McAlester News-Capital, McAlester, OK

State news

October 3, 2013

City pursues business

ENID, Okla. — About 15 years ago years ago, before the Enid Regional Development Alliance formed as a nonprofit agency separate from the Greater Enid Chamber of Commerce, the city budgeted only $50,000 for economic development.

Executive Director Brent Kisling said the growth since then is what shows Enid is one of the most aggressive pursuers of new business in the state, considering ERDA’s allocation from the city of Enid has ballooned to $600,000. ERDA also receives funding from the Garfield County government and other sources.

Map of businesses receiving incentives

Historically, Kisling said, Enid has been a town that just lets things happen.

“If somebody wanted to set up a widget manufacturing company, we would help them get their licenses and permits, but there really wasn’t a coordinated marketing effort for the community and an incentive package that would put us at the top of the pile,” he said.

Kisling believes the economic climate now, with more online storefronts and easy ways to transport a product, the focus on a business’ location means less and less.

“The actual place where you set up shop is very competitive. It could be anywhere,” he said.

Benchmarks

On that premise of a mostly equal playing field, the city and ERDA have turned out millions in public money to businesses — luring them here, helping them get started or simply by keeping the doors open.

By offering help to industrial and retail outlets, the idea is seen as a benefit to the city and county as a whole. The former Homeland grocery store building at Oakwood and Garriott had sat empty for eight years, a vacant pizza restaurant stuck out on Enid’s main north-south thoroughfare, and another building along the high-value Garriott commercial corridor had been empty for several years before Enid and ERDA offered an incentive to Flaming Auto Supply Co. to open a new store there.

Kisling said renovating vacant or blighted buildings is one of the benchmarks a retail outlet must meet to get help from ERDA. They also can increase Enid’s trade area by attracting customers from other towns, and they must prove they can increase the total sales tax revenue instead of cannibalizing business from other shops.

Universal Management & Maintenance was lauded for picking the former Cheezie’s Pizza for their new consolidated operation.

“It’s not a huge sales tax generator,” said Kisling, “but they’re taking what used to be a convenience store and then an old pizza place and it’s going to be beautiful when they’re done with it.”

 

Caveats

While the money allocated for economic development technically can be called public funds, the program’s supporters say it’s money that wouldn’t be around in the first place.

“They’re only sharing funds that they never received and that aren’t allocated to something else,” said Johnny Peart, owner of the Broadway Tower, which is being partly renovated into a hotel.

Peart will receive a percentage of sales taxes back on the rooms he rents.

ERDA doesn’t just hand out checks to attract business, although Kisling said that’s the trend in economic development.

“We don’t do that in Enid, nor would I support us doing something like that in Enid. You’ve got to perform in order for that incentive to be paid,” he said.

Pelagic Tank received a commitment of $180,000 so they could lease a building in Enid. First, though, they have to meet payroll benchmarks and to date only three-quarters of the money has been paid.

“We’re in the 70-employee range right now. We would have more if we could find qualified people,” said Pelagic co-partner Glen Snapp.

At Jumbo Foods’ Save-a-Lot South location, which opened with help from an incentive based on performance and sales tax revenue, ERDA has sent back a little more than $16,000 out of a $250,000 commitment. The store has seven years to make that money back before the incentive expires.

That policy is fine with Peart, who hopes to have stylish hotel rooms ready to rent before the end of the year. Giving an economic development incentive, he said, isn’t picking a winner or unfairly influencing business development.

“A city can’t lose if nobody was going to buy the building anyway, and they’re giving back tax dollars that they wouldn’t have otherwise earned,” he said. “It appears like a fantastic thing for the developer, when in actual fact it means nothing. You’re not giving me anything until I show you what I can do for you.”

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