Business and the Economy

Reading Sonoma Biz, the county’s premier slick and glossy business magazine, created by and for very gung ho business supporters. Disclaimer: I have written articles in the far past for the magazine and they have some great stuff at times. This month’s lead off story is all about a new Chamber of Commerce led effort to create jobs — 4,000 or more in five years.

As usual, the first thing business wants to do is dip into the public trough to pay for it. The new byword is “public-private partnership” where the public funds private ventures. Politically, many of these folks are beating the “no taxes” drum as loud as possible and supporting the biggest group of dingbats I’ve ever seen on the campaign trail, but they never stop reaching in the public pocket when things get tough.

“The first phase of the project is to raise $3.5 million …” The project is designed to help the community and raise all boats, countywide, with all the money that will be spent locally by the new hires spending their money locally.

The Chamber promptly hired a Florida-based revenue raising consultant to survey 60 local government and business people to come up with a plan. I’d really like to how much money flowed out of Sonoma County to pay for that, and if any of it was provided by taxpayers.

The tap will be put on county and city governments to pony up for the jobs program. According to the article, Sonoma County’s supervisors voted the group $100,000 a year for the next two years with a two-year extension possible ($500,000 max). The grant will be funded by the county’s Transient Occupancy Tax (TOT) which is designed to stimulate tourism through advertising and marketing. I can only speculate that the majority of jobs to be created will be in the hospitality/wine industry to justify sourcing the funds. Using that money to get outside businesses to move to the County might well fall inside the original intentions behind the tax.

The more subtle aspects of what the business community will be trying to do, among other things, is “create a positive environment in which to do business.” Read: reduce or eliminate environmental, health and other public safety regulation, reduce fees and taxes, and expedite all forms of paperwork.

Supervisor Shirlee Zane lamented the fact that Amy’s Kitchen, a hugely successful local business, expanded it’s East Coast operations in Greenville, NC. What wasn’t said was what concessions Greenville made to the company to get them there. Five to ten years suspended taxes? There is often a huge cost to taxpayers incurred with these deals that may never be recovered. Sure, people are hired and pay local taxes, but never enough to cover what a local company would have had to pay. There’s a reason for the taxes that the local companies are paying: they take a high level of public support to keep the roads open, police and fire, sewage, garbage, and other civilized functions operating to keep business running smoothly.

What you wind up with is less taxes being put in by the very people asking for more tax-based support to continue business. This is not a formula designed to solve our overall problems. Clever and stupid at the same time.

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