July 5, 2009

Taxpayer Money in the Chamber's Pot

I am not a teabagger. I do not think the world is coming to an end because I have to pay taxes. I prefer government to anarchy. But I get really irked when government uses taxpayer money to prop up businesses.

When it comes to business, I am pretty much of a purist. In a capitalist system, businesses are seeking to make money. I'm all for it. Competition, entrepreneurship, making a profit, it is all fine. When government and business get in bed together, that's when things get messed up.

In my last post I wrote about how skewed and screwed up the budget gets when redevelopment agencies offer incentives to selected businesses. I don't think it is in the public's interest for government to decide which businesses should leave town, and which should be bestowed with millions of dollars in taxpayer subsidies. I'm also not too keen on governments, like our Poway City Council, handing out grant money to the local chambers of commerce. This year, the Poway Chamber is asking the Council for $36,300.Chamber Grant Request

The Poway Council started giving the Poway Chamber of Commerce a little pot of money many years ago. Originally, they gave them a share of the T.O.T. (transient occupancy taxes). At the time, the Chamber ran something called a "visitor enhancement" program. The visitors were "economic tourists", people the Chamber tried to get to come and shop in Poway. The program has changed only slightly over the years, but the grant for the Chamber is now coming out of redevelopment funds instead of T.O.T taxes.

I visited the Poway Chamber and asked President Luanne Hulsizer just what the grant was going to be used for. Ms Hulsizer, who was very cordial and professional gave me a document outlining the distribution of funds.
Of the $36,300 that the Chamber is asking for, $25,000 of it will go for administration, staffing, rent and supplies, in other words, a subsidy to the chamber. Another $2000 will go for the printing of "Shop Local" cards, $1400 for merchant decals, $1000 for printing a restaurant guide, $400 for membership in SD North Con/Vis, $3000 for the "State of the City" breakfast, $1500 for sponsorship of the Business Expo and another $1000 as an incentive to green businesses at the earth day festival. And $1000 for something that will be on "you-tube."

Most of the events, like the State of the City breakfast, the business expo, and the street fairs are actually fundraisers for the Chamber. According to the Chamber's 2007 IRS 990 tax return, they made $46,644 from the street fairs, $19,223 from the Business Expo, and $113 from Poway Days. No wonder the Chamber is no longer interested in sponsoring the Poway Days Parade; they are not making money off of it.

The goal of the Chamber is to "encourage and benefit the business community." They provide their members with the opportunity to network with each other and help them advertise themselves to the community. It is really about them, not us, the residents of Poway. And although they are subsidized by the city to promote the "Shop Poway" program, the Chamber does not always choose Poway first. This year's "State of the City" breakfast was held at Bernardo Heights Country Club. The Chamber's IRS forms are signed by a Rancho Bernardo tax accountant. And why not? The accountant and the Bernardo Heights Country Club are members of the Poway Chamber. Ms. Hulsizer said that about 60% of the members were Poway businesses, and about 40% were from somewhere else, mostly San Diego and other North County cities, although none of those cities help to subsidize the Poway Chamber. Poway does benefit from the regional interaction of the group members but they also lose business to competitors within the group that are located in other cities.

The grant will also help pay for a restaurant guide. The "guide" is a single sheet of paper with the names of restaurants and the name of the shopping center that they are located in. I've lived in Poway for over 30 years and I don't think I could name a half a dozen shopping centers in town to save my life. Just saying. I noticed that most of the restaurants in the guide are in Poway, with the exception of a handful, like, El Pollo Loco on Scripps Poway Pkwy and Panera Bread in Carmel Mtn Ranch. But who looks for a restaurant from a list on a piece of paper? My son got a new ipod phone recently. He showed me how he finds restaurants with his ipod application. He can see the location, the price range and the type of food served with a few clicks. That is how people shop for a place to eat nowadays. Just saying.

Ms Hulsizer also clued me in as to what the City did with the nearly $1000 they spent on "Shop Poway " bags. Apparently the Chamber stuffed the bags with some of their brochures and the restaurant guide and gave them out as welcome gifts to the employees of General Atomics. That's nice, but I would prefer if the restaurants that are named in the guide pay for those bags instead of the taxpayers.

I support the Poway Chamber members efforts to promote their businesses and to network with each other. There are other groups in town, even other business groups that do the same thing, although they may be smaller. I know of a Poway real-estate group that meets in the community center every Friday for an update on which homes have gone up for sale in Poway. That group is not subsidized by the City, in fact, they have to pay to use the room. Recently they were told that the city would no longer set up the tables and chairs for their use. I get it. The city is hard up for staff. So the paying customer gets stiffed, while the city shells out taxpayer money to a group that is only partially from Poway and wants free use of the streets for their fundraiser. And the City even sends someone over from public works to help close off the street and open it back up. Gratis. That I do not get.

I think the Chamber members will do a much better job of advertising themsleves if they use their own money. And if the City really wants to help businesses stay afloat, well then, why did they put a Wal-Mart in the center of town? And why would they even think of expanding it to a superstore? Just saying.


Anonymous said...

The City of Poway and the Poway Chamber of Commerce should have similar objectives regarding the economic and community strength of the city, and support and cooperate with each other in their endeavors. So it bothers me that the city is paying the chamber to perform the duties described here, when the chamber should be supporting these activities as part of their mission; i.e., "The mission of the Poway Chamber of Commerce is to provide leadership, education, and advocacy to strengthen and enhance economic prosperity for its members, businesses, and the region."

I think you are on to something when you mention that about 40% of the Poway chamber's members are from outside of Poway. This dilutes the chamber's focus on Poway, and the city's only option may be to contract and pay the Poway chamber to give specific attention to Poway.

One interesting note in the grant request reinforcing the need for this contract -- On page three of the actual request (page 12 of the agenda item), item b, regarding the State of the City Breakfast -- the last sentence reads, "The Chamber will assure that this event will be held within the Poway city limits."

Chris Cruse said...

The goal of the "Shop Poway" program is to get folks to shop in Poway. The goal of the Chamber is to get people to shop at their businesses which are located in Poway, Carmel Mtn Ranch, San Diego, even Temecula and out of state. There is a conflict in their basic mission.

"Shop Local" cards that are a part of the grant are discounts at member's places of businesses. They will be available to Chamber members and to the public who attend a Chamber function. In the past, the Chamber has used taxpayer money to print these discounts and distributed them to their members exclusively. So I guess it is an improvement that some of the taxpayers who paid for it can get a discount if they happen to come across one at a Chamber function.

Ms Hulsizer said that the Chamber would continue most of the activities even if they did not get the grant from the City, although they might not do the State of the City breakfast or incentivize a green business at the Earth Day festival. I have often wondered why the State of the City message wasn't delivered directly to the people of Poway in the council chambers, instead of at a Chamber fundraiser.