Ohio Needs to Simplify and Improve Business Incentives, Study says

Monday, May 25, 2009
Topics: Economy, Politics
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When a company wants to find a place to put its new headquarters or a new factory, they often shop around for the best tax breaks a state can offer. A report out last week says tax cuts over the past few years have made Ohio competitive with other states, but we still lag others. ideastream®'s Dan Bobkoff has more.

A report commissioned by the Ohio Department of Development finds that all the incentives and tax breaks the state enacted over the past few years have made Ohio more competitive with other states-as much as 20% more than before. But the study says Ohio needs to do a better job explaining its incentives to companies considering moving here.  And, the state needs to be known as customer friendly: a place that works well with business.

Steve Schoeny is the director of the strategic investment division of the Ohio Department of Development. It was his job to conduct this study.

He says the research is a strong argument against repealing business tax breaks as some have proposed in order to help balance the budget.

SCHOENY: our analysis is that the environment out there is so competitive that you do have to make sure that you not only provide the dollar value at the beginning of the process, but throughout the process you have to operate state government, you have to operate local government, and you have to operate the programs in a way that gets you repeat customers because companies will make decisions sometimes based on the hassle factor.

Bottom line: it’s not just the tax breaks that matter to companies. Speed, efficiency and service from state and local governments are just as important.