The budget released today completely eliminates all of California’s 42 Enterprise Zones.  It also takes away all prior credit carryover.  However, many see this is a starting point for negotiations.  

Assemblyman Dan Logue, R-Linda, who opposes eliminating enterprise zones, said the state needs to do more to create jobs, not less.“The governor has to realize that to create wealth and revenue, you have to give businesses a reason to develop in an area,” said Logue.

He added in the last decade, the majority of new jobs created in California came in areas where there were enterprise zones.  But because the initial budget proposal from the governor often undergoes several revisions before it’s passed and signed, Logue said, Brown may be including the cuts as a negotiating tactic.

Read the full article here.

Press release from Siskiyou County:

Siskiyou County Economic Development council responded quickly to Senator Doug LaMalfa’s request for supporting documents to ensure the continuation of the Enterprise Zone program in California.  Governor Jerry Brown announced shortly after taking office that the enterprise zone tax credits may be eliminated in the new budget.  The SCEDC provided the Senator with a letter of support and testimonials from many Siskiyou County businesses who utilize the enterprise zone program.

January 5, 2011

The Honorable Doug LaMalfa                       

CA State Senator, 4^th District

State Capitol, Room 3070

Sacramento, CA 95814

Dear Senator LaMalfa:

The Siskiyou County Economic Development Council fully supports your efforts to ensure the continuation of the California Enterprise Zone program. The Siskiyou Enterprise Zone was created on June 22, 2008. The Siskiyou County Economic Development Council administers the zone in service of its eight partner cities and the County of Siskiyou.

The SCEDC works with its partner cities, CPA’s and businesses to help them utilize the program. The program has grown from 260 employee tax credit vouchers processed in 2008 to 542 vouchers processed in 2010.   Sixty-six employers voucher employees through the SCEDC of which 61 are categorized as small companies with less than 50 employees. The 542 vouchers processed in 2010 represent 542 jobs created within Siskiyou County.  

The value of enterprise zone tax credits to Siskiyou County employers is considerable given the number of privately owned, small businesses who use the program. The dollars that they are able to reinvest in their companies are critical to the economic recovery and growth in Siskiyou County.

Sincerely,

Tonya Dowse

Executive Director

Newly elected Democrat Luis Alejo, of the 28th Assembly District, is lining up in favor of Enterprise Zones.  “The Enterprise Zone program should be strengthened rather than eliminated,”  Alejo said in a January 1 article in The Californian.  Although a new Democrat, Alejo was picked by Speaker Perez to be Vice Chairman of the Assembly Local Government Committee.  Alejo is also a member of the Assembly Budget Committee.  He joins JEDE committee chair Manuel Perez in voicing strong support for the Enterprise Zones.

The League of California Cities urges everyone to contact their local political leaders and educate them as to the benefits and worthiness of the EZ program.  “City officials from communities with Enterprise Zones are encouraged to begin talking to their legislators now about the jobs and economic benefits these zones bring.”  View the Leage of Cities piece.

San Joaquin County’s governmental bodies have rallied behind a proposed expansion of the region’s business-friendly Enterprise Zone, but economic development leaders say a fight to keep the program alive is upcoming.

San Joaquin County Economic Development Director Fran Aguilera adamantly supports the EZ.  ”The zone is the biggest tool we have to attract business, and to keep them here.  It’s ludicrous. If you do something that hurts businesses … you’re hurting employment.”

Read the story here.

“Salinas, Greenfield and other south Monterey County cities lining up to take action are doing the right thing by approving expansion of the Salinas Valley Enterprise Zone.  By doing so, they are sending a message loudly and clearly that we welcome businesses to set up shop in our communities.”

  Read the article here.

Coachella valley EZ has come up with a simple yet catchy way to advertise its EZ.  They’ve put up road signs alerting businesses that they are “entering” an EZ.  Here’s the article.

The LA Times editorial board actually wrote last week that California’s businesses are not overtaxed.    Some might disagree with that proposition.  Loren Kaye, President of the California Foundation for Commerce and Education brings some pretty convincing facts to prove that California’s businesses are considerably overtaxed and at a disadvantage right out of the gate because of oppressive taxation and poor leadership.

The fundamental problem with the Times article, and much of the left-of-center criticism of California business taxation – is that they posit a world where public policy is a passive pawn in the hands of manipulative corporations, in the words of Controller John Chiang, “A lot of the tax credits are given to larger business…”

No, not “given.” Companies invest in California, buy equipment and buildings, hire workers, are successful in producing and selling their product or service, make a profit – in California – pay taxes, and earn a credit if they have made investments according to the policies underlying the credit. This is an active, dynamic and competitive economy, influenced by state policy and the interest in businesses in investing here.

Read the entire article here.

That’s what Fox Business News guest called California’s legislature in explaining why 144 companies left California this year.  Business relocation expert Joseph Vranich listed a host of reasons why California is the worst state in the union to do business.  Negative business climate, high regulation and excessive taxes were all reasons why companies are fleeing California.  Los Angeles, Vranich said, was the worst city in United States to do business.  See the interview here.

Mission Foods is taking advantage of the new Valley EZ by opening up a $50 million facility that will produce 400 new jobs.  Read the San Fernando Valley Business Journal article.