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Next Round of Enterprise Zone Applications (Unofficially) Getting Started

Two Enterprise Zones will expire in early 2012, and, in theory, HCD should be rolling out a new application round in the near future. In fact, in HCD’s press release from December 2010, they said:

HCD also announces the release of the Request for Proposals (RFP) in January 2011 for the next two Enterprise Zones expiring in early 2012, with conditional awards being announced in August 2011. There will be a strong emphasis on renewable energy (wind, solar, etc.) in this round of applications with an additional 100 bonus points being awarded for applications that demonstrate that commitment.

HCD has not moved forward with this application round yet, but at least one jurisdiction is getting ready to apply. From the The Valley Chronicle:

San Jacinto has set out to snag one of the two available enterprise zones available in the state.

The City Council last month decided to file an application to expand its opportunities for job creation and tax base expansion, according to a staff report form Economic Development Coordinator Sharon Paisley.

Paisley said the location and size of the enterprise zone are yet to be determined, but will not necessarily follow the boundaries of any other similar designation, such as the redevelopment district or the proposed multiple-use Gateway at the city’s north entrance.

The size, shape, and location of the enterprise zone, if there is one, will be determined by census tract information, said Paisley.

Under California law, there are 43 [sic] enterprise zones allowed in the state and none can be formed unless someone gives one up.

That has happened in two locations, and that opens the door for what Paisley described in her staff report as a highly competitive application process.

It is an expensive process as well.

Part of the City Council action was to hire DGA Consulting for $100,000 to prepare a feasibility study and application.

The city hopes to split the cost with Riverside County and Hemet, but did not have time to consult either of those neighboring jurisdictions on a joint effort and will proceed on its own until they can be consulted.

Paisley said the competitive character of the application process makes it desirable to file a joint application because it gives the application more weight.

The feasibility study includes determining areas eligible for the designation in San Jacinto, Hemet, and surrounding county area; assessing the community’s economic distress factors; and reviewing local economic development plans and local funding and business incentives.

Paisley’s report said areas with enterprise zones tend to have higher employment and hiring rates that similar jurisdictions without such zones, and that businesses consider an enterprise zone a positive when considering locating or relocation.

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