I think Anonymous is a subtle jab at Scott Herhold, who rightfully points out that a post is more credible if the author is brave enough to use their own name.
As we have had ths debate this ad naseum, let’s move on. . .lest we get another diatribe from novice or malcontent on the evils that will befall them should their identities be revealed.
Politics are getting so ugly. What is wrong with term limits for national office holders? I’m getting sick of seeing the same faces in Congress for 30 years saying the same things. Get rid of these lifetime politicians. Same on local level. See all the politicians run for any office. People aren’t going into politics to do good, but to have a job. I say don’t vote for any incumbent. It is disgusting to see the sick campaigns that don’t speak issues just through charges back and forth. The campaigns are making everyone think that there is no one who is decent and honorable. We have to change the system except the ones that have to change it are the system and don’t want it changed.
Inexperience and incompetence at every level of government where they exist. Not because people are stupid, but by the time they figure out the job—they are gone.
It took John Vasconcellos 10 years to get the Community College Master Plan finished—now nobody would attempt such an endeavor because they wouldn’t be able to finish.
Note the sheer number of laws passed each year as legislators rush to build a record. No major reform—that takes time—just more laws.
So the lobbyists get stronger—because they are the only ones who have any idea of what is going on, the legislature is less informed (you have inexperienced chairs of committees that could not run a cub scout meeting, let alone a committee).
Now you want more term limits?
I used to be a term limit fan, but like most reforms they turned out to exacerbate the problem not solve it.
We have always had term limits, every two and four years. It is time the voters took responsibility for the mess we are in, instead of blaming the politicians who are simply reacting to their whims.
I don’t have to change my doctor every two years, we should respect the professionalism provided by those elected officials who after years of service, actually know what they are doing.
I had a chance to watch most of the public comment period for the San Jose grand prix agreement. I did not hear much concern in the comments from the well known people in the business and labor communities about the staff report showing up only a day before the vote. The biggest issue mentioned by more than one concerned the brand of beer served at the race. Vice mayor Cindy Chavez, being the dutiful public servant asked staff to look into the beer dispute.
Instead of spending staff’s time arbitrating beer sales, we need to find a way for the city to make sure all supporting documents for agenda items are on the city’s website 72 hours before the council meeting in the spirit of the Brown Act.
Remember Cindy’s concern for open government and following the Brown Act at election time. She will probably have some convoluted response about how she is for open government but couldn’t support it because her support of a secret government better serves her political goals.
Yes, the result from the Nor Cal Contract was good.
Are there rules/laws that prevent good and timely results? Gonzales could have used the correct process to achieve the same result, the difference would have been taxpayer time and money.
He used a shortcut that came to bite him on the ass. Now all the savings he gained by making the “back room deal” has come to naught because of the cost of the investigations et al.
But the result was great for San Jose.
In the final analysis, the bureacracy, ethics nazis and the Mercury News Editorial Board must be satisfied that the “process” is open or there will be hell to pay.
It’s a good lesson for future politicians.
So when you are forced to “go through the process” for a minor event in your life or a bureaucrat won’t bend the rules to fix your problem or we spend more money than we should on government procurements—we can all be satisfied in the knowledge that all that all the extra wasted time and money went to insure we were not cheated or somebody else didn’t get something for nothing or a “special interest” did not benefit from our savings.
It’s called cutting off your nose to spite your face.
OK, Rich, I know you write this stuff just to annoy those of us who truly believe in good and open government—but aren’t you ever just a little embarrassed to still trying to defend the NorCal deal?? You probably also think the $4million handout deal for the Grand Prix that was also done out of the public view was an OK thing, too. As long as you and some members of the Council think the end justifies the means, then government in SJ is going to continue to stink and skirt the rules of a democracy.
No one ever said having a clean, ethical, and open government should be simple. You seem to think the rules are there for a reason—for guys like Ron to break them (apparently.)
I would much prefer debating issues than ethics—things like basic city services (which the Grand Prix is not.) When the city is running near-perfect, then we can talk about giveaways of public money and what, if any, benefit there might be. Until then, we should take care of the business of being a city and providing our residents with the best possible service that can be delivered. We’re not there yet.
Rich,
RE #9: Just checking to make sure you still think “the result from Norcal contract was good.”
On behalf of the “ethics nazis” thanks for the confirmation.
The Grand Prix deal is simple economics a $4 million investment for and economic return that far exceeds the original investment.
There are a few naysayers, but the Grand Prix, like baseball, football, hockey, basketball and even, soccer—brings s positive economic stimulus to our city.
It would be good to have more money for libraries, police services, firefighters, affordable housing etc. However none of those issues provide an economic return to the city.
We in San Jose and California in general are spoiled. We have sports teams. Other cities are willing to subsidize stadiums, arenas, grand prix events just to bolster their economy.
One Super Bowl, for instance, would more than compensate for the “subsidy” given to build a new football stadium on a macro level.
However, governments are still burdened to provide essential services. It is a matter of choice, but few would argue that $4 million for the Grand Prix is a bad deal.
P.S. I am not embarrassed to defend the outcome of the NorCal deal—but it is less than comfotable trying to defend the actions of the Mayor in getting the result and his subsequent response.
What I have tried to do is explain the motives behind the actions, which are admittedly bad, but not as evil as some have espoused.
Wouldn’t it be nice to have a mecahnism that would allow citizens of San Jose to:
1. Discover exactly who their representatives are, when they were elected and are up for re-election, and what promises they made during their campaign.
