Sunday, March 25, 2012

Those That Facilitate Rent Seekers: Rent Seeking in Action

Although politicos have the final say-so on bestowing taxpayer dollars upon economic rent seekers it's worth one’s attention to look at those that facilitate rent seekers. Those persons and entities that act as the broker between rent seekers and politicos. Those that help spend your taxpayer dollars under the heading “economic incentives” and not so incidentally spend those dollars upon themselves.

 A Greensboro, NC based blog, TriadWatch, proves to outline a rent seeking facilitator example quite nicely:

A few other deals the "Senior Managing Director with CBRE Consulting" is going to present to the "Economic Development Briefing", on Tuesday, March 28 at 8AM at City Hall. – Triad Watch 03/24/2012


Developed an aggressive economic incentives negotiation strategy to maximize economic benefits to the client.

 .. Selected and announced Lawrence, Kansas within six weeks of project kick-off (including community visits and incentives negotiation).


... Achieved total economic incentive package valued in excess of $9.5 million, including income tax credits, property tax abatements, forgivable loans, reduced land costs and job training reimbursements


 ...completed an operating cost analysis including project economic incentives


The icing on the cake was his negotiation of a $32 million package of economic incentives to support the project’s business case.

Incentives Negotiation

Economic incentives package totalling $32 million was negotiated to help offset start-up and short-term operating costs.

Incentives included tax credits, training assistance, property tax abatements, and cash grants.


 Leadership is challenged to identify and negotiate an economic incentives package to create a viable business case for the project.

 Developed an aggressive economic incentives strategy to achieve a level of support for project viability.

 Advised the client during face-to-face negotiations with each state in their European headquarters.

 ... Identified creative financing/bonding solutions at the local government level to significantly increase the packages in two of the three finalist states.


 ... Achieved final offers from each state ranging from $150 million to $250 million including free land, free buildings, property tax abatements, workforce training, tax exemptions and tax credits.” (1)

A little from the bio of the fellow presenting along with Dan Lynch, at the "Economic Development Briefing", Tuesday, March 28 at 8AM at City Hall. – TriadWatch 03/23/2012

“Jonathan Sangster is a Senior Managing Director with CBRE Consulting...He leads a team that delivers strategic real estate solutions to corporate clients, focusing on business location solutions and corporate real estate strategies.”

 “He was also recently nominated and appointed to The Site Selectors Guild, a consortium of top global site location consultants, as one of the twelve internationally acclaimed founding members." (2)

Hence TriadWatch has outlined a meeting between rent seeker facilitators and potential prospects. We have a meeting presented as an “economic development briefing” when in fact it’s a rent seeker facilitator prospecting sales seminar seeking taxpayer dollars with a network of rent seeking facilitators. Facilitators who have a series of firms [clients] looking to rent seek taxpayer dollars. In other words, the “economic development briefing” is in essence a “rent seeker development sales seminar”.

Looking slightly deeper we find:

(1)    The presenter of the rent seeker seminar is highly acclaimed. Yes, “as one of the twelve internationally acclaimed founding members” of The Site Selectors Guild,

(2)    Upon further review, The Site Selectors Guild, “as one of the twelve internationally acclaimed founding members” was founded many, many years ago….way back in 2010. Yes, the Site Selectors Guild, internationally renowned since….2010.

“Founded in 2010 by twelve internationally acclaimed site selectors, The Guild facilitates direct contact between corporations seeking guidance in facility placement and qualified site selection companies.” – The Site Selectors Guild web site, About Us. (3)

The reader would assume an “internationally acclaimed” group, The Site Selectors Guild, would be a guild with a long history which would span decades rather than two (2) years. Would such a new guild offer an annual conference? Yes, the latest annual conference was held at the Orlando, FL Hilton 01/22- 01/24/2012. A sampling of the agenda:

Monday, January 23, 10 am – 11 am Integrated Panel: Economic Development Professionals and Consultants discuss the current state and future of incentives.

Tuesday, January 24, 1:45 am – Noon Consultants Panel: Consultant-Client Relationships. Consultants discuss their client-related issues such as fee/commission structures, non-disclosure agreements, lobbyist registration requirements and how the consultant-client relationship impacts how consultants interface with economic developers. (4)

Hence the conference was how facilitators view and deal with "incentives" [taxpayer dollars] and how the facilitators deals with their clients regarding rent seeking those taxpayer dollars [commissions charged].

Summary and Implications

By no means is rent seeking a random event that occurs in every little burg and town based upon “if they do it, we must do it too”. It’s a perpetual event more based upon “let’s all do it” of which  groups have been formed to facilitate “let’s all do it” regarding the rent seeking of taxpayer dollars. These groups merely rent seek taxpayer dollars on behalf of their client and extract a commission for their rent seeking services.






1 comment: