urbanSTL

In addition to your comments, I believe the Chinese airline(and all Chinese Airlines) is owned by the Chinese Government. No better backer in the world than the government that essentially owns our country.

That's what I was trying to get at. Maybe I should have said "one of China's largest state-owned companies," but I thought I'd stay away from overt mentions of China's lingering communist past. I don't really want this to become any more political than it already is. Just trying to cut down on any Red Dawn 2012 comments.

gone corporate,
Nixon is asking that Republicans pass a damn econ. dev. bill. But if they can't get the f in gear then they should go home.

fwiw, Mayor Slay feels there's still hope:
http://www.stltoday.com/news/local/govt ... 0f31a.html

I think it all boils down to a few obstinant Senators (who said they weren't part of the Summer agreement) and whether they respond to the pressure from the business community and Kit Bonds of the world. If no breakthrough is forthcoming next week then these guys probably are immovable. (In there defense, I can see how the House should have some flexibility to try and address concerns, but sticking close to the general agreement should be what passes.)

and some are just ego-fed narcissists (at least one)

GC, based on our experience interacting with legislators last week, I can't think of whom you are talking about. hahaha.
You're right; the legislators who oppose this generally have well thought-out reasons for why they are against the bill (I strongly disagree with them, however). They were also surprisingly cordial. Only one was a complete and utter ass, and he happens to be the one leading the charge.

gone corporate wrote:Addendum to previous post: I heard Gov. Nixon on a KMOX news report on the drive home, and I'll say he sounds flustered. Whether or not he was in favor of this earlier in the year, he's married to it now and is loyal. He said that economic development is his top priority, and that this is the top piece of economic development in the state, culminating that his office is working overtime to see that a piece of legislation can make it through both chambers and to his office. Huzzah, Mr. Governor.

Have to agree, Gov Nixon is all in at this point nor does he really lose any political ground or face when respective leaders of each house of the same party can't even get something on his desk.

I also believe, as these guys get details on Mamtek deal, they will realize the stark differences on what happen in that town, small town going all in on backing $39 million in bonds vs state performance tax credits that were approved but not issued. Tough to argue that China Eastern airlines is a fly by night company. Nor is Mamtek, other then the amount of bonds issued for the size of the city, the first company to go out and get a city to back bonds on a facility. Pacific, MO backed building bonds for a auto part manufacturer before Chrysler folded shop and the auto part manufacturer closed doors shortly later (I believe they found a new tenant this past spring). O'Fallon, MO bonded a data center for Centure I believe. Washington, MO bonded a building for a aerospace manurfacturer last year. That was just in the immediate area.

Haven't really weighed in on this although I have been following closely.

This is such a No-Brainer to me I cannot even begin to fathom the possibility of this not passing. I graduated with my undergrad in Finance from a program ranked 9th in the country the last 2 years (for Finance, specifically) by Business Week, and although this far from crowns me an intelligent individual, places me in a category in which I believe I can render a judgement on the cost-benefit of this bill and more than likely places me among the top .0001% of MO legislators with regards to educational experience in economics.

If this does not get passed, and we do not lockdown the China hub, it is going to go down as the single greatest failure in the history of MO politics. The railway decisions of the 1900's will pale in comparisson. (Economic impact of the decisions, not necessarily to do with MO politics)

I am not saying this is the end all be all for StL. I believe in this city more than anything and am going to do everything in my power to grow the city regardless of whether or not this passes...it would just be a terrible shame to see us repeat the mistakes of our past.

"Those who don't remember history (or in this case, care not about it at all) are doomed to repeat it."

PASS THE HUB!

As a side note, this whole debate exemplifies contemporary American Democracy in my opinion. Good or bad, past politics had singular figures which exuded power and cut through the bullsh*t. St. louis needs one now, badly.

Weekly flights start Oct. 10th. Pretty cool....

http://www.bizjournals.com/stlouis/news ... louis.html

For what it's worth, my "letter to the editor" is going to be published in the P-D on Monday. Again, here is what I wrote:

