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The Daily Tar Heel Thursday, April 27, 19895
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Downtown Commission pons budget hopes on proposed tax
By CRAIG ALLEN
Y Staff Writer
-'Franklin Street merchants should
Xbear the burden of financing the
revitalization of the downtown bus
iness district, the president of the
.Chapcl Hill-Carrboro Downtown
'Commission said Wednesday, refer
ring to a proposed special tax district
Jp'r downtown Chapel Hill.
! The district, first proposed in a
Feburary petition by the commission,
w;uld encompass most Franklin
" Street merchants. Merchants within
rtrie district would pay an additional
"..seven cents per $100 of property.
.The proposal is now before the
' Chapel Hill Town Council. It will be
;the subject of a public hearing May
The commission, which has ambi-t-tious
plans for next year, has based
;. more than 40 percent of its 1989-90
'"budget around income from the
;;JNew .economic figures indicate inflation
I From Associated Prsss reports
f WASHINGTON The govern
crrient reported Wednesday the U.S.
economy topped the $5 trillion mark
l fox the first time last quarter, powered
by a strong 5.5 percent growth rate
0 that caused some analysts to express
v concern about rising inflation.
X'.Even discounting for a statistical
jl bounce back from the 1988 drought,
. a major factor in the overall increase,
j' tfie gross national product (GNP)
I grew at a solid 3 percent annual rate
. during the January-March period,
'tfie Commerce Department reported.
Antonio Villamil, chief economist
1 for the Commerce Department, said
:the economy's performance in the
fifst quarter "appears to be consistent
vwlth moderate, sustainable growth
'fbr the balance of the year" and
Contains no threat of a recession.
I, Commerce Secretary Robert
Mosbachcr said the growth pattern,
!;iri which the pace of consumer
" spending slowed while exports and
y business investment rose, was "a
desirable one for the sustainability of
the economic expansion."
f Private analysts cautioned, how
ever, that the report offered some
trpubling indications that inflation
- -'A GNP index that measures prices
146.90 million shares
420 421 424 425 426
Source: Edward D. Jones & Co., Chapel Hid
special tax district, according to the
April issue of the commission's
The commission's plans include a
trolley system to help combat parking
problems, special sidewalk cleaning
and other programs designed to
improve the attractiveness of the
downtown area. '
If the proposal does not pass, the
commission will be left to private
contributions to make up the differ
ence in its revitalization budget, said
Debbie Dibbert, co-director of the
"We are going to go on the
assumption that (the proposal) will
pass," Dibbert said.
Joseph Hakan is president of the
commission, a group of local mer
chants working to revitalize the
slumping downtown business district.
According to Hakan, the com
mission is confident the proposal will
for a fixed-market basket of goods
and services rose at an annual rate
of 5 percent in the first quarter, up
from 4.2 percent during the previous
While half of the increase was
linked to a pay raise for government
employees, "certainly it suggests we're
in a period of accelerating inflation,"
said economist David Jones of
Aubrey G. Lanston & Co. in New
Robert Dederick, chief economist
for Northern Trust Co. in Chicago,
said the economy's strong growth in
the first quarter was "too much of
a good thing."
"The report suggested that the
economy was still growing at a rate
too fast for comfort and the man
ifestation of this was in the inflation
figure," Dederick said. "No matter
what you look at, the inflation worry
Villamil said that discounting the
effects of the pay raise and recent food
and energy price increases, the
underlying inflation rate seems to be
holding "at a stable lower level of
about four or four-and-a-half
By JADA K. HARRIS
. Downtown Chapel Hill should
reflect the absence of the majority of
the student population in a business
slump during the summer sessions.
"We get people who live here and
have for most of their lives. That
business doesn't change. It's the lack
of 25,000 students that hurts our
business," said Paul Wiester, man
ager of Hector's International Foods.
"We go into a major slump. About
one-third of the business is student
During the day, most of the sales
come from business people rather
than students, he said. "But at night
it's usually all students and locals that
hang out at the bars."
Other places even more heavily
dependent on University traffic do
well to stay afloat during the summer.
"(Business) slows down a lot," said
John Kessler, manager of Copytron.
"It (summer) is when people take
vacations. We feel happy if we're
making labor. We just relax and wait
for the students to come back."
But most merchants agree that with
the students gone, local people are
more likely to come downtown.
"Townspeople come out and spend
Call to boycott Exxon not felt
By TOM PARKS
Despite calls for Chapel Hill
drivers to boycott Exxon Corp.
products in protest of the oil com
pany's handling of last month's
Alaskan oil spill, local Exxon sta
tions' sales have not suffered, accord
ing to company employees.
