Economic Development with no accountability

What would you think of officials who spend tens of millions of your tax dollars every year and never check on whether citizens get what they pay for?

That’s what’s happening with Delaware’s questionable program to buy jobs. The state regularly gives your tax dollars to companies that promise to create or maintain jobs here.

The catch is that nobody ever checks on whether the companies keep the promises they made about jobs. A new study by the Pew Center on the States evaluated states that pay companies in return for the promise of jobs. Delaware was found lacking.

According to Pew, Delaware is not among the 13 states that have established a process for evaluating whether economic development incentives are used wisely. States that make a sincere effort to find out what taxpayers get for their money employ such commonsense considerations as the cost per job and the overall economic impact. And they report their findings to the public who foots the bill.

If the Delaware Economic Development Office evaluates the tax incentives, grants and low interest loans extended to companies, officials keep those findings a secret. Every deal brokered through DEDO and the Delaware Strategic Development Fund comes with specific promises of jobs to be created or retained. Yet there is no evidence that these commitments are worth more than the paper they’re written on.

Your tax dollars have gone to established companies that became successful without taxpayer give-aways, such as Amazon.com, AstraZeneca, Hercules, Allen Family Foods, GM and Chrysler. Payments also have gone to companies with no record of success, such as the hybrid car start-up Fisker, which recently acknowledged it may never create a single job here, and the now defunct AstroPower.

There are good reasons to question the ultimate public good of states competing with each other to offer the biggest bribe to businesses that promise jobs. Delaware officials will tell you that they have to play this game because other states play it. And, in these tough economic times, corporate executives have become most adept at pitting states against each other in bidding wars.

Even if you allow that Delaware has to play, then insist they play honestly. There is no excuse for elected officials to play fast and loose with your money. They are selling taxpayers a pig in a poke. It’s time for taxpayers to demand a full accounting of what they’re getting for their money.

Dr. John E. Stapleford
Caesar Rodney Institute

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