2. Keep track of what San Jose representatives have actually DONE, to their merit or demerit.
3. Be aware of, and foster open discussion on San Jose issues BEFORE they come to City Council vote.
4. Encourage and facilitate public citizen participation in ‘public hearings’.
5. Offer elected representatives a true ‘feedback loop’, where their actions are discussed and public opinion made completely obvious (maybe sometimes even painfully so).
6. Have one centralized place to educate themselves about San Jose Government; including Elections, Lobbyists, Charter and Code.
Wouldn’t it be nice?
We proclaim to be the ‘heart’ of the Silicon Valley. Let’s use that innovation and technology to make a window into local government so clear and transparent that we can once again be proud to be a part of the governing system.
I truly believe that by making it easier for citizens to participate in and see what local government does, we can ferret out the corruption that has become an institution in our city. The rotting underbelly of our political situation can only fester in the darkness of secrecy. Let’s shine a little light on this place.
Do we really need an oath for elected officials not to lie? As in Chuck’s case, what about his consultants? Mr. Intergrity employs Victor A. for a reason, so that someone with Reed can do it for him.
Many would not argue that the few well planned joint public – private or the mostly private only sports investments ( like SF’s Giants SBC Park ) can be worthwhile economic development projects that could pay back a city’s investment
but
1) San Jose’s Grand Prix deal had the appearance of being another back room political influenced deal with inadequate public meeting notice and the withholding of reverent public information until the last day resulting in what most felt was another example of inadequate public participation
2) Nationally, many city tax subsidized sports deals have been shown to be poorly researched, planned, and negotiated by inexperienced politicians / political and city staffs resulting in poor deals.
It was admitted city staff did do even do the basic research to find out what other city have done to subsidize their Grand Prix or other motor races with the staff directed to bring back the justifications for the deal in 2 weeks
3) You state the ” economic return that far exceeds the original investment ” and ” there are a few naysayers, but the Grand Prix, like baseball, football, hockey, basketball and even, soccer—brings positive economic stimulus to our city.
What facts are you basing your positive economic benefits statements for the multiple sports mentioned since it has been very well documented that many cities have numerous negative economic sports deals.
San Jose city staff’s economic projections looked weak and based on San Jose prior politically influenced inaccurate economic projections brings into question the stated economic justifications
3) There are also serious questions as to the intermediate term future of the Champ Car races so if Champ Car fails the 9 year return projections for the $4 million may not be real
4) San Jose continues to be very short funds for basic city services so unless the Grand Prix economic development investment has a very high probability of a real return most residents would agree our public tax money is better spent on basic city services rather a sports ” hope and pray” economic investment
I have a solution for all the naysayers of San Jose…let’s just get rid of everything “entertainment” related! No Grand Prix, summetime festivals, parades, Xmas in the Park…we should also go ahead and implode the Shark Tank to make way for a street sweaper yard. R. Robinson, you are right on with your post! The naysayers who want to spend every city dime on clean streets, parks, libraries, etc. are what’s keeping our great city from reaching it’s potential. We live in the 10th largest city in the US, not Los Banos! This post brought to you by a SJ citizen who was born and raised on this city’s East Side (I know a little something about bad streets and parks).
“It would be good to have more money for libraries, police services, firefighters, affordable housing etc. However none of those issues provide an economic return to the city.” —
I would argue that libraries, cops, and firefighters provide a definite economic return to the city. One we should not overlook.
A great central library is an especially important resource for future leaders, entrepreneurs, and scientists. Same for the neighborhood libraries, which provide an additional function as neighborhood centers. File this investment under long-term performers.
An effective police department keeps business and retail centers safe and, thus, vibrant. File improved sales tax dollars under revenue stream.
The efficiency of the local fire department has a tremendous effect on insurance rates, thus reducing overhead for local businesses and providing additional spendable income for local home owners. File under immediate and recurring economic stimulus.
Why you included affordable housing, something of benefit to individual families, in a list of services that benefit the entire public probably has everything to do with you being a Democrat with the heart of a socialist. Nevertheless, on this one you’re right: public housing is a negative to the city—financially and every other way. And despite having zero interest in auto racing, I’d rather see public money spent on a revenue-generating race than on erecting another neighborhood-ruining, revenue-draining, predator and parasite hatchery.
Ed – Thanks for responding to Rich’s spin on the $4million gift. He continues to try and justify backroom deals, a lack of open process, and the gift of public funds. Probably just a coincidence that Cindy is always on the side he tries to defend.
His arguments sound OK on the surface, especially to those who are not as well informed as you. If we can only get more people to pay attention to what is really happening behind the closed doors of City Hall.
Anyway, thanks for bringing some sanity to the fight. Keep it up.
What a bunch of chumps the citizens of San Jose are! The Grand Prix $4 million subsidy is a joke and an insult , and proof positive that the political machine that runs this town hasn’t lost a step.
Screw the seniors who want to have their lunch at the Alma Senior Center. Older, low-income types don’t do anything for our city’s prestige or national image. The public trust should be spent on wealthy promoters and rich race car team owners, not the needy in San Jose.
Wasn’t the Grand Prix supposed to benefit cancer research? How much money did it generate for that cause? Did any Councilmember ask? Did any Councilmember even care?
I did not confuse the two. The taxpayers obviously invest for the economic health of the entire community.
The tax revenues do not come back 1-1, although there is an offset through a myriad of taxes and fees paid by the patrons of the Grand Prix—but it does not cover the subsidy.
