Develop a new system to grant public funds
Once again we are in the middle of a big industrial development agency struggle. A company/developer applies for tax breaks, citizens line up on one side or the other, much ink is spilled, many meetings take place and in the end the company gets the tax breaks – in the name of “economic development and job creation.”
We’ve improved the process somewhat, in that it is more transparent than it used to be, and the use of “claw backs” to recover the tax benefits in the event the jobs are not created are somewhat stronger. But in the end, it all boils down to “that’s just the way we do business now.” Private companies get taxpayer funding as an inducement to do business here.
I’d like to propose a different way of looking at this, in an effort to shift the existing paradigm: If we give a private company a tax or other monetary benefit, paid for with public, taxpayer funds, then the public owns a piece of that project. The value of the public funding becomes a lien on the company/project. This would have to be paid back in the event the company did not deliver the jobs, if the company moved or was sold. Otherwise, it would just remain on the books. The company could choose to pay it back if it wished, or just let it ride.
This establishes the fundamental principle that public funds are investments in the present and future prosperity of our region, and we want our investments recognized as such, and protected. They are not gifts. The idea that we give out public funding to private companies as just the cost of doing business has to end. Now is a good time to start.
Eric A. Gallion