Talking points on tax development slush fund | Arkansas Blog

Talking points on tax development slush fund



I wrote a column this week about Mayor Mark Stodola's explanation of the need for a $40 million economic development slush fund in the city's $500 million sales tax increase proposal.

It would appear he and the Little Rock Regional Chamber of Commerce, the driving force for this money, need to get their talking points together. Stodola was hazy on details, but said the Little Rock Port and some other areas needed $25 million for expansion. He also mentioned a need for money to put into the research development project touted by UAMS and UALR.

I've been supplied the Chamber of Commerce's own talking points. Full copy on jump, but it says the tax would provide $23 million for the research park (direct taxpayer subsidy of private enterprise), $10 million for the port and $7 million for infrastructure work for new jobs. The talking points are silent on accountability, not a strong suit of the chamber. They are silent, too, about the types of jobs and industries acceptable to the chamber. Environmental commitments? Workplace quality commitments?

If you should get this spiel, I'd encourage you to ask for specifics on this job creation and private business investment numbers. I've found exaggerations and oversights in the so-called "reports" the Chamber makes on these topics to the city of Little Rock. These reports are in return for the $200,000 subsidy taxpayers give to people who work against universal health care, worker bargaining, decent workers comp programs and the public schools. I'd also like an accounting of jobs lost at companies given past incentives and taxpayer handouts and whether anybody ever tried to get a nickel back.

The worst thing about the talking points is that they openly encourage a destructive arms race. The chambers want sales taxes to promote economic development so they need not raise money from their members. A number of cities and counties have rolled right over. The LR Chamber is hungry for a similar tax here. We have a well-funded state agency that is supposed to oversee state development efforts fairly. It is lunacy for cities and counties in Arkansas, a poor state, to be taxing poor people's groceries to pay industrial blackmail. There hasn't been a serious study yet that shows corporate welfare is a serious factor in industrial location. The important things are location, raw materials, education of workforce, quality of life — not bribery.

I simply don't trust people who believe this with $40 million.

Meanwhile, mayor and chamber, get your stories straight.

Talking Points
Uses for Economic Development Funds$40 million of City capital tax funds over 8 years:

- $23 million for Research Park
- $10 million for Port of Little Rock expansion
- $ 7 million for infrastructure
incentives to recruit new jobs

The Research Park investment will help create and attract the jobs Little Rock wants for our future. Our medical industry is one of the largest job creation sectors in our economy. This Park will attract new companies while also providing much-needed incubator space for new technology being created at UAMS and UALR - all resulting in
high paying jobs for our citizens. These new jobs, at all skill and professional levels, will substantially increase Little Rock's tax base which further benefits the entire community.

Over 2100 new jobs have been announced at the Little Rock Port in the last 6 years. These advanced manufacturing jobs, and payroll, are the result of Little Rock's investment in creating and improving the Port over the last 30 years. Yet, we're out of land which means we cannot attract more new companies and jobs. This investment will "keep us in the game" in bringing new capital investment and high paying, advanced manufacturing jobs to Little Rock.

Our economic development partnership has resulted in expanded local industry and new company projects, representing over 7200 new jobs, being announced in our market during the last 6 years. Infrastructure incentives, state and local, are key to locating new projects here. Little Rock competes with major metropolitan cities for
these projects. If we cannot create infrastructure incentives, in partnership with the Governor's Quick Action Closing Fund and other State incentives, Little Rock will not be competitive and will lose projects to other communities, even those in Arkansas that have now passed a sales tax for economic development, and other states. The City Board would maintain strict control of these infrastructure incentive funds and vote on every incentive proposal to attract new jobs to Little Rock.

Little Rock's business community has invested over $2.5 million of private sector dollars in economic development work in the last 6 years - but recognizes it's now not enough to remain competitive. The Little Rock Regional Chamber of Commerce is raising even more private sector funds to increase the economic development program to
$1,500,000 annually for the next 5 years. This 100% annual increase over previous budgets is further commitment to the development of our economy and the creation of new jobs, at diverse skill levels, for all Little Rock citizens.

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