Tuesday, September 21, 2010

Standard-Examiner: Ogden Getting Three New Retail Outlets - UPDATED

The Boss Godfrey Administration persists in following the grubby practice of providing corporate welfare on the taxpayer's dime to weakling business startups

The Standard-Examiner reports this morning that Ogden City has inked lease agreements to place two new retail operations to downtown Ogden, (one in the Junction Money Pit, and one across Washington Boulevard within the East Washington Redevelopment District. ) In addition, we are informed by Mr. Schwebke that negotiations are also underway to bring yet a third unnamed "business" to the Junction property:
Ogden getting three new retail outlets
Conspicuously displayed in the middle of this morning's story is this revelation, which reveals that Ogden taxpayers are likely to provide much of the seed money to start up these new downtown businesses:
G4G and Ogden ROX will likely be the first businesses to take advantage of the city's new $315,000 tenant improvement loan program, said Tom Christopulos, Ogden's business development manager.
The beat goes on... the Boss Godfrey Administration continues to use taxpayer dollars to subsidize newly arriving private business operations. Despite the $2 million+ plus payroll, Ogden City's bloated Economic Development Department continues to take the low road, and persists in following the grubby practice of providing corporate welfare to weakling business startups.

How much taxpayer money will the Ogden administration devote to these new businesses? A trusted source tells us that the amount for the first two will be over $315 thousand.

Did the Godfrey administration even run a credit check on this Gary Barsdorf guy?

Somehow... we doubt it.

Update 9/22/10 9:52 a.m.: For an informative discussion which fully fleshes out the issues involved in these "tenant improvement loans," view the September 7, 2010 city council video (fast forward to 30:00):
09/07 City Council Regular Session video

31 comments:

big thinker said...

Here's my take. If the taxpayers are to engage in the subsidization of private businesses, they should take a piece of the action, in terms of proportionate business ownership and revenue.

Ozboy said...

A comment from the Standard article that I concur with:

"Meanwhile Davis County, our immediate neighbor to the South, gets a thousand plus new high paying jobs in high tech industries while the tax payers of Ogden put still more tax payer money out to lure a few paltry clerk jobs into the mayor's high adventure fantasy."

It really is pathetic that the citizens of Ogden are paying such a large amount of money to Godfrey and his circle of incompetents and receiving so little in return. Layton and Clearfield spend a fraction of what Ogden does and their results are literally thousands of times greater.

Hindman said...

I am not a businessman and IMHO I would never, NEVER give any tax credits or stimulus refurbished buildings to any company that is going to bring minimum wage jobs to the city. Although I am glad someone, anyone is willing to open a business in Ogden.

Luv's Ya" Bros said...

Here's my question: Does G4G carry the revolutionary Geigerrig products?

These poor Geiger bastards are up to their necks in mortgages and other financial obligations, now that they've been cut loose from Descente.

Here's my suggestion! Howbout we set up an Ogden Charity to help out the Geigers?

PPK said...

Totally off topic....but excellent tidbit of hope:
Ex-city manager among 8 arrested in Calif. scandal

Larry said...

350,000 dollars for some wiz-kids without sufficient start-up money to open retail stores where the combined payroll will be less than 100,000 a year?

Might as well just mailed everyone in the city 50 bucks, and waited for someone with his own money and a viable product to come along.

Marion said...

It is interesting how Mr. Godfrey keeps promising new companies are coming, and just who they are is always a secret, and then they never show up.

What happened to the Chinese, Mexican and manufacturers outlet stores he promised in the past?

ozboy said...

Larry

I don't think this guy is a "wiz kid".

He seems to have been around for quite a while. His resume (curriculum vitae) is on the net and makes for interesting reading.

I have hired a lot of people in my time and have had the opportunity to revue countless resumes. This guy's seems to have a lot of different things on it. The most troubling from an employer point of view is that he claims 16 jobs in the last ten years. They range from 4 months to a year or so each. This may or may not be an indication of his stability and reliability, but as a minimum it is a definite red flag. I believe that if a bank were looking to lend him money, instead of Ogden City, this could be of some concern to them.