Tommy Wagner, manager of the
Highway 70 Exxon in Durham, said
the Alaskan oil spill has not harmed
"It hasn't affected . my business,
hasn't affected a thing (about his
Wagner said he has heard rumors
about a boycott, but he said he felt
a boycott of Exxon would hurt local
businesses more than it would Exxon
Corp., which, behind General Motors
and Ford, had the third highest sales
of any company in the nation for
"I don't think it (a boycott) would
change much of anything," Wagner
pass because many of the merchants
who will benefit from downtown
revitalization are also members of the
"We have faith that it will pass,"
said Hakan. "We call it an investment
Mickey Ewell, owner of Spanky's
restaurant on Franklin Street, said he
thought the cost of the tax would be
minimal and would fund some worth
while projects. Ewell said he sup
ported the tax as long as it was used
for downtown revitalization.
"I do not think we ought to be
paying it (the tax) just to be paying
it," he said.
Walter Baum, owner of Baum
Jewelry, said he supported the tax but
did not think it would have a large
effect, especially on the lack of
"I dont think it's going to have a
dramatic effect," Baum said. "Park-
The 5.5 percent annual rate of
growth was the highest since a 6.1
percent increase in the fourth quarter'
It reflected an improvement in the
trade deficit after two negative
quarters, as exports rose 10.6 percent
while imports advanced just 2.3
percent, and business investments
increased by a strong 9.6 percent.
Lottery numbers picked
HARRISBURG, Pa. Players
drove, flew, took the train and walked
to the nearest Pennsylvania lottery
ticket counter up to the last minute
Wednesday before the winning North
American record jackpot of more
than $100 million was drawn.
The official winning numbers were
06; 16; 24; 34; 35; 37; 40; 41; 45; 60;
71. A winning ticket must have seven
of the 1 1 numbers drawn.
James Scroggins, the lottery's
executive director, said the prize
would be "something higher than
$100 million when it's all said and
How much higher wont be known
until sometime Thursday, but unof
ficial estimates put the jackpot in
excess of $1 10 million. And Scroggins
said lottery officials wont know until
"(In summer) we just relax and wait
for students to come back.9!
manager of Copytron
time enjoying what downtown is all
about," said Perry Dowd, owner's
assistant at Spanky's.
A lack of students brings with it
more parking, and this helps to draw
the people back downtown, mer
chants said. '
But many businesses do not depend
as heavily on the student dollar.
"Our business doesn't slow down
a whole lot," said Frank Heath,
owner and booking agent of Cat's
Cradle. "It's based on what bands
play and how many people want to
see the bands."
Heath said this type of demand and
slowdown of business worked two
ways. Even if it does slow the business
down to fewer days per week, the
promotion for the bands goes up
because they have more time to
devote to each one. This in turn drives
Slick talk, no action."
flyer on Franklin Street kiosk
. The Exxon supertanker Valdez
spilled more than 1 1 million gallons
of oil after striking a reef off the
Alaskan coast March 24.
Following the oil spill, fliers
reading, "Boycott Exxon! Slick talk,
no action," began appearing on
Franklin Street's kiosks. The focus of
the fliers was a black-and-white
picture of an oil-covered bird.
Michael Stipe, the lead singer of
Georgia rock group R.E.M., asked
fans to boycott Exxon during the
band's concert Saturday in the Smith
ing has been a problem in Chapel Hill
Other merchants support the pro
posal for various reasons. Robert
Humphreys, owner of Chapel Hill
Cleaners, said parking in Chapel Hill
was not the major problem to be
addressed. Instead, he said, the
problem concerns public relations.
Merchants have contributed to the
"negative feeling" between merchants
and consumers by continually com
plaining about parking, convincing
consumers that a trip to the down
town district is not worth fighting for
a parking space.
to make downtown a
people' want to come
again," Humphreys said. "We've been
cutting our own throats by sending
out some bad signals about parking,
Some merchants, however, oppose
Friday if any winning tickets were
In an average week, the state
usually sells about 4 or 5 million
tickets, but on Tuesday alone about
24 million tickets were sold, said Karl
Ross, deputy revenue secretary. From
6 a.m. to 1 1 a.m. Wednesday, about
7 million tickets were sold. Players
came from all over the country.
But lottery officials considered the
nightmarish possibility that no one
would win Wednesday night's Super
The odds of any one ticket bearing
seven winning numbers are 9.6
million to one. With more than 74
million tickets sold in the last week,
lottery officials said that they
wouldn't know for certain until
sometime Friday if a winning ticket
' had been sold or how many had been
They said the computer would give
them a preliminary indication Thurs
day afternoon, but that it would take
another day to complete backup
reviews of ticket numbers.
If there is a rollover, next week's
jackpot could approach $200 million,
payable over 26 years, and some
lottery agents would run out of
"(During the summer) we promote
what we do have better. With a band
every night, it's hard to convince
people this is the show they should
go to," Heath said.
Other businesses have greater
success in the summer and combat
the slump of the student population
with the heat itself.
"We're not dependent on the
student population because we have
a product that everybody wants," said
Kathy Kennedy, owner and manager
of Ben and Jerry's Homemade Ice
"We lose the population, but these
are the biggest (sales months) of the
year," Kennedy said.
