The Center of the California Enterprise Zone Information Universe

An Editorial and an Expansion

A pro-Enterprise Zone commentary appeared in today’s Capitol Weekly.

And the City of Los Angeles received approval for a significant expansion of its Enterprise Zone in areas of the San Fernando Valley. Here is the story from the Los Angeles Daily News:

An expanded enterprise zone that will encompass many of the San Fernando Valley’s top business centers is expected to save or generate thousands of jobs and has already attracted millions of dollars in investment, city officials said Wednesday.

The expansion of the zone to 5,444 acres across the Valley is expected to be formally announced this morning by First Deputy Mayor Austin Beutner during the Valley Economic Summit at the Sheraton Universal Hotel.

The enterprise zone now includes land zoned for industrial and manufacturing use in Chatsworth, Canoga Park, Northridge, the Van Nuys Airport corridor, Warner Center and the Northeast Valley industrial area.

“With 37 percent of the population and 47 percent of the city’s land area, the San Fernando Valley’s economic vitality is of utmost importance to all Angelenos,” Mayor Antonio Villaraigosa said in a statement. “Enterprise Zones help businesses lower their operating costs and promote hiring and capital investment through tax credits and deductions.”

Several businesses have already committed to hiring and investing in their Valley locations because of the expanded zone, according to officials.

Audi of Woodland Hills Auto Gallery, which has 35 full-time employees and 60 construction jobs, will make a $5 million investment and has projected $50 million in sales, according to the Mayor’s Office.

Micro Solutions Enterprises, which manufactures and distributes toner cartridges from its 200,000-square-foot facility in Van Nuys, will invest $2 million in capital improvements in the next year. The company employs 700 people and expects to hire 100 by next year.

Sightline, a Woodland Hills radiology clinic, will invest $1.5million in capital improvements, officials said.

Stuart Waldman, president of the Valley Industry and Commerce Association, said the enterprise zone expansion was the result of months of work between different organizations and the city.

“We were working with other groups to try to get this and it will be a big boost for the Valley,” Waldman said. “It will provide tax breaks and breaks on DWP, and I think it will particularly help manufacturing areas like in Van Nuys. But all of the Valley will benefit.”

Incentives for businesses in the zone include a $37,400 tax credit for each employee hired, tax credits for buying machinery and equipment, priority bidding on state contracts and deductions on loan interests.

The city will offer a 35 percent reduction on utilities from the Department of Water and Power, site plan review fee waivers and reduced parking rates.

Other major businesses that will be impacted by the zone include those in the Warner Center business district such Northrop Grumman Corp., Kaiser Permanente and Health Net, which has about 2,000 employees.

“As one of Warner Center’s largest tenants, we salute the creation of the enterprise zone,” said Health Net spokesman Brad Kieffer. “It’s a valuable approach that will undoubtedly strengthen and enhance the local climate by attracting and retaining important businesses.”

Major businesses in Chatsworth and Northridge include 3M and Nestle Foods, while the Van Nuys Airport corridor contributes more than $1.3 billion annually to the Southland and supports 12,300 jobs, according to the Mayor’s Office.

A previous enterprise zone established in the East Valley has spawned development at the former General Motors plant in Panorama City and a new Costco in Pacoima.

“Having the enterprise zone expanded in the San Fernando Valley is some of the best news we have ever had,” said Bruce Ackerman, president and CEO of the Valley Economic Alliance. “This gives us the ability to retain existing businesses that may be considering moving from the Valley and enhances our ability to attract new businesses from outside of the state.

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