLLOW US ON TWITTER: Viewpoints delivers the latest perspectives on current events.

This is more about heaping largesse on the owners of incentivized companies and the cadre of real estate, title and economic consultants who thrive on such growth. A deal like this allows our mayor and City Council to strut around at news conferences showing they have “big ideas” and “vision.”

But history shows they are blind to the real consequences on their real constituents. Such deals do nothing real for most people in Austin who are struggling to hold on to what they have. The enormous problems we see now — unaffordable cost of living, stretched infrastructure and resources, and maxed-out tax increases — are the predictable result of the pro-growth-at-any-cost practices of the past. Have we learned nothing?

Aleshire is an Austin attorney and former Travis County Judge.

Reader Comments ...

Next Up in Opinion

Opinion: A little too much reality in the show?

Watching the parade of porn stars, reality TV contestants and former Playboy models lining up to lambaste the president of the United States, as well as the daily trove of stories of wife beating, naked nepotism, gambling and official corruption among his Cabinet members and White House staff, I was reminded of a story Bill Buckley once told. He had...
Opinion: Trump and his team in thrall to zombie ideas

Almost four decades have passed since Daniel Patrick Moynihan famously declared, “Of a sudden, the GOP has become a party of ideas.” And his statement still holds true, with one modification: These days, Republicans are a party of zombie ideas — ideas that should have died long ago, yet still keep shambling along, eating politicians&rsquo...
Commentary: Why Austin should take Dale Watson’s exit seriously
Commentary: Why Austin should take Dale Watson’s exit seriously

There’s a conversation in Austin that’s as predictable as starting the day with breakfast tacos and it revolves around the question that’s on a lot of people’s minds: Is our Austin dying? From Pinballz to Luis’ Corner Barber Shop and Yoga Vida to the patio over at LaLa’s, we love talking about what Austin is evolving...
Letters to the editor: March 25, 2018
Letters to the editor: March 25, 2018

Truly we all feel the Austin Police Department did an outstanding job of apprehending the bomber that terrified the city. As many other law enforcement agencies assisted in this process, the Austin police served as the base to create the successful outcome. The mayor and City Council can now come to terms to provide a mutually agreed upon contract...
Herman: Napkin folding, hand kissing and other diplomatic intricacies
Herman: Napkin folding, hand kissing and other diplomatic intricacies

Our president recently tweeted this at us: “Mike Pompeo, Director of the CIA, will become our new Secretary of State. He will do a fantastic job!” Exciting. The guy in charge of getting dirt on other countries will become the guy in charge of getting along with other countries. What could possibly go wrong? The change means Secretary of...
More Stories