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Re: [web-126] Hillsborough County and $15M

From: Mike B.
Sent on: Friday, March 16, 2012 5:31 PM
Bri:

Please don't attack me personally.  I AM pro startup.  You don't know me at all.

So, on to the DISCUSSION!

Let's look at how the money is being spent.  The county just isn't handing over $15m to Bass Pro Shops.  In fact, Bass Pro Shops will receive ZERO from the county!  That's right!  Check it out for yourself!

1.)  The county will re-imburse the developer for required road improvements to the tune of $8 out of the $10 million to modify the roads.  That may sound like a lot, but the annual budget of the county is 2.95 billion (varies a bit).  What is that?  .2% of their annual budget?  And guess what?  Fixing roads is what counties do as a normal part of business.

2.)  1.5 million is a bonus of the developer gets the store up by 2013; and only then after the developer has put in $25 million of their own money.  Performance bonuses are common.

3.)  The developer gets paid $550,000 per year for the next 10 years if the Bass Pro Shops bring in gross revenue of $55 million per year.  Hillsborough County's sales tax rate is 7%.  At 55 million annually, that's about 3.8 million in additional tax revenue per year.  So what's that?  A 7x return on their money annually?  Sounds like a wise move to me.  And if my math 'chip' is working correctly, of the 55 million, 28 million will come from outside the area.  A great way to stimulate any local economy is to bring in revenue from outside the area.

I know that the $15m sounds like a lot, but this year alone, Hillsborough County will spend 12 million on tourism advertising.  The county's annual budged is almost 3 BILLION.  Also, the $15M will be paid out over 10 years; and only if certain financial milestones are met.

According to the county, the the payback is estimated to be 6 years, not the 3 that I 'guessed' in my earlier assessment.  Oops!  My bad!

Bass Pro own internal surveys indicate that nearly half of their sales will come from further than 25 miles away.  I tend to agree with these numbers.  So, I'm pretty comfortable saying that the tax revenue vs service cost comes down heavily on the side of a any business that draws in customers from outside the local area.

Bri:  So, my question to you is:  Can you list the local bait and tackle shops you think my be affected?  Of the 34 listed in the yellow pages, most seemed to be specialty shops or operating as part of a local marina.  If Bass Pro could put them out of business (i.e. they don't have a specialty or are located in a marina), wouldn't have Wal-Mart already driven them out of business?  I'm thinking the major competitor to Bass Pro Shops would be the Wal-Marts in the area.  In my opinion, from a fishing perspective, I think the market is pretty much already dominated by the big box stores (Sports Authority, Wal-Mart, etc.). 

And Bri, from a philosophical standpoint, I do agree with you.  I've read the book called The Wal-Mart Effect by Charles Fishman.  I don't like it any better than you do.  But, putting our collective heads in the sand and hoping that big companies will just 'go away' is just wishful thinking.  I think a better strategy would be to adapt and change with the times.

As far as your comments about 'hogwash' and local tackles shops would 'get the revenue anyway', I think I am going to disagree with you.  In general, I agree with your thoughts.  But in the case of Bass Pro Shops, my thinking is a bit different.  Bass Pro ADVERTISES, local bait and tackle shops do not (at least not from what I've seen in my newspaper, on the radio, and on TV).  I've seen the fishing department at Bass Pro Shops.  They aren't geared toward the high end.  It's more towards the everyday fisherman.  So, if the shops you are hoping to protect don't have anything to distinguish them as a unique value proposition in the market (i.e high-end gear, convenience (at a marina), or tons of local knowledge), should they still be in business anyway?  I'm not a big fan of the 'buy from me because I'm the only game in town' mantra.  I am not totally convinced that I'm right, so some additional feedback on this item would be greatly appreciated.

I do like the thought of trying to get Hillsborough County to do more for local startups.  I just don't think it should be done at the expense of trying to grow the local economy.

Thanks!
Mike B.







