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Tale of Two Enterprise Zone Applications

There are a pair of stories out today about new communities’ interest in applying for an Enterprise Zone designation. The Desert Sun reports that the Riverside County Board of Supervisors has approved an application that would include the Western Coachella Valley:

“We really need all the help we can to get some economic action out there,” said county Supervisor Marion Ashley, who represents the city. “And particularly Desert Hot Springs needs it.”

The Coachella Valley already has an enterprise zone that has created 12,000 new jobs since 2000 from parts of Coachella into Indio and Thousand Palms. The proposed western Coachella Valley enterprise zone would include parts of Cathedral City and Desert Hot Springs.

“There is no guarantee that every single application will be granted,” said Tom Freeman, spokesman for the county’s economic development department. “We will not be the sole applicant for the new designation.”

The Chico Enterprise-Record, however, describes a much more nuanced issue involving a proposed Regional Enterprise Zone application for the counties of Glenn and Colusa. The Glenn County Board of Supervisors is struggling with the need for an economic development program such as the Enterprise Zone on the one hand, but their inability to come up with the liquid cash resources needed to operate a zone:

WILLOWS — It was one of those good news-bad news scenarios: an idea that could boost Glenn County’s economy, but faced the age-old question, “where’s the money to pay?”

The Board of Supervisors Tuesday heard a proposal to join Colusa County and the cities of Colusa and Williams to apply for a regional enterprise zone designation.

The idea hatched publicly Oct. 25 at a joint-governments meeting between Glenn county and city officials.

County Administrative Officer David Shoemaker Tuesday asked the supervisors to designate a county representative and identify funding solutions; authorize the board chairman to write a letter committing to the county’s participation, if approved; and refer the proposal to the block-grant reuse committee for action.

But while the supervisors agreed the county needs to improve its economy, the main obstacle the proposal faced was the county’s current financial status.

As Supervisor Keith Hansen put it, “we’re saying there is no General Fund money.”

Under the proposal, the costs of hiring a professional to complete the zone application would be split six ways between the two counties and four cities, assuming Orland and Willows are willing to participate. Shoemaker estimated the county share at between $22,000 and $44,000 for that cost.

But the county would also have to come up with $32,000 to $49,000 each year for operation and maintenance of the zone, again depending on the cities’ participation.

The county would also have to enter into a contract with Colusa County and the cities to protect its interest in the zone.

Shoemaker said the county could possibly apply for a community development block grant for the cost of applying for the zone, a possibility later confirmed by Planning Director Dan Obermeyer.

It’s the long-term obligation that is a problem. Not only doesn’t the county have money, but the governor is talking about state budget reductions, and both factors weighed heavily on the supervisors.

Supervisor John Amaro said he didn’t see how the county can go forward and wouldn’t enter into any kind of commitment without first knowing there would be funding.

Supervisor Tracey Quarne said he didn’t want to move ahead until the cities have indicated a solid interest.

“We don’t have any money,” Quarne said. “I can’t see committing to a collaboration if we don’t know if Willows and Orland are on board.”

“The General Fund is fragile,” said Supervisor Mike Murray, a self-described fiscal conservative. “I would not support anything from the General Fund … it’s a math problem.”

But Supervisor Tom McGowan asked, “How do you harvest if you don’t plant seeds?”

McGowan said the county hasn’t done anything “proactive” on economic development. He is the one who initially advocated for the proposal at the joint meeting, and urged the county and cities then to commit to the idea.

“Momentum is growing a little bit … we do have a good chance of being awarded one of these enterprise zones,” McGowan said.

Amaro disagreed that the county isn’t doing anything to improve economically, and reiterated his position that the county can’t commit at this time.

“I think it’s a great project …” Amaro said. “We can’t afford it.”

As discussion wound to an end, Finance Director Don Santoro reminded the board the governor has ordered a 10-percent spending reduction by all state agencies that could affect county programs in the future — a possibility he cautioned the board to think about when looking at ongoing projects.

No decisions were made, although Shoemaker was directed to find out more about the cities’ interest. The board may revisit the proposal at the first meeting in December.

If they are serious, they’ll have to make a decision before December – the applications are due November 16th.

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