[Mpls] Allina

[Chris Johnson]

Dennis Plante wrote:

> Somehow, in coming to an accurate cost analysis of the subsidies (both 
> real and imagined), one should probably try and factor-in to what 
> degree the employees of Allina wll be supporting the local economy.  I 
> suspect they'll eat plenty of lunches, buy plenty of gas, many will do 
> their banking near work (if it's covenient), many will use local care 
> providers for medical/dental/eyecare and some (heaven forbid) will 
> look at purchasing homes closer to their workplace.


I don't mean to specifically target this at Dennis' remarks so much as 
the idea shared by a number of people who believe that having the Allina 
HQ is going to be a big economic benefit to the neighborhood.

For example, one person mentioned the office supplies contract.  Here's 
a perfect example of how fallacious this notion is:  Allina like any 
other large corporation already has a contract for office supplies, 
company wide.  It matters not one iota where any particular Allina 
office is located -- they all get ordered from the same company and 
delivered.  Allina is not going to change their suppliers just because 
they moved.

Banking?  Gasoline?  Sure, the employees will buy where convenient -- 
like the corner gas station in their suburban neighborhoods, especially 
since gasoline prices tend to be higher in Minneapolis, and especially 
in places where there are few competitors, such as around the Abbott NW 
campus.  (E.g. the lone over-priced Amoco station on Chicago.)

One of the reasons Allina and Wells Fargo wanted the 35W Excess Project 
is so that they could "beam" their employees right into their parking 
lots without them having to pass through "those" neighborhoods.  How 
likely is it that Jane Suburbanite, who is afraid to drive down 2nd 
Avenue from the current exit ramp, is going to choose to bank or buy 
gasoline next to Sears, versus near her home in New Suburban Prairie Grove?

So in reality, the incremental increase in gasoline purchases will be 
tiny.  Likewise the banking, and I'm not sure how banking introduces any 
new revenue or jobs into the local neighborhood.  It's not like you 
spend much money at the bank.

Lunch?  Now there's a real possibility.  People do need to eat, and some 
adventurous souls will no doubt go out into the neighborhood and buy 
lunch -- maybe at Sunny's Restaurant and Liquors or Chi Lake Cafe.

Many will use local care providers?  A few might change from their 
current providers, but since they are Allina employees, I'd have to 
guess they'd use the Allina Clinics across the street, don't ya' think?

A few might decide to move to shorten their commutes.  Maybe some of 
them might even move into the city of Minneapolis.  And a few of those 
might even move to a neighborhood near the Sears building -- or not.  A 
fraction of a fraction of a fraction sounds like very few at all.

And when will all this economic gain take place?  After the building is 
rehabbed, after Allina has consolidated all of its employees scattered 
in other offices and after the dust settles, in a few years.

Meanwhile we are dropping $750,000 in taxes and millions of dollars in 
35W Excess development.  Seems like it might be cheaper to just give 
money directly to those businesses and residents in the area that might 
marginally benefit directly from the presence of Allina employees.

As I said weeks ago, the idea that Allina moving to a building in your 
neighborhood, no matter where it is, is somehow going to be an economic 
boon is just plain false.  It's just another building to Allina, and 
just another commuting destination to the existing employees.  The 
situation is quite the opposite of Boston Scientific's announced plans 
to build a new facility and hire 600 new employees in Maple Grove.

The one big good thing coming out of this is that having Allina buy into 
part of Sears means that something will finally get done with that 
building.  Whether it will be the most desirable solution or not will 
not be seen for years to come, but almost anything will be an 
improvement over a vacant, deteriorating hulk.  Depending on what 
happens with that building, and how successful it is, it could be of 
significant help to the neighborhood.

That's why the call for the balance sheet is reasonable.  Is the 
millions of tax dollars being filtered through tangentially related 
projects and enriching various private corporations worth the end 
results in improvement of our neighborhoods and city?  Or would it be 
cheaper or quicker to spend that money on something that would help more 
directly?  It's hard to answer those questions without objective 
numbers.  All too often it seems the government aids and abets the 
private interests who will gain by hiding the numbers, or spinning them 
into useless puffery.

Chris Johnson
Fulton