'Tiered' incentives would drive economic growth

by Jill Long Thompson

As Indiana communities, both rural and urban, continue to experience rising rates of unemployment and round after round of layoffs and factory closings, it's time for a new approach to growing Indiana's economy and securing good-paying jobs.

To be truly successful our state's leaders must do a better job of engaging all of our communities and citizens in economic development -- not just those in Central Indiana.

As someone who grew up and still resides in rural northern Indiana, I know that what works in one community may not work in another -- and that's why Gov. Mitch Daniels' "one size fits all" approach to economic development has been so disastrous.

If elected governor, I will lead Indiana in a new direction.

In addition to reforming our tax, health-care, education and infrastructure systems, I want develop a "tier" system in Indiana to help guide future development efforts. Modeled after successful programs in Georgia, Nebraska and the Carolinas, this approach would encourage businesses to build or expand in the state's most economically distressed areas.

Specifically, my plan would categorize the state's 92 counties into three different economic tiers based on a variety of factors, including a county's unemployment rate, median household income, population growth and assessed property value per capita. Counties within each tier designation would be allotted different tax incentives to help grow and retain good paying jobs.

For instance, companies that locate to the most economically distressed areas, Tier 1 counties, could receive a $3,500 tax credit for every new job that is created. Those moving to or expanding in a Tier 2 county might receive $2,500 tax credit per new job and Tier 3 counties could offer a $1,000 tax credit per new job.

This is an economical and efficient approach to luring new jobs to the areas of the state that need the most help, and because the incentives are based off of the creation of new jobs, it won't cost taxpayers anything.

My proposal also recognizes that not all jobs are good jobs. That's why, under my plan, only companies that offer their employees health insurance, cover at least 50 percent of the premiums and pay more than the county average wage would be eligible.

I would also restrict companies from participating in this program if they owe back taxes or have received a significant environmental violation within the last five years. As a former undersecretary for rural development at the United States Department of Agriculture, I managed numerous economic development programs that created and secured thousands of jobs annually in the country's most economically distressed areas.

For the long-term prosperity and sustainability of Indiana, we can and we must do more to recognize the value and potential of all of our counties, communities and citizens across that state.