Palm Desert's Supervisor Criticizes Gov.'s Move to Eliminate Enterprise Zones

County Supervisor John Benoit expressed his opposition to the elimination of California's Enterprise Zone program under legislation signed Thursday by Gov. Jerry Brown.

Benoit, whose district includes the Coachella Valley, said the legislation "will kill jobs and likely chase away businesses in the Coachella Valley's poorest communities."

Brown said the signing of AB 93 and SB 90 establishes the Governor's Economic Development Initiative, will create jobs and grow the state's economy in part by phasing out the zones over the next decade and replacing them with incentive programs.

The Enterprise Zone program offered hiring credits, sales and use tax credits and other perks to employers in 40 zones. The 56-square-mile Coachella Valley Enterprise Zone Authority is Riverside County's only enterprise zone, encompassing Coachella, Indio, Mecca, Thermal and Thousand Palms, and will shut down Dec. 31, according to Benoit's office.

The newly signed legislation creates a sales tax waiver for factory equipment, a hiring tax credit, and tax breaks for businesses expanding or relocating to California. The Governor's Economic Development Initiative will be funded by redirecting around $750 million annually from the Enterprise Zone program.

"This legislation will help grow our economy and create good manufacturing jobs," Brown said. "Through our great university system and through the companies we have, California can build on the strength of intellectual capacity."

According to Benoit's office, under the new requirements full-time employees paid between $12 and $28 per hour will be considered for hiring credits, and they must be long-term unemployed workers, veterans, ex-offenders or Earned Income Tax Credit recipients. Businesses that want to use credits must make a tentative credit reservation with the Franchise Tax Board within 30 days of hiring.

Benoit said that over the past three years, the Coachella Valley Enterprise Zone Authority issued 6,549 hiring credit vouchers, with local businesses reporting 2,247 of those as new jobs. Preliminary analysis of current voucher data indicates that less than 1 percent of the current vouchers would qualify under the new parameters, according to his office.

—City News Service.