Cities, counties take back corporate tax breaks

[kpete]

Source: Associated Press


Cities, counties take back corporate tax breaks
AP

CHICAGO – Cash-strapped communities have a message for corporations that promised jobs in return for tax breaks: A deal's a deal.

As the economy sputters along, municipalities struggling to fix roads, fund schools and pay bills increasingly are rescinding tax abatements to companies that don't hire enough workers, that lay them off or that close up shop. At the same time, they're sharpening new incentive deals, leaving no doubt what is expected of companies and what will happen if they don't deliver.

"We will roll out the red carpet as much as we can (but) they are going to honor the contract," said Brendon Gallagher, an alderman in DeKalb, Ill., where Target Corp. got abatements from the city, county, school district and other taxing bodies after promising at least 500 jobs at a local distribution center.

So when the company came up 66 workers short in 2009, Target got word its next tax bill would be jumping almost $600,000 — more than half of which goes to the local school district, where teachers and programs have been cut as coffers dried up.

Read more: http://news.yahoo.com/s/ap/us_tax_fights

[47of74]

1. Good

It's about time these clowns learn that a contract is a contract.

[Richardo]

37. Absolutely goddamn right.

[Greybnk48]

2. OMG! A corporation is being forced to follow the rules!

Stunning! I can think of more abusive corporations (can you say Walmart). I sure hope this is the beginning of a national trend.

[wordpix]

9. this was an issue in CT in 2004 when I ran a campaign---never took off & the repuke

incumbent was voted back in :shrug:

Maybe our time has come? :applause:

[Greybnk48]

17. Maybe it has. And good on you for trying to get something going in 2004.

[Left Coast2020]

10. I'm glad you brought up wal-fart.

Every community should review all its tax matters pertaining to this corporate garbage dump and force wal-fart to pay up. They don't respect many communities anyway.

[defendandprotect]

3. Ah . . . an awakening . . . downward spiral reversing . . . ??? Good move!!

[boppers]

4. $600,000 / 66 = $9090.90 per worker.

Cheaper for Target to pay the fine than to hire 66 workers... but good on them for calling BS on the inflated numbers that they used to try and avoid taxes.

[wordpix]

8. better than zero, and taxpayers having to pay to fill holes in coffers

[mascarax]

36. You're right - cheaper for Target

Wonder how the $600K figure was arrived at. Should be higher.
(And yes, I agree it's good to call out these corporations getting tax breaks and not following through...)

[toadzilla]

67. maybe not, considering how low wages are

and companies like target hire very few full time workers.

[aggiesal]

5. What a great idea!!! ...

I think I'll get in touch with our City and County board members here in San Diego,
and ask if Qualcomm has tax credits, and how H1B visas fit into those tax credits.

I've been complaining that the Qualcomm campus is "Little Calcutta" with all the
engineers from India that work there, under H1B visas. While qualified US born
engineers are unemployed in record amounts, because the H1B's are getting paid
about 50% of a US engineer.

[Iggo]

14. delete

[LiberalEsto]

43. Same thing happened at Fannie Mae

Their Herndon, VA IT department is filled with H1Bs from India, while American citizen IT workers - with college loans to pay off - are flipping burgers at MacDonalds.

[abelenkpe]

51. And getting harrassed by

Sallie Mae workers calling to collect on their student loans no doubt.

Ahhhh, Northern Virginia.....

:banghead:

[LiberalEsto]

56. And the Sallie Mae calls

are probably coming from the other side of the globe, where lots of call center jobs have been offshored.

[Name removed]

54. Deleted message

Message removed by moderator. Click here to review the message board rules.

[aggiesal]

80. There is no racism calling it "Little Calcutta" ...

It's no different then calling the district in San Diego known as "Little Italy"

I also have friends from India & Canada with H1B's but, the fact remains that there are
US engineers out of work that can perform jobs currently held by H1B's at Qualcomm
and elsewhere.