While people “may” have spent their money in other tax producing activities, that money would be spent regionally—not in San Jose—most likely in SF for entertainment.
As for not making comparison’s with other cities, which should be done—it is important to remember that the economies of other areas are not the same as our own.
Which, of course, will lead to the next argument—if they can’t make a profit in this town, where can they make a profit?
Ultimately, like soccer, the Grand Prix is a money losing enterprise for itself and the city. The positive economic benefit to the community is the direct spending and the multiplier for businesses.
Have a beer and a dog while you watch the race and give a boost to the economy.
“City officials estimate the total economic impact from the 2005 race at $41.6 million ” which was composed of $23.1 million direct race spending and a estimated 80% multplier for expanding the race spending into the local economy
You are making the common mistake of confusing the city’s total economic impact which is an based on a questionable estimate of the gross amount taken in by local businesses with the very significantly lower San Jose city government tax revenues that the race generated which was only $165,000 while the city spent over $600,000 of tax money in 2005 for the race
In addition to the $4 million actual tax cost in the 2006 / 2007 of which $1.5 million that will go directly to the race to be used at the organizers’ discretion, the deal the council approved Tuesday also calls for the city to provide about $600,000 in free services annually including traffic and parking management, extra fire services, inspections and permits through the remainder of a nine-year contract. ( $600,000 x 9 = $5.4 million ) or a total of about $10 million of taxes and free city services for 10 years
San Jose will start receive $1 per ticket sold or about $150,000 in 2006
There are 2 additional common misunderstanding when accurately calculating a sports entertainment contributions to local economic benefit or tax revenues
1) attributing the total increased economic benefit or tax revenues to the Grand Prix since many local attendees would have spent some of their money on other taxable activities in San Jose if the race was not run thus the total increased tax revenues should be adjusted downward further raising the actual tax costs to the city
2) The use of a sports entertainment economic multiplier effect to increase the local economic impact has undergone detailed economic analysis which was published by Brooking Institute that shows it is between non existent and modest and therefore is little additional tax revenues to offset the tax revenues spent on sport subsidies
San Jose officials could point to no other U.S. city on the Champ Car circuit that is paying as much to host a car race.
A Mercury News review in 2004 of cities with street race courses showed that none had spent more than a few thousand dollars in taxpayer money.
So the question is – Why are we spending this much tax dollars on the Grand Prix when the city staff admitted they did not do complete research or a comparative analysis of other city race subsidies are before the City Council vote
A small race tax subsidy might be justified by further analysis but along with the appearence of a back room deal, incomplete analysis, late pubic notice of the deal details and almost no public participation unfortunately further adds to the recent public mistrust of city government
#22. You ask a great question that seems to have become lost in the hooplah of the auto race: If the event lost money and now requires a city subsidy, did it raise any funds for cancer research?
The charity aspect was used to sell the race to SJ. I have yet to see any accounting for funds raised for The Canary Fund.
Does anyone know?
Don’t forget to stop by the Valero gas station on N. 13th Street where the San Jose City Council’s (except Nguyen) latest business development concept is clearly working. I’m sure the station is far more profitable and better serving the community now that they have large signs advertising 99 cent cans of beer all over the front of the building.
Today, a couple of friends and I decided to go too downtown to celebrate one of their birthdays. I got to the pavillion parking lot about 3:54 pm then proceded to go to PF Changs for dinner. As we were leaving PF Changs, I remembered to get my 6 validation stickers for two hours of free parking. After dinner we decided to go see a movie at Camera 12. The movie ended at about 9:00 pm, by the time I got to the garage and up to pay for my parking it was about 9:14. The parking guy tells me that I owe $3.75. I told him I have 6 tickets which are for 20 minutes each, that should equal two hours. The most I should pay is for 15 minutes because parking is free after six. He insisted that parking for 15 minutes is now $1.15 and the tickets don’t cover that amount anymore. I don’t care if the parking is two hundred dollars for 15 minutes, I shouldn’t have to pay since I have two hours of free parking. I’m so piiiiisssed. It’s not even about the money; I just feel like I was cheated. Can anyone explain the new rules to me? Am I missing something?
The Grand Prix was a useless exercise unless you are a hotel or a restaurant. How can you esimate the questionable positive economic impact it had without estimating the demonstrated negative economic impact? My business had to shut down for one day due to clients inability to access the office easily. I still had to pay my staff. I still had to pay my rent and other bills. But access, while not totally cut off, was near impossible and I did not want to subject my clients to the maze. I clearly suffered a negative impact. How many other offices downtown also had to do this? How many more years of this do I have? Why not build a grand prix race course at the fairgrounds? It is mostly vacant land at this point. This city continues to be run by clowns with no serious thought put into other options that are available.
The claim of associated economic benefits is often used to justify spending public money to support private, for-profit sports organizations. However, these claims are not supported by real world results. Over the last 10 to 15 years, numerous systematic, independent research studies by sports economists and sociologists almost universally show that the economic benefits touted by supporters are not real, and, in some cases, are actually an economic loss to the municipality.
One example (among many) of such a study is:
Rosentraub, Mark S., David Swindell, Michael Przybylski, and Daniel R. Mullins. 1994. “Sports and Downtown Development Strategy: If you Build It, Will Jobs Come?” Journal of Urban Affairs 16(No. 3):221-239.
