JobZ

The Albert Lea Tribune came out in support of a new and improved JobZ program tonight in their editorial page

Down to considering the termination of the JOBZ program.The Job Opportunity Building Zone
program has benefited Freeborn County almost more than any other county in the
state of Minnesota. It is a program that has been especially helpful to out state Minnesota.
Now, some legislators from metropolitan Minnesota want it to end. But the metro
area enjoys many perks by simply being large, but the JOBZ incentive helps even
the economic-development field for regional cities such as Albert Lea,
Worthington or St. Cloud.What perks are their for being large? The biggest is
the population to dominate representation in the Legislature, guiding state
dollars toward metro desires. Others include greater federal assistance dollars
and grants, plus greater human resources all around to go after funding sources.
So what harm is there to the metro area in cutting a break to out state Minnesota?
None.We hope what comes out of the discussion is an enhanced, improved JOBZ program.

Then there was this article on the MPR website on JobZ. Here are some highlights

While the battle over the fate of the JOBZ program continues in the Legislature,
participation in the rural economic development program continues to fall
sharply. In 2007, the number of JOBZ projects went down about one-third from the
year before. So far in 2008, participation is off to its slowest start ever.

Worthington, Minn. — JOBZ is the centerpiece of Gov. Tim Pawlenty's rural economic development program. Businesses adding jobs in certain areas get big breaks on corporate, income, sales and other taxes. In JOBZ's first three years, the tax reductions totaled nearly $46 million.
With incentives like that, JOBZ got off to a fast start. About 120 companies signed up the first year, 2004.
Since then, the number of new projects has fallen an average 26 percent a year. That decline accelerated last year.

"I wouldn't describe the whole outlook as bleak," said Dan McElroy, commissioner of the Minnesota Department of Employment and Economic Development, who oversees the program. "But JOBZ needs clarification by the Legislature, and we're working hard to get that."
But right now there's a battle in the Legislature over whether JOBZ will be clarified or canceled. One legislative effort to prop up the program would extend the number of years companies receive tax breaks. Currently, JOBZ benefits are on a sliding scale. Based on JOBZ's 2015 end date, a company signing up this year gets eight years of tax breaks. A business entering the program in 2004 received 12 years of benefits. While some legislators work to revive JOBZ, others want to stop the program. The Senate tax bill contains a provision to end JOBZ. McElroy said some companies are waiting to see what happens in the Legislature before they commit to the program. He said that's part of the reason for a slow 2008. There have been just two JOBZ sign ups so far this year, compared to 17 in the same period last year.

"I'm a little surprised. I hadn't realized it was only two so far," said McElroy. "There are probably 10 more that I know that are in process. But it is not as robust as it would have been in 2006." The slowdown in JOBZ is something Mankato business consultant Ed Tschida has seen first hand. He works mainly with city and county governments on economic development projects, often involving JOBZ. "Certainly, all evidence is that it will continue to decline," said Tschida. "I don't see anything turning that around." Tschida said companies are shying away from the Pawlenty centerpiece for a number of reasons. Some businesses calculate the benefits aren't as rich as expected. Some are concerned that court challenges of JOBZ may prove successful and end the program. Tschida said others complain JOBZ requires them to pay construction wages that are higher than the going rate in the area.

"Having to pay several hundred thousand, or even millions of dollars more, up front was not worth the potential benefit of staying in the program," said Tschida.
Officials with Bedford Technology in Worthington decided against JOBZ for an expansion project when they learned the wage requirement would increase their labor costs 10 percent. Another southwest Minnesota company figured the so-called prevailing wage obligation would increase costs nearly 25 percent. Mankato consultant Ed Tschida said the JOBZ requirements caught some companies by surprise, and their difficulties have slowed participation in the program.
"Businesses that maybe would have rushed into the program a little bit in the past, have found out the program wasn't a good fit. I think maybe we steer some of these businesses away that aren't good fits," said Tschida. "And the cumulative effect of that, I think, has been to see a slowdown in the use of the program."
JOBZ took another blow earlier this year when a Legislative Auditor's report called the program "unfocused." The audit found "significant problems" in administering JOBZ, particularly with the business subsidy agreements. The report said those agreements too often lacked adequate job and wage requirements. As with other JOBZ problems, the Legislative Auditor said it's up to the Legislature to fix the program.

I do see some merit in the JobZ Program in bringing jobs into rural Minnesota. But I would like to know the cost to every taxpayers in freeborn county in bringing these jobZ to our area.

Albert Lea Economic Development Agency Executive Director Dan Dorman attended hearing by the Senate and House Tax Committees on Job Opportunity Building Zone (JOBZ) its interesting to note that Mr. Dorman stated

"Currently in Albert Lea, the JOBZ program has helped create about 600 jobs from a
total of about seven successful projects,

600 hundred job is about the amount of jobs that were lost from the Farmland fire. So I would have to ask are we better off now? Are the wages and benefit packages paid by the company's in the JobZ zones better then what was at the Farmland plant back in 2001?
What I really see is we have a net gain of 0 jobs here. What we have done is replace the Farmland Jobs buy giving 7 company's 8-12 years of free taxes. Or should I say corporate welfare