Besides, I know for a fact how Qualcomm skirts the law to keep acquiring H1B's. A
friend of mine is a manager at Qualcomm and he explained to me how it is done. His
excuse was that every company is doing it, so why not Qualcomm.

The H1B's should be tied to the current unemployment rate. The higher the unemployment
rate gets, the lower the number of H1B's that should be allowed into this country.

[primavera]

6. About fucking time!

As far as I can tell, corporations destroy way more jobs than they create, so I think they ought to be paying us back for everything they've stolen from the public. They sure as shit don't deserve any red carpet treatment for driving the economy into the ground.

[Egalitariat]

30. Corporations destroy way more jobs than they create?

A little overboard on the hyperbole?

[mbperrin]

40. Yes. Please name any industry that is entirely corporatized that has

more employees now than they did 30 years ago. Might want to check automakers, steel, communications, just to start.

In the name of "productivity" corporations lay off people, outsource to other countries, "consolidate" operations, and then, when all goes completely to shit, bail out their fat cats with golden parachutes and hand jobs, I mean, hand shakes.

Corporations are designed to plunder as much lucre as possible from their employees, customers, and the government into the pockets of management before folding. It's call creative destruction, and it gets Randians hard just thinking about it.

[joeglow3]

44. Do you back up your views with your actions?

I agree with the sentiment. However, I will bet ANYTHING you don't spend $5,000 for a computer. I bet you don't demand a car built solely by humans for $100,000. Simple fact is that a LOT more blame rests on the consumer.

[laughingliberal]

58. Regardless, a deal is a deal and corporations have been dangling the jobs carrot out there since

Reagan to avoid paying their share of taxes. They create jobs or they don't mooch off the infrastructure built with our tax money. Simple, huh?

[mbperrin]

75. When someone uses political and monetary power extorted from

me to take away my choices, how is that my fault?

And your car comment is just silly. Privately owned companies have built cars and can build cars, and computers, too. The corporate structure is designed to funnel control away from owners to managers, profits from owners to managers, and to obtain freedom from personal liability for one's management actions.

Adam Smith, the father of economics, thought that corporations should be prohibited, and I teach that to my economics students.

[mbperrin]

76. Oops, nearly got distracted. Where are those net corporate job

creators, please?

[joeglow3]

83. You need some common sense

I work for a Fortune 500 producer. Many of our plants are highly automated and have seen the number of emplyees needed drop. Our profits have not shot up for these amounts. The majority of the savings is passed on to the consumer, allowing us to compete with the our competitors who are doing the same thing. The reason both companies are doing this is because the VAST VAST VAST majority of consumers care only about cost and could not give two shits less about how many people are employed.

All consumers have to do is demand that and support those companies and you will see fewer automated plants. Of course, you WILL be paying 5-10 times the price for many items.

[mbperrin]

84. You really have drunk the Kool Aid, haven't you?

The distribution of wealth is the country is skewed the most since 1928; most people have lousy lives trying to keep up with media images.

Check the story of Motorola for a real look at attempts to outsource and automate at whatever cost. They ended up creating multiple competitors after just about inventing their business.

Management works only to enrich itself. If they could just put a cardboard box by the door and tell people to throw money in it and leave, they would. But they still have to put up some illusion of doing something, so it's not perfect yet.

[laughingliberal]

57. +1 nt

[DissedByBush]

72. Software

Far more than 30 years ago.

[mbperrin]

77. Fair enough. 10 years ago as well?

[DissedByBush]

81. Doesn't really matter

That software was the only thing I can think of is really sad.

[boppers]

74. Medicine, Data Communications, Robotics, Plastics, Genetics

All have more workers now than 30 years ago.

Unskilled labor has gone away, and was replaced by skilled and specialized labor.

[mbperrin]

78. Okay, I'd like to see some actual numbers, because I'm pretty sure

data communications is not the case, and in the last 10 years, the others have reversed as well. I'll get some numbers.

And where did the ludicrous notion that anyone who doesn't work for an incorporated company is unskilled labor?

