Toward a better Betz

In the November 2019 city elections this newspaper proudly endorsed newcomer Brandon Betz for the First Ward seat on the Lansing City Council, replacing two-term Councilmember Jody Washington. His victory promises to bring a fresh voice to the city’s legislative body and rebalances the group’s informal alliances in a way that tempers Carol Wood’s seemingly perpetual stranglehold over Council affairs.

Our support for Betz, however, doesn’t mean we will refrain from critical commentary as he assumes his new role in city governance. We haven’t shied away from critiques of incumbents Patricia Spitzley and Adam Hussain, who also earned our endorsement. We won’t pull our punches with Betz, either.

Toward that end, we were disappointed that one of Betz’s first public statements after winning the election lacked the graciousness we hope to hear from any victorious candidate. His comment that Jody Washington “has no say in what goes on in the city of Lansing anymore” was unnecessarily harsh and should have been followed with a humble apology. While it can be hard for a candidate to take off his or her combat boots after a rough-and-tumble campaign, it is almost always advisable to move forward with a modicum of respect for one’s vanquished opponent.

We’re also put off by some of Betz’s post-election statements regarding the city’s use of economic incentives, particularly his characterization on Facebook that incentives “line the pockets of the rich, powerful, and politically well connected.” It is one thing to critically examine the use of incentives as part of the city’s development toolkit; we expect that from Betz and welcome it. It is another thing to rhetorically villainize the people and companies who play a key role in driving the city’s growth, which in turn creates economic opportunity for Lansing residents.

Developers are not the enemy of progress. Painting them as the evil handmaidens of rapacious capitalism serves no discernable interest and sends the message that the city’s leadership is hostile toward potential investors. We encourage Betz to tone down such rhetoric and work toward developing collaborative, respectful relationships with those who are willing to open their pocketbooks and drive new growth in Lansing.

Betz’s animus toward economic incentives is well known, but we are not convinced it is well founded. Tax incentives are often used by local governments to facilitate the redevelopment of contaminated properties and blighted buildings. Economic development tools like the Brownfield TIF and the Obsolete Property Rehabilitation Act (OPRA) were created precisely to level the financial playing field between greenfield sites on the urban periphery and industrial legacy sites in the urban core. The latter are inherently more expensive to develop than the former for obvious reasons: Removing toxic soil or underground fuel storage tanks from a prospective building site, for example, is an added expense that tilts the investment calculus toward suburban sites.

In case after case, Lansing’s leaders have granted tax incentives to spur the rehabilitation of the city’s most debilitated structures and toxic sites because redeveloping the properties would not otherwise have happened. The most obvious example is the Ottawa Power Station/Accident Fund project. In the absence of substantial economic incentives, the financial barriers to transforming the gargantuan structure into Class A office space were simply insurmountable. On a much smaller scale, incentives have played a crucial role in the redevelopment of numerous other buildings across the city.

Betz and others argue unpersuasively that these projects would have happened anyway and that developers seek incentives merely to line their pockets with excessive profits. These assertions are ideologically driven hyperbole. While it is true that factors like labor availability, infrastructure and quality of life are primary drivers of business location decisions, the rehabilitation of blighted and contaminated structures within a community has everything to do with the financial viability of tackling an old building in the urban core rather than building a new one elsewhere. Economic incentives are a primary factor in that equation.

It’s also important to note that incentives are not paid by the city’s earn-and-file taxpayers, but from the new incremental tax revenues generated by the project itself, which are paid by the developers. The brownfield incentive, for example, captures this stream of new taxes to reimburse the developer for the costs of environmental remediation, which is a public good in and of itself. Betz and others claim that the city is losing tax revenues by granting incentives is based on the flawed assumption that the projects would have happened anyway. In fact, in nearly every case, the city has gained tax revenues (both property and income) as well as ancillary benefits that include temporary and permanent jobs, blight removal and neighborhood stabilization.

We say all of this to remind Councilman Betz and his colleagues that incentives can and should continue to play a vital role in sustaining Lansing’s economic resurgence. We encourage our newest Council member to temper his anti-incentive fervor and give a fair shake to redevelopment proposals that seek the city’s assistance. To do otherwise is to risk stalling the measurable, meaningful progress the city has made over the past decade.