Another item on his resume that is potentially troubling is that in 2006 he indicates that this G4G deal had multiple locations in Utah. In the Standard article it indicates there is one location in Orem and that the Ogden store will be the "Flag ship". This raises the question - was he stretching the truth on his resume, or did he use to have multiple locations but now only has one? If that is the case, what happened and why are the others now closed?

From a tax payer point of view, is this guy and this deal a good credit risk to lay a pile of public money on, or isn't he? Would a bank loan the same amount of money on this deal?

I do hope that the stores succeed in Ogden, but it sure doesn't look like a very sound bet to me. Any guesses on how long they will stay open?

blackrulon said...

Ozboy-"Any guesses on how long they will stay open?" They will stay open long enough for Godfrey to inflate the impact of the store on the Ogden economy and for the owner to make a hefty campaign contribution to the mayors reelection fund.

Curmudgeon said...

They're coming. I wish them well, and am glad to have one of the Junction vacant storefronts leased at last. Business brings business, foot traffic past the windows, people on the grounds, and so long as the Kiesel stretch at the Junction is one long unbroken string of empty storefronts, the kind of synergy that marks successful commercial developments is unlikely to develop.

As for whether the two stores opening will succeed, who knows? Opening a small business is a crap shoot in the best of times, which lord knows these ain't. And it seems the two stores will compete against each other [selling similar goods] and, of course, against established outing goods stores in Ogden already.

I hope both take off like gangbusters creating new demand and new customers, not merely luring existing ones away from established businesses, though all outings good customers are fair game for all of them.

But we'll just have to wait and see, as with any new business coming to Ogden, large or small.

I wish them well and hope they have shopper-generating neighbors on Washington and Kiesel soon.

Ken O Williams said...

I wrote and asked about these 3 new businesses on another thread nad lo and behold, here it is, a top page article, complete with figures, assumptions, dark predictions, questions about the Chinese and the Mexicans, an anuseum. I like to think that Curmudgeon kind of nailed it with a bias free post that, reading between the lines and not getting lost in verbose analogy, simply stated that "They're coming." He wishes them well, as do I, mentions how businesses attract businesses, and that opening a small business in the best of times is a crap shoot, let alone opening something in today's economy.

Granted, Ozborn's thoughts about Layton scoring thousands of jobs vs. Ogden's getting a few clerks, is compeling, but it's a start. Not many of us wanted The Junction to begin with, but every store front that fills up there, or across the street to the East, is a positive step and should be saluted rather than criticized because stimulus money was involved that would allow some under-capitalized business open at the taxpayers' expense. And I don't think any of us know what kind of deal was cut, or if any deal was cut.

I am wondering how Ogden, the home of the 2nd store, can be the flagship over Orem, the 1st store. But if it is, good on us.

Hell, at least there's movement down there now, and I applaud that, even if Geiger products are to be one of the inventory. Maybe it would help out the overall picture if we got behind one or two of these smaller businesses instead of wondering how long they will last and tying them into some scheme that the
Administration has cooked up.

OneWhoKnows said...

Godfrey is committed to his so-called vision of reinventing Ogden to a High Adventure mecca. Now, eleven years into his dream, not much has materialized as he hoped, yet he still believes it will happen eventually. Even in the best of times, it's a crap shoot. For the past four years, the Great Recession has made sure that people are not interested in his dream and his fun little things to do. They want to provide food and shelter and the basics for their families, not bowl, float and fly for fifty bucks an hour. Although, he still believes he's right, he's not. He has created secrecy, back room deals, massive debt and mistrust amongst his employees and peers. He has made a huge miscalculation in that people do not believe him any longer and that alot of us don't even like him. I doubt he could win another term, and probably should not run. Ogden needs new and fresh ideas and a new direction to the future other than cute little sideshows that are subsidized by taxpayer dollars and free enterprise must prevail without City Hall trying to run the show. Remember how well the Streets Festival was enbraced by thousands until the City got involved? Send this failed dreamer to Disneyland and leave Ogden to real leaders, not a spoiled brat.

