(Quin’s column, Dec. 10, the Advocate/T-P): The New Orleans City Council has been hoodwinked into outrageously rapid approval of one aspect of a two-part process for a riverfront business development that features too many moving parts and too few answers.
Before even thinking of approving the necessary second aspect, called a Cooperative Endeavor Agreement — without which the complex project can’t go forward — the council should rethink its initial decision, iron out the extremely complicated details and secure far stronger guarantees from the developer.
The Shell Gulf of Mexico Headquarters Development Project might bring great benefits to the city, but it sure looks like a major sweetheart deal for developer Cypress-Lauricella. In return for developing land owned by the New Orleans Ernest N. Morial Convention Center (a state entity), Lauricella and Shell would receive a 15-year exemption from local property taxes, which equals a $21.6 million break (of which $7.3 million would otherwise go to NOLA Public Schools).
City Hall’s Office of Economic Development conjures numbers estimating net fiscal benefits to the city and state governments over 20 years of $37.6 million and $238.7 million, respectively. The direct economic impact for local economies as a whole is pegged at $412 million, plus another $195 million in indirect impact.
Decades of experience with rosy economic projections has taught the value of healthy skepticism and independent valuations, but even if the actual impact is half as large, this might still be a good deal. Still, there’s much that should be investigated. The deal’s technicalities are dizzying, and there seem to be few (if any) guarantees or enforcement mechanisms. There’s also no deadline for completing the affordable housing units. In sum, the developers get bankable benefits regardless, but the city would get promises no better than Simon and Garfunkel’s “pocketful of mumbles.”
Yet officials often hear what they want to hear and disregard the rest…. [The rest of the column is at this link.]
