Debra Gruszecki published a lengthy article in The Desert Sun yesterday describing Coachella Valley area responses to Governor Jerry Brown’s proposal to dismantle California’s Enterprise Zones program. While there is much in her article worth reading, one statement in particular captured my attention.
State Assemblyman V. Manuel Pérez, the Coachella Democrat who chairs the committee on Jobs, Economic Development and the Economy, has been working on a reform legislation to ensure enterprise zones . . . are protected.
Assemblyman Pérez has been a strong supporter of the state’s enterprise zone program. Last year, the California Association of Enterprise Zones recognized Perez with the organization’s Legislator of the Year Award because of his highly visible support of the program.
My review of recent news reveals no additional details of the Assemblyman’s anticipated reform legislation. Recalling anti-EZ bills that were pushed by enterprise-zone opponents last year, however, I would not be surprised if Pérez offers them something they wanted. Reasonable options would include elimination or modification of the Targeted Employment Area (TEA) eligibility category, which has been heavily criticized by opponents.
Another probable reform would be to limit the amount of time employers have to apply for hiring vouchers. Hiring vouchers are certificates of employee eligibility. A business can not claim a hiring tax credit without first obtaining an employee-certification voucher from the zone’s vouchering agent. By placing a limit on the amount of time available for obtaining a voucher, the state would be eliminating the practice of retroactive vouchering – a process that currently enables businesses to amend their tax returns and claim refunds based on tax credits they had missed during the past 3 to 5 years.
There are reasonable reforms that friends of the enterprise zone program should be willing to accept — especially if the alternative is the complete dismantling of the program.