A wise investment – Our view: Lazy Loon abatement good for Glencoe

At its meeting July 15, the Glencoe City Council directed the city attorney to work on a property tax agreement between the city and Lazy Loon Brewery and Restaurant. The proposed agreement is the first step in granting a new business in Glencoe a small subsidy that will help transform an empty, under-utilized building on East 13th Street to become a greater contribution to the city, its downtown area and the business community. Additional consideration to the request will come next month when the proposed agreement is expected back before the council.
We hope the city and Lazy Loon are able to complete a property tax abatement agreement for a variety of reasons. Though some may oppose a business receiving a tax break, it is a wise investment in the commercial tax base.
Lazy Loon owner Jon Lueck has purchased a building that sat relatively empty for years. He is investing significant resources into its transformation from a large, walk-in closet to a small brewery and restaurant. The McLeod County estimates the building was worth just over $256,100 for property tax purposes when Lueck bought it. The county estimates it will be worth about $350,000 when he opens the business. That value will surely increase over time.
The building generated $3,187 annually for the city before Lueck requested just under $14,000 in property tax abatement over five years. Its annual tax contribution will grow to an estimated $4,566. The business will bring new jobs into downtown Glencoe and will also contribute to the downtown area’s revitalization.
It is, in two words, a good value for Glencoe.
But there is still more work to do. While the abatement for Lazy Loon is a good investment for the community, the city needs to refine the process and add criteria for companies receiving tax abatement from the City of Glencoe to pay livable wages. The council will consider that potential requirement in the next step of the abatement approval process.
Dan Ehrke, assistant city administrator, said the business subsidy policy hasn’t been updated in several years. Sadly, the state of the economy hasn’t generated many requests.
If the city is going to invest in bringing businesses to Glencoe to expand and diversify the property tax base, shouldn’t there be some requirement that brings employees to be part of the community? We think so.
Ehrke says the issue of livable wages for full-time employees hasn’t been an issue previously. We hope the council will address it with both the application from Lazy Loon as well as future other applicants. Paying livable wages will allow employees of businesses a better chance at living in Glencoe and contributing to the community and local economy. In a way, a livable wage requirement would help create a cycle of investment: The city to the business, the business to its employees and the employees back into the community that invested in the employer.
Some will argue government should not try and dictate what an employer pays its staff, which the free market will take care of levels of compensation.
That argument is sound, unless of course a business wants a subsidy from the local government. It also makes sense to try and keep folks who work at businesses receiving assistance in town to avoid an outflow of commuters and all they might contribute to the community.
We hope the Lazy Loon is wildly successful in the years to come, employs many hard-working people and contributes mightily to the greater community. If so, its success will make the business subsidy a wise investment.

-jm