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Travis County readies policy on providing economic incentives

Wednesday, November 14, 2012 by Michael Kanin

Travis County Commissioners continued to inch toward final approval of a comprehensive economic development incentive policy. In a series of successive votes Tuesday, Commissioners made a handful of key decisions about the requirements companies must meet in terms of the number of jobs created, amount of employee wages and minimum property investment to receive a rebate on county property taxes.


Though the court appeared to seal much of its policy with its Tuesday action, a corrected document will be back for final approval next week.


Each commissioner had some input with regard to the policy. However, Commissioner Sarah Eckhardt seemed to object to more of its content than the rest of her colleagues. At a break in the hearing, she told In Fact Daily that it is “very good to have a policy,” adding that “this policy is reflective of a clear majority of the court.”


Commissioners did pass one of Eckhardt’s motions – what would amount, if finally ratified, to a landmark clause that would establish a wage floor for all employees that service an incentivized business, including construction workers. The floor would parallel the county’s minimum wage, which is currently $11 an hour.


Commissioners approved the wage floor’s inclusion in the policy on a 3-1 vote. County Judge Sam Biscoe was the lone “no.” Commissioner Karen Huber was off the dais.


The wage floor is a major goal of officials with the Workers Defense Project, an Austin organization that supports low-wage workers. It has repeatedly called for such action, and for it to include construction workers. Biscoe worried there had not been enough discussion on the matter.


“We really ought to get all the right people in the room, work through (the) issues, and land on them,” Biscoe said.


Dave Porter, senior vice president for economic development for the Greater Austin Chamber of Commerce, argued that an $11 an hour minimum wage, as stipulated by the agreement, would have short-circuited a recent development agreement with HID Global Corp., a deal that will bring 276 jobs to the county that was geared toward providing work for the hard-to-employ. “Flexibility is very critical,” Porter said.


The head of county planning and budget, Leslie Browder, presented the policy to commissioners. She noted that its contents were the result of much time and discussion.


Commissioners agreed with many of Browder’s recommendations, including the idea of limiting the available incentives to only a potential property tax rebate (as opposed to also allowing for tax abatements), the decision to not demand a supermajority of commissioners to approve either a waiver of any portion of or an amendment to their new policy, a $25 million property investment minimum for applicants, a minimum of 100 jobs created by a company looking for the rebate, a mandatory recapture provision that would allow the county to reclaim at least a portion of the tax rebates it issues should a company breach its agreement.


Eckhardt objected to only offering a tax rebate. She argued that, though the court might never need it, she’d rather have the flexibility to provide tax abatements.


However, it was Eckhardt’s vote against the supermajority provision of the policy – and the failure of that issue to pass – that seemed to carry the most import. She suggested that such a measure would prevent the court from being “overpowered in the moment by a very large and starry applicant,” she said.


The issue continued to arise and then, during the recapture discussion, Biscoe directly addressed her statements. “You keep making reference to a simple majority like it’s not in the law,” he said. “A simple majority of the court is what controls us, basically.”


Biscoe also called for the county’s policy to be as close as possible to the one run by the City of Austin. “We really ought to be where the city is, if possible,” he said. The city is also in the process of overhauling that policy.


The county’s economic development policy will be back for final approval next week. commissioners are set to address outstanding issues then. That, however, may not spell finality: Biscoe appears set to call for a working group to address concerns that arise in the future.

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