A bill that would tie future corporate tax breaks to job creation and accountability has passed the Legislature and now goes to Gov. Jerry Brown, who has until Oct. 9 to sign or veto it.
Both Central Coast legislators, Assemblyman Katcho Achadjian, R-San Luis Obispo, and state Sen. Sam Blakeslee, voted against the proposal.
Blakeslee, R-San Luis Obispo, has said he supports the notion of reviewing tax credits, “but that review needs to be comprehensive.”
Blakeslee calls the bill that passed “problematic because it doesn’t account for jobs saved (already) with the tax credit.”
“For example,” Blakeslee said, “if a company has experienced a 10 percent loss in jobs with the assistance of the tax credit, it’s logical that the job loss would have been much higher without such assistance.”
Under the proposal, an employer who benefits from a business tax incentive or tax credit related to job creation must state and meet “clear goals and performance measures.” If the employer failed to meet them, the state could take back the tax credit.
The bill’s chief backer, state Sen. Leland Yee, D-San Francisco, argues that tax credits for corporations “are often created with the argument that they will create jobs and fuel economic development.
“Yet under existing law, it is nearly impossible to track which companies are receiving tax credits and if those subsidies are meeting the goals of the expenditure,” he said.
Yee claims that California provides more than $14 billion in corporate tax credits “without transparency and accountability. If a business fails to keep its word, or in some cases even moves out of the state, taxpayers should not have to foot the bill.”