Flunked English said...

Red Hill, South Africa? What does it say on the cover of Gary's passport?

ozboy (or is it osborn?) said...

Ken

Do you NOT think the "questions about the Chinese and Mexicans" were pertinent? I think the context in which the writer brought them up was certainly timely as it had to do with one more "secret" business coming to Ogden according to Godfrey and his loser team.

And in case you didn't notice, I too wrote that I hope the two businesses that were identified succeed. I also wrote of course that I highly doubt they will given the highly risky over all circumstances.

You also wrote "Not many of us wanted The Junction to begin with". So now that it is here and a resounding failure, do you think it is OK to spend even more tax payer money to essentially pay people to open up stores there? Is it a smart business model to throw good money after bad? Would you invest your own money in this business, or this guy with the questionable resume?

I'm all for businesses going in that vast wasteland, but on their own dime. I certainly don't think it a smart move for the tax payers to subsidize private businesses - in this case especially.

As far as one business attracting others as Mr. Curmudgeon suggested, and which you apparently concur, well that can cut both ways. It is every bit as likely that this business will go in there, fail and thus set just the opposite example to other people who might contemplate opening up shop down there. It could give the place even more of an aura of failure than it already has. And if one business is subsidized, will others go in there without getting the same deal? Where will it end, will every store in the whole junktion ultimately be financed by the tax payers?

I agree with you that businesses that go into that area should be "saluted" as you say, but only if they do so on their own dime. I certainly do not see anything worth respecting if they do it on the tax payer's money, as these guys are apparently going to do. That essentially makes all of us high risk venture investors in a deal we have no choice in and no stake in profits if it does succeed.
I also think it highly appropriate for any tax payer to criticize such idiotic behavior as exhibited by Godfrey and his team of losers.

You can bet your ass that these guys are going to be drawing down on a very large tax payer funded subsidy to open these stores - that according to Christopulos from the city.

So Ken, if you are such a believer in the Godfrey dream, why don't you give the tax payers a break and pony up the cash to subsidize this store yourself? If you don't believe enough to do that, or if that hundred grand or so they are going to get is a little too much for you, how about betting me a grand that G4G doesn't last 6 months in Ogden and that all the tax payer money spent on them moving here will go down the crapper like everything else Godfrey has anything to do with does.?

By the way, according to the G4G website, they don't carry the Geigerrig gizmos. Perhaps they will in their Ogden store.

Curmudgeon said...

Oz: The time for objecting to the latest subsidies to rehab properties or pay for business installations was when the Mayor proposed the plan, and the City Council was considering it. And many who post here did object. But the Council approved the plan. That particular ship has sailed, no matter that many of us wish it had not.

Once the Council approved the latest subsidy budget, the key question then became, for each business applying for the money, was that business a good choice to receive the funds, was the probability of the money doing long term good to the Ogden economy higher by making the money available to Business X rather than Business Y or Z. The questions you raised about the companies that [to date] have gotten the funding would be very relevant during the [in house] discussion about what would be the most prudent use of the funds. But that ship too has sailed, like it or not.

So where are we now? The two companies have gotten the subsidies and are coming. Whether the administration was wise in making the choices it did or not will become clear over time. At this point, no one can be certain, absolutely certain, if the decisions regarding these two businesses were prudent ones or not. In a few years, we'll have a better idea. But we won't know for sure until the loans are paid back, or they're not, until those two businesses succeed in Ogden, or they don't. We'll just have to wait to see now what happens now. Given the Administration's long record of poor business judgment, there is as you note reason for concern, but targeting the news businesses coming, or their owners, doesn't seem a productive thing to do, now, to me.