From: Brian French <[address removed]>
To: [address removed]
Sent: Friday, March 16,[masked]:54 PM
Subject: RE: [web-126] Hillsborough County and $15M

Hogwash…
 
The 15% of startups that succeed could make millions for their owners (heard of Bill Jackson’s?). That’s millions that will likely stay in the local economy.
 
The “jobs” that Bass Pro Shops create will not create any real wealth for anyone in Hillsborough county.  Peanut slave wages. As soon as the money comes into the store it will get wired out faster than a largemouth hitting a nightcrawler.
 
Some opinions aren’t worth two cents…
 
Bri
 
Concerning Bass Pro Shops and the $15m investment by the county:
(it’s corporate welfare for a company that makes millions)
 
I hate to say this, but more often than not, this is a great move by local governments.  It's good business sense!  Why?  Because right way, it will add about 100+ new jobs to the economy (assuming they don't build a new building, (if you spent 15 million dollars on digging holes it would create jobs too) I'm sure they would do; which means even more money) and a new proven business that pays loads of taxes (property, payroll, etc.)  Then, there is the trickle down theory.  (how exactly does this help the small tackle shop?) For example, 100 new jobs translates into approximately 20 new cars, 100 auto insurance policies, and 1,200 pizzas a year.  (let’s just have a pizza party instead) Well, you get the idea.  I'd guess the payback on that 15 million is less than 3 years.  I'd bet the 'contract' stipulates that Bass Pro has to stay in the area for anywhere from 10 to 20 years.  (in 20 years we turn into Pottersville) Honestly, this is smart government.
 
The great thing about Bass Pro Shops is that vacationers travel hundreds of miles to wander down their isles (fantasy).  I'd estimate that approximately 50% of their revenue is from people who don't live in the area?  Why is that important?  (it’s called tourism and local tackle would get these customers otherwise) shops Because that means tons of additional revenue (hogwash.. where is the proof of that) (and taxes) with no accompanying service load (i.e no schools to build, etc.).  Plus, visitors eat, sleep, drive, buy gas, go to movies, etc.(crazy talk)  This means lots of trickle down money for the local economy. (more like trickled on)
 
What surprises me is that they'd even consider putting it in Hillsborough.  I'd think given the closer proximity to the water that St. Pete would be a much wiser move on their part.  But I digress...
 
Now, compare that to spending 15 million on local startups....  Well, guess what?  Startups fail.  At a rate of about 85%.  So, what's that?  About 2.25 million?  Then, throw in the cost to administer such a program and what would we really be getting?  1.8 million?  As a tax payer, this doesn't seem to be such a wise use of my money.
(when you help a startup’s competitor you hurt the startup)
Don't get me wrong, (but you are) I'm extremely pro-startup.  (but you aren’t) But, I don't think county governments have the expertise necessary to manage such a program.  (who asked them?) Hey, I don't think churches should get in the startup business either.  The environment for startups in Florida seems to be halfway decent.  The state of Florida has a matching funds program.  Plus, add all the venture capital groups in town and the 'high tech corridor' program and this area provides loads of opportunities for us startups.
 
Well, that's just my $.02 worth.
Thanks!
Mike B.
 
 
 
From: [address removed] [mailto:[address removed]] On Behalf Of Peter Sysko
Sent: Friday, March 16,[masked]:31 PM
To: [address removed]
Subject: Re: [web-126] Hillsborough County and $15M
 

wow
 
mike b  is right about this
and he proved it well
standing against the
swarm of complainers. 
cheers
 
many of us would tend to align our
arguments to those that could benefit our personal lives much
easier than the side that would makes us a smaller stakeholder.
there is no reason why a bunch of tech geeks should win over a proven business model for grant money on those descriptors alone
 
Wanting to believe that is a horrible government idea
doesn't make it one
 
one key virtue in life and business I've learned is to take your share of the world while letting other people have theirs. both are required or else it's not fair 
 
oh and doesn't anyone try
save and invest money from their customers and clients anymore for launching new startup ideas?
 
