$5 million provision would boost local economic development
JANESVILLE So you’re looking for the perfect place for your new factory.
Lots of cities are clamoring for you to choose them. Why choose Janesville?
How about hundreds of thousands of dollars in tax incentives that most places in Wisconsin can’t offer?
That’s no pipedream.
The Legislature’s Joint Finance Committee on Thursday approved a provision in the state budget that would create a Development Opportunity Zone in Janesville. The zone comes with $5 million in tax incentives available over the next five years.
If it’s successful, the zone could be extended for another five years and another $5 million.
Sen. Judy Robson, D-Beloit, and Rep. Mike Sheridan, D-Janesville, made the announcement and deserve much of the credit, said Dan Cunningham of Forward Janesville.
“Hopefully, this is a part of our economic recovery in Janesville,” Cunningham said.
“This is a big, big, big deal to us,” Cunningham added, noting that Forward Janesville had made the DOZ its top goal in lobbying the Legislature this year.
It’s not a done deal yet, Cunningham noted. The full Legislature and Gov. Jim Doyle must approve the budget first.
Local economic development officials, however, are already mentioning the potential for a Janesville DOZ to companies that may be looking for locations, said James Otterstein, Rock County’s economic development manager.
Only six DOZs have ever been created. Only one—Beloit’s Gateway project—is still active, said a Department of Commerce spokesman.
The Gateway DOZ has used up most of its tax credits, however, Otterstein said.
Janesville economic development director Doug Venable said a DOZ could make all the difference for a company that is weighing the advantages of several locations.
“It becomes a deal breaker, or a deal maker,” Venable said.
“Under the DOZ program, businesses in Janesville could claim up to $8,000 in tax credits for each full-time, family-supporting job they create or sustain,” Sheridan said in a news release.
Sheridan and Robson stressed the area’s high unemployment.
“We can’t afford to wait for this economy, or the manufacturing industry, to turn around while families struggle to put food on the table,” Sheridan said.
“Development zone designation will help the city and its businesses pick themselves up by their bootstraps,” Robson said.
The zone would allow companies to claim tax credits for creating jobs, environmental cleanup and capital investment.
The zone’s precise boundaries have not been set. Typically, Venable said, the local government negotiates with the Department of Commerce to define the zone.
Venable said Janesville would want the General Motors plant included. Inclusion of any or all of Janesville’s industrial parks also is desirable, Venable said.
“We want to make it as broad and as useful as possible,” Cunningham said, adding that the ideal package would include the entire city.
The zone probably would be available July 1, but negotiations with the state probably would take the rest of the year, Venable said.
If a company makes an offer right away, however, officials could move faster to make the tax incentive available, Venable said.
Otterstein said the $5 million proposed could be used only in Janesville. Other state programs could not dip into the fund.
The possibility of a DOZ has already been used in conversations with companies that might be scouting locations, Otterstein said, and it will become a mainstay of local marketing efforts.
Cunningham acknowledged “a ton of volunteers” from Forward Janesville and the city who lobbied for the DOZ in Madison.
“But a lot of the credit should go to Sen. Robson and Speaker Sheridan,” who were “absolutely instrumental in getting this done,” Cunningham said.
Plan brings some relief to county
The news is good for Rock County.
Not great. But good.
The budget passed by the Legislature’s Joint Finance Committee early Friday staved off three of the five cuts that had county officials concerned, said Phil Boutwell, assistant county administrator.
The committee killed:
-- A proposed $344,000 cut to state funding for Rock Haven.
-- A proposed $147,300 cut to the county’s “income maintenance allocation.” That money is used for the administration of medical, food stamp and child-care programs, he said.
-- A proposed $413,200 cut to programming for juvenile justice.
All of those cuts were proposed for 2010.
“Given what we were looking at on May 4, I’m amazed,” Boutwell said. “They heard us.”
Sen. Judy Robson, D-Beloit, and Rep. Mike Sheridan, D-Janesville, on Friday morning announced the committee’s plan, highlighting some of the good news for Rock County.
Robson is a member of the committee, and Sheridan is the speaker of the Assembly.
Their work made the budget outlook “incrementally better for citizens in Rock County,” Boutwell said.
Gov. Jim Doyle proposed a budget that would have cut $2 million annually in funding for Rock County programs.
County officials were most concerned about cuts to five major programs. The county’s human service’s department administers all of the programs, including the three that have now avoided cuts.
The other two proposed cuts include:
-- A $391,000 cut to child protective services in 2010. That could affect investigations into abuse and neglect cases.
-- Funding cuts to mental health services that would leave the county responsible for paying for treatment for a larger population of people.
“We’re still facing serious budget cuts,” Boutwell said. “That does not include some of the impacts the downturn of the economy has had, such as a decrease in sales tax revenue. We’re looking at serious financial issues.”
—Ann Marie Ames