Artificial Connections

I am writing to express my frustration with recent attempts to link the Moberly debacle with the international air cargo trade hub initiative at Lambert. This paper, in fact, has suggested that this alleged connection accounts for much of Jefferson City’s mounting opposition to the trade hub. Moberly, however, effectively wired money to a “Nigerian prince” who emailed them regarding a tremendous business opportunity. The plan to establish an international trade hub at Lambert could not be more different.
To begin, Moberly’s losses stem from the decision to partially fund the construction of an artificial sweetener plant by issuing bonds to an inadequately vetted American-Chinese joint venture. Moberly incurred losses when this company defaulted on its bond payments. The proposed Aerotropolis (trade hub) bill, however, would only provide performance-based tax incentives; companies could only receive tax credits to the extent that they directly contribute to the shipment of international cargo. Furthermore, the bill targets business activity that does not currently exist in the region, meaning that the credits would not substantively impact the state’s existing revenue streams. In light of these realities, if the Chinese fail to follow through on their stated intention to turn St. Louis into a “major air trade hub,” the state would not incur losses suffered by Moberly.
Additionally, unlike the Moberly deal, which was concluded in 73 days, the trade hub initiative is the culmination of roughly 4 years of negotiations between regional leaders and officials representing the highest levels of the Chinese government. Furthermore, China Cargo Airlines, the company on behalf of which these officials have negotiated, is a subsidiary of one of the largest companies in China, hardly a fly-by-night operation.
The only thing that the company with which Moberly contracted shares in common with China Cargo Airlines is the fact that they are both linked to China. Refusing to move forward with the hub because of this tenuous connection is about as sophisticated as holding a grudge against all Chinese people because you once argued with a Chinese person.
The Moberly debacle teaches us to be cautious with the use of public funds and to adequately vet potential business partners. The Aerotropolis bill contains sufficient taxpayer safeguards, and China Cargo Airlines is probably more financially secure than the state of Missouri.
I urge you to contact your elected representatives and demand that they not squander this opportunity to position the region as a competitive player in the global economy.

So what are the chances of the private sector and/or local govt. passing a bond issue to get this hub started. I mean we provide TIFS and subsidies for shopping malls....why not a cargo hub?

goat314 wrote:So what are the chances of the private sector and/or local govt. passing a bond issue to get this hub started. I mean we provide TIFS and subsidies for shopping malls....why not a cargo hub?

I think their is avenues on that front as long as the state can come through with the export credits, or the $60 million that the Senate wanted to keep.

Lambert is pretty much extended on debt, runway and terminal improvements. However, I think the city could come to bat since it is actually owned by them. I see Slay pitching to bond air cargo facilities or least he would go that direction (Agree with the city not backing Ballpark bonds but think this is in a league all by itself). Think Mamtec in a way. Maybe on the magnitude of what was appropriated the preveious fiscal year, I think 2009 with an amount of roughly 25-30 million, but was held back for budgetary reasons. Maybe secure a DOT grant for some targeted tarmac/ramp improvements. Then you would have a starting point to work off and probably could handle a jump from 3 to 10 flights weekly.

I think the county would be better off supporting and finding those businesses/manufactures that can use up space around Lambert and see export facility on their doorstep as part of their business model. In other words, I think their is a legitimate argument by opponents that there is warehouse space available in the immediate area.

I see Slay pitching to bond air cargo facilities or least he would go that direction (Agree with the city not backing Ballpark bonds but think this is in a league all by itself). Think Mamtec in a

How ironic would that be? A bill with safeguards to ensure that something like Mamtek couldn't happen is shot down because of Mamtek hysteria, which forces St. Louis finance the project in the same manner as Moberly. The China hub is an entirely different deal, but I'd definitely prefer funding this through incentives outlined in Aerotropolis. If we were to issue bonds to China Eastern to raise money, we'd just be selling bonds to the Chinese government. Hardly new, and they're more reliable than the Feds rights now. I wonder, however, if the Chinese would be so frustrated at that point that they would just move on to the next city. I imagine that they would just establish operations in a city that already has much of the necessary infrastructure in place, even if these other places lack our competitive advantages.
P-D published an edited version of my letter. Glad it made the paper, but they took out a sentence that I think kind of serves as a punch line. Oh well. Waiting for the paranoid comments to roll.
http://www.stltoday.com/news/opinion/ma ... d59cc.html

Colby wrote:

I see Slay pitching to bond air cargo facilities or least he would go that direction (Agree with the city not backing Ballpark bonds but think this is in a league all by itself). Think Mamtec in a

How ironic would that be? A bill with safeguards to ensure that something like Mamtek couldn't happen is shot down because of Mamtek hysteria, which forces St. Louis finance the project in the same manner as Moberly. The China hub is an entirely different deal, but I'd definitely prefer funding this through incentives outlined in Aerotropolis. If we were to issue bonds to China Eastern to raise money, we'd just be selling bonds to the Chinese government. Hardly new, and they're more reliable than the Feds rights now. I wonder, however, if the Chinese would be so frustrated at that point that they would just move on to the next city. I imagine that they would just establish operations in a city that already has much of the necessary infrastructure in place, even if these other places lack our competitive advantages.
P-D published an edited version of my letter. Glad it made the paper, but they took out a sentence that I think kind of serves as a punch line. Oh well. Waiting for the paranoid comments to roll.
http://www.stltoday.com/news/opinion/ma ... d59cc.html

Definitely agree, a comprehensive tax credit plan out of the state would be ideal. Even a reconfigured and enhanced BUILD tax credit as the Senate was proposing would stil be better.

