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    Entries in tax incentives (3)

    Tuesday
    May012018

    How Cities Fell Out of Love With Sports Stadiums

    Major league teams used to get everything they wanted from sports-mad cities. Now they have to fight for it -- and increasingly, they’re losing.
    BY  MAY 2018
    (AP)

    St. Louis is used to getting stood up by football teams. The city has been home to four different franchises, and all of them have left town. But the last two departures -- and especially the loss of the Rams to Los Angeles in 2016 -- have been gut-wrenching experiences that seem to have broken much of the city’s storied enthusiasm for sports.

    In 1987, St. Louis’ NFL team, the Cardinals, skipped town abruptly. Tired of the old Busch Memorial Stadium and increasingly indifferent fans, the team packed up after 27 years and headed for Arizona. The loss was a bitter one for St. Louis. But the city went after another NFL team with zeal. In the early 1990s, local officials had little trouble winning approval of a new downtown stadium funded entirely with taxpayer dollars. The city failed to win one of two NFL expansion teams awarded in 1993, but eventually it lured the Los Angeles Rams, who had their own problems with an ancient facility and a waning fan base. By 1995, the Rams were kicking off in downtown St. Louis.

    It was a time when other cities were making similar choices. The Maryland Stadium Authority built a new publicly funded football stadium in 1998 as a prize for the NFL team it had stolen away from Cleveland two years earlier. Cleveland, in response, built a taxpayer-funded stadium and won back an NFL franchise in 1999.

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    Thursday
    Nov032016

    A Sneak Peek at the Seismic Shift in Corporate Tax Breaks

    New rules are forcing states and localities to calculate how much revenue they’re losing to business deals -- and whether they pay off. It’s something Washington state has been doing for a decade.
    BY  NOVEMBER 2016

    Earlier this year, Washington state lawmakers got a wake-up call. A tax incentive package they’d approved in 2013 for aerospace giant Boeing -- largely regarded as the most expensive incentive deal in history -- was actually on pace to surpass its estimated $8.7 billion cost. According to a Department of Revenue report, the deal, which extends to 2040, had already amounted to half a billion dollars in giveaways in just the first two years alone. In other words, the state was losing out on a whole lot more money than it had planned.

    And the kicker? Just months earlier, Boeing had announced plans to cut roughly 4,000 jobs in Washington. The year before, the company had transferred thousands more jobs out of the state.

    Some lawmakers were livid, openly contemplating whether the state should consider revoking the tax breaks if the company didn’t add back some jobs. (Boeing, for its part, says it has continued to invest in the state, including $1 billion last year for a plant to build its new 777x aircraft.) But on the whole, response from officials and local media was measured. Most lawmakers said that in the bigger picture, the company was still good for Washington.

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    Monday
    Jan042016

    The Curious Case of Disappearing Corporate Taxes

    Over the past two decades, corporations have doubled their profits but contributed increasingly less to state revenues. Where is all the money going?
    BY  JANUARY 2016

    When Rick Snyder became governor of Michigan in 2011, his state had been on a 10-year economic slide -- businesses were leaving and so were people. Where the rest of the country saw growth in the first two-thirds of the 2000s, Michigan’s fiscal health was slip-sliding away.

    Reversing a slide is difficult, and Michigan’s governor and legislators focused a good chunk of their turnaround efforts on taxes. They wanted to reform the tax code so that it would lure businesses and generate the revenue needed to underwrite the kind of quality services that make people want to live there. Snyder’s first step was to ask the legislature to slash business taxes. Within months, lawmakers repealed the unpopular and complicated Michigan Business Tax -- though businesses could opt to stay with parts of the old system and its arcane web of credits and rebates. That isn’t all the legislation did. The new tax law created a flat 6 percent tax that only certain types of corporations paid on their income. Talk about simplification: Nearly 100,000 businesses no longer had to file corporate returns.

    Michigan has made economic progress since the 2011 tax reforms were passed. The population has stabilized, and the state ranks fifth in the country in job creation. Earlier this year, Michigan’s bond rating was upgraded, an affirmation of a more stable fiscal environment.

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