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Op-Ed: Enterprise Zone Critical for Salinas Valley

Salinas Valley Enterprise Zone manager Andrew Myrick published the following Op-Ed in The Californian:

On Jan. 30, 2009, the Salinas Valley Enterprise Zone, a partnership between Monterey County and the cities of Salinas, Gonzales, Soledad, Greenfield and King City, took its place as the newest Enterprise Zone in California. The state’s Enterprise Zone Program offers tax incentives to businesses of all sizes and across all industry lines, including a tax credit for businesses that hire new employees. Established in 1984, the program is designed to get businesses to locate, invest and create jobs in economically distressed areas of the state.

Throughout the past 25 years, Enterprise Zones have proven to be a valuable asset to California’s economy. In fact, a study titled “2006 Report to the California Department of Housing and Community Development on Enterprise Zones” states that during a 10-year span the Enterprise Zones “experienced, as compared to the rest of the state, decreases in unemployment, property taxes and vacancy rates.” Furthermore, the report concluded that the Enterprise Zones “saw increases in household incomes, rents and wage and salary income,” thus further exemplifying that the program is a benefit to California and its residents.

A number of businesses in the Salinas Valley rely greatly on the program for the opportunity to create more jobs and increase employment opportunities in their local communities. Without it, these businesses would find it harder to get involved in revitalizing struggling neighborhoods, bolstering local economies and helping individuals who would normally face disadvantages to being hired.

Between July 2009 and June 2010, the Salinas Valley Enterprise Zone issued 930 vouchers, with each voucher representing a job created or sustained with the help of the Enterprise Zone program, with a total value to the Salinas Valley of over $4 million. This is money local businesses would have paid in taxes, but can now use to reinvest in their businesses and the community. Job opportunities were created in a variety of fields, including agriculture, manufacturing, health care, retail, and wholesale trade.

California’s ongoing budget challenge has impacted every state program, and talk is under way of severely shrinking or eliminating the Enterprise Zone program to save money. This would be devastating to businesses that have hired new employees, purchased new equipment or taken out a loan based on the promises made to them, and would discourage others from taking those steps. While some modifications to the program are inevitable, legislators need to do all they can to preserve the Enterprise Zone program to encourage businesses to plant their roots in the state, increase job growth and get Californians back to work.

Here in the Salinas Valley, all of our communities struggle with unemployment, and we need to work to attract new businesses to the area while helping existing businesses stay in business or expand their operations. We have taken the first steps toward these goals, but there’s still a long way to go before we can claim success.

We need to keep the Enterprise Zone program strong enough to make a difference to local businesses and our community.

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