|Go Back to the Drawing Board with the Promise|
|Commentary/Politics - Guest Commentaries|
|Written by Jeff Ignatius|
|Tuesday, 10 February 2009 21:46|
For the sake of argument, let's say that the Promise program will be the panacea for Davenport that its backers claim it will be. People will flood into the city because they've been promised college tuition, vocational training, or (if they're in the military) a homestead grant. Enrollment in the Davenport Community School District will reverse its nearly-two-decade-long trend of decline - thus ensuring a greater amount of state education funding, which is distributed on a per-pupil basis. And the increased aggregate property value will bring new riches to city government and the school district through property taxes, thus allowing them to lower the property-tax rate.
Even if all that is true, the backers of the Davenport Promise have structured the program all wrong.
They've chosen a convenient funding mechanism - reallocating a portion of the city's 1-percent local option sales tax - rather than one that assigns the risk to the primary beneficiary: the school district. They're engaging in bald provincialism to bribe residents from other parts of the Quad Cities, which in the end brings little benefit to the community at large. And they're pursuing public funds before they've offered any evidence that private resources aren't available. These are structural deficiencies that burden taxpayers unnecessarily and limit the Promise's benefits to the Quad Cities region.
For those reasons, Davenport voters should send the proposal back to the drawing board on March 3, when a referendum appears on the ballot.
Full disclosure: I am a resident of Rock Island, and those with long memories might recall that I've twice been critical of the Promise proposal. (See "Building a Better Promise," River Cities' Reader Issue 654, October 10-16, 2007 , and "Promises, Promises," River Cities' Reader Issue 712, November 26-December 2, 2008 .)
Despite my problems with certain details and assumptions, though, I would support some public funding for a Promise-style program if it made two major changes, and I remain hopeful that a better Promise proposal can be crafted if this one fails.
Problem One: An Unbalanced Risk/Reward Equation
Here's an obvious question that I haven't heard asked: Who would benefit most directly from the Davenport Promise program? The Davenport Community School District, with state aid for each new student enrolled.
Here we get to one of the defects of the program as proposed. A secondary beneficiary (the City of Davenport) assumes all responsibility and risk (through its taxpayers), while the primary beneficiary contributes nothing.
So why isn't the school district the funding body?
Because the school district by law can't fund such a program.
But there's nothing to prevent the district's foundation from doing it.
Except the school-district foundation can't levy taxes.
Hold on a second. Has anybody proved that the Promise can't be funded privately here?
The most logical thing would be for the Davenport Schools Foundation to take the lead, especially considering that it claims, according to its Web site, to be "actively involved in raising funds from private and corporate sources which support scholarships and enrichment programs throughout the district." That sounds like a perfect match for the Davenport Promise.
But this is still thinking small, and still thinking provincially.
Instead of the Davenport Promise, make it the Quad Cities Promise. Expand the scope, and get school districts to compete for families that would be attracted to the area because of the program. Get lots of local foundations and corporations involved in a sustained, community-wide fundraising campaign.
Problem Two: Public Money First
The rule of thumb with government incentives such as tax increment financing is to give the smallest amount necessary to make sure the project happens. So why did Promise supporters go to taxpayers first?
Bluntly, because they figured passing a referendum would be easier than raising the money.
Critics of the Promise point out they'd be all for it if, like the Kalamazoo, Michigan, program on which it's modeled, it were funded through the private sector. (One donor funds the program in Michigan.) And who wouldn't support that?
But a task-force report claimed that "assembling completely private funding for the Davenport Promise has been deemed impossible by professional fundraisers in the community." Notice the word choice here: completely private funding.
Say that's true, that it would be impossible to raise all the private money necessary to fund this program for Davenport, let alone the entire Quad Cities.
Let's see how much we can raise, and let's make it less provincial by making this a benefit for all families in the Quad Cities. And let's challenge our corporate citizens - those that fret about a brain drain, those that claim to want educated and trained workers - to step up.
If a Promise program works as intended, the beneficiaries include every company in the Quad Cities. The influx of people - and the increased education of the population through the program - ensure a strong, large workforce. Corporate contributions to the Promise wouldn't be donations then; they'd be investments. This would also address the suspicion that local companies don't think the Promise would be effective at its stated goals.
Let's set a target of funding the program's anticipated costs through an endowment, figure out how large it needs to be, and see how much can be raised in five years, with the understanding that the contributions are contingent on the program actually moving forward. The Davenport Promise was estimated to cost $4 million a year in benefits by 2018, and if the program were expanded to the remainder of the Quad Cities, I'd guess that the annual cost would be near $15 million a year. Admittedly, that would need to be one big-ass endowment.
Can we get there? I don't know. I'd like to see us try.
And after five years (or perhaps 10), we can go to taxpayers for the remainder, after we've exhausted all private resources.
Would a bi-state referendum be messy logistically? It could be; it might also be as simple as a ballot measure in Scott and Rock Island counties.
But I'm hopeful that we wouldn't need to ask taxpayers for anything.
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