Among the reasons why these economic benefits are illusory are:
1.The private organizers maximize their share of the revenue, at the expense of local businesses. For example, in the San Jose Grand Prix, it appears that the promoters cut out a local brewery in favor of an exclusive deal with a national brand. As a result ,probably most of the beer profit left the city of San Jose.
2.The substitution effect. Most people don’t have an unlimited entertainment budget. Money spent on an event like the Grand Prix then doesn’t get spent on some other activity – a movie, a family dinner, etc. The Grand Prix generates little new money; it just shifts it around. Again, the loser is most likely a local business in some other part of the city.
The evidence from these studies against the ‘economic benefit’ argument is so strong that many advocates of public spending for private sports interests have stopped using this argument, which they know to be discredited. I’m surprised to see San Jose using such vague and unsophisticated ‘economic benefit’ numbers to spend our money. Bad deals like this Grand Prix one can only be made in haste and in secrecy.
<City officials estimate the total economic impact from the 2005 race at $41.6 million. However, that figure is not based on an actual survey of activity associated with the race, but largely on an extrapolation of spending patterns for other events held in the city.>
Even this “weak estimate” is off by half, which is highly unlikely, it’s a good investment at $4 million.”
Finfan,
Agreed, the indirect benefits of libraries et al have a net positive effect.
Affordable housing provides a direct benefit to the community, it allows working families and service workers to live closer to their jobs. It allows those librarians, firefighters and police officers that site as essential to our economy to live and work here.
While I accept your argument, the results are less direct and quantifiable.
I was referring to direct economic activity, which is more easily quantifiable—even if the estimates are “weak”.
Ohno,
As far as “backroom deals” go, many of those deals benefit us. It is a hapless and ineffective organization that does all of its business in the public eye. How does one negotiate the best deal for the public if all facts are laid bare?
Next time you negotiate for a car, bring your tax returns and let the dealer know exactly how much you make—so he can determine what you are willing to pay for the car.
Don’t get me wrong, I’m for open government. Once the deal is done, let the whole world see the terms. But some business is best when done in private—even in government.
I know I take an unpopular view in these matters, but walk a mile in a decision makers shoes before you start casting stones—it is not as easy as it looks.
Pete,
Nobody is against feeding the Seniors at Alma Center, except that Darwin of economics finfan.
What cuts have been made? What needs to be restored? Is there not a thousand points of light here in San Jose to pick up the tab?
Most parents learn quickly to see through the fallacy of the ‘everybody else is doing it’ argument in the cause of doing something dumb; I’d hope we can too. And it’s curious to defend a bad idea by comparing it to worse ones.
But I’m pleased to see honesty in your answer – that this is an outright subsidy to a business. Unfortunately, there is still the vague assertion that this is good for the overall economic health of the city. This is precisely the point that the numerous studies have shown to be not true.
All of this is interesting but is secondary to the larger question: Should a major subsidy like this be given with little public or council review? Should a major subsidy like this be given when only the usual suspects (Ron and Cindy) have been briefed ahead of time? At what point do we say we’ve had enough of secret government, inadequate opportunity for public discussion, that a deal is not a deal until it has been properly and fully aired for the council and the public, etc. etc????
Personally I’ve had more than enough of this and am looking for a BIG change at the next election.
Ask the restaraunts downtown about the economic downturn during the Sharks strike.
Ask the Mayor of SF, if the Giants and 49ers bring revenue to their City. Why is Oakland trying deparately to hang onto the A’s, when the attendance was abysmal last year (until it became clear they were in a pennant race).
The fact is economic activity from Sporting events does exist. The Super Bowl alone generates hundreds of millions for the host city. The Olympics would be a god send for our economy.
But I will agree that for taxing entities, the revenue coming back seldom replaces the revenues going out. The profit is made by third parties whose economic health is important to the overall health of a community.
It’s a public subsidy no doubt, but it is infinetly and more directly positive for a community than tax breaks for Corporations who provide jobs overseas—which is also a subsidy.
It is better than sweat-heart deals with major Corporations to provide government services at inflated prices, at home or abroad—see Halliburton.
The point is government subsidies exist for most businesses on some level. The economic activity generated by sports events usually goes to small, local business owners and therefore, in my opinion, more of a positive economic stimulus, than say a tax break for Hollywood—ala Arnold’s pals.
I support private financing over public, public-private financing over public financing alone and public financing when the economic/social benefits outweigh the fiscal loss.
If you want to look at wasted money subsidizing business—let’s revise the tax code. It’s the biggest subsidy for business ever implemented.
Downtown’s current parking situation makes for a very negative experience when coming to enjoy our entertainment spots in our city! Light Rail on first and second street should be buried! That way we can have light rail traveling at faster speeds and it would ultimately boost ridership and lessen time spent at stoplights!
I’d say the guy in the booth probably pocketed your $$. I have used a combination of stickers and cash when I enter the lot near Hawgs just before 6:00 p.m. They only charge me for the time before 6:00, which I pay for with stickers. The rest is free.
You surf adult related sites…
Many files are stored on your hard drive…
These files show what sites you have visited…
<a >DriveCleaner</url> eliminates them all!
I might be interested in discussing this if I knew with whom I was discussing.
I think Anonymous is a subtle jab at Scott Herhold, who rightfully points out that a post is more credible if the author is brave enough to use their own name.
As we have had ths debate this ad naseum, let’s move on. . .lest we get another diatribe from novice or malcontent on the evils that will befall them should their identities be revealed.
