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Enterprise Zones
The Case Against Incentives
What is Miami-Dade getting in return for public-money incentives to private businesses? Very little, according to a report by Florida International University.
 DISCONNECT: “A lot of businesses treat these incentives like found money,” says Bruce Nissen. [Photo: Daniel Portnoy] |
Based on data from the Office of Community and Economic Development, FIU researchers studied the “number and quality” of jobs created through incentive programs. The study found that 41% of the jobs created in Enterprise Zones paid less than $25,200 annually. What’s more, over the past 10 years, companies that received a portion of the tax rebates in Enterprise Zones were not even required to hire residents from those low-income communities.
The 29-page report titled “Subsidized Economic Development in Miami-Dade County” argues that money spent to lure businesses into low-income communities might be better invested on job training, housing and transportation.
“There’s strong, strong skepticism about these types of programs among academics,” says Bruce Nissen, the report’s author.
The report provoked a sharp retort from Frank Nero, president and CEO of the Beacon Council, the county’s economic development agency. In a letter to FIU, Nero complained about the research team’s failure to involve the Beacon Council in the study.
“We also believe that Florida’s Enterprise Zone program is weak and does not meet the full potential of the intent of the program,” Nero wrote.
But Nero defended other incentive programs. He credits Miami-Dade County’s Target Jobs Incentive Fund with retaining about 1,300 Burger King and Ryder System jobs that would have gone to another region.
Nissen’s response: “You can always make (a program) look like it’s working. It’s easy to keep on defending these programs.”
Links: Click to read the complete report by FIU’s Research Institute on Social and Economic Policy.For more articles this month with extra links, go to the Links page.
