From Deseret News archives:
Financial-incentive plan for companies advances
HB131 was passed out by the Senate Workforce Services and Community and Economic Development Standing Committee after earlier getting through the House. It allows companies to receive both Industrial Assistance Fund money and tax rebates.
IAF money is awarded to companies as either a cash grant or loan. HB11, passed by the Legislature last year, allows companies to get rebates of part of the new state revenues their expansions or relocations create. Companies currently cannot receive both.
Mike Nelson, who is in charge of incentive programs for the Governor's Office of Economic Development, said the change would not allow companies to get more money than they already can with the prohibition in place.
"We have a policy . . . that we will not double-dip when we use both of these funds," Nelson said. "We will analyze each deal as we do now, and we won't give them any more money if we use both funds together."
He cited the example of a large oil exploration company that plans to move its headquarters to northern Utah. It would mean 450 new jobs paying twice the county median wage. That company wants $100,000 to offset its moving expenses, and that amount will be deducted from the $3 million tax-rebate incentive awarded to the company.
"So we're not looking to use a lot of the IAF when we blend them," Nelson said. "We're just using it to offset some immediate expenses the companies have coming to the state."
Both Nelson and the bill's sponsor, Rep. Brad Dee, R-Washington Terrace, hailed the success of HB11. "This has worked phenomenally well — beyond our wildest expectations," Dee said.
Last year's HB11-related approvals have resulted in 3,449 new jobs for Utah, plus an 8-to-1 return on the state's investment dollars, he said. "And that's just the first year," Dee said. "Imagine what those new jobs will do next year and the next and next and next."
"HB11 has just been great for economic development," Nelson said. "We've been able to attract some significant companies to Utah."
An example is a building manufacturing company that plans to bring 255 jobs paying 267 percent of the county median wage to a rural northern Utah county, he said. That company provides benefits to employees, such as $2,500 for their children's college tuition, and has never had a layoff in its 50-year history.
"These are the kinds of companies that we're attracting with the incentives to this state," Nelson said.