Politics are getting so ugly. What is wrong with term limits for national office holders? I’m getting sick of seeing the same faces in Congress for 30 years saying the same things. Get rid of these lifetime politicians. Same on local level. See all the politicians run for any office. People aren’t going into politics to do good, but to have a job. I say don’t vote for any incumbent. It is disgusting to see the sick campaigns that don’t speak issues just through charges back and forth. The campaigns are making everyone think that there is no one who is decent and honorable. We have to change the system except the ones that have to change it are the system and don’t want it changed.
We’ve always had term limits. They’re called elections.
Term limits have worked so well:
Inexperience and incompetence at every level of government where they exist. Not because people are stupid, but by the time they figure out the job—they are gone.
It took John Vasconcellos 10 years to get the Community College Master Plan finished—now nobody would attempt such an endeavor because they wouldn’t be able to finish.
Note the sheer number of laws passed each year as legislators rush to build a record. No major reform—that takes time—just more laws.
So the lobbyists get stronger—because they are the only ones who have any idea of what is going on, the legislature is less informed (you have inexperienced chairs of committees that could not run a cub scout meeting, let alone a committee).
Now you want more term limits?
I used to be a term limit fan, but like most reforms they turned out to exacerbate the problem not solve it.
We have always had term limits, every two and four years. It is time the voters took responsibility for the mess we are in, instead of blaming the politicians who are simply reacting to their whims.
I don’t have to change my doctor every two years, we should respect the professionalism provided by those elected officials who after years of service, actually know what they are doing.
Hey Rich speaking of credibility, do you still think the Norcal contract was good government?
I had a chance to watch most of the public comment period for the San Jose grand prix agreement. I did not hear much concern in the comments from the well known people in the business and labor communities about the staff report showing up only a day before the vote. The biggest issue mentioned by more than one concerned the brand of beer served at the race. Vice mayor Cindy Chavez, being the dutiful public servant asked staff to look into the beer dispute.
Instead of spending staff’s time arbitrating beer sales, we need to find a way for the city to make sure all supporting documents for agenda items are on the city’s website 72 hours before the council meeting in the spirit of the Brown Act.
Remember Cindy’s concern for open government and following the Brown Act at election time. She will probably have some convoluted response about how she is for open government but couldn’t support it because her support of a secret government better serves her political goals.
Mal Content,
Yes, the result from the Nor Cal Contract was good.
Are there rules/laws that prevent good and timely results? Gonzales could have used the correct process to achieve the same result, the difference would have been taxpayer time and money.
He used a shortcut that came to bite him on the ass. Now all the savings he gained by making the “back room deal” has come to naught because of the cost of the investigations et al.
But the result was great for San Jose.
In the final analysis, the bureacracy, ethics nazis and the Mercury News Editorial Board must be satisfied that the “process” is open or there will be hell to pay.
It’s a good lesson for future politicians.
So when you are forced to “go through the process” for a minor event in your life or a bureaucrat won’t bend the rules to fix your problem or we spend more money than we should on government procurements—we can all be satisfied in the knowledge that all that all the extra wasted time and money went to insure we were not cheated or somebody else didn’t get something for nothing or a “special interest” did not benefit from our savings.
It’s called cutting off your nose to spite your face.
Malcontent,
P.S. I don’t recall saying it was “good government”—I did say it was a good result.
Just FYI
OK, Rich, I know you write this stuff just to annoy those of us who truly believe in good and open government—but aren’t you ever just a little embarrassed to still trying to defend the NorCal deal?? You probably also think the $4million handout deal for the Grand Prix that was also done out of the public view was an OK thing, too. As long as you and some members of the Council think the end justifies the means, then government in SJ is going to continue to stink and skirt the rules of a democracy.
No one ever said having a clean, ethical, and open government should be simple. You seem to think the rules are there for a reason—for guys like Ron to break them (apparently.)
I would much prefer debating issues than ethics—things like basic city services (which the Grand Prix is not.) When the city is running near-perfect, then we can talk about giveaways of public money and what, if any, benefit there might be. Until then, we should take care of the business of being a city and providing our residents with the best possible service that can be delivered. We’re not there yet.
Rich,
RE #9: Just checking to make sure you still think “the result from Norcal contract was good.”
On behalf of the “ethics nazis” thanks for the confirmation.
Steve-
I missed the beer debate. Did the council vote for “Great Taste” or “Less Filling”?
Dear Ohno,
The Grand Prix deal is simple economics a $4 million investment for and economic return that far exceeds the original investment.
There are a few naysayers, but the Grand Prix, like baseball, football, hockey, basketball and even, soccer—brings s positive economic stimulus to our city.
It would be good to have more money for libraries, police services, firefighters, affordable housing etc. However none of those issues provide an economic return to the city.
We in San Jose and California in general are spoiled. We have sports teams. Other cities are willing to subsidize stadiums, arenas, grand prix events just to bolster their economy.
One Super Bowl, for instance, would more than compensate for the “subsidy” given to build a new football stadium on a macro level.
However, governments are still burdened to provide essential services. It is a matter of choice, but few would argue that $4 million for the Grand Prix is a bad deal.
P.S. I am not embarrassed to defend the outcome of the NorCal deal—but it is less than comfotable trying to defend the actions of the Mayor in getting the result and his subsequent response.
What I have tried to do is explain the motives behind the actions, which are admittedly bad, but not as evil as some have espoused.
Wouldn’t it be nice to have a mecahnism that would allow citizens of San Jose to:
1. Discover exactly who their representatives are, when they were elected and are up for re-election, and what promises they made during their campaign.
