Thursday, March 25, 2010

State of the City: stimulus update

• Author's note: This is the first in a planned series of blogs about the March 24 State of the City address.

In the 2009 edition of the SOTC, Mayor Brent Ives unveiled the "Tracy Investment Plan" — known around here as the city stimulus.

It was supposed to protect auto buyers, pump up sales tax revenue, bring more people downtown and set up the city so it could be first in line to boom when the recession ended.

While we're still waiting for the end of the recession — and likely will be waiting for quite a while — Ives gave a --year recap during his Wednesday address. (For my 6-month update, click here.)

Cards for Cars
The city's answer to the Cash for Clunkers program, Ives reported that giving a $500 gift card to car buyers for a period last summer kept local car dealerships afloat and brought in thousands of sales tax dollars.

The downside? It was a one-shot deal aimed at a very specific type of business — a good idea, but one that was inherently unfair. And although I say one-shot deal, there's no reason the city couldn't do this again. It would just have a much harder time selling it to a public increasingly wary of government support of industry, even though government spending has so far played a large part in preventing wholesale economic collapse.

Celebrate the bad times
People might be down during the recession, but last year the city made it a point to pour more money into partying — including the Fourth of July and several new events called the Taste of Tracy series.

By all accounts, the events were a hit. While many cities shut down their celebrations — like Stockton saying no to fireworks — Tracy drew folks out by keeping its going, something Ives pointed out Wednesday but that we've known for a while. Taste of Tracy even drew more people into the downtown area and got more people acquainted with some of the city's eateries.

Overall, it was a modest investment. And really, who doesn't like to party?

City-backed small business loans
While most of these programs are floating, this one has so far sunk.

Ives described the program with $1 million in seed money as "still developing." As in, it hasn't done diddly yet.

This isn't to say it won't. Eventually, I expect it to get off the ground and offer a serious opportunity to local entrepreneurs who are either in the market to start or expand a business. It just ain't happenin' now.

Capital improvements
This one didn't get a lot of mention from Ives, but it's been responsible for a lot of road repair work.

This way to bolster the local economy entails some risk. Yes, it keeps people working, gets things done that would have needed to been done anyway, and it's being done with money that can't really be used for anything else.

However, once the capital improvement fund is gone, it'll take developer and utility fees to build it up again — something that is going to take a while given the current economic climate. And until it's built up, there won't be a whole lotta captial improvement work going on.

As City Manager Leon Churchill told me six months ago, there's a risk of the city shooting all its bullets and the recession not being over. But, as I've said before, I've thought the city's approach was better than doing nothing.

Future job creation
This was Ives' biggest point to sell.

The city went ahead and partnered with private entities ($820,000 and $2.3 million, respectively) to get infrastructure together in the West Tracy business area, which when built out will be the largest such area in the county, according to Ives.

Along with the long-awaited Gateway development, which should see building commence this summer according to Ives, the West Tracy area would be primed and ready for developers and industries looking to move in, priming the city to be the top jobs producer when better times roll around.

If that goes according to plan, we'll all sing the city stimulus' praises.

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