Tulsa County seeks fund to attract, assist potential employers
BY WAYNE GREENE World Senior Writer
Monday, August 13, 2012
8/13/12 at 9:18 AM
Read more about the proposal and the status of Vision 2025 projects.
Jim Fram says it happens routinely.
Other cities are coming to local employers and are offering them all sort of incentives - including new buildings and even cash - if they will take jobs from Tulsa to their communities, the senior vice president for economic development at the Tulsa Metro Chamber says.
What many of those cities have that Tulsa doesn't in the competition for new jobs is a closing fund, a publicly funded incentive program that would allow local negotiators to offer the last piece needed to close a deal.
A $52,942,000 job creation fund - a local incentive program for growing employers - is part of the Vision2 economic development program, proposed to go before Tulsa County voters on Nov. 6.
Tulsa County commissioners will decide Monday morning whether to send the two-part, $748.8 million Vision2 proposal to voters for their consideration.
The proposal would include $254 million for buildings, infrastructure and equipment improvements at the Tulsa airport industrial complex and $349.92 million for capital projects in Tulsa, Tulsa County and local communities. It would extend the county's 0.6 percent Vision 2025 sales tax through 2029.
The job closing fund has already raised some eyebrows of those suspicious of large funds dedicated to the bidding war for jobs.
Fram said it would just get Tulsa into the game on the same level as the competition.
When Broken Arrow's FlightSafety International was looking for a new manufacturing location, Texas Gov. Rick Perry offered a sizable cash incentive, Fram said.
Broken Arrow was able to counter the offer with land already owned by the city and infrastructure funding raised from a tax increment finance district, but the process was certainly more difficult and less direct than the Texas option, said Wes Smithwick, president and CEO of the Broken Arrow Chamber of Commerce.
The area's potential competition isn't just from Texas, Smithwick said. Even cities the size of Bartlesville have publicly funded economic development funds available for incentives, he said.
When Wal-Mart was looking to locate a warehouse and distribution center, Bartlesville was able to make an offer Tulsa couldn't match, Fram said.
Routinely, Tulsa gets on the short list of major employers considering new locations only to lose the deals to competing cities, Fram said.
When the city goes back to find out from the employers why they weren't successful, they learn that the other cities were able to use economic development funds to solve last-minute issues, he said.
The money would be managed by a public trust. The money would be available for projects in Tulsa County or near enough that they would create a justifiable number of jobs in Tulsa County, Fram said.
As chamber of commerce officials are working with potential employers they will negotiate contracts with "deliverables," promises of jobs and payroll from the employer, he said. If the employer fails to deliver the jobs, the contract will allow the county to recoup its incentives, Fram said.
Incentive programs of area cities
Amarillo, Texas: Sales-tax funded incentive fund for operations of new or existing businesses; $17.3 million paid out in 2009.
Austin, Texas: Discretionary grants of city funds, staff, facilities and services for promoting and encouraging economic development.
Bartlesville: Economic development corporation funded with quarter-cent city sales tax.
Frisco, Texas: $9.3 million a year in sales tax revenue available for economic development.
Little Rock, Ark.: Ten-year, 3/8-cent sales tax includes money for port improvements, land acquisition for a research facility and $6 million for recruiting new jobs.
Lubbock, Texas: $4.2 million a year in sales-tax revenue available for economic development.
Oklahoma City: Strategic investment program created $75 million fund for investments that create at least 50 jobs and have at least $1.75 million in payroll.
Sugar Land, Texas: $4.9 million a year in sales tax revenue available for economic development.
Wichita: Tax abatement program (100 percent for up to 10 years) for manufacturing, research and development and good storage for interstate commerce; forgivable loan program for new or expanding opportunities with 1 percent to 3 percent annual employment growth ($1.8 million available annually).
Original Print Headline: Fund sought to close deals
Wayne Greene 918-581-8308