[boppers]

79. How many ISP's were there 30 years ago, vs. now?

Cable company technicians? Data Hotel staff? Cell tower techs? LAN techs?

Where Communications jobs dropped was in the POTS related technologies of 1979.

"anyone who doesn't work for an incorporated company is unskilled labor" doesn't parse for me, so I can understand why it wouldn't make sense to you either.

My point was that menial jobs, such as repeated manual assembly of small electronics, have been replaced by jobs in software, robotics, and engineering... to automate the assembly of small electronics.

That doesn't mean that there isn't skill in the manual tasks (quite to the contrary, actually), but that there's less jobs on production lines than on hand-crafted lines. That blame/credit goes back to the industrial revolution.

edit: grammar

[mbperrin]

85. Look at your words! Menial, production, revolution.

You about in your mid 30s, right?

[boppers]

86. You nailed it. Later 30's actually, but still in the 30's.

One of my earliest jobs was putting together software patterns on paper tape (yes, paper tape, floppy wasn't practical yet, let alone a hard drive) to duplicate a sewing craft called embroidery onto a 12-head sewing machine, so that a single machine could sew as fast (or faster) as 12 sweatshop-wage humans, only with greater accuracy and repeatability. I eventually learned the machine to a micrometer level, then the machine computers, and wound up in computer programming.

You see, I viewed the song of John Henry as a cautionary tale, not a romantic salute to bygone technology... sure, buggy whip makers and train engineers were put out of work by the car companies, but those who had good jobs on car lines in the 30's-60's had very little sympathy for driving the horse buggy economy out of business.... until the same changes drove *them* out of jobs.

50 years later, the story continues repeating. New technology eliminates the viability of an old business model, people who thought that learning and changing stopped once you got a job are displaced and have to learn new skills (the horror!) to find new work, and complain about the loss of jobs, or craft, or whatever.

Heard of the Luddites before?

http://en.wikipedia.org/wiki/Luddite

This has been an issue since 1811. It's been spreading from industry to industry since then. Even my own current industry (unix and web software) requires constant training, and retraining, and education (none of which is paid for by an employer) to be a viable member of the workforce.

People actually have to work their minds now, as the supposed physical "work" of yesteryear is now done (in many cases) by machines. This has been ongoing for close to 200 years, and shows no signs of stopping.

[mbperrin]

88. Yep, you match up nicely with the educational norms for that age group.

I'm 20 plus years older than that.

Stay safe in the current economy, keep working, and keep your eyes open. Thank you.

[boppers]

90. Work norms for the age group, too.

Most of us grew up in an economy, and in a society, where changing jobs every 3-5 years is normal, and the idea of working for a company for a whole lifetime is inconceivable.

I have heard tales of a different world, where getting a job meant that education stopped, that the pressure ended... I don't know which one is better, but I do know that my age group was raised to be mobile, adapt, and keep moving and reinventing ourselves to survive.

Since you're likely in your 50's/60's, maybe you didn't have a great depression to live through, where hustling for work was part and parcel of life. Hopefully, my kids can also have the kind of easy life where they don't have to hustle, or, even better, we can build out an economy where we aren't alternating age blocks between hustlers and slackers.

[primavera]

87. Bravo

You took the words right out of my mouth. :hi:

[wordpix]

7. praise the FSM!!

[LiberalEsto]

39. Ramen!

May Her wrath boil them way beyond al dente.

[aquart]

11. Excellent!

Wish I could see it in New York.

[eilen]

16. It's happening in NY

http://blog.syracuse.com/news/2008/02/new_york_begins_closing_empire.html

New York begins closing Empire Zone loopholes that allow businesses to claim bogus tax breaks

By Stan Linhorst

February 16, 2008, 11:30PM

This report is the latest in an ongoing investigation by The Post-Standard. You can read earlier reports about "The Great Empire Zone Giveaway." You can also search through records at www.syracuse.com/data/empirezones and see for yourself who's cashing in.

New York is slowly fixing the Empire Zone tax break program. For seven years, businesses exploited the program's loopholes to grab millions of dollars worth of tax breaks while creating few jobs.

