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Local Business Feeling Pressure to Move if Enterprise Zones Scrapped

The Sacramento Bee published an Op-Ed by Cindy Schock, the HR/payroll manager of Scientific Specialties Inc. in Lodi, in response to one if its editorials that was against the Enterprise Zone program:

Re “Abolish a failed tax break, plug a budget hole” (Editorial, Feb. 8):

The Bee’s editorial advocating for abolishing enterprise zones both is misleading and makes unfounded assumptions and generalizations regarding the effectiveness of this program.

Opponents are relying on old, inaccurate data, overgeneralizations and baseless claims to support their arguments – and The Bee is no exception. The study they cite relies on outdated information and questionable assumptions, not to mention that there is another study conducted by researchers at USC that shows enterprise zones create jobs, generate economic growth and help alleviate poverty. In fact, when you look at the real data, and talk to real employers who utilize the program, the benefits of enterprise zones are clear.

Last year, 10,000 businesses in 42 enterprise zones created 20,000 new jobs and retained an additional 92,000 employees!

My company wants to stay here, continue hiring California workers and be part of the California recovery. But the day that the governor announced his intention to end this program, our company began being courted by other states. South Carolina, Arizona and Montana have all called to schedule appointments to review the benefits of moving out of California. They all cited the end of California’s enterprise zone program in their pitch.

Enterprise zones are an investment in a community and our overall economy. They provide important incentives to businesses to relocate to our state or stay here at a time when neighboring states are trying to attract our businesses. By focusing on underprivileged areas, enterprise zones provide unprecedented job opportunities to the previously unemployed, veterans, those reliant on taxpayer-funded services, etc.

In fact, the nonpartisan Legislative Analyst’s Office agrees that enterprise zones increase wages of people located in a zone and help decrease bureaucratic red tape that contributes to California’s bad business climate.

Enterprise zones will save tax dollars by employing people previously receiving government services. Eliminating the program will be a nearly $1 billion tax increase on California businesses. The governor’s proposal includes the elimination of previous tax credits, called carry forward credits. According to the nonpartisan Legislative Counsel, this will be a tax increase and requires a two-thirds vote of the Legislature.

Now is not the time to increase taxes on businesses or jeopardize good-paying jobs in California. We must keep enterprise zones and the jobs they create and the businesses they attract.

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