See-Saw Economics - Up Here and Down Over There

The drums are beating loudly and often about East 4th Street. Even the New York Times had an extensive piece about the lively street that’s become an open air bazaar of restaurants.

It’s a small economic oasis in a virtual desert of inactivity. But not much more.

Go directly north across the street. Lively it ain’t. There sits the grandest of Cleveland’s buildings – The Arcade. Built in 1890. “It has no peer in the United States…” says Eric Johannesen’s “Cleveland Architecture 1876-1976”

And it’s dying. Economically, that is.

Just a few steps from East 4th Street.

As full as East 4th street might be on any July noon that’s as empty The Arcade will be at the exact same time.

Into each project has flowed millions of public dollars. Chris Warren, the city’s economic development major domo, says $10 million has gone into East 4th Street. Well, that’s high subsidies for such a short street.

I expect with tax relief and other subsidies it’s more than $10 million.

At The Arcade, more than $10 million of public money has been given.

It had a $6.26 million historic tax credit; a TIF (form of tax abatement) worth $6,454,000; a $1 million, 30 year city loan at zero interest rate for 26 years and 2 percent on the remainder; another $3 million loan for 20 years at 6 percent and another $2 million, 20-year loan via the County at 2.5 percent. Foundations also made contributions.

As bad as that is, The Arcade was seeking a $15 million property tax reduction in its value, a cut of more than half of what it was on the tax duplicate.

Look at The Arcade. It will depress you. The grand building lacks even the pretense of commerce.

So why the cheering for East 4th Street?

Just a few steps away from East 4th, the city gave $3.3 million in low interest loans to the Colonial/Euclid Arcades and diverted property taxes to help these two arcades. Both seem in economic decline. Very depressing.

So where is the percentage in the city dishing out free money? Does one subsidized street simply rob commerce from three arcades? Does anyone but the developer make money?

Indeed, all around the Great East Fourth Street Miracle – as seen by the Plain Dealer and New York Times – economic failures abound.

And don’t forget the $200 million RTA fix-up of Euclid Avenue, a pretend urban transit investment that rides right through this E. 4th and Arcade site.

If you go to East 4th street from any side, you’ll hit protesters. They’re handing out flyers that complain about the East 4th Street developer, MRN. Calls the developer “rats.”

“MRN, Ltd. wants to keep all the cheese for themselves. Tell them they have to share,” says the flyer from the Regional Council of Carpenters.

So despite heavy public subsidization, MRN won’t use union carpenters on their development, which includes housing.

By the way, the protesters have been out there for weeks. Have you read anything in the Pee Dee about this?