Gov. Eliot Spitzer's administration has launched a multipronged effort to weed out some abusers of a program that costs New York taxpayers $600 million a year.

Recently, the state's tax department denied $1.7 million in Empire Zone tax credits to five businesses for 2005. That crackdown for the first time targeted so-called shirt-changers, companies that changed their names to qualify for tax breaks intended for true start-ups.

Because businesses can claim the tax breaks for up to 13 years, the audits will eventually save New York a projected $17 million, said Tom Bergin, tax department spokesman.

The tax department is auditing the returns of 19 more businesses that may have received big Empire Zone tax breaks by simply changing their corporate names, and it plans to audit 150, Bergin said. Meanwhile, this month Empire State Development Corp., which runs the program, notified 180 businesses -- including 39 in five counties surrounding Syracuse -- that the state may kick them out of the program.

[aquart]

22. Spitzer?

You mean there was another reason for him not to resign?

Is Paterson following up?

[BlancheSplanchnik]

41. I'd like to know too, is Patterson following up on this program?

We out in the Fingerlakes boondocks would like to know.

[eilen]

63. Yes, there was an article in the paper recently about it.

Companies suing New York say their Empire Zone benefits were taken away unfairly
By Mike McAndrew / The Post-Standard
December 27, 2009, 8:15AM
Gloria Wright / The Post-Standard
The owners of the AXA Towers in Syracuse are among two dozen companies suing New York over their dismissal from the Empire Zone tax break program.
Syracuse, NY -- Two dozen companies are suing New York over their dismissal from the Empire Zone tax break program.
The companies, which together were collecting about $4.8 million in tax credits per year, are almost all from Central New York.
The plaintiffs include the owners of the AXA Towers, the largest commercial building in downtown Syracuse; the James Square Health & Rehabilitation Centre; the Pioneer Management Group; and several law firms, including Costello, Cooney & Fearon and Mackenzie Hughes.
They were among more than 500 businesses that were decertified this year from the Empire Zone program in an effort to weed out companies that did not merit the tax credits.
The lawsuits, most filed in state Supreme Court in Albany, are in addition to more than 300 appeals filed by companies with the state Empire Zone Designation Board.
http://www.syracuse.com/news/index.ssf/2009/12/companies_suing_new_york_say_t.html

[BlancheSplanchnik]

65. oh cool!

I think I was thinking about Rochester, and well, had a dumbass moment... :P

Sure hope those companies LOSE their suits and appeals!

Wonder if any Rochester areas are decertifying companies? (I don't touch the local rag, Democrat and Chronicle, it's conservative bullshit. Rochester City is the alternative paper, but it's small--don't know if they'd have an article.)

[Raineyb]

52. The city can't be bothered.

My former employer was getting some kind of tax break for creating jobs. They didn't create the number the were supposed to. Didn't stop them from continuing to get the break and then they closed up shop completely. Of course now it's too late to take back the break.

I don't think Bloomberg with his let's forget what the voters voted for and overturn turn limits to run for a third term I had no business running for attitude is going to bother enforcing things like this.

[laughingliberal]

12. Damn straight!

About time someone decided the business world needed to give something back. They've been freeloading on our infrastructure for years without contributing. Perhaps this will be the first nail in the coffin of trickle down, voodoo economics.

[Love Bug]

13. *stands and appauds*

It's about time! I hope this is a trend that catches on.

[freethought]

15. Hey. this has been too long in coming

Corporations are aided in their pursuit of profit by using infastructure paid for by taxpayers. They even get infastructure built for them by local municipalities for free. Their labor force, is a largely a product of public school systems. Sometimes they are given free use of other types of infastructure such as water and sewer systems. Local police departments are employed in the protection of corporate property. Why the hell shouldn't they pay?

