Last week Clayco CEO Bob Clark made a guest appearance on KTRS to discuss the Centene expansion being proposed in downtown Clayton. The discussion touched on zoning and planning issues between the Fortune 500 Company and local residents, but the heart of the broadcast explored the reasons that Centene should receive tax incentives for the project. To pull a few quotes from Clark:
“Incentives are kind of a funny thing to get your head around…we don’t get a check, we actually get a small increment, a small discount on the overall taxes that we pay.”
The small discount mentioned is quoted at $78 million from property tax abatement and another $35 million off of income tax bills. There may not be a check in the mail, but public funds would go towards the development’s costs all the same.
“Centene has shareholders; they have a responsibility to be responsible with their dollars and with their investment.”
I absolutely agree, and it seems that the company is doing an excellent job of growing and increasing revenue, but the City of Clayton also has “shareholders” (aka taxpayers) and a responsibility to be responsible with public dollars. If an expansion might take place anyways, then does it make sense to spend tax dollars on attracting it to an already successful business environment?
“This is a company that is growing really, really rapidly, and so in the long term it’s highly likely and most possible that Centene will occupy these buildings completely”
In 2015 Centene was named the 4th fastest growing corporation in America, and it’s great to hear that the company is interested in such an extensive expansion in the Clayton community. However if the plan is to occupy their buildings completely, then why is there a proposed expansion on the table while the current headquarters still leases out about half of its office space?
“There’s very, very low vacancy in the market right now, the market has done extremely well.”
Clayton has been a very successful city when it comes to attracting developments. The area has recently been referred to as the St. Louis region’s new downtown. Still the question is posed that if the area is successful and is experiencing a low vacancy rate, is spending millions to subsidize a large development really the healthiest use of taxpayer dollars?