HCD has announced three winners of the most recent round of Enterprise Zone applications. As reported here earlier, HCD received seven applications for two open slots. But with the application of two zones that have not yet expired, the total possible new designations climbed to four.

The following is from the Department’s press release:

– To assist in the creation of jobs and thereby improve California’s business climate, the California Department of Housing and Community Development (HCD) today announced the conditional designation for three Enterprise Zones statewide. The zones are Anaheim, Harbor Gateway and Santa Clarita Valley.

The California Enterprise Zone Program targets economically distressed areas using special state and local incentives to promote business investment and job creation. By encouraging entrepreneurship and employer growth, the program strives to create and sustain economic expansion in California communities.

“The Schwarzenegger Administration has approved 36 Enterprise Zones in the last 4 years, the first new designations in the program since it was started in 1986. This program is vital in being able to compete in the global market to attract and retain businesses in California, while at the same time increasing the number of jobs with state and local incentives,” said HCD Director Lynn L. Jacobs.

The new designations will take the place of the zones set out in statute which expired in 2010. Each zone designation is in effect for 15 years.

The current Santa Clarita zone was designated in 2007. In order to create a zone in partnership with the County of Los Angeles to include some unincorporated areas, they opted to apply for this new zone which will then sunset the original zone once the new zone received final designation.

In the same press release, HCD also announced the start of its next designation round for two slots that will open when the Antelope Valley and Watsonville zones expire in 2012. The statement says that they plan to award the new conditional designations by August of 2011.

The Shafter Enterprise Zone expires today, October 3, 2010 after 15 years of designation.

According to an HCD official, they received seven applications for the two available Enterprise Zone slots in 2010. The applicants were:

1. Anaheim Enterprise Zone
2. Antelope Valley Zone
3. Desert Communities Enterprise Zone
4. Los Angeles Harbor Gateway Communities Enterprise Zone
5. Madera County Enterprise Zone
6. Santa Clarita Valley Enterprise Zone
7. Victor Valley Enterprise Zone

So we might actually see as many as four new zones designated if Santa Clarita and Antelope Valley’s applications are within the top four scores. HCD has previously indicated that they hoped to announce the winners by the end of the year.

The deadline to submit applications to HCD to become a new Enterprise Zone in 2010 is Sept. 15. There are only two openings, so the competition will be significant. The two expiring zones are Lindsay and Shafter; of course, Lindsay is part of the new Sequoia Valley zone and therefore won’t apply for a new zone.

Here is a collection of findings indicating what that competition might look like:

Based on this City Council agenda, it appears that Shafter will apply to replace its zone.

Santa Clarita will be applying for a new zone in partnership with Los Angeles County to replace its existing zone. This is a similar maneuver that worked for Sacramento last year, if successful they would not use up one of the two openings.

There had been some earlier interest to make a similar move in Imperial Valley, but that process will not be proceeding in this application round.

The City of Los Angeles and the City of Huntington Park will attempt to get a new zone to replace the Harbor Zone which was unsuccessful in its 2008 bid.

Three west valley cities–Cathedral City, Desert Hot Springs, and Palm Springs, are in the process of jointly applying for what would be the Coachella Valley’s second enterprise zone.

Anaheim, one of the 2009 round applicants, has considered an application in the 2010 round.

The cities of Apple Valley and Victorville with the County of San Bernardino are considering applying for the “Victor Valley Enterprise Zone.”

In the 2009 application round there were 15 applications for four open slots. I would expect we should see a similar number of applications for this round as well.

According to this article in The Signal, Santa Clarita and the County of Los Angeles will attempt to pull off the same maneuver Sacramento used last year to create a new, larger Enterprise Zone.

If successful in applying for a new zone, they would prematurely opt to expire the current Santa Clarita zone and enable HCD to designate three rather than two new zones in 2010.

The 2010 Enterprise Zone application round officially starts today with HCD’s publication of the new application guidebook.

