Tax abatement blues

I know I’ve penned this familiar phrase several times on the blog, but I’ll write it again for a reason: “Don’t piss on my shoes and then tell me it’s raining.” The latest example of this exercise, if not in lying, in bullshit, came to us courtesy of officials associated with two of the oldest industries in Hastings. The front page of the Nov. 30 Hastings Banner carried the story about the Hastings City Council approving Viking’s request of a transfer of the now defunct Tyden Seal’s tax abatement.

For those bereft of Civics 101, a tax abatement is a government unit giving a tax break of up to 50 percent for up to 12 years to a business that is expanding or being established if the move will create jobs. Some people refer to it simply as “corporate welfare.” It has become a way for corporations to pit communities against each other in a race to the bottom where the town willing to shift more of its tax burden to the people who will supposedly gain from the handful of jobs the company is dangling from a stick is rewarded with the extra jobs but sometimes only until the abatement lasts, and sometimes not even, and then it's off to India, China or Kentucky.

Tyden Seal back in 2002 was granted a tax break from the City of Hastings when it built a new plant across the street from Viking and 30 new jobs were promised. However, the Groos family, which owned Tyden and Viking, sold the former to Crimson Investments, an outside firm, in May 2005 and almost exactly a year later Tyden was shut down with its 40 jobs moved to China. Oh, the humanity!

Now comes Viking to the City Council asking to take up Tyden’s tax break, all while the city already is out nearly $78,000 in tax revenue because Tyden (Crimson) did not live up to its end of the bargain for the abatement.
It’s a pea and shell game foisted on the taxpayers of Hastings, who are stuck with a $78,000 bill that Tyden, Crimson or Viking should have paid. It’s deceitful.

Tom Groos, CEO of Viking, was quoted in the Banner as saying Viking didn’t have anything to do with Tyden folding its tent and not repaying the tax abatement, that was the responsibility of Crimson Investments. In the words of the Church Lady, “how convenient” for Viking to sell to an outsider to do its dirty work of shutting down and moving to China. Groos insisted in the Banner story they had no idea Tyden would be shut down. Bullshit.

A little history, please. Tyden was the original industry between it and Viking, founded by Emil Tyden, the inventor of the Tyden Seal cargo lock, in 1897. Tyden brought in other industries to Hastings at the turn of the 20th century and one that paired up with his business was Viking, a manufacturer of commercial and residential fire sprinklers. The two industries worked inside the same building for many years under Tyden, his daughter, Florence Tyden Groos, her son, Richard Groos, and finally Tom Groos. Viking and Tyden were not the same business, but they family and they were tightly connected for many years. The Tyden and Groos families have been famous in past years as philanthropists and community activists, the kind every community needs to thrive. However, the latest generation hasn’t continued that tradition. Tom Groos doesn’t even live in Hastings and his children attend wealthy suburban Forest Hills schools.

I submit that Viking and Tyden started an ambitious project for the latter to move into its own facility across the street four years ago, and when it became painfully apparent things weren’t working out, the decision was made to sell Tyden to a “hit man,” in this case, Crimson Investments, to act as “the bad guy” who shuts down the local plant and packs the jobs off to China. So the Groos family is spared the agony of doing a hatchet job to a 109-year-old business started by the patriarch, Tom Groos’ great-grandfather, and they’re given an opportunity to win back the opportunity to ask for the tax abatement lost by Tyden’s non-compliance. Crimson may be the bogeyman that doesn’t repay the abatemen, but the bottom line is that the citizens of Hastings are stuck with the $78,000 check.

It would have been nice if the Hastings City Council members would have shown its constituents a little spine before eventually caving in. They could have insisted there would be no abatement until the old tax break bill is picked up, regardless of whether it’s by Viking or Crimson. All they did was adopt a wimpy resolution to try to get back the money from Crimson, with no assurance the taxpayers’ money due will ever be collected.

Besides the pea and shell game, I get real tired of poor people getting saddled with taunts of being welfare cheats, charges for which some admittedly are guilty. I get real tired of it because when businesses and industries are welfare cheats the government doesn’t seem to put up much of a fuss, in fact they’ll let ’em back in the tax abatement game. Viking should hang its head in shame for spreading bullshit about its sorry deceit. The City of Hastings should hang its head in shame for not having the guts to insist on fair play.

And I have no proof, but I think somewhere Emil Tyden is not pleased with what has transpired. His business is gone, his family name tarnished and taxpayers have been snookered.