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10425/12 <br /> Whether it was a huge company such as <br /> Target or a humble Pizza Ranch franchisee =y � , <br /> in Elk River receiving the money, local 3 ' <br /> officials continually made the argument <br /> that the building projects would not have <br /> happened otherwise — or at least would ", <br /> have not happened to the extent that <br /> they did. <br /> r _; c � xa <br /> But those types of statements draw <br /> skeptical responses from critics of <br /> economic development incentives. <br /> "It sure looks like jobs were created with <br /> that subsidy. But what's the St. Paul beneficiaries of TIF financing include <br /> counterevidence? What would have Cosetta's on West Seventh Street. (Staff photo: <br /> happened if you hadn't given those Bill Klotz) <br /> subsidies?" said Art Rolnick, a former <br /> Minneapolis Federal Reserve research director who is a senior fellow at the University of <br /> Minnesota's Humphrey School of Public Affairs. <br /> Rolnick thinks tax cuts and improved government services are better ways to spur economic <br /> growth. <br /> Some cities did not want to risk losing projects. <br /> Duluth's Economic Development Authority, for example, owns a 180,000-square-foot-plus <br /> former Northwest Airlines maintenance facility, which has been empty for nearly 10 years, at <br /> the city's airport. <br /> When Wood Dale, Ill.-based aircraft maintenance outsourcer AAR Corp. said earlier this year <br /> that it needed $5 million in grants to move into 152,000 square feet of the building, local and <br /> state officials instead cobbled together a package of$7.5 million of grants, loans and lease <br /> discounts. <br /> "This deal was vital to Duluth. ... That building sitting empty there sends the wrong message <br /> for our community when people fly in there," said Brian Hanson, president and CEO of <br /> regional economic development group Apex. <br /> Running up to the July 1 deadline, the city used the 2010 jobs program to provide $350,000 in <br /> property tax revenue up front to pay for$500,000-worth of building renovations for MR. <br /> Local officials anticipate 20 construction jobs in coming months from the work and expect MR <br /> to bring 192 jobs to the city. <br /> Both Hanson and Chris Eng, Duluth's business development director, don't think MR will <br /> accept the full $7.5 million package, but the money is hanging out there for now. <br /> Economic development gone wild? <br /> Unleashing the local property tax dollars appears to have had a free-for-all effect that Rolnick <br /> says is similar to earmarks — the congressional practice of steering federal dollars toward <br /> local pet projects that has been limited in recent years. <br /> "You would think you would want fiscal discipline. This is earmarks on the local level. This is <br /> bad public policy," Rolnick said. <br /> Phil Krinkie, a former Republican state legislator who is president of the Taxpayers League of <br /> Minnesota, compared the situation to a lab experiment involving rats and cheese. <br /> "The Legislature sets up the maze with all the criteria to find the money, and enterprising <br /> people, private-sector along with public-sector employees, will endeavor to get to the <br /> money," Krinkie said. <br /> Mark Phillips, former commissioner of the Minnesota Department of Employment and Economic <br /> Development, counters that rules sometimes have to be loosened during times of economic <br /> distress, even if some mistakes result. <br /> f inance-com m erce.com/wp-content/plugins/tdc-sociable-toolbar/wp-print.php?p=52262 <br />