There are two zones expiring this year, and the deadline to submit applications is 9/15/2010.

Last month I reported on a movement to combine the Imperial Valley and Calexico Enterprise Zones into a single regional zone for Imperial County. That proposal, apparently, is not without controversy.

From the Tribune Weekly Chronicle:

The Calexico City Council will hear recommendations about the possible new Imperial County Enterprise Zone.

The Calexico County Enterprise Zone and the Imperial Valley Enterprise Zone in Brawley have discussed the possibility of merging into one zone that would include all seven cities and the unincorporated areas of the Imperial County. If approved, the Imperial Valley EDC could end up being the manager of the County Enterprise Zone.

The CCEZ is composed of the City of Calexico, Imperial County, and Imperial Irrigation District as designated by the State of California in 2006. The agencies contribute approximately $60,000 each towards the annual administrative cost. CCEZ Manager Daniel Fitzgerald told the council that John Nunn, State of California Enterprise Zone Manager, encouraged Imperial County to apply as one zone as this would free up one zone in the State that could be awarded to another jurisdiction. Fitzgerald said if he is given direction by the council to bring information for the deliberation of the Council to accept this merger or not. Deadline to apply for this new designation is August 18, 2010.

Councilman John Moreno said to be opposed to have one designation since El Centro has Imperial Valley Mall and other businesses that create tax revenue for the City. Moreno said Calexico could lose its competitiveness in bringing new industry if there is a valley wide enterprise zone. Moreno made a motion to deny this countywide EZ with Mayor Ouzan seconding the motion. Councilman Daniel Romero said that he had reservations about this countywide designation but after meeting with Daniel Fitzgerald he thinks that a regional effort will be good for the valley. He said that there will be a lot of impact and asked to have all the information presented to the Council before taking a final decision

Councilman Moreno agreed with Romero to have all the information be given to the Council and then vote on the resolution. Moreno said he doesn’t support the Countywide Zoning but agreed to give direction to the CCEZ Manager do research about the pros and cons of this initiative.

Pending legislation notwithstanding, two Enterprise Zones are scheduled to expire in 2010, Lindsay and Shafter.  Another two, Antelope Valley and Watasonville, will be expiring in early 2012.  After that, there will not be another opportunity to apply for a new zone designation until the Stanislaus County EZ expires in 2020.

The City of Lindsay is already included in the new Tulare County Enterprise Zone, so we won’t see them as part of the competition.  But we are already starting to see prospective zones gearing up.

Of course, there are the 10 applicants who were not winners in 2009.  The San Fernando Business Journal is reporting that the cities of Lancaster and Palmdale are are already preparing their applicaion for 2012.  And in the Victor Valley Daily Press there is this story about high hopes:

A regional economic development group is looking to follow the city of Hesperia’s example by possibly getting a huge portion of the Victor Valley declared an Enterprise Zone.

The designation would create a number of significant tax incentives to help lure businesses to the region.

“An enterprise zone is a very effective economic development tool,” said David Zook, chief of staff for 1st District Supervisor Brad Mitzelfelt. “It gives a company looking to locate a facility tremendous incentives to locate there.”

Among those incentives are generous tax credits for hiring new employees and substantial sales tax credits on new equipment, so a business such as Dr Pepper Snapple Group could get a break on the pricey bottling equipment that’s being rolled into its coming plant at this moment.

Mitzelfelt chairs the Victor Valley Economic Development Authority, charged with overseeing the revitalization of 10,500 local acres impacted by the closure of George Air Force Base in 1992. VVEDA’s project area includes almost all of Victorville, large chunks of Adelanto and Apple Valley, a portion of Hesperia and patches of unincorporated San Bernardino County scattered across the Victor Valley.

VVEDA’s board this month approved paying some $9,000 for a consultant to study the feasibility of a VVEDA Enterprise Zone. Zook said the results are due back in November.

If the group is successful, the Victor Valley’s enterprise zone designation will last for 15 years.