What’s Going On With Downtown Incentives
By Mickey Howley
Higher education is one of those crazy economic realities you might just figure out too late. It is the only situation when you pay good money and if you’re getting shortchanged in terms or service or product you don’t feel cheated or mad.
You pay…or your parents paid…big bucks for that education and if per chance you did not apply yourself diligently and had easy assignments or generous grading, well you’re getting actually less than what you paid for and happy about it. I’m talking undergraduate education here. Maybe a little personal experience, too. I look at these Main Street conferences like graduate seminars, so I’m sitting up front, paying attention, taking notes because I want to remember, but I also don’t want to gyp myself.
So one of the many informative sessions two weeks ago at the National Main Streets big show in Atlanta was by Place Economics. They looked at how targeted businesses incentives can help in achieving results. I realize this is not sexy stuff for most folks and incentives are not a cure all, but targeted incentives can certainly make a difference. I’ll talk about what they suggested in my next column, but first here’s a refresher course on what is already going on downtown in terms of business and building incentives.
There have been several incentives via the WVMSA. The one we have done the most and the one most Main Street associations use, are facade grants. Those are matching grants up to $500, so work must at least total $1,000, meaning minimum 1 to 1 matching ratio. The actual effect is greater, with 11 façade grants completed; the ratio is just shy of 10 private dollars to 1 grant dollar. So it has been a small, but highly productive incentive tool.
The WVMSA also has a low interest loan arrangement with Mechanics and Renasant Banks for up to $50k. The loan target is building improvement. Several people have made these loans, either for systems upgrades (think A/C) or part of a larger loan package.
The incentive that Place Economics folks Donovan Rypkema and Briana Paxton talked about is our Creative Economy Grant coming through the Mississippi Development Authority. It also is a minimum 1 to 1 matching grant limited to $2,500. The general purpose is to assist CE businesses to purchase durable equipment that will help them bump up their game a notch.
Again like the façade grant, very specific and small, but hopefully with impact far greater than the dollars would suggest.
The biggest incentive currently for downtown Water Valley is the federal and state historic tax credits. There are 84 buildings eligible for these credits in the downtown district. That’s about 80% of the commercial buildings. The way the incentives work is you must first do the work of fixing a building and then you get a direct dollar for dollar credit on your taxes. It can be pretty serious money, with up to 45% of the cost of renovation. So with an average WV Main Street building rehabilitation costing $100k to $150k, that’s $45k or better in money back.
Not chump change and really makes a difference. That’s what has been going on for downtown incentives.