Thursday, June 28, 2007

Why does the Twin Cities care about JOBZ? 

Another lawsuit has been filed against the state for its JOBZ program.

Former state Rep. Rob Leighton says JOBZ discriminates against other businesses that don't get those tax breaks. Leighton is an attorney representing ten businesses and individuals who believe they've been harmed by competitors in the JOBZ program.

"The JOBZ program permits them to not have to pay real estate taxes, income taxes, corporate taxes. And you can imagine that if your trying to compete with a fellow business that's in the same area of business you are that would be a big disadvantage. So, each of these plaintiffs feel they've been directly harmed economically because of it. And they believe they should be treated equally."

As Leighton works for a St. Paul firm, I will venture a guess that his plaintiffs are in the metro area and thus ineligible for JOBZ. A different lawsuit failed last year because the plaintiffs -- also Cities-based, did not have standing to sue, nor could show harm in the form of higher taxes. I see nothing to indicate yet how this suit is different.

It's interesting: The argument goes that a metro area firm's tax burden rises because the government is making tax expenditures to support outstate economic development. If that sort of thing passed, could towns that did not qualify for, say, local government aid sue because they did not have access to that crack kit? Where would such logic take you?

If I was a lawyer trying to stop JOBZ, why wouldn't I find plaintiffs instead in areas that DO have JOBZ, but firms that had not been able to get access to JOBZ-designated properties? Then one might argue that local business property taxes rose because JOBZ had taken other property in the city off the tax rolls.

(Noted: I'm not a fan of the program. See here and here.)

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