Probably not, particularly for those shows struggling amid Branson’s current marketing and economic climate. Does the possibility of the city of Branson helping finance new businesses, to compete against them, sound like the type of Christmas gift they would enjoy getting?
“Get off it Seagull; competition is just part of doing business!” “Can’t believe you just said that! Fair competition is one thing. The city of Branson helping to finance that competition, especially within the economic tourism environment many Branson shows and other tourist related businesses find themselves in, is another!
Branson shows compete amongst themselves, and other businesses, to get Branson visitors to spend “time” and “money” in their theatres. Of the two, in the opinion of an Ole Seagull, “time” is the most important. Chances are slim that a Branson show or business will generate much revenue from someone who’s not spent time in their theatre or establishment.
It makes no difference, whether it happens intentionally or otherwise. It’s a no brainer, if someone is spending their time or money with someone else they are not spending it with you. “That’s true Seagull, it’s called ‘competition’ and is an inherent part of doing business.” “Only if everyone is playing on a level playing field. That’s not the case however, if the city’s ‘reimbursing’ a substantial portion of the development costs to help establish competing businesses.”
In general terms, that’s what a TIF (Tax Incremental Financing) does. Obviously, if city financial assistance is used for a portion of the projects development costs, as opposed to those who received no such assistance, that gives them a financial advantage over those businesses that received no such assistance.
Of equal importance, it creates a competitor that, presumably, wouldn’t be there, but for the interference of the city with the normal competitive process. Again, a situation that is exasperated because of the current environment many Branson shows, and other tourism businesses, find themselves in.
“But Seagull, if a TIF is used to develop a ‘Blighted area,’ create new jobs, enhance the economy, and not for the development of ‘commercial businesses which unfairly compete in the local economy,’ is that a bad thing?” “Absolutely not, but that’s a big ‘If’!'”
It’s one thing to develop new businesses in “blighted areas ” that will diversify Branson’s economic base and provide good paying jobs. It’s entirely another however, to use a TIF for a project in an area, “blighted” or not, where the result is a project that not only competes directly against existing shows and businesses, but creates more of the same relatively low paying jobs that Branson is trying to negotiate with Puerto Rico to get enough people to fill now.
“But Seagull, the city gets more in taxes from the land after development than before isn’t that a ‘win-win?'” “Not necessarily; in Branson, it’s a tad more complicated than that.”
If the revenue and increased taxes are simply a redistribution from the cannibalization of other businesses then, at a minimum its an exercise in futility. At its worst, it penalizes existing shows and businesses, putting them at a competitive disadvantage. It’s one thing if it happens fairly and openly in the market place. It’s an entirely different thing when it happens because the city, that the existing shows and businesses are paying taxes to, intervenes with financial incentives to help create a competitor that would otherwise not be there.
“Why Seagull, one could get the impression that you are against any TIFs.” “That would be an erroneous impression. Just those that don’t substantially increase the number of new visitors coming to Branson; develop projects similar to already existing shows and businesses that then compete against them for the time and business of Branson visitors; or don’t create a significant number better, higher paying jobs, than those routinely available in Branson today.
“”Well Seagull it appears that there are two TIFs on the horizon, one a big water park development on the western edge of Branson and one involving turning the RFD theatre into some sort of hillbilly dinner venue. What do you think?”
“If the answer to the first two of the following questions is ‘No,’ and the third is ‘Yes,’ not much. Will the project increase the number of new visitors coming to Branson substantially? Will it create a significant number of better, higher paying jobs, than those routinely available in Branson today? Will the project directly compete against a similar type of existing business for the time and business of Branson visitors?”