St. Paul - Economic development incentives that were originally intended to help revitalize older areas are instead being used by outlying suburbs to pirate jobs and tax revenues from older cities in the Twin Cities metro area. Local officials need a cooperative structure to curtail zero-sum job piracy and focus instead on jointly promoting the region. And the state should use incentive deals as leverage to make more jobs transit-accessible and alleviate traffic congestion.

Those are the key findings of a report released today at a St. Paul press conference. The Thin Cities: How Subsidized Job Piracy Deepens Inequality in the Twin Cities Metro Area examines 86 business relocations involving 8,200 jobs and $90 million in subsidies that occurred in the Twin Cities metro area between 1999 and 2003.

The report is available at http://goodjobsfirst.org/pdf/thincities.pdf. It was funded by the Ford Fundation.

"This is the largest study ever performed of subsidized corporate relocations," said Greg LeRoy, executive director of Good Jobs First and lead author of the study. "It suggests that the economic war among the suburbs may be a bigger problem than the so-called 'economic war among the states.'"

Comparing places that lose jobs to those that gain them, the study finds that the relocations have the net effect of creating deeper regional inequality by measures of poverty, unemployment, welfare, or tax base wealth.

It finds that four fifths of the relocations were outbound and 22 of the companies moved outwards more than 10 miles, receiving subsidies such as free land and property tax breaks from outlying communities. Despite the region's traffic congestion crisis, nearly 70 percent of the relocations arrived at locations that are inaccessible via public transit. That means fewer job opportunities for low-income workers who cannot afford a car.

The report recommends convening a cooperative regional system, making transit access a requirement to qualify for job subsidies, and modernizing the metro area's Fiscal Disparities Act tax-base sharing program to reflect 35 years of growth.

Good Jobs First is a national resource center promoting accountability in economic development and smart growth for working families. Based in Washington DC, it has project offices in New York and Chicago.