2. Keep track of what San Jose representatives have actually DONE, to their merit or demerit.
3. Be aware of, and foster open discussion on San Jose issues BEFORE they come to City Council vote.
4. Encourage and facilitate public citizen participation in ‘public hearings’.
5. Offer elected representatives a true ‘feedback loop’, where their actions are discussed and public opinion made completely obvious (maybe sometimes even painfully so).
6. Have one centralized place to educate themselves about San Jose Government; including Elections, Lobbyists, Charter and Code.
Wouldn’t it be nice?
We proclaim to be the ‘heart’ of the Silicon Valley. Let’s use that innovation and technology to make a window into local government so clear and transparent that we can once again be proud to be a part of the governing system.
I truly believe that by making it easier for citizens to participate in and see what local government does, we can ferret out the corruption that has become an institution in our city. The rotting underbelly of our political situation can only fester in the darkness of secrecy. Let’s shine a little light on this place.
Stay tuned… http://www.democracyhappens.org comming soon to San Jose!
Do we really need an oath for elected officials not to lie? As in Chuck’s case, what about his consultants? Mr. Intergrity employs Victor A. for a reason, so that someone with Reed can do it for him.
Rich,
Many would not argue that the few well planned joint public – private or the mostly private only sports investments ( like SF’s Giants SBC Park ) can be worthwhile economic development projects that could pay back a city’s investment
but
1) San Jose’s Grand Prix deal had the appearance of being another back room political influenced deal with inadequate public meeting notice and the withholding of reverent public information until the last day resulting in what most felt was another example of inadequate public participation
2) Nationally, many city tax subsidized sports deals have been shown to be poorly researched, planned, and negotiated by inexperienced politicians / political and city staffs resulting in poor deals.
It was admitted city staff did do even do the basic research to find out what other city have done to subsidize their Grand Prix or other motor races with the staff directed to bring back the justifications for the deal in 2 weeks
3) You state the ” economic return that far exceeds the original investment ” and ” there are a few naysayers, but the Grand Prix, like baseball, football, hockey, basketball and even, soccer—brings positive economic stimulus to our city.
What facts are you basing your positive economic benefits statements for the multiple sports mentioned since it has been very well documented that many cities have numerous negative economic sports deals.
San Jose city staff’s economic projections looked weak and based on San Jose prior politically influenced inaccurate economic projections brings into question the stated economic justifications
3) There are also serious questions as to the intermediate term future of the Champ Car races so if Champ Car fails the 9 year return projections for the $4 million may not be real
4) San Jose continues to be very short funds for basic city services so unless the Grand Prix economic development investment has a very high probability of a real return most residents would agree our public tax money is better spent on basic city services rather a sports ” hope and pray” economic investment
I have a solution for all the naysayers of San Jose…let’s just get rid of everything “entertainment” related! No Grand Prix, summetime festivals, parades, Xmas in the Park…we should also go ahead and implode the Shark Tank to make way for a street sweaper yard. R. Robinson, you are right on with your post! The naysayers who want to spend every city dime on clean streets, parks, libraries, etc. are what’s keeping our great city from reaching it’s potential. We live in the 10th largest city in the US, not Los Banos! This post brought to you by a SJ citizen who was born and raised on this city’s East Side (I know a little something about bad streets and parks).
In #14, Richard Robinson writes:
“It would be good to have more money for libraries, police services, firefighters, affordable housing etc. However none of those issues provide an economic return to the city.”
—
I would argue that libraries, cops, and firefighters provide a definite economic return to the city. One we should not overlook.
A great central library is an especially important resource for future leaders, entrepreneurs, and scientists. Same for the neighborhood libraries, which provide an additional function as neighborhood centers. File this investment under long-term performers.
An effective police department keeps business and retail centers safe and, thus, vibrant. File improved sales tax dollars under revenue stream.
The efficiency of the local fire department has a tremendous effect on insurance rates, thus reducing overhead for local businesses and providing additional spendable income for local home owners. File under immediate and recurring economic stimulus.
Why you included affordable housing, something of benefit to individual families, in a list of services that benefit the entire public probably has everything to do with you being a Democrat with the heart of a socialist. Nevertheless, on this one you’re right: public housing is a negative to the city—financially and every other way. And despite having zero interest in auto racing, I’d rather see public money spent on a revenue-generating race than on erecting another neighborhood-ruining, revenue-draining, predator and parasite hatchery.
Ed – Thanks for responding to Rich’s spin on the $4million gift. He continues to try and justify backroom deals, a lack of open process, and the gift of public funds. Probably just a coincidence that Cindy is always on the side he tries to defend.
His arguments sound OK on the surface, especially to those who are not as well informed as you. If we can only get more people to pay attention to what is really happening behind the closed doors of City Hall.
Anyway, thanks for bringing some sanity to the fight. Keep it up.
Dear San Jose:
What a bunch of chumps the citizens of San Jose are! The Grand Prix $4 million subsidy is a joke and an insult , and proof positive that the political machine that runs this town hasn’t lost a step.
Screw the seniors who want to have their lunch at the Alma Senior Center. Older, low-income types don’t do anything for our city’s prestige or national image. The public trust should be spent on wealthy promoters and rich race car team owners, not the needy in San Jose.
What an elitist place San Jose has become!!!
Pete Campbell
Wasn’t the Grand Prix supposed to benefit cancer research? How much money did it generate for that cause? Did any Councilmember ask? Did any Councilmember even care?
