Now that the Pasco City Council has shifted some money to encourage economic development, let's consider some of the side effects to the plan.
Several of any city's economic development projects typically are funded through grants, which is usually a good way to go.
The money is tied to a certain project. When the project is complete, the funds are gone.
It's kind of a pay-as-you-go financing plan.
Plus, it often allows cities to tackle bigger projects than they could using their own resources. An example of a big project that draws on multiple funding sources is the Lewis Street overpass in Pasco (price tag around $31 million).
The problem arises when cities have more projects to complete than grants available. It's hard for local governments to be progressive when they're always waiting for dollars that may or may not come.
The wisdom of creating a steady stream of income that's dedicated to economic development projects ought to be self-evident. A fast-growing city like Pasco can't keep pace with its needs by relying on grants as its sole source of money for project development.
That's why we are convinced that investing in Pasco's future is a wise use of the income from the city's agricultural lands.
Pasco's growth spurt appears unabated, and investing in economic development is a crucial part of managing that growth. It's much more difficult to try and play catch-up later.
Of course there is an equilibrium to consider.
In order to put the farm income into this economic development fund, city officials will have to take it from somewhere else, since this isn't new money.
The idea of taking money from one account and putting it into another often scares people.
In this case, the city will shift money from the utility fund. Rent from the circle farms is currently putting about $400,000 into a utility fund that has an annual budget of $26 million.
It's more than a drop in the bucket, but in all reality, the loss of this income will not raise the cost of service to Pasco's ratepayers. The money clearly can be put to a better use.
When the debt on the 14 farm circles is retired in 2014, another $200,000 a year will be available.
Pasco's operating budget is $36 million, so the new fund does not represent a big slice of the pie, but it will allow the city to build a little fund that can cover smaller economic development projects, for example a sewer trunk line.
Good community leaders look to the future. Pasco made a smart investment when it bought the farm circles. Now the council looks to have made another wise move by voting to put that money to work in an economic development fund.