As The Associated Press tells it, Dennis Davin, Pennsylvania’s secretary of the Department of Community & Economic Development (DCED), is downplaying Standard & Poor’s (S&P’s) downgrading of the commonwealth’s credit rating.
At least, that is, when it comes to luring Amazon to build its second campus-style headquarters (“HQ2,” as they call it) in Penn’s Wood.
S&P cut the Keystone State’s credit rating amid the protracted budget battle. The state, despite having a spending blueprint for the current fiscal year, has failed to adopt a revenue plan.
Don’t try this at home.
Davin tells the wire service that Amazon will, as grandmas once were wont to say, pay no never mind to the budget battle but, instead, quoting the AP, “will look at Pennsylvania’s business environment.”
Uh-oh.
Just this past summer, one analysis (by WalletHub) ranked Pennsylvania as the nation’s sixth-worst state to start a small business. And the Tax Foundation ranked the commonwealth as the 44th worst in the nation for corporate taxes in its 2017 survey.
Of course, given what Amazon reportedly is demanding – “incentives” that could top $1 billion – and given Pennsylvania’s efforts to, it seems, hand Amazon the keys to state and local treasuries, perhaps that’s the “business environment” to which Davin is referring.
Meanwhile, back at The Giveaway Ranch, the AP also is reporting that North Carolina offered Foxconn more than half-a-billion dollars in “incentives” to locate an electronics plant in the Tar Heel State.
But Foxconn opted instead to locate the plant in Wisconsin, which offered five times that amount. Foxconn says it will build a $10 billion flat-screen factory and employ 13,000. The Badger State will fork over an estimated $3 billion in “incentives.”
That said, a June 12 memo obtained by the AP in a Right-to-Know request shows Pennsylvania was in the running for the facility. But it’s not divulged how much commonwealth leaders were offering.
Pennsylvanians have every right to know how deep the state was willing to dive into taxpayers’ pockets for a company that, only four years ago, promised to invest $30 million in the state and to hire 500 workers.
Nothing ever came of that Foxconn plan; the “incentives” were said not to be rich enough.
Allegheny County officials, take note: Lots of eyebrows are being raised in Seattle where it appears some funny numbers are being used to expand the city’s light-rail system.
The city next month is planning to break ground on a 1.2-mile, $177 million extension to its LRT system. The idea, as The Seattle Times reports, is to “link the city’s two fragmented streetcar lines.”
The only problem is the existing LRT lines have been performing far under their original projections. Imagine that. Have no fear, however, planners say the new link will fix all that.
Tripling down on a mistake seldom produces positive results.
And as Seattle City Councilwoman Lisa Herbold put it, “The financial assumptions are simply unrealistic based on our history with the streetcar.”
How rosy are the planners’ predictions? They claim the new segment will boost daily average ridership from 5,200 to an astounding 22,000 weekday riders when it bows in 2020.
By 2035, planners say ridership will be almost 30,000 daily and fares will cover 56 percent of operating costs system-wide, which, as the newspaper reports, “would be among the highest rates of any transit agency in the country.”
As The Times notes, that represents a nearly 470 percent increase over current numbers. For a system whose 2016 “on-time” ranking was only 58 percent and whose usage has been flagging.
How sad that such mass transit projects all too often end up as mass misrepresentations.
Colin McNickle is a senior fellow and media specialist at the Allegheny Institute for Public Policy (cmcnickle@alleghenyinstitute.org).