All the points you've raised are good ones in considering the business development record of the Godfrey administration, and certainly relevant come election time. The objection I have to some [by no means all] of what's been posted on this is that it seems to target the two companies, or their owners, themselves. Gotta tell ya, Oz, if I were looking at locating a business in Ogden and someone was offering me either straight subsidies or subsidized loans to cover my start-up costs, damn right I'd get in line for the dinero. It's the targeting of the businesses themselves, or their owners, that --- given that the subsidies were approved by the Council and endorsed by the Administration [however much we might wish they hadn't been] --- seems at this point counterproductive.

It's a little like the continued snarking about Mr. Geiger and his new venture. It seems to serve little point but... what? Some kind of rhetorical revenge? Rooting for his new venture to fail? Why? What do we, Ogden, Utah, any of us, gain if that happens? Again, I hope his new business takes off. Ogden has something to gain if it does, and something to lose if it doesn't. I see no point in rooting for it, and him, to fail, which seems to be the tone of some of the posts lately. Not all, Oz, but some.

Poole said...

Rooting for the opposition to fail? Just because you disagree with their policies? Or, sour grapes at being unable to unseat the administration?
An automatic no, just because?

Now, in this divided country, just who does that sound like?

OgdenLover said...

Meanwhile back at the ranch, the Cityhas cited Kaffe Mercnatile for it's sandwich sign on Harrison. It's a tasteful, unobtrusive sign and the only way they can let people driving on Harrison know they exist. A copy is up on Kaffe's Facebook page.

The City cared so much that they left the sentence about weed abatement right there in the letter.

The owners rehabbed an old eyesore on their own dime and made it an asset to the neighborhood. But they are not FOMs, so we can see where truly investing in Ogden has gotten them.

disgusted said...

What no one has commented on is that these two new start up business are owned by the same individual. So he is going to start two new ventures at the same time? Seems to me that is extremely risky. Council should limit the city's financial exposure to a total amount to one individual whether he owns one or two businesses.

Also since when is opening a close out and consignment store a sign of a healthy downtown business environment.

RudiZink said...

"What no one has commented on is that these two new start up business are owned by the same individual."

Point well taken, disgusted. And if you decide to view the video which I've just linked via the update above, you'll find that this issue was a matter of concern for council members Wicks and Van Hooser, although it appears the other council members are oblivious to this potential problem.

Marvin said...

For those of you who haven't taken the time to view the city council video here is a condensed version of the biggest part of it:

The city has already put a huge pile of money in the privately owned buildings on the east side of Washington and is unable to attract any successful or bankable companies to rent them, therefore we should take another very large amount of money from the tax payers and give it to unbankable and unproven individuals, who are the only ones willing to do business in Ogden, to start up new ventures which may or may not have any success potential.

Doug Stephens doesn't get it said...

I checked out the video, Rudi, and I loved the part where this idiot Doug Stephens suggested that the most risky Ogden businesses ought to borrow with lower interest rates.

Julia said...

I thought it was Stephenson, the mayor's sycophant, who was making all the stupid and uninformed comments, not Doug Stevens.

RBW said...

I'm astonished that existing outdoor retailers like Alpine Sports, Ski Mania, Canyon Sports, and others manage to stay in business. Adding two more retailers to the mix, doesn't bode well for anyone. Usually, competition among retailers is good for the consumer, but it's hard to discount merchandise when you're facing bankruptcy. I give the G4G store six months before it has to dramatically change its inventory or crossover into something else. Call me a jerk, but I enjoy seeing small businesses fail. How dare anyone have a dream anymore.

Fact Check said...

Where are you on this list?

http://money.cnn.com/2010/09/22/news/companies/forbes_400/?section=money_latest

Curmudgeon said...

Watched the video. One of the things that surprised me was how unprepared Mr. Christopolus [sp?] seemed to be to make the presentation he was responsible for making. He told the Council that the remaining interest on a loan would be forgiven for any business staying five years. Turned out not to be so. One of the Council members noticed that [Mr. Blair? Not sure.] interest forgiveness was not in the proposal the Council had been sent. And Hizzonah had to chime in to tell the Council that the interest forgiveness provision had been dropped from the proposal. Mr. C. offered only his guess that that had been taken out "in the editing." Asked by Mr. Stephens where the principal and interest paid back to the city would go, Mr. C. said back into the general fund... and had to be corrected by the Mayor who said no, this is a revolving loan fund, so anything paid back would become available to re-loan to another business.