Ed,
I did not confuse the two. The taxpayers obviously invest for the economic health of the entire community.
The tax revenues do not come back 1-1, although there is an offset through a myriad of taxes and fees paid by the patrons of the Grand Prix—but it does not cover the subsidy.
While people “may” have spent their money in other tax producing activities, that money would be spent regionally—not in San Jose—most likely in SF for entertainment.
As for not making comparison’s with other cities, which should be done—it is important to remember that the economies of other areas are not the same as our own.
Which, of course, will lead to the next argument—if they can’t make a profit in this town, where can they make a profit?
Ultimately, like soccer, the Grand Prix is a money losing enterprise for itself and the city. The positive economic benefit to the community is the direct spending and the multiplier for businesses.
Have a beer and a dog while you watch the race and give a boost to the economy.
Rich,
“City officials estimate the total economic impact from the 2005 race at $41.6 million ” which was composed of $23.1 million direct race spending and a estimated 80% multplier for expanding the race spending into the local economy
You are making the common mistake of confusing the city’s total economic impact which is an based on a questionable estimate of the gross amount taken in by local businesses with the very significantly lower San Jose city government tax revenues that the race generated which was only $165,000 while the city spent over $600,000 of tax money in 2005 for the race
In addition to the $4 million actual tax cost in the 2006 / 2007 of which $1.5 million that will go directly to the race to be used at the organizers’ discretion, the deal the council approved Tuesday also calls for the city to provide about $600,000 in free services annually including traffic and parking management, extra fire services, inspections and permits through the remainder of a nine-year contract. ( $600,000 x 9 = $5.4 million ) or a total of about $10 million of taxes and free city services for 10 years
San Jose will start receive $1 per ticket sold or about $150,000 in 2006
There are 2 additional common misunderstanding when accurately calculating a sports entertainment contributions to local economic benefit or tax revenues
1) attributing the total increased economic benefit or tax revenues to the Grand Prix since many local attendees would have spent some of their money on other taxable activities in San Jose if the race was not run thus the total increased tax revenues should be adjusted downward further raising the actual tax costs to the city
2) The use of a sports entertainment economic multiplier effect to increase the local economic impact has undergone detailed economic analysis which was published by Brooking Institute that shows it is between non existent and modest and therefore is little additional tax revenues to offset the tax revenues spent on sport subsidies
San Jose officials could point to no other U.S. city on the Champ Car circuit that is paying as much to host a car race.
A Mercury News review in 2004 of cities with street race courses showed that none had spent more than a few thousand dollars in taxpayer money.
So the question is – Why are we spending this much tax dollars on the Grand Prix when the city staff admitted they did not do complete research or a comparative analysis of other city race subsidies are before the City Council vote
A small race tax subsidy might be justified by further analysis but along with the appearence of a back room deal, incomplete analysis, late pubic notice of the deal details and almost no public participation unfortunately further adds to the recent public mistrust of city government
#22. You ask a great question that seems to have become lost in the hooplah of the auto race: If the event lost money and now requires a city subsidy, did it raise any funds for cancer research?
The charity aspect was used to sell the race to SJ. I have yet to see any accounting for funds raised for The Canary Fund.
Does anyone know?
#27. San Jose’s Ethics Hotline should sell naming rights to Dial-A-Joke.
Re Post #13
Don’t forget to stop by the Valero gas station on N. 13th Street where the San Jose City Council’s (except Nguyen) latest business development concept is clearly working. I’m sure the station is far more profitable and better serving the community now that they have large signs advertising 99 cent cans of beer all over the front of the building.
Whatever happened to the City ethics hot line?Wasn’t that implemented in July of ‘05? Has there ever been a report on it?
Today, a couple of friends and I decided to go too downtown to celebrate one of their birthdays. I got to the pavillion parking lot about 3:54 pm then proceded to go to PF Changs for dinner. As we were leaving PF Changs, I remembered to get my 6 validation stickers for two hours of free parking. After dinner we decided to go see a movie at Camera 12. The movie ended at about 9:00 pm, by the time I got to the garage and up to pay for my parking it was about 9:14. The parking guy tells me that I owe $3.75. I told him I have 6 tickets which are for 20 minutes each, that should equal two hours. The most I should pay is for 15 minutes because parking is free after six. He insisted that parking for 15 minutes is now $1.15 and the tickets don’t cover that amount anymore. I don’t care if the parking is two hundred dollars for 15 minutes, I shouldn’t have to pay since I have two hours of free parking. I’m so piiiiisssed. It’s not even about the money; I just feel like I was cheated. Can anyone explain the new rules to me? Am I missing something?
The Grand Prix was a useless exercise unless you are a hotel or a restaurant. How can you esimate the questionable positive economic impact it had without estimating the demonstrated negative economic impact? My business had to shut down for one day due to clients inability to access the office easily. I still had to pay my staff. I still had to pay my rent and other bills. But access, while not totally cut off, was near impossible and I did not want to subject my clients to the maze. I clearly suffered a negative impact. How many other offices downtown also had to do this? How many more years of this do I have? Why not build a grand prix race course at the fairgrounds? It is mostly vacant land at this point. This city continues to be run by clowns with no serious thought put into other options that are available.
The claim of associated economic benefits is often used to justify spending public money to support private, for-profit sports organizations. However, these claims are not supported by real world results. Over the last 10 to 15 years, numerous systematic, independent research studies by sports economists and sociologists almost universally show that the economic benefits touted by supporters are not real, and, in some cases, are actually an economic loss to the municipality.
