Incentive Speak strikes again: Cost this time? $3 million per job Wednesday, November 06, 2002 In what must be a record, NY State and its local partners are investing $23.9 million in incentives for a natural gas storgage facility that will produce 8 jobs. Investment per job: $3 million. EDPros are often guilty of "incentive speak", but this project takes the cake. Instead of doing some hard analysis of the return on investment from these incentives, New York appears to have fallen into the "build it and they will come" mindset. Here's what the Empire State Development Corp. folks say, ""If a company makes the investment or creates jobs, they will receive tax credits from the state." Here's what the local Empire Zone coordinator has to say: ""The investment, infrastructure and power is so important for this state." Here's what the company says: "We became aware of the Empire Zone, which would afford us tax benefits, and we made the final decision to pursue development. It really worked to induce a company like ours to go here." Are we surprised? The proposed power plant was not originally in the Empire Zone (where incentives are supposed to be targeted), but local officials fixed that probelm. They simply redrew the boudaries of the zone. Yes, incentives work. (Why? People like money.) But to what end? Will a capital intensive natural gas storage facility help the economiy of Upstate New York? Not really. And certainly, it is not worth the investment of $24 million. Here's the core problem: The incentive programs in New York State do not have clear goals for job creation for the incentives. (Even more important, the incentives miss the mark. They do not addresss the core ED problem of upstate: an aging skilled workforce and too few young people with adequate work skills.) Read more. Go posted by Ed Morrison |		This work is licensed under a Creative Commons License. links Some Background on EDPro Weblog The purpose of this weblog is to help economic development professionals -- EDPros -- keep up with the changes sweeping our profession. Strap on your goggles. It's a whole new game. There are no experts any more. The only place to learn about economic development is from other EDPros who are doing it. One other point: the prevaling approach (paradigm, if you like) in economic development is shifting from competition to collaboration. There are a lot of reaasons underlying this shift, but here's the important insight: You, your community, and your region will do better by collaborating and sharing information. So, spread the word...Share the knowledge. Tell a friend about EDPro Weblog. If you are using a news reader, here is the link to syndicate this site: Here's the link if you are a bloglines subscriber: Speaking and workshops on Open Source Economic Development As the idea of Open Source Economic Development starts spreading, more people are asking about it. Visit the I-Open web site to learn more. My colleagues and I are happy to explain the basic concepts in a talk or a workshop. E-mail Susan Alshuler if you'd like to learn more about workshops and speaking. Background on Ed Morrison Download some background information on me here.

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