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Council passes IFSA resolution

By John Larson

Tacoma Weekly
jlarson@tacomaweekly.com
Published on: June 19, 2008

Tacoma City Council took several steps June 17 toward keeping Russell Investments in town. The financial services firm has outgrown its current world headquarters in downtown and has indicated it is considering moving.

The council passed a resolution establishing an International Financial Services Area. It calls upon City Manager Eric Anderson to develop a strategy to attract other financial services firms to a designated area downtown. Anderson has previously stated that this is part of a wider plan to locate such firms in Tacoma, and is not entirely about keeping Russell in town.

The council heard the first reading that would reduce the city’s share of the business and occupation tax for financial services companies, and eliminate the tax for this sector by 2013.

The meeting included a public hearing on establishing a Revenue Development Area (RDA), which would consist of 658 acres downtown. The city might be able to retain state sales taxes and some property taxes generated within this zone, which would fund infrastructure improvements and create additional parking spaces.

The city will have to apply for the state tax revenue by the end of the month. It is a competitive process with numerous other cities expected to apply, so there is no guarantee Tacoma will be approved. If it is, it could retain up to $1 million a year in state taxes for 25 years. The state will announce the cities selected for the program in September.

Several business leaders spoke in favor of creating the RDA.

“The city is putting its absolute best foot forward,” said Bruce Kendall, president of the Economic Development Board for Tacoma/Pierce County. “This is a way to keep money that is generated in Tacoma here in Tacoma.”

David Graybill, president of Tacoma/Pierce County Chamber of Commerce, said it would not increase local taxes. The state revenue would improve and enhance downtown, he added.

Keith Stone, president of the Dome District, said he supports the RDA but wants to see more emphasis on retail and residential with the parking stalls, some of which are slated for his neighborhood. “We don’t want to become just a parking garage.”

Tom Luce, executive director of Executive Council for a Greater Tacoma, said the funding for parking, utilities and streetscapes downtown will benefit the entire community. “It is important to emphasize that LIFT financing does not take money away from neighborhoods,” he said, using an acronym for the state funding mechanism.

Jake Carton of the labor activist group Jobs With Justice said he could support funding for infrastructure that benefits everyone, but he expressed concerns over what he labeled “a corporate subsidy.”

Ed Hawkins claimed he came up with a similar proposal, which he called “Tacoma Square,” and presented it to Anderson some time ago. He inferred that Anderson is using his idea without giving him any credit or financial compensation.

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