{"id":6896,"date":"2012-05-03T11:45:00","date_gmt":"2012-05-03T17:45:00","guid":{"rendered":"http:\/\/stateimpact.npr.org\/idaho\/?p=6896"},"modified":"2012-06-26T13:57:46","modified_gmt":"2012-06-26T19:57:46","slug":"open-government-advocate-tax-incentive-details-should-be-public-info","status":"publish","type":"post","link":"https:\/\/stateimpact.npr.org\/idaho\/2012\/05\/03\/open-government-advocate-tax-incentive-details-should-be-public-info\/","title":{"rendered":"Open Government Advocate: Tax Incentive Details Should Be Public Info"},"content":{"rendered":"
\"\"<\/a>

Good Jobs First<\/p>

Greg LeRoy founded Good Jobs First in 1998.<\/p><\/div>\n

Good Jobs First is a non-partisan, non-profit government transparency advocacy group based in Washington, D.C.\u00a0 It was founded in 1998 by Greg LeRoy<\/a>, who is now executive director.<\/del> LeRoy has been studying tax incentive transparency for more than two decades.\u00a0 We recently spoke with him to learn more about what he considers ‘transparent enough,’ and what states are doing to open incentive information to the public.\u00a0<\/em><\/p>\n

Q: <\/span>What is transparent enough? What should people have the right to see?<\/p>\n

A: <\/span>Our position here at Good Jobs First is that tax incentives, whether they are property tax abatements or sales tax exemptions or corporate income tax credits or other types of tax based economic development subsidies, should be equally transparent.\u00a0 None of it should be hidden from taxpayers view. <\/p>\n

We think the source of the subsidy, that is, which agency or program the money came from, the recipient of the money, that is, the company or entity or developer that got the money or benefited from the money should be disclosed.\u00a0 Also, the value of the subsidy and the purpose of the subsidy should be disclosed.<\/p>\n

Was the company supposed to create 100 jobs or invest $10 million or perform certain research and development activity? And then taxpayers should be able to see the outcome of the deal.\u00a0 How well did the company create 100 jobs, after a reasonable amount of time, or did they invest the dollars or do the R&D<\/del>?\u00a0 We think that should all be on the web, visible at least once a year, for every company, every deal, and every program.<\/p>\n

Q: <\/span>Idaho law says all tax information is confidential. How do states get around that?<\/p>\n

A: <\/span>So here\u2019s an important distinction.\u00a0 We\u2019re not advocating the disclosure of tax returns.\u00a0 There are some people who do advocate for that. This is about saying, if you claim a corporate income tax income credit on line 39C of your Idaho tax return, it\u2019s no different than if the state wrote you a check.\u00a0 It\u2019s no different than if the county gave you a big property tax break. It\u2019s no different than if the development agency gave you a big low interest loan. It\u2019s no different than if the workforce investment board gave you a big training grant.<\/p>\n

It\u2019s all taxpayer money being spent in the name of economic development.\u00a0 All those other kinds of tax incentives I just listed are all highly transparent.\u00a0 You can see property tax abatements at the county tax assessor.\u00a0 You can see training grants at the workforce investment board, you can see revenue bonds at the investment board.\u00a0 We don\u2019t think there should be a double standard for subsidies that are based on corporate income tax breaks.<\/p>\n

So there is really a business fairness issue here, because there is a burden shift going on.\u00a0\u00a0When companies do get these credits people should have a right to see who is getting them, and how much their worth and what kind of bang for the buck taxpayers are getting in terms of job creation and wages and all that good stuff.<\/p>\n

Q: <\/span>Washington state, for example, has written specific reporting requirements into tax incentive legislation as a way to get around the confidentiality of tax returns. Is that what most states are doing?<\/p>\n

A: <\/span>We see it done in different ways.\u00a0 We see it done the way you describe, but we also often see it as a new bill specifically about sunshine<\/strong> which is then applied to a broad number of programs.\u00a0 Illinois is an outstanding example of that. They passed a bill in 2003 that covers numerous programs and does a great job, starting in 2005, of disclosing them on their website.\u00a0 In other cases, governors just do it administratively.<\/p>\n

Q: <\/span>What\u2019s the fear with releasing this info?<\/p>\n

A: <\/span>About 16 months ago, for the third or fourth time, we issued a survey grading the states<\/a> on how transparent they are in revealing company specific subsidy data.\u00a0 At that point, 37 states had some degree of online disclosure.\u00a0 Thirteen states including Idaho and Washington, D.C. were in the dark, and most of those are still in the dark.\u00a0But some have since entered the disclosure column.<\/strong><\/p>\n