thank for your time. all
 
 
 
 
Regards,
               ~ Peter S. Sysko                                    
                    
 
"Unless someone like you cares a whole awful lot, nothing is going to get better. It's not."
                                 - the Lorax
          by Theodor Seuss Geisel
                           

On Mar 16, 2012, at 10:15 AM, "Mike B.." <[address removed]> wrote:
Concerning Bass Pro Shops and the $15m investment by the county:
 
I hate to say this, but more often than not, this is a great move by local governments.  It's good business sense!  Why?  Because right way, it will add about 100+ new jobs to the economy (assuming they don't build a new building, which I'm sure they would do; which means even more money) and a new proven business that pays loads of taxes (property, payroll, etc.)  Then, there is the trickle down theory.  For example, 100 new jobs translates into approximately 20 new cars, 100 auto insurance policies, and 1,200 pizzas a year.  Well, you get the idea.  I'd guess the payback on that 15 million is less than 3 years.  I'd bet the 'contract' stipulates that Bass Pro has to stay in the area for anywhere from 10 to 20 years.  Honestly, this is smart government.
 
The great thing about Bass Pro Shops is that vacationers travel hundreds of miles to wander down their isles.  I'd estimate that approximately 50% of their revenue is from people who don't live in the area?  Why is that important?  Because that means tons of additional revenue (and taxes) with no accompanying service load (i.e no schools to build, etc.).  Plus, visitors eat, sleep, drive, buy gas, go to movies, etc.  This means lots of trickle down money for the local economy.
 
What surprises me is that they'd even consider putting it in Hillsborough.  I'd think given the closer proximity to the water that St. Pete would be a much wiser move on their part.  But I digress...
 
Now, compare that to spending 15 million on local startups....  Well, guess what?  Startups fail.  At a rate of about 85%.  So, what's that?  About 2.25 million?  Then, throw in the cost to administer such a program and what would we really be getting?  1.8 million?  As a tax payer, this doesn't seem to be such a wise use of my money.
 
Don't get me wrong, I'm extremely pro-startup.  But, I don't think county governments have the expertise necessary to manage such a program.  Hey, I don't think churches should get in the startup business either.  The environment for startups in Florida seems to be halfway decent.  The state of Florida has a matching funds program.  Plus, add all the venture capital groups in town and the 'high tech corridor' program and this area provides loads of opportunities for us startups.
 
Well, that's just my $.02 worth.
Thanks!
Mike B.
 
 
 

From: Brenda Young <[address removed]>
To: [address removed]
Sent: Thursday, March 15,[masked]:25 PM
Subject: Re: [web-126] Hillsborough County and $15M
 
This is an issue that should be near and dear to the hearts of everyone on this list. How many people with great ideas who could implement quickly and successfully have we seen over the years who struggled to get funding?
 
...and seriously, retail jobs from a company that would probably come here anyway? They can't even hide behind calling it a 'safe' choice. This is just mindless and clueless on the part of people who should be focused on high-end jobs that create 6 additional jobs.
 
 
-Just my $0.02  -- What does everyone else think?
 
 
 
 
 
--Brenda
On Thu, Mar 15, 2012 at 4:18 PM, Peter <[address removed]> wrote:
So Hillsborough Count is dangling a carrot in front of Bass Pro Shops.
A $15 Million carrot to get them to open a store in Brandon.

Not for nothing, but couldn't that $15M be put to better use?

Is there really the jobs we want? Chain Retail stores and call centers?

$50,000 grants or loans to 300 start-ups would create 600 REAL jobs immediately!

Nice editorial about it here:
http://www.tampabay.com/opinion/editorials/article1220078.ece

Could you contact your County Commissioner, please?
http://hillsboroughcounty.org/bocc/

Original article:
http://www2.tbo.com/news/breaking-news/2012/mar/14/memeto1-county-casts-15m-to-lure-bass-pro-ar-368910/

Thanks!

Peter



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