I was thinking of the California freight/forwarders who have been working on an agreement with Lambert, vice versa (not Pan Am). Can't recall their name as I sit in Long Beach, CA airport of all places. In other words, you essentially bond an American company as means to get better infrastructure in the pipeline as I think that the Chinese will eventually want to invest in capital outside the airport itself, manufacturing facilities, etc.

Good letter, Colby. I think that captures it. It is hard to believe that our Republican Senate and Republican House can't even pass the $60 million credit, given that they both support it. Its hard to believe they are willing to hand this over to Denver or Columbus, and will let that be their Republican legacy forever. It kind of sounds like they are just lazy.

So the House passed a tax credit bill...

http://www.stltoday.com/news/local/govt ... f6878.html

Can anyone tell me if this has any components of the what the House was proposing a few weeks ago? There was $20 million for BUILD among other things. Is the $60 million in their new bill the only money for the Cargo Hub?

^ yes, I believe the $60 million freight-forwarding credit language is the only direct Aerotroplis provision although I think wharehousing could still get some existing credits as argued before.

I listened a bit on the live streaming, and a whole lot of other stuff got tacked on such as credits for donations to pregnancy crisis centers and a sales tax holiday for made in USA goods; other attempts to add bonding for higher edication building and early permit for nuclear plant were rejected. We'll see what the Senate does next, and presumably then on to conference committee.

Buckle yer seat belts, cause there is gonna be some turbulance as they try to land this sucker.

I don’t want to say too much, but earlier this week I talked to someone who has been at the center of negotiations with the Chinese, and he said that Shanghai was attached to the $300 million included in the original bill. Making matters worse, it looks like the House and Senate aren’t even going to compromise on BUILD, which means the special session will likely only result in the passage of that trivial facebook legislation.
Make no mistake, if the Chinese walk away, which is looking increasingly likely, then this special session will have been nothing short of a monumental, epic failure of the Missouri Legislature. We basically have President Hu Jintao on the line, and we are about to tell him that we aren’t too fond of this whole globalization thing. Economic isolationism is not the way to get ahead in the 21st century. If this fails, we absolutely need to hold these politicians accountable. This is insane!
Relationships and connections are immensely important to the Chinese. In addition to some of Lambert's and the region's competitive advantages, we also had these connections working for us:
http://www.chinadaily.com.cn/cndy/2010- ... 645990.htm
President Hu Jintao lavishing praise on Stephen Perry and his uncle:
http://www.48groupclub.org/docs/The_48_ ... glish).pdf
It doesn't get better than that.
Although we have a lot going for us, we lack the necessary infrastructure. We need to quickly attract various unrelated entities to the table. The credits would accomplish this by mitigating risks associated with establishing operations in a new market during the time that the Chinese are incrementally increasing the number of flights landed per week at Lambert. More importantly, the Chinese are reluctant to move forward without assurances that these unrelated parties will come together and make the necessary massive investments. Aerotropolis provided such guarantees. Without it, the Chinese don't want to risk the time and resources it would take to develop the hub. As such, the bill serves a dual purpose: mitigating risk for the American air cargo industry and providing the Chinese with sufficient assurances that necessary infrastructure will eventually be in place. The Chinese will move forward if we get our act together, and the necessary parties and infrastructure will materialize if the Chinese commit and the incentives are in place.
Back to building relationships, this is (was?) an opportunity to develop an enduring relationship with the future economic hegemon. This is (was?) an opportunity to revitalize the regional economy. Be angry!

Lets just be real guys. This bill is going down in flames. So is the proposed Chinese Air Cargo Hub. The state of Missouri is just too backwards and politically fractured for anything productive to get done (especially if it benefits St. Louis). The only way I see a China Hub in St. Louis is if local leaders can get together and put an incentive package together on a local level, but the fact that the state is not fully behind this will most like draw concern from the Chinese and the will pick a state where everyone is on board. Really really pathetic! I hope local leaders have a back up plan and didn't put all their hopes and dreams on rural legislatures.

link: http://www.newspressnow.com/localnews/2 ... etail.html

I hate to put more of a damper on things, but the cargo hub won't happen without tax incentives. If the bill fails, which it almost certainly will, the Chinese will go to another city, most likely Cincinnati. Private sector won't be able to rescue this.

Is there anything the local govts can do? We give hundreds of millions in TIFS to outlet malls and sprawl projects every year? Why not infrastructure? This really sucks that our economy will suffer because of partisan politics and urban/rural divide, but what else is new? Is there any chance the Chinese will deal with us in the future if it fails now? Or will they have lost all respect for us?

I was wondering the same thing. St. Louis County should consider a TIF. If the 8,000 people in Des Peres could come up with a $30 million TIF for West County Center, couldn't the County come up with something, since it is 125 times larger than Des Peres? Always have a backup plan. And tax rural Missourians to ship their livestock to China.