1/17/2011
I am opposed to the retail incentive proposed to be given to Brea Boutique:
1. The funding source comes from our sales tax dollar, for every $1000 dollars in sales tax dollars we give away; it will take $100,000 in sales to replace this lost revenue. The shop projects sales of $2000 per month this means it will take almost 25 years just to replenish the amount given from this fund. Formula for this $100,000 x .01(Mandan sales tax rate)= $1,000. Store estimated sales $2,000 per month X .01 (Mandan sales tax)=$20 a month is $240 a year. To refund the sales tax used it would be abt $6,000; 6000 divided by 240 = 25 years. The Retail Incentive program requires only 12 month operation.
2. Eligibility of the retail incentive number 3 requires a majority of the space be used for retail, in your agenda packet it states the majority of the space will be used as their personal residence.
Again eligibility criteria number 8; a business currently in the city moving from one location to another location is not eligible. If expanding; the incentive can only be based on the expansion. On the city of Mandan website Baby Mod Boutique was listed as a business, combining the two; isn’t this expansion of an existing business? at best consolidation? The criteria states the square footage should be based on the additional square footage. Baby Mod Boutique was listed at 108 1st St NW.
At that address, what was or is the square footage they were operating out of?
3. Conditions of the retail incentive number 2 requires the business open a minimum of 30 hours, this business will only be open half of this time, at best the incentive should be for $4125 half of the hours they are open. In the business plan they stated based on observation of Bismarck; this works. Criteria under conditions number 2 states justification must be presented; Bismarck is not Mandan in what works.
4. Qualifications under selection criteria: selling eyeglasses retail is totally different then servicing clients in a retail store environment or a vendor or craft show. These owners have never had a retail space; a red flag for me is the quote “has dreamed about opening a store of her own.” Looking at a couple of businesses; members of the Mandan Growth Committee looked at was Mandan Drug, that owner had experience in a furniture business not a candy business, they are 3 years delinquent on their loans according to the Mandan Growth minutes. Stepping Stones Academy website once located at this address; their website shows it is now located in Bismarck. The Mysteria Theatre owners had the “dream of opening a restaurant”; they no longer participate in the restaurant business the building they purchased for $1 from the city, approved by the Mandan Growth Committee.
5. Jobs created under selection criteria; there are no jobs being created, they already are working. I came before the commission and opposed the supposedly low income jobs which were going to supposedly be created by Mandan Drug; at this meeting the mayor wanted me removed from the meeting because I questioned how the CBDG funds were supposedly being used to create these jobs.
6. The implementation Procedure I question the legality of this whole program based on our states North Dakota Constitution, it is illegal to give gifts. My guess is they will open their business whether or not you give them this incentive otherwise they will just use it for their home.
7. At $6,187.50, this would be the equivalent to $515.58 per month or a 3 year property tax exemption or 18 months of their house payments based on the home assessed value with a 30 year mortgage. (using the $79,000 listed for this property value on the Morton County website)
8. It would take three homeowners average property tax($2300) to cover this business incentive. Is this fair to the tax paying homeowners?
9. The business plan includes other owners and the agreement has only one signing.
Susan Beehler 701 220-2297
