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Who Wants to Be a Zone 2009? Monrovia Update

As I wrote earlier, Monrovia is aggressively seeking one of the four available Enterprise Zone designations in 2009. Here is a detailed account of their activity so far from the San Gabriel Valley Tribune:

MONROVIA – Worried about a possible exodus of businesses from the economically distressed southern section of the city, officials have begun the lengthy application process for a state Enterprise Zone designation for the area.

Monrovia City Council members took the first step recently by awarding a $103,000 contract to Shaw & Associates LLC, a consulting firm that has been “very successful in obtaining enterprise zones for other cities,” City Manager Scott Ochoa said. The consulting group recently helped secure an EZ designation in Santa Clarita, he added.

While Monrovia’s redevelopment efforts have largely been successful in Old Town Monrovia, “we haven’t focused that much on that south Myrtle anchor until now,” Ochoa said.

Pursuing its own Enterprise Zone (EZ) designation could prevent other cities with the zones from luring companies away, said Lauren Vasquez, a redevelopment specialist with the Monrovia Redevelopment Agency.

“This designation can really help Monrovia compete with other cities that have zones because other such cities are able to entice businesses out of Monrovia,” she said.

A few mid-size businesses already have left Monrovia to relocate in cities with EZ designations, according to Ochoa.

Enterprise Zones are administered by the state Department of Housing and Community Development (HCD). The zones offer local and state incentives to promote economic revitalization and job growth.

“They are to help communities that typically have fallen on bad times,” said Chris Westlake, deputy director of the division of financial assistance for the HCD. “It’s used to entice businesses to a community or to a state. Also it helps attract expansion of existing businesses.”

The HCD uses economic and socioeconomic census data to determine if an area qualifies for an EZ designation. If it does, the benefits offered are many.

Businesses can earn more than $37,000 in state tax credits for every employee hired. Firms in EZs also can earn sales tax credits on purchases of machinery, and they can gain preference points in state contracts, among other advantages.

But competition among cities vying for the designation is tough. The state allows for 42 EZ zones – and just four zones are available for the current application period that ends in late March. Westlake anticipates the HCD will receive between 10 and 12 applications.

Pasadena has had an EZ designation since 1992. The zone covers the northwest part of the city, as well as the Walnut Avenue corridor. “It definitely has been a boost,” said city spokeswoman Ann Erdman. “It’s really helped us to bring in businesses to Pasadena and retain businesses here.”

Gourmet Fresh Pasta on North Fair Oaks is one of about 250 businesses in Pasadena that utilize the EZ designation. Company President Michael Yagjian said the designation was a factor in his decision to open a business there in 1996.

His manufacturing plant needed to be retrofitted, and the EZ designation helped him secure the permits.

“The fact that we were in an Enterprise Zone really smoothed out that whole process,” Yagjian said.

A decision by HCD on Monrovia’s EZ application will probably take about three months, following the March application deadline. If Monrovia is awarded the designation, the zone could take effect in the fall.

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