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Getting Wheeling On Path to Growth

April 14, 2013
The Intelligencer / Wheeling News-Register

By far the best strategy for politicians who want to "create" jobs is to get out of the private sector's way. A proposal by Mayor Andy McKenzie would do that to an extent in Wheeling.

It now becomes Wheeling City Council's task to ensure the mayor's plan will be good for the city in the long run.

One of the keys to McKenzie's plan is providing relief to businesses which can bring new jobs to Wheeling and can reinvigorate the city's downtown area if they see opportunity here.

Business and Occupation taxes are a frequent complaint, in large part because they are levied on a company's total sales, regardless of whether the firm is making a profit. The mayor wants to eliminate B&O taxes for manufacturers and cut them by about 26 percent for retail businesses.

At the same time, he wants a one-half percent sales tax within city limits, on top of the existing 6 percent state tax. Sales of unprepared food, gasoline and vehicles would be exempted to ensure the new tax is not a burden on those least able to deal with a higher cost of living.

The net effect of McKenzie's plan - B&O tax relief and a new sales tax - would bring about $1.4 million a year in new revenue to city government.

About half of that would be earmarked for infrastructure projects such as street, sidewalk and bridge repair and improvements. While City Manager Robert Herron and his staff have done an excellent job in keeping up with infrastructure needs, the additional $700,000 a year could be put to good use.

But another $700,000 a year would be used for economic development projects. McKenzie has said improvements to WesBanco Arena - also maintained well by Manager Dennis Magruder and his staff - would be part of that.

A substantial amount of the remaining cash would be used for "essential future economic development projects," the mayor said. One he cited is possible expansion of convention facilities near the arena.

McKenzie said city funding could generate $10 million to $20 million in private investment, though he did not specify how.

City officials constantly are attempting to lure new businesses to Wheeling. Almost always, a condition of such discussions is that they not be made public.

Still, in discussing the mayor's proposal, council members should ask for more specifics on how he plans to use economic development money from the new tax. There must be a realistic expectation of significant positive results for downtown Wheeling.

Other factors including the appropriateness of city investments should be considered. For example, the propriety of any plan that would compete with existing local businesses should be weighed carefully.

While McKenzie may not be able to provide details on a specific private proposal, guidelines for what uses of the money are acceptable should be in place. Few Wheeling residents will like the idea of, in effect, handing the city a blank check.

Finally, there is the matter of growth in the size and cost of government. Both for infrastructure improvements and economic development, a specific, realistic strategy must be in place. Simply establishing a major new tax and handing city government a huge pot of money forever is not a good idea.

If the tax is left in place long after McKenzie and the current council have departed, no one can say how the money will be used. Council should consider a "sunset" provision on the sales tax - eliminating it several years from now, once the current, specific initiative is completed.

McKenzie's plan seems like a good step toward reinvigorating the downtown economy. But the devil always is in the details. Before proceeding, council members should ensure the proposal's specifics will be good for Wheeling in the long run.

 
 

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