We sought that information, and we noticed a lot of the data was hidden on obscure websites and obscure reports and obscure appendices in non-searchable PDF pages or in ways that were not intuitive or easy to find.\u00a0 So we decided to begin to capture that info electronically, actually hiring a software scraper to automate the capture of information from certain states’ websites.\u00a0 We dumped it into a unified searchable database on our website called the Subsidy Tracker<\/strong><\/a>, and we now have some data on every state in the country.<\/p>\n

“If you claim a corporate income tax income credit on line 39C of your Idaho tax return, it\u2019s no different than if the state wrote you a check.”<\/div><\/p>\n

Now, even for states like yours and many, the amount of data we have is small, and the number of programs covered sometimes, it’s only one program like your state.\u00a0 But there is no state in the country now that can claim this so-called business climate advantage because it\u2019s in the dark still.\u00a0Nor can any state claim any kind of business climate harm because they\u2019re transparent.<\/p>\n

That\u2019s the recurring theme we hear is the so-called business climate – business friendly signals that a state would harm its reputation for having a good business climate by being more transparent with economic development subsidies.\u00a0 If there was any evidence from any level of government that anybody had ever harmed their business climate or their ability to retain employers or attract employers because of safeguards in place, I would have been confronted with that data \u2013 there isn\u2019t any.\u00a0 There no evidence that anyone has ever hurt their business climate.<\/p>\n

Q: <\/span>What is your hope for states like Idaho that aren\u2019t releasing this info?<\/p>\n

A: <\/span>We think that over time states that are still secretive are going to become more marginal and less attractive, frankly.\u00a0 We think overtime they will understand since almost every state is disclosing to some degree, either voluntarily or through our own subsidy tracking, that there is no advantage to being secret. But there is potential taxpayer resentment because frankly people have a right to ask now \u2018what are you hiding?\u2019.<\/p>\n

If every state is to some degree in the sunshine, why would a state continue to hide this information?\u00a0 And it\u2019s not just tax payers or watchdog groups from the left and right interested in this data.\u00a0It’s businesses. It’s economic development practitioners. It’s competing businesses. It’s site locating consultants who might be looking to bring jobs to Idaho.<\/p>\n

This is not a corporate bashing issue. This is a good government issue at its core.\u00a0 This is about taxpayers right to see where their money is going.\u00a0 Frankly, with so many states cutting services \u2013 cutting health care, cutting Medicaid, cutting public transportation, cutting aid to schools — people have every right to ask, \u2018well how come there\u2019s not enough money to pay for these things? How could we be reining in spending in other areas so public services are protected?’.<\/p>\n

Q: <\/span>Are you just talking about corporate tax breaks \u2013 what about small businesses? Should that information be public too?<\/p>\n

A: <\/span>Usually we recommend cutoffs that exclude most small businesses.\u00a0 But frankly, we know there is a real bias in the distribution of dollars and deals.\u00a0 The system is really dominated by big businesses.\u00a0 Businesses that have the greatest ability to threaten to move across state lines. Companies that have the greatest ability to hire teams of tax consultants and lawyers and to lobby for changes in tax code to benefit their industry.<\/p>\n

Small businesses really often don\u2019t benefit much from these programs because they aren\u2019t the ones that really play the game.\u00a0 Small businesses tend to be more loyal to their states, less likely to run away, more rooted in the community.\u00a0 We think by making the whole system more transparent, that would favor making them more balanced and helpful to small businesses.<\/p>\n","protected":false},"excerpt":{"rendered":"

Good Jobs First is a non-partisan, non-profit government transparency advocacy group based in Washington, D.C.\u00a0 It was founded in 1998 by Greg LeRoy, who is now executive director. LeRoy has been studying tax incentive transparency for more than two decades.\u00a0 We recently spoke with him to learn more about what he considers ‘transparent enough,’ and […]<\/p>\n","protected":false},"author":40,"featured_media":6945,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[15],"tags":[145,94,102,42,163],"acf":[],"_links":{"self":[{"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/posts\/6896"}],"collection":[{"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/users\/40"}],"replies":[{"embeddable":true,"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/comments?post=6896"}],"version-history":[{"count":2,"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/posts\/6896\/revisions"}],"predecessor-version":[{"id":8577,"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/posts\/6896\/revisions\/8577"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/media\/6945"}],"wp:attachment":[{"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/media?parent=6896"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/categories?post=6896"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/tags?post=6896"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}