2012 Predictions for CA’s Enterprise Zone Program


It’s January 2, 2012 and so far, not a peep from the Governor’s office about destroying California’s best tax incentive program. So far, so good. Last year at this time, California was holding its breath in anticipation of Governor Jerry Brown’s 2011 budget proposal. Rumors had been leaked that the Governor’s budget would propose the elimination of the state’s Enterprise Zone program.
As it turned out, those rumors were true. A heated political debate ensued that lasted into the summer of 2011. In the end, the Enterprise Zone program was preserved without modifications. The program’s opponents could not muster the votes needed to pass their nefarious legislation.
Since that time, supporters of California’s enterprise zones, like Democratic Assemblyman V. Manuel Pérez, have been pursuing more constructive legislative changes. He was recently asked by The Desert Sun about his political predictions for 2012. Among other things,

Pérez . . . predicts reforms to the state enterprise zone process, “resulting in a more accountable, transparent economic development program serving our neediest communities.”

I hope Assemblyman Pérez is right in his prediction. Reasonable changes that make the program more transparent and effective might also contribute to its continued political stability.
The Governor’s office has directed the Department of Housing and Community Development (HCD) to evaluate potential regulatory changes to the way the enterprise zone program is run. A regulatory approach will not permit the draconian revamping proposed by the Governor in 2011 . . . and might actually produce something beneficial. In any case, HCD’s evaluation appears to still be in a very early phase.
Based on my personal experience with the last set of regulations prepared by HCD for the Enterprise Zone program, it will probably be a year or more before anything concrete is ready. Prove me wrong, HCD. I’m cheering for Assemblyman Pérez to get something decent through the California legislature first.

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