This is something that has angered me for some time, for these corporations often play one municipality off of each other seeing how far backward they can get both to bend. I am not a rabid anti-capitalist but I am against corporations getting off the hood in terms of their civic responsibilities. These towns have every right to put clawback provisions in these agreements. I personally don't think corporations should get this kind of treatment at all. For the corporation that gets a big abatement on local property taxes, there is likely some other businesses just down the road that are not getting those kind of sweetheart deals.

I used to live in Maine. Not long ago, a big-name sporting goods outfitter, Cabela's, completed a huge sporting goods store just outside of Portland. In doing so Cabela's tried to get tax breaks and abatements from the local government. This did not sit well with an already well-established sporting goods retailer well known throughout the state of Maine. I am speaking of L.L. Bean of course! L.L. Bean has been based in Freeport, Maine for decades and in that area and gets no such breaks from local government. When Bean got wind that Cabela's was gunning for these tax breaks, L.L. Bean took Cabela's to court. Bean's argument was simple-we don't get these tax breaks and we've been located in Maine for years and years. Cabela's should not get them either for it represents an unfair comptetitive advantage.
Fortunately, the court found in favor of Bean's claim and Cabela's wound up having to pay their fair share. Last I heard, there was no appeal going to filed.

[fudge stripe cookays]

19. Good for Bean's.

Both these stories are encouraging.

[laughingliberal]

60. A score for the good guys!

[Yavin4]

18. The Whole Concept of Corporatism Was That It Provided Jobs

The whole point behind all of the tax cuts, deregulation, H1B Visas, and subsidies was that private corporations would provide jobs. In the last 10 years, job creation in the U.S. has been non-existent. Thus, corporatism has failed. The American people are waking up to this fact, and maybe, just maybe, we're seeing the beginning of the end of corporatism.

[leeroysphitz]

20. Somebody pinch me...

[uncle ray]

46. looks like you've already been touched by techno viking.

[proud patriot]

21. good

[Hekate]

23. About time. nt

[Greyhound]

24. Yeah, Chicago was one of the cities that got royally fucked in the

"Dialing for Corporate Dollars" scam.

Another that stands out for me is Beaverton, OR. They literally sold the farm to keep Nike there and screwed themselves really good in the process. Now the city can't take a figurative shit without an OK from "the campus", while their tax base continually shrinks while need dramatically rises.

[boppers]

28. Speaking as a Portland resident:

You get what you support. Let them Beaverton get what they have sown, with their crappy strip-malls, anti-art, anti-people, anti-sharing, anti-social, attitude.

They don't deserve to have a voice in the Metro anymore.

edit:typo

[Solly Mack]

25. K&R

[SergeStorms]

26. Since the corporations write the laws..........

elect the politicians, and generally run our government, I can't see them putting up with these unfair practices forced upon them by corrupt local governments. :sarcasm: :sarcasm: :sarcasm:

They'll find a way around it. They'll elect new politicians, write new laws and nothing, I repeat, nothing, will come of it. Let's not forget who we're dealing with here. These people run the country. I wish I could get excited about this, that this was really a step in the right direction and the corporations would finally keep their end of the bargain. But my cynicism (forged from years of corporate dumbfuckery) tells me otherwise. I've had my hopes dashed against the rocks too many times to get my hopes up about ANYTHING anymore.

We'll see. :shrug:

[Auggie]

27. I cynically agree

[Jamastiene]

35. I don't want to get my hopes up too much either.

I'm tired of seeing them dashed.

[Odin2005]

48. Yuck, I hate defeatism.

:puke:

[That Is Quite Enough]

62. Eh. Agreed.

[Hestia]

66. Which is why you need to get involved in Local Politics more so than Federal.

Think of the Federal level as the macro, but individuals generally can only operate on the micro level. You can personally affect on your local level, especially if you do in concert with other citizens in your area. We need to start pushing back against the corporatists in our areas. Don't let them have the only voice on the airwaves - demand to be heard also, that their's is not the only voice in political affairs.

