Bubble Talk

Our article yesterday touched on the idea that many in our area are working diligently to rebuild the development bubble that for a few good years, consumed our entire community. Today, in a good article in the Osceola News Gazette titled "Vine St. worries - Is redevelopment too slow?", we see even more evidence of this growing problem. In the article, the progress of making the zoning changes and an overlay district for the redevelopment of the Vine Street area through Kissimmee is described as moving slow, even though the vision for what the area has become well established. The frustration by some commissioners is that not enough commercial developers have been advertised to in order to get things moving along with the grand Utopian view. The idea of course is to redevelop in an area that has been allowed to fall apart in hopes that the sting of projects will some how gel as the economic epicenter of the City of Kissimmee. There is no real evidence that this will work, but the suggestion by a few of the commissioners was that we need to start building now.

While this all sounds good, we have to wonder if the creation of another construction boom is what we need right now. While we agree that the city needs to move forward with the plans for the redevelopment of the area, we think rushing the process is foolish at best. The belief that by building something you have done a good thing for a community is the exact thought process that has lead this area into the economic collapse we are feeling right now. In a Wall Street Journal article out today titled "Commercial Property Faces Crisis", the delinquency rates of commercial loans are described as going sour at an 'accelerating pace' which is threatening to cause tens of billion dollars in losses. According to the article "The delinquency rate on about $700 billion in securitized loans backed by office buildings, hotels, stores and other investment property has more than doubled since September." So the plan of the City Commission is to jump head first into commercial redevelopment in the middle of one of the worst commercial downturns on record. We can only assume that the plan is to rename 'Vine Street' to 'Toxic Asset Street' in order to get more dollars from the Federal Government.

This debate of course gave the Mayor an opportunity to light the campfire and start telling stories about the good old days of tricking businesses into taxing themselves for the the good of all in the West 192 area of the county. The bard's tale of getting the property owners to 'buy-in' to setting up a special taxing district so government could use the dollars to make the area the center piece for Osceola County tourism echoed through the chambers. The only thoughts we could grasp from another round of story time was that the Mayor's goal is to turn the failed Vine Street Corridor into the failed West 192 Tourism Corridor, and he wants to have the Vine Street property owners pay for it. Just for the heck of it, the WayneWho staff decided to take a quick ride through the 'redeveloped' West 192 ghost town that has had the advantage large amounts of tax dollars being thrown into it, and we were left wondering if this area was the best example of government at work?

The problem that we see with the discussion on all levels of government is that there is no clear acceptance that we are in a new economic era. Economic development actually means something different than it did two years ago. While we hear many whines and gripes about budget deficits, we do not see true efforts to put us on the right path to a community that is not built on the erroneous concept of some taxes being 'special' which magically makes them 'good' and 'good' for those paying them. This, of course, leads government to think that every thing they spend the 'good' taxes on is also 'good'.

Pop goes the bubble.