Council Infighting A Bottom-Line Issue

This is one in a series of stories about issues that may affect the Spokane City Council elections.

What can City Council members do to improve Spokane’s economy?

Stop squabbling with one another and with the county, say the city’s business boosters.

Council members have clashed frequently over whether City Hall has done too much for downtown revitalization and not enough for the economic development of other parts of Spokane. At the same time, some city and county officials are at odds over where future growth boundaries should be drawn and how much land should end up inside the city limits.

There aren’t a lot of options available to City Hall to pump up the local economy, but one of the most effective steps the council could take is to create the impression of unity and stability, said Dan Kirschner, the Spokane Area Chamber of Commerce’s director of public affairs.

“We like to have people in City Council who are looking to work together to solve issues,” Kirschner said. “There’s too much divisiveness, finger-pointing and pitting factions against each other.”

There can be a direct relationship between civic harmony and economic growth, said Michael Edwards, president of the Downtown Spokane Partnership.

“Whenever someone is thinking about investing in the community, they want to have some assurance that the city is stable,” Edwards said. “If there is political unrest, it becomes a less attractive place to invest.”

This fall’s council elections will be full of discussion about economic development.

Long a concern of Spokane’s business community, the city’s slow rate of growth got more attention when Forbes magazine ranked Spokane 161st out of the 162 best cities in America to do business.

The Forbes study gave added weight to cities that are attracting high-technology businesses. Spokane’s economy traditionally has been service-oriented.

The article led to a symposium series of meetings focusing on shoring up Spokane’s growth and poverty problems.

The series was devised in part by real estate developer John Stone and technology businessman Bernard Daines. Stone, Daines and others have been critical of Spokane’s failure to attract new businesses, specifically the high-paying technology companies that have fueled the booming U.S. economy.

That’s a concern shared by members of the City Council, but they sometimes clash over how to address it.

Mayor John Talbott and Councilwoman Cherie Rodgers have frequently disagreed with the council majority on development issues, questioning if too many city resources are spent enhancing downtown through support of the River Park Square retail project and the proposed expansion of the convention center.

Supporters of those projects contend that a strong downtown is essential to creating a strong city and enhances the region’s ability to lure new businesses.

While citizens cast about for solutions to Spokane’s economic woes, they shouldn’t necessarily look to the City Council for all the answers.

The city is limited in what it can do to entice businesses to relocate to Spokane, said Assistant City Manager Dave Mandyke.

The city can offer tax abatements on city-only taxes, such as utility taxes, but “we’re not going to be able to do anything about state taxes or countywide taxes,” Mandyke said.

Due to state law, the city is also unable to make use of tax-increment financing, which freezes taxes for specific developments.

A port district, which would collect taxes to finance roads, sewers or land for recruiting businesses, is a development tool used by 76 communities throughout Washington but was crushed at the polls in Spokane in 1983. It has not been put to a vote since.

But there are steps the city could take to address the business climate.

One already under discussion is a proposal to streamline the permitting process for new buildings and businesses. Another would be to create a new job at City Hall for an “economic development champion,” Edwards said.

“The city of Spokane, like many cities, has become extremely bureaucratic, so when investment opportunities come to the city, they get caught in a morass at City Hall,” Edwards said. “What is needed is something that can shepherd someone through all the processes in an efficient and an effective way.”

The trick, however, is not to let the champion become part of the problem, Edwards said.

“Other cities have entire divisions doing this and they become so big that they have their own bureaucracies,” he said.

The region’s lead job-recruitment agency, the Spokane Area Economic Development Council, currently receives $80,000 of its $850,000 annual budget from the city, with an equal portion coming from the county and the rest from businesses.

The EDC’s goal this year is to generate 1,000 new jobs, but at mid-year it had landed two new business - with six jobs. The agency did better last month, announcing that Safeco would open a Spokane call center that should employ 200-250 people next year, and as many as 370 soon after that.

Bigger contributions from local governments might help, but “that’s not an issue I’ve given any thought to,” said Mark Turner, EDC president. “There is no strategy right now to ask the city for more support.”

One potential objection to increasing the city’s contribution to the EDC is the EDC’s regional focus: The agency recruits jobs for all of Spokane County, not just the city.

But if the city wants to grow economically, it has to think regionally, said Kirschner of the Chamber.

He pointed to a current dispute between the city and county surrounding the city’s waste-water treatment facility. At issue is whether the city should allow additional county sewage to be treated when the plant expands.

“If you have no waste-water treatment capacity outside of the city limits because the city is looking to itself, we have a problem,” Kirschner said. “Lots of businesses that want to locate here need that water.

“The city doesn’t reside by itself. It affects the rest of the region and its actions affect the rest of the region.”

The same holds true for the implementation of the Growth Management Act, another issue that directly shapes regional development and is the subject of city-county friction over setting urban-growth boundaries.

“All of these sorts of things have an impact not just to the attraction of new business but to development of existing businesses,” Turner said. “The ability that municipalities have to resolve their differences will go a long way in determining the future of economic development.”