The Daphne City Council is moving ahead with plans to pursue the annexation and purchase of 30 acres of land at the intersection of State Highway 181 and Champions Way near Daphne High School to make way for the first phase of the development of a 75-acre, campus-style business park. The City Council approved Aug.17 as the date for a public hearing for the pre-zoning and annexation of the property, but not every member of the council is on board with the project.
The park, dubbed the Daphne Innovation and Science Complex (DISC), will open with three “Class A” office buildings the board hopes will attract technology companies and professional corporations like engineers, law firms, architects, doctors and accountants. Daphne’s Industrial Development Board (IDB) expects the initial land purchase to cost around $760,000, with approximately $300,000 coming from the board’s funds and the balance from money allocated to the state by the recent civil settlement with BP.
The land is currently owned by Fairhope-based The Bills’ LLC No. 2, and would need to be annexed into Daphne’s city limits before the project can move forward.
In May, IDB chairman Toni Fassbender told Lagniappe the board plans to close on the initial land purchase by the end of the year. The total cost for the first phase comes to about $2.4 million, with $760,000 for the land purchase and $1.6 million in estimated development costs.
At least two members of the City Council said the deal amounts to corporate welfare, where government supports private businesses through subsidies and tax incentives.
“When the government does things like this, the standards of success are way above the private market,” Councilman Pat Rudicell said. “The United States was founded on the private citizens doing things like this, not the government. For us to do this, to get into this business, there are going to be some ramifications if it goes bad. That’s a gamble, and for the city to make a gamble like this I want to make sure we have all the info.”
Agreeing with Rudicell, Councilman John Lake cited a study from Troy University’s Manuel H. Johnson Center for Political Economy showing that the state’s tax incentives package to lure roughly 1,800 ThyssenKrupp jobs to Mobile equaled approximately $555,555 per job. He said government can’t create jobs as well as the private sector.
“As Americans we look down at welfare, but when you look at corporate welfare it is a different subject. But this is the same thing,” Lake said. “If you give a company public access through taxpayer funds, it is the same thing. If the money isn’t being used for the betterment of the vast majority of the citizens you have to consider that. I think that we are talking about a form of welfare.”
Mayor Dane Haygood took issue with Lake and Rudicell calling the DISC project a form of corporate welfare.
“There is some terminology being used that I disagree with but I think there is a time and place to invest in our community,” Haygood said. “I think there are already examples of that, which we don’t classify as corporate welfare, that are great assets to our community. Jubilee Square comes to mind. That is a pure retail development. Sometimes the environment has to be created for success to happen. That is a recipe that has been used here and in other places successfully.”
Regarding traffic, Councilman Joe Davis, the council’s liaison to the IDB, said an increase in traffic is often a sign of economic progress to be celebrated. He pointed to signs of life in the local economy, like home sales reaching pre-recession levels, as reasons why a project like DISC is needed in the city.
“That’s a good sign but it is a two-edged sword,” Davis said. “We have more people to serve, more people to move around, more people to take care of. It is our job as this council to have a plan in place to address all of those things, and make sure it is progressive and not antagonizing.”
Deborah Few, a Daphne resident, addressed the councilors during time set aside for public participation and said she is concerned about the DISC project’s impact combined with a separate piece of property near Daphne High School that is up for annexation into the county. The councilors admitted they do not have concrete information about what that property would be used for, but speculated it could be the site of the proposed freestanding Thomas Hospital emergency clinic, offices relocating from Spanish Fort or other, unnamed projects.
“I just would like to make sure we distinguish that the property, in the county, is unrelated to this property we are trying to rezone,” Haygood said.
The IDB funded a study by Dr. Semoon Chang of the Gulf Coast Center for Impact Studies which showed the project could bring an estimated 1,521 permanent jobs and $96 million in annual wages to the city. The study estimated the project could generate $207,450 more in annual property taxes for the city. The project would bring in $2.9 million in tax revenue during construction, with $16.3 million in temporary spending in Daphne, the study suggested.
The Aug. 17 public hearing will address the pre-zoning of the property from Baldwin County’s single family residential district to the city of Daphne’s planned unit development zoning and the property’s annexation. Lake said all the information about the DISC project and the county’s proposed zoning change should be made public before the hearing.
“We have a lot of lead time between now and then. It would be nice to have that info before the hearing so we can get the info out to our constituents and the council so we can be informed,” Lake said. “Both of these projects together will quite possibly create a traffic impact that we have to take that into consideration.”