Wednesday, March 18, 2015

Angie's List Proposal On Brink

It appears Angie’s List is about to get what it wants: $18.5 million in our tax dollars, courtesy the Indianapolis-Marion County City-County Council.

As you may remember, a proposed plan in front of the Council hands Angie’s List an $18.5 million shot in the arm and will allow the company to buy the old Ford plant and build a 500-car parking garage. The promise from the company is 1,000 new or relocated jobs to Indianapolis by 2019. 

This is the second time that the proposal passed through the Metropolitan and Economic Development Committee., the full council sent the proposal back to committee at its March 2 meeting. Final adoption of the Angie’s List proposal could come as early as the March 30 full Council meeting.

It’s true that Indianapolis struggles to find good economic development projects outside of the mile square and especially in areas like the Near-Eastside. With that said, we cannot have an “any port in a storm” mentality when it comes to vetting these deals. Angie’s List, by its own performance, has left a number of questions as to whether it can or ever will live up to its end of the bargain. I have no doubt that the organization is solvent and isn’t about to go under, but how can we trust a company that has rarely turned a profit and just reduced its workforce by 97 jobs in August?

I just think it's too questionable.


Paul K. Ogden said...

Not only that, Jon, but I have tried to get ahold of document(s) outlining the Angie List promises and thus far have not succeeded. (That's probably a document titled as the operating agreement.) I've seen several documents, but none contain the promises made public. My belief is that upon closer examination, I'll see a lot of unpleasant surprises as there were with the ROC contract.

IndyDem said...

Some things to keep in mind. While true, they haven turned a profit until recently, the trend is getting positive attention from NASDAQ. The 100 jobs they let go in Aug was a cleaning house of their sales staff. They let go the bottom 10% of their sales force in Aug. By Sept, they had hired 150 more to replace them.
Here are some things to keep in mind also.
NASDAQ has a series of fiscal analysts who assess the viability and stock worthiness of a company. They make predictions on the direction of the company and give advice on what should be done with their stock. If a person should hold it, sell it or buy it. Right now, the consensus of these 16 analysts, says to BUY. Not a strong buy, but a buy. And if you have it, they say to hold it.
The same people also say: 10 say ANGI stock value will change. 1 says it will go down and 9 say it will go UP.
All this info can be seen on the NASDAQ webpage.
I'm no wiz with stocks. But these people are. But as a small business owner for nearly 2 decades, I can tell you the measure of a company's success is not just in profit. It's in longevity and employment numbers. Angie's has both. They currently have over 1500 employees. They plan to add 1000 more. That to me says success. Also keep in mind that in the plan for whats going on, they must contribute $44 mil of their own money in this expansion. An expansion that will turn 2 major parcels of property on Indy's busiest commercial corridor into tax viable properties bringing in $1M a year in property tax, where they currently pay next to nothing. Taking the money out of the downtown TIF rarely used for the common good, and investing it in struggling areas is a GOOD thing. And since this area is not in the TIF, the increase in tax revenue goes into the general fund, that can be used to pay for cops, streets, parks, etc.
Is this deal risk free? No. Are any risk free? No. Whether Angie's is around, we win. In both development of a section of Washington St in desperate need AND in the property tax increase. Both happen whether Angie's is still here or not. The likely hood that they will be around is very good and if that happens, they'll have to meet their commitments of hiring 1000 people. That too, will bring in 1 million in income tax for Indy. meaning 2 M a year in new revenue for the city.
Over the last 3 years, nearly 100 M has flowed out of the DT TIF into the hands of developers. 85M has been used to subsidize LUXURY housing. This is the first time it's being invested in an struggling area to bring major development and jobs.
That's why I support this.

IndyDem said...

Here is the NASDAQ page where the info previous can be found.