Analysis: Economic development incentives have varied in Decorah over the past 20 years

If you take a look at the tax abatements offered by the City of Decorah for development projects over the last 20 years, it's impossible to make any generalizations.

That's because tax abatements have ranged from covering three years to covering ten years--and the former Quillin's developer is now asking for a 15-year tax abatement.

Then there are the tax abatements themselves.  The Fairfield Hotel developers were given four years of 100 percent tax abatement on the increased property value; another three years of 90 percent tax abatement; and another three years of 80 percent tax abatement.  Six different projects, including KAR Auto Group, Oneota Valley Eye Clinic and the former Bob's Standard building, were given ten years of tax abatements beginning at 80 percent and gradually decreasing to 20 percent.  But Toppling Goliath's tax abatement package for its new brewery in the Business Park was for five years, starting at 80 percent and decreasing to 40 percent the last year.  And Norwegian Mutual received tax abatements for just three years for its new office in the Business Park, starting at 75 percent and falling to 45 percent.

Phew!

Is there any dispute that City Administrator Chad Bird is right to call for the city council to create an economic development "framework?" 

The comments I hear most about tax abatements from the public are questions about the fairness of the system.  Those questions are about the system itself, but now I'm wondering if the system is even fair among the businesses who receive the tax abatements.  How do those business owners feel when they learn that others are asking for 15-year tax abatements when they received 3-year or 5-year tax abatements?  And why are the tax abatement schedules different?

Is it a case of businesses asking for whatever they can get?  And does not having a set policy only encourage new businesses to ask for more than the last business received?  These are questions it will be important for city officials to answer.