Tax payers in Vermont may end up paying twice for corporate subsidies: once to the company for creating jobs and then a second time through public assistance to workers at subsidized companies making below the state’s living wage.
After losing to South Carolina in the competition for a new Volvo auto plant, North Carolina is trying to figure out what went wrong. Some blame the legislature’s gridlock over reauthorizing the state’s biggest subsidy program, the Jobs Development Incentive Grant (JDIG). Others say incentives had a minimal impact on Volvo’s decision and that North Carolina would never have been able to outbid South Carolina anyway.
A recent report by the Pioneer Institute evaluates the job creation impact of six years of investment in the life sciences industry in Massachusetts under the 2008 Life Sciences Act. The LSA was funded at $1 billion over 10 years; when the program was launched, former Gov. Deval Patrick announced it could create 250,000 jobs, resulting in a cost of $4,000 per position.
Risky Business, a new report by New Jersey Policy Perspective, urges the state to improve subsidy accountability and protect taxpayers from bad economic development deals. Such reforms are needed now more than ever as spending on subsidies has sky-rocketed under the Christie administration: $5.1 billion has been awarded since 2010, four times the amount awarded in the previous ten years.
A recent series of articles from the Portland Press Herald (see Payday at the Mill and Shrewd Financiers Exploit Unsophisticated Maine Legislators) is bringing new attention to the complex system of state level New Markets Tax Credits (NMTC).