I don't know, folks. Seems to me part of treating the Council with respect is coming before it to make a presentation --- any presentation --- fully prepared to answer accurately questions on the matter you've come to brief the Council about. If I were a mayor and my staffer was sent to present an administration proposal to the Council and to answer questions about it and he turned out to be as apparently ill-prepared on the very matter he was supposed to be the expert on as Mr. C seemed to be, I'd be... unhappy.

Really was surprising.

Disgusted said...

Curm,
What I read in it was that Mr. C didn't come up with the ordinance or write the deal. It was all put together by Godfrey, from start to finish.

David S. said...

The whole idea of this "tenant improvement program" stinks. It should be called the "taxpayer cash for cronies" bill.

VanHooser and Wicks were right to vote against it.

But note that Blair put on a "no default" provision, and Gochnour put on a minimum interest provision, and they all seemed comfortable standing up to Godfrey - even Cook.

Godfrey, for his part, was 50% BS and 50% cluelessness.

So it is nice that it's not the Godfrey show. The council does seem to be endeavoring to be independent, even if they still buy the Godfrey claptrap too much.

Stanley said...

In Seattle G4G is a large and well known lesbian organization - Girls4Girls. I hope there are not too many disappointed ladies in Ogden who read the article in the paper and got their hopes up for a new beginning in town.

The G4G (Utah version) web site shows some pretty neat and upscale merchandise that the store carries. It will be interesting to see if they can make a go of it in Ogden.

Curm, I didn't get your critic of the ozboy post. He did mention that he was hopeful that the G4G store would succeed and he was mostly slamming the city's poor judgement and insider dealings in granting loans to high risk ventures, rightfully so in my opinion. Also, I think your ship has sailed lecture could be directed at a good number of your own comments on this site when you criticize the mayor's actions. Is it OK when you do it, but not when others do?

Curmudgeon said...

Stanley:

You wrote: Also, I think your ship has sailed lecture could be directed at a good number of your own comments on this site when you criticize the mayor's actions. Is it OK when you do it, but not when others do?

As I noted, Oz's comments were sound critiques of the Mayor and his policies, and they're certainly appropriate criticisms for an election round. What I don't generally like, and don't agree with, is attacks upon Administration policy that slough over into attacks on, in this case, the individuals applying for the subsidized loans the Council approved. [Same point in re: some of the comments on Mr. Geiger: they seem to be aimed at him personally, not policies he endorses, etc.] So far as I know, the owners of the businesses involved have done nothing [to date] but apply for and receive subsidized loans the Council approved. I don't see why that should let them in for criticism.

Oz and I are in very close agreement about the Godfrey administration's long record of poor business judgment, and its penchant for tossing more public money than is prudent into subsidizing private businesses, and its penchant for crony government, and much else. I don't think I was applying a double standard.

ozboy said...

Mr. Curmudgeon

I did not mean to disparage the Geigers in any way. In fact back when they were all over the news and this blog I repeatedly made comments about appreciating and liking Bobby Geiger in spite of his head butting approach to public relations. For this I got whammed, slammed and head butted big time by WCF readers! (What ever happened to the Geiger's anyway, did the fall off the face of the earth?)

I do feel that my spill over criticism of the G4G guy with the questionable resume was within bounds even though it was only in the context of pointing out the mayor's incompetence and cronyism. As a tax payer I hope that G4G succeeds in Ogden, as a betting man I'm still willing to entertain bets that he doesn't. This does not mean that I wish they would fail.

Curmudgeon said...

Oz:

OK, Oz. I may have conflated some other posts in re: Geiger with yours. If I read more into your comments than was intended, please accept my apologies. As usual, we seem not far apart on Matters Godfrey, if at all.

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