Highly highly suggest that people watch "Voices of the People's History" on History Channel. There is a poem/speech given by a woman that starts - one person is a thought, two people are a ?, three people are ?, four people are a group, ten people are an organization, 10k people have a newsletter, etc. It is a great showing of theater productions from around the US, speeches and poems and songs performed by professional actors. Fantastic ideas for today from our Elders. Now it just takes dedication to get others on board also. That's the hardest part.

Collectively we really can talk to our local officials. Maybe most of the them need to be replaced, especially those who came up these sweetheart deals in the first place. They aren't invunerable, and peacefully, we can either show them the door or support them when they do speak up.

[winyanstaz]

29. K & R for the good news :)

Now to take the next step which will save jobs....
Strip corporations from their personhood status...they are NOT a person..they are a frikkin company.
Also...ANY corporation that outsources their jobs..is no longer an AMERICAN based company but a forgion company regardless of where their "office" is...so tarrifs should apply and ALL tax breaks should end.

[DailyGrind51]

31. This has been a big problem in Chicago, where Mayor Daley has used

Tax Incremental Financing (TIF), intended for blighted neighborhoods, to give big breaks to large companies as incentives to locate in Chicago's Loop, pushing the tax burden to average residents.

[Confusious]

34. It's not just Chicago

Since reagan, they've been shoving the tax burden off on the middle class everywhere ( and borrowing), and then telling us there's not enough money for eduction, health care, etc, etc, etc.

It's an Fing scam. Welcome to the new feudalism.

[Blue Diadem]

32. Good for them!

It needs to happen more often.

[lonestarnot]

33. Now we're fucking cooking with gas!

:applause:

[Vermontgrown]

38. So,

To me that's the way to deal with these assholes. If they don't stick to their agreement, tax them out of business.

[laughingliberal]

68. Businesses managed to survive in the days before they got all these tax breaks and they can survive

now. No one suggests taxing them out of business but if they are not hiring employees to increase the taxpayer base then it's time for them to pay their share. They've mooched off the infrastructures we built with our tax dollars long enough.

[BlancheSplanchnik]

42. YAY!! Think globally, act locally!!

Again, I say, YAY!

MORE, PLEASE!

[laughingliberal]

59. Yep. Start with local communities refusing to keep letting these guys shirk their responsibilities

and it may work its way up. I love this story!

[fascisthunter]

45. GOOD!(nt)

[Odin2005]

47. K&R This is good!

[glinda]

49. Walmart is a bigger offender. They should go after them in most communities.

[Lorien]

82. Indeed. nt

[abelenkpe]

50. k & r

[davidwparker]

53. K&R

Oh, this is so good.

P.S. Move your money to a local credit union or bank.

[proud2BlibKansan]

55. Good deal

It's about time we put what is best for our kids above greedy businesses who don't need the silly tax breaks anyway.

Here in KC, they gave HUGE tax breaks to H&R Block to move their corporate headquarters from one part of town to downtown. Their building was fine and they weren't even looking for a new one. But the city said oh move downtown and you won't have to pay property taxes! And you should see the freaking palatial building they put up.



I have been asking why the country's #1 tax preparer needs tax breaks. That's just nuts.

[proudohioan]

71. Charming!!!!

And in another 20 years, THAT building will be a vacant eyesore, just like the one that was left behind for the new palace. I'm willing to bet that tax abatements weren't the ONLY government subsidy given away!

[alp227]

61. "Tax cuts cause economic growth"? Yeah right.

Companies just don't follow up on promises and continue being inefficient.

[SeattleGirl]

64. Good deal!

It's about time someone stood up to these corporations who have been getting away for far too long with empty promises.

[benld74]

69. Its about effin time! Corps dont pay for a effin thing and get everything!

[maryf]

70. K&R nt

[Vidar]

73. Glad to hear it.

[naaman fletcher]

89. These tax deals should be illegal in the first place..

Every business should face the same effective tax rate. What happens in reality is that big businesses get these tax abatements, which gives them an edge over smaller companies.


The whole system should be illegal.

If a city wants to attract employers, go ahead and cut the tax rates, but do it for everyone, not just a few.