Kern County supervisors have created a “carrot” they hope will help lure new business, economic development and jobs to the southern San Joaquin Valley.
With the idea of making Kern County more competitive, supervisors last fall widened the number of industries that can get tax incentives for bringing new businesses to the county and removed the cap on those tax credits.
“Kern County’s incentive program has been designed to maintain parity with incentives offered by other jurisdictions within California,” explained Assistant County Administrator Teresa Hitchcock, who oversees economic development.
“Real estate and labor costs in Southern California have escalated to the point that Kern County can provide welcome relief to businesses that must be in California to serve their customers but find the costs in Southern California to be prohibitive,” she said. “We are sending the message to the business community that there is a place in Southern California where you can efficiently serve the 40 million people in this state and all of the western United States in a business-friendly community, where the local government is supportive, rather than destructive.”
Richard Chapman, president of the Kern Economic Development Corporation, lauded the new incentive plan that his organization helped create. The plan is also supported by the Kern County Taxpayers’ Association, the Kern Citizens for Sustainable Government and the Cal State Bakersfield Small Business Development Center.
“This will get our community on the short list” for new business development, Chapman said, after supervisors approved the plan in November. He noted that local companies hoping to expand or stay in Kern County also will benefit.
According to Hitchcock, the new incentive plan:
• Is based on a pay-for-performance scheme, with businesses only receiving incentives that they earn.
• Incentives will include potential rebates of sales and use tax and property tax. Transient occupancy tax rebates may be included in pursuit of quality lodging opportunities for tourism.
• The program’s focus is on new, full-time job creation, rather than capital investment, at better than the living wage rate for Kern County (as determined by MIT, www.livingwage.mit.edu/metros/12540). The MIT basis will be used because the rate changes annually.
• Targeted industry clusters have been expanded to include e-commerce, general manufacturing and destination retail.
• Designed for flexibility, the performance-based program will require quantitative thresholds to be tested periodically for accountability.
• The county will review applicants on a case-by-case basis. Overall net benefits and incentives will be tailored accordingly.
• Program details and application will be available on the Kern County’s Economic Development website (www.kerncounty.com/econdev/) and through the Kern Economic Development Corporation (www.KEDC.com)
• Applications will be evaluated on a cost-benefit basis and incentives, with incentives offered on a per project basis. Complicated projects may require evaluation by an outside consultant at the applicant’s expense.
• Any incentives offered of more than $100,000 will require a public hearing.