CITY, COUNTY HOPE ZONE WILL ALSO CREATE JOBS
By Daniel Thigpen
January 25, 2011
Record Staff Writer
STOCKTON - Elected leaders throughout San Joaquin County in recent weeks have approved small expansions to the sprawling, 656-square-mile special zone that offers state tax credits to employers.
In Stockton, city leaders this month OK'd three small areas for inclusion in the county's enterprise zone expansion, including a 63-acre cluster of north Stockton parcels south of Eight Mile Road.
Officials said at least a portion of that land is eyed by an undisclosed company considering whether to stay in Stockton or expand elsewhere. They hope the additional economic incentive - on top of a deep development fee reduction the city approved last summer - will keep Stockton in the running.
The state still must review the county's expansion requests. But whether the enterprise zone incentives will materialize depends largely on passage of the state budget. Gov. Jerry Brown has proposed eliminating the $500 million tax breaks, which a state agency and separate study have called ineffective, to help solve a multibillion-dollar budget shortfall.
Local officials defend the program as the only significant job-creating tool in an economically depressed region.
"That's California breaking its promise to business," said Fran Aguilera, the county's economic development director.
Enterprise zones offer tax breaks up to $37,000 for new hires and other benefits, including credits for machinery purchases.
The state finalized San Joaquin County's existing enterprise zone, one of 42 statewide, in September 2009. The zones are allowed to expand, with state approval, by 15 percent over the 15-year life of the special districts.
San Joaquin County's proposed expansion would add less than 6 square miles to the zone, an addition of less than 1 percent.
Most of the areas requested to be included either were not eligible in the first round - including Escalon and Ripon - or were overlooked, Aguilera said.
Stockton's proposed expansions are:
» A 61-acre industrial parcel at Arch and Newcastle roads. Officials hope the potential tax breaks will help market the property to new businesses.
» A collection of retail and office space, including The Grupe Co.'s Marina Shopping Center, off Interstate 5 and Benjamin Holt Drive.
» Several parcels at Spanos Park West, off Trinity Parkway. Real estate entities affiliated with retail giant Walmart own roughly 40 acres of the land. The retailer is in the beginning stages of its new north Stockton store, cleared by a state Supreme Court ruling in April.
Greg Folsom, Stockton's deputy economic development director, said Walmart is not the company the city is trying to entice through the zone expansion.
City officials have declined to name the company other than to call it an "important sales tax-generating business."
Last year, the city also approved a temporary development fee reduction incentive - which slashes many fees in half - a move partly aimed at keeping Stockton competitive with the same, unnamed company.
The state Department of Housing and Community Development will review the county's expansion request. A spokesman said at least two other requests besides San Joaquin County's are pending, but he did not say whether those reviews are on hold pending approval of the state budget.
Contact reporter Daniel Thigpen at (209) 546-8254 or email@example.com. Visit his blog at recordnet.com/thigpenblog.