logo logo
Donate
    • Membership
    • Donate
  • Social Justice
    • Racial Justice
    • Climate Justice
    • Disability Justice
    • Economic Justice
    • Food Justice
    • Health Justice
    • Immigration
    • LGBTQ+
  • Civic News
  • Nonprofit Leadership
    • Board Governance
    • Equity-Centered Management
    • Finances
    • Fundraising
    • Human Resources
    • Organizational Culture
    • Philanthropy
    • Power Dynamics
    • Strategic Planning
    • Technology
  • Columns
    • Ask Rhea!
    • Ask a Nonprofit Expert
    • Gathering in Support of Democracy
    • Hope in the Dark
    • Humans of Nonprofits
    • Inside the States
    • In Defense of Civil Society
    • The Myth of Heroic Leadership
    • Notes from the Frontlines
    • Notes from the Long Arc
    • Reimagining Philanthropy
    • The Unexpected Value of Volunteers
    • We Stood Up
  • Newsletters
  • NPQ Online Events
    • Learn Out Loud
    • Premium Webinars
    • Partner Events
    • On Demand
  • Leading Edge Membership

JOBZ Program Loses Jobs, Tax Breaks Increase

Nancy Knoche
April 25, 2011

April 22, 2011; Source: Star-Tribune | Suzlon Rotor Corp., a wind energy company located in rural Minnesota, was one of the biggest job losers in a state program to encourage job creation. Yet it still remains eligible to receive $297,000 in tax breaks. Critics are wondering why.

JOBZ, which stands for Jobs Opportunity Building Zones, is a signature rural job creation bill started in 2004 by then governor Tim Pawlenty. The program touted creating 6,992 jobs since its launch. But a program publication released last week reported that only 6,366 jobs were created through the program through the end of 2009, a 9 percent decline. Yet as job creation has stalled, program subsidies rose to nearly $34 million to participating companies.

Since it began, 379 JOBZ companies received $144 million in tax breaks including 77 businesses that were booted from the program for not meeting goals.

“It is further evidence that economic development subsidies cannot defy gravity,” notes Greg LeRoy, executive director of the nonprofit group, Good Jobs First. Similar efforts in other states have produced similar results, he added.

Sign up for our free newsletters

Subscribe to NPQ's newsletters to have our top stories delivered directly to your inbox.

By signing up, you agree to our privacy policy and terms of use, and to receive messages from NPQ and our partners.

Bob Isaacson, director of JOBZ and business finance manager for the state department who issued the report, emphasized that manufacturing companies in Minnesota suffered nearly 11 percent of job declines in 2009. Participating JOBZ companies expanded operations and added jobs because of the subsidies, he reports.

An analysis by the Star-Tribune reveals that many other job creation programs supported by local and state governments from 2004 to 2009 didn’t meet hiring goals.

At Suzlon Rotor Corp., their employee numbers fell from 500 in 2006 to 30 today. It is scheduled to receive the $297,000 property tax reduction because it met its JOBZ goal of 23 new jobs. Former employees of the company are frustrated because they believe a job goal so low doesn’t warrant such a large subsidy.

Jason Bush and his wife were both laid off from Suzlon in December. “What I don’t think was very good is the number they are required to maintain – 23 jobs – seriously,” says Bush. “McDonalds employs more people than that.”—Nancy Knoche

Our Voices Are Our Power.

Journalism, nonprofits, and multiracial democracy are under attack. At NPQ, we fight back by sharing stories and essential insights from nonprofit leaders and workers—and we pay every contributor.

Can you help us protect nonprofit voices?

Your support keeps truth alive when it matters most.
Every single dollar makes a difference.

Donate now
logo logo logo logo logo
See comments

Sidebar-WTC
You might also like
Election accessibility is dismal in some states, potentially impacting a quarter of U.S. adults in the who are disabled.
Marianne Dhenin
The false virtue of restraint: what would it take to actually win?
Brooke Richie-Babbage
Three years after Chicago’s labor peace ordinance, what has changed?
Jason Collins
The South Has Always Organized for Our Nation’s Democratic Ideals
Flozell Daniels
Building Democracy Beyond Elections: What the US Experiment in Shared Governance Can Teach Us
Ben Palmquist
California faith leaders walk 96 miles to demand end to ICE detention
Marianne Dhenin

Upcoming Webinars

Group Created with Sketch.
October 29, 2:00 pm ET

Leading Edge

Fundraising Trends and Emerging Practices

Register
Group Created with Sketch.
December 3, 2:00 pm ET

After the Midterms

What’s Next for Nonprofits?

Register

    
You might also like
A night sky full of stars, with one star glowing much birghter than the others. Below, a tree line is silhouetted against the sky.
Why We Should Not Abandon the South
Rebekah Barber
Is Doing Business with AARP a Bad Deal?
Nancy Knoche
9/11 Charities Hope to Open Hearts and Wallets
Nancy Knoche

Like what you see?

Subscribe to the NPQ newsletter to have our top stories delivered directly to your inbox.

See our newsletters

By signing up, you agree to our privacy policy and terms of use, and to receive messages from NPQ and our partners.

  • About
  • Advertise
  • Careers
  • Contact
  • Copyright
  • Donate
  • Funders
  • Editorial Policy
  • Media Relations
  • Privacy Policy
  • Submissions

We are using cookies to give you the best experience on our website.

 

Nonprofit Quarterly | Civic News. Empowering Nonprofits. Advancing Justice.
Powered by  GDPR Cookie Compliance
Privacy Overview

This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping our team to understand which sections of the website you find most interesting and useful.

Strictly Necessary Cookies

Strictly Necessary Cookie should be enabled at all times so that we can save your preferences for cookie settings.