Marc Lifsher
Monday, May 12, 2014

California is fighting back in the battle to keep businesses from relocating to lower-cost states.

Gov. Jerry Brown’s administration is rolling out a new $750-million program that offers some modest financial incentives to encourage California employers to stay put and help persuade out-of-state companies to move here.
Gov. Jerry Brown
“These tax credits will spur new jobs and help communities hardest hit by the recession,” Gov. Jerry Brown says of his new state tax credit program aimed at retaining and attracting employers in California. (Autumn Cruz, Associated Press)

A trio of tax credits, approved by the Legislature last year, are now in play. They’re aimed at preventing high-profile departures by companies such as Toyota Motor Corp. and Occidental Petroleum Corp., both of which plan to go to Texas.

The governor’s tax package includes:

• A reduction in the amount of sales tax a business pays on the purchase of equipment for manufacturing, food processing, biotech, and research and development

• A California Competes income tax credit, negotiated by the Governor’s Office of Business and Economic Development, for companies that invest in new jobs anywhere in the state

• A New Employment Credit on income taxes for boosting the number of jobs for veterans, public assistance recipients and former prisoners in targeted areas with high unemployment and poverty levels

The program “puts California back in the mix for significant manufacturing investments,” said Gino DiCaro of the California Manufacturers & Technology Assn.

The new employment tax credit, for now, is limited to three pilot zones selected by the Brown administration: portions of Riverside, Merced and Fresno counties.
Rewarding Mr. Sterling or any other professional sports team owner with tax relief as a result of being fined for despicable behavior is outrageous – Reggie Jones-Sawyer, state assemblyman

The city of Riverside is already getting the word out to potentially eligible businesses, said Larry Vaupel, the city’s economic development manager.

To read entire story, click here.