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The deals: Great Wolf vs. Amazon
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The deal of the century — at least from the perspective of the City of Manteca at this point in time — is in what apparently are the final stages of negotiations.
In the end, if all goes according to plan, Manteca will have:
uA 500-room destination resort hotel, the largest by far in the Great Central Valley.
uA massive indoor water park that would likely impress even the late Budge Brown, the founder of the now defunct Manteca Waterslides who was considered the father of the modern waterpark.
u500 more private sector jobs with an annual straight impact in terms of all payroll costs of $20 million.
uSome $1.7 million flowing directly into the city’s general fund to support municipal services on an annual basis after the first full year of operation.
The deal revolves around two key factors in terms of public money — the investment of $8 million plus in infrastructure and the splitting of room tax that a Great Wolf Resort would generate over a 25-year period.
The city is emphasizing the $8 million would have been spent on extending services to south of the 120 Bypass to handle with growth. That’s probably the case but remember the $8 million was fronted by collecting redevelopment agency taxes on existing homes and businesses within the RDA boundaries and not from developers per se.
You could make an argument the $8 million should have been funded by all the new home buyers south of the 120 Bypass. It’s a legitimate point but given it’s all been spent and is in the ground makes it not the deal point that should get all of the attention.
Instead city leaders should be held accountable on the $1.7 million annual cash flow projected initially from the project that is expected to increase as the years go by as the room tax split shifts to the city’s favor over the course of the 25-year term of the deal and/or the city ups the room tax with 100 percent of the increase going to the city.
Even though the room tax Great Wolf will generate is money the city would not generate without a waterpark project so would the sales tax coming from a Dillard’s department store if one happened to build here.
The big difference is the city is giving up some of the taxes commercial-style growth would be obligated to pay in order to make the numbers work for a private sector investment in excess of $250 million.
Philosophically this creates an issue over what government’s role should be in trying to spur or secure economic development. It’s a legitimate question. And it is not a new issue by a long shot.
Governments have made concessions and offered incentives for decades, if not centuries, to snare economic development. Spreckels Sugar in Manteca is one such example as were the extensions of streets, sewer, water, and such in the mid-20th century on the dimes generated by property taxes to get people to build homes and industrial concerns.
Thanks in a large part to Proposition 13 and other changes the “stealth” investment of public funds to lure business has essentially disappeared. In its place is the somewhat repulsive act of exchanging cash to snag a private sector concern.
The best deals are the ones with clear benchmarks and can be tracked not in terms of economic multipliers but exactly what direct positive financial impact a benefactor receiving government funds provides for the jurisdiction in question.
Then there are the Amazon deals of the world. Twenty cities have made the initial cut needed to provide Jeff Bezos with more details on how they will shower one of the world’s highest valued companies with trainloads of tax credits and such if they will chose their city for the firm’s second headquarters.
From what we know to date, none of the proposals are based on hardcore benchmarks in terms of cash flowing into a specific city’s treasury other than the somewhat nebulous economic multiplier of the promise of 50,000 jobs.
There is nothing to gauge what a specific city is giving up directly to what Amazon will be doing directly for them. Economic multipliers — the measurement of how many times a dollar spent or a dollar paid to an employee circulates in a community — are not a precise measuring tool.
If a city gives up $100 million in tax credits to get Amazon, how long will Amazon per se take to directly return that to the city in terms of tangible measurements such as property tax?
The Great Wolf deal that’s on the table — aside from the $8 million of infrastructure the city could legitimately argue the project is piggybacking on — is measurable.
The city’s share of the room tax as well as general sales tax, public safety sales tax, and property tax they don’t share that flows directly into the municipal general fund from Great Wolf  can be counted.
Compared to any of the frameworks of the various Amazon deals that have been shared with the public, the outline of the Great Wolf deal provides real, solid money benchmarks and not fuzzy ones.
The risk is essentially all on the private sector.
You may not like any kind of so-called “corporate welfare” but with how the world works today the proposed Manteca deal is much more pragmatic. It also comes with a truckload of economic benefits that are more in the fuzzy range whether it is the economic multiplier of a $20 million all-inclusive annual payroll or the drawing card Manteca would have from a destination resort at its front door.

This column is the opinion of executive editor, Dennis Wyatt, and does not necessarily represent the opinion of The Bulletin or Morris Newspaper Corp. of CA.  He can be contacted at or 209.249.3519.