One example (among many) of such a study is:
Rosentraub, Mark S., David Swindell, Michael Przybylski, and Daniel R. Mullins. 1994. “Sports and Downtown Development Strategy: If you Build It, Will Jobs Come?” Journal of Urban Affairs 16(No. 3):221-239.
Among the reasons why these economic benefits are illusory are:
1.The private organizers maximize their share of the revenue, at the expense of local businesses. For example, in the San Jose Grand Prix, it appears that the promoters cut out a local brewery in favor of an exclusive deal with a national brand. As a result ,probably most of the beer profit left the city of San Jose.
2.The substitution effect. Most people don’t have an unlimited entertainment budget. Money spent on an event like the Grand Prix then doesn’t get spent on some other activity – a movie, a family dinner, etc. The Grand Prix generates little new money; it just shifts it around. Again, the loser is most likely a local business in some other part of the city.
The evidence from these studies against the ‘economic benefit’ argument is so strong that many advocates of public spending for private sports interests have stopped using this argument, which they know to be discredited. I’m surprised to see San Jose using such vague and unsophisticated ‘economic benefit’ numbers to spend our money. Bad deals like this Grand Prix one can only be made in haste and in secrecy.
Ed,
<City officials estimate the total economic impact from the 2005 race at $41.6 million. However, that figure is not based on an actual survey of activity associated with the race, but largely on an extrapolation of spending patterns for other events held in the city.>
Even this “weak estimate” is off by half, which is highly unlikely, it’s a good investment at $4 million.”
Finfan,
Agreed, the indirect benefits of libraries et al have a net positive effect.
Affordable housing provides a direct benefit to the community, it allows working families and service workers to live closer to their jobs. It allows those librarians, firefighters and police officers that site as essential to our economy to live and work here.
While I accept your argument, the results are less direct and quantifiable.
I was referring to direct economic activity, which is more easily quantifiable—even if the estimates are “weak”.
Ohno,
As far as “backroom deals” go, many of those deals benefit us. It is a hapless and ineffective organization that does all of its business in the public eye. How does one negotiate the best deal for the public if all facts are laid bare?
Next time you negotiate for a car, bring your tax returns and let the dealer know exactly how much you make—so he can determine what you are willing to pay for the car.
Don’t get me wrong, I’m for open government. Once the deal is done, let the whole world see the terms. But some business is best when done in private—even in government.
I know I take an unpopular view in these matters, but walk a mile in a decision makers shoes before you start casting stones—it is not as easy as it looks.
Pete,
Nobody is against feeding the Seniors at Alma Center, except that Darwin of economics finfan.
What cuts have been made? What needs to be restored? Is there not a thousand points of light here in San Jose to pick up the tab?
Most parents learn quickly to see through the fallacy of the ‘everybody else is doing it’ argument in the cause of doing something dumb; I’d hope we can too. And it’s curious to defend a bad idea by comparing it to worse ones.
But I’m pleased to see honesty in your answer – that this is an outright subsidy to a business. Unfortunately, there is still the vague assertion that this is good for the overall economic health of the city. This is precisely the point that the numerous studies have shown to be not true.
All of this is interesting but is secondary to the larger question: Should a major subsidy like this be given with little public or council review? Should a major subsidy like this be given when only the usual suspects (Ron and Cindy) have been briefed ahead of time? At what point do we say we’ve had enough of secret government, inadequate opportunity for public discussion, that a deal is not a deal until it has been properly and fully aired for the council and the public, etc. etc????
Personally I’ve had more than enough of this and am looking for a BIG change at the next election.
Marc,
Ask the restaraunts downtown about the economic downturn during the Sharks strike.
Ask the Mayor of SF, if the Giants and 49ers bring revenue to their City. Why is Oakland trying deparately to hang onto the A’s, when the attendance was abysmal last year (until it became clear they were in a pennant race).
The fact is economic activity from Sporting events does exist. The Super Bowl alone generates hundreds of millions for the host city. The Olympics would be a god send for our economy.
But I will agree that for taxing entities, the revenue coming back seldom replaces the revenues going out. The profit is made by third parties whose economic health is important to the overall health of a community.
It’s a public subsidy no doubt, but it is infinetly and more directly positive for a community than tax breaks for Corporations who provide jobs overseas—which is also a subsidy.
It is better than sweat-heart deals with major Corporations to provide government services at inflated prices, at home or abroad—see Halliburton.
The point is government subsidies exist for most businesses on some level. The economic activity generated by sports events usually goes to small, local business owners and therefore, in my opinion, more of a positive economic stimulus, than say a tax break for Hollywood—ala Arnold’s pals.
I support private financing over public, public-private financing over public financing alone and public financing when the economic/social benefits outweigh the fiscal loss.
If you want to look at wasted money subsidizing business—let’s revise the tax code. It’s the biggest subsidy for business ever implemented.
Downtown’s current parking situation makes for a very negative experience when coming to enjoy our entertainment spots in our city! Light Rail on first and second street should be buried! That way we can have light rail traveling at faster speeds and it would ultimately boost ridership and lessen time spent at stoplights!
Pissed Girl # 28:
I’d say the guy in the booth probably pocketed your $$. I have used a combination of stickers and cash when I enter the lot near Hawgs just before 6:00 p.m. They only charge me for the time before 6:00, which I pay for with stickers. The rest is free.
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