In fact, rather than cutting back,
Ben and Jerry's has expanded its
hours to stay open later on Fridays
Since Ben and Jerry's is a new
On Wednesday, an employee of
McFarling's Exxon on Franklin
Street would only say that he had no
comment about the spill.
"It (the spill) doesnt have any effect
on the business. We just dont talk
Students hold different views on
whether a boycott would be effective.
Liz flennett, a junior biology
major, said she planned to send her
Exxon gas credit card back to the
company to protest the company's
handling of the spill.
"I'm going to cut it in half and send
it to them with a nasty letter."
the tax proposal. A Franklin Street
merchant who asked not to be
identified said the tax proposal is
unfair to merchants. Because of this
minimum wage hike
By FRED WILLIAMS
President Bush and Congress
seem to be headed for a confron
tation over plans . to raise the
hourly minimum wage as both the
Senate and the House of Repre
sentatives have passed plans to
raise it to $4.55, and Bush has said
he will veto any bill that raises it
The minimum wage has been
$3.35 since 1981.
The Senate last week passed a
bill sponsored by Sen. Edward
Kennedy, D-Mass., that would
raise minimum wage by incre
ments to $4.55 by October, 1991.
In a concession to Bush and
Southern Democrats, the bill
allowed for workers to be paid a
sub-minimum training wage dur
ing their first two months in the
job market. The House passed a
similar bill last month, but rrinor
differences in the two bills will
have to be worked out in a
conference committee before
being sent to the president.
The bill passed the Senate 62
37, slightly less than the two-thirds
majority needed to override a
North Carolina's senators fol
lowed party lines in voting on the
Republican Sen. Jesse Helms
voted against the bill. Helms is
against any type of raise in the
minimum wage, because it would
be "inflationary and cost many
jobs," according to Barbara Lu
kens, a Helms spokeswoman.
Democratic Sen. Terry Sanford
voted for the bill. A representative
for Sanford said the senator only
supported the bill after the wage
business downtown, the owners said
they "don't have a clue" as to what
-However, Baskin Robbins, a more
established Chapel Hill ice cream
parlor, has a different idea.
"Summertime brings more busi
ness for us, but we depend on summer
school students and visitors," said
Manoj Pandya, owner and manager
of Baskin Robbins on Franklin
Special deals and promotions
throughout the summer and around
Mother's and Father's days will be
used to attract more repeat
"New faces do come down here,
and they dont tend to want to come
back," Pandya said. "We're trying to
call them back with the specials."
Chapel Hill Transit will be cutting
back its hours to reduced service at
the end of the semester.
"We put service on the street based
on the University demands," said
Scott McClellan, administrative
assistant of Chapel Hill Transit.
Of the four campus routes, only
two (U and S) will be operating
during the summer. The law school
shuttle and the P lot shuttle will not
be in service.
Patrick Heron, a freshman from
San Francisco, said pressuring Con
gress to enact stricter regulations for
oil tankers would be more appro
priate and effective than a boycott.
"I don't think a boycott at this time
is the proper way to influence
Avery Upchurch, owner of Avery
Upchurch's Exxon in Raleigh, said
it was hard to gauge whether a
boycott had affected his sales because
of an industrywide rise in gasoline
prices that coincided with the spill.
"As far as customer reactions, we
haven't seen a change," he said.
Gasoline prices normally rise in the
summer months, Upchurch said.? .r
An Exxon spokesman interviewed
earlier this month said the rise in
gasoline prices was caused by a
number of factors including a rise in
crude oil prices, new Environmental
Protection Agency regulations and,
in the short term, the Valdez spill.
proposed special tax district, the
merchant said, downtown businesses
would be burdened with a tax based
solely on location.
level was lowered from $4.65 to
Congressman David Price, D
N.C. 4th Dist., voted in favor of
the House's proposal last month.
"He feels an increase in min
imum wage is long overdue,"
Rachel Perry, a spokeswoman for
Evaluating the raise proposal is
a matter of "weighing the costs
against the benefits," said David
Blau, a UNC Associate Professor
A benefit would be a raise for
workers already in low-paying
jobs, but the costs would be fewer
jobs available for the low-wage
worker, he said.
Although the minimum wage
level has not been keeping pace
with inflation, Blau said most
economists would agree that on a
"purely economical level" the raise
is not justified because of the loss
of low-level jobs that would result.
A training period sub-minimum
wage is "an attempt to ameliorate
the job-loss effects," Blau said.
What might actually happen is
that some companies could use the
provision to get around paying the
regular minimum wage, he said.
After an employee had been
working for two months at the
training wage, the company could
fire him and replace him with a
new worker who would also be
paid the training wage.
The bill would affect students
in different ways, Blau said,
depending on their jobs. "If they
have a job, and are able to keep
it, it could help them." But there
would also be fewer jobs available,