Council Approves Tax Abatement for Medline Industries

Today the City Council approved a tax abatement for Medline Industries in Mountainview (District 3). The abatement is 75% for 7 years, for a total of $879,530 forgone. Medline is going to expand its warehousing facility and hire additional employees.

I am becoming more and more cautious in approving tax abatements, which reduce the amount of property taxes a company pays to the city. (Sometimes other taxing entities — county, DISD, the community college district — join in; usually they don’t.) I will go into my philosophy at a later date, but wanted to explain my thoughts on this particular abatement.

We need to use tax abatements sparingly, and when we do, we need to use them to encourage particular economic ends. Such as improving the lives of people who live in South Dallas. Again and again we talk about economic development in the Southern Sector, but what does that really mean if it’s not focused on improving the everyday lives of the people who live there?

During our discussion today, I asked Medline how many of their employees live in Dallas. Their representative said about 45%. I also asked the Medline representative what kind of jobs they held, and he said mostly warehouse jobs.

I would like to see our businesses, particularly those in South Dallas, hire people who live in South Dallas. Let’s give them jobs and take care of our residents.

I pointed out that while I would support this tax abatement (because it can stimulate the economy in South Dallas and because they employ Dallas residents), I want to see an EMPLOYEE RESIDENCY requirement in future tax abatements. I talked with our attorneys, and we’ve done it in the past and can do it again. If a company wants US to invest in THEM (by allowing them to forego paying property taxes), then THEY should be willing to invest in US by hiring Dallas residents.

The Mayor obliquely criticized the idea of creating residency requirements, claiming that the marketplace is too competitive to place “additional restrictions” on the companies receiving tax abatements. I couldn’t disagree more, but will elaborate in another blog.

The tax abatement passed unanimously.

Council Discusses Sanitation Worker Pay Increase

Today the City Council discussed a contract with a company that provides the city with the workers who ride the trash trucks and pick up our garbage. (Agenda Item #6)

The question arose about whether it was fair to pay these workers minimum wage ($5.85/hr), rather than a living wage. In Dallas, it’s not possible to live on $5.85/hr. To be just out of poverty level, you have to make more than $10/hr. The discussion was whether to require the contractor to pay their employees $8.16/hr. That figure is not based on any analysis of what a livable wage is within our city, but simply represents the lowest hourly amount that the City pays its part-time employees.

We talk a lot about “economic development” in the Southern Sector. That usually takes the form of tax abatements or other incentives to COMPANIES, with the assumption that the company will improve the lives of people in South Dallas. This is a trickle-down theory of improving the Southern Sector.

A more direct way to help is to make sure that people who work for the city make a living wage. More than 63% of the men who collect our garbage live in South or West Dallas. Twenty-five percent of these men have been working as garbagemen from 1-3 years, and another 25% have worked more than 3 years. They fulfill one of the most fundamental services for our city, and are out there picking up trash during the heat of the summer, the rain of spring and fall, and the cold of winter. They deserve to make a living wage.

The council voted to approve the contract at the minimum wage, 15 to 5. I was among the five to vote against it (along with Medrano, Salazar, Atkins, and Davis). If we had required an increase to $8.16, it would have added $0.17 per month to our sanitation bills. That’s a very small cost to pay to ensure that our garbagmen are making a fair wage for their hard work.

In the coming months, we will have a council briefing on requiring contractors who provide temporary staff support to the city to pay those staffers more than minimum wage. If we decide to create our own minimum wage, then we can cancel the sanitation contract that was approved today, and have companies rebid at the new minimum wage for city workers.