According to an article posted late Friday by Shane Goldmacher and Anthony York of the Los Angeles Times, officials familiar with CA Governor Jerry Brown’s revised budget revealed a few key details today. The Governor’s new plan (which will be formally announced on Monday), contains very good news for communities touched by California’s enterprise zone program.
The Governor’s revised budget will no longer call for the elimination of the enterprise zone program!
Justification for this and other anticipated changes in the Governor’s proposals comes from two directions — foremost, an unexpected $2 billion surge in state tax receipts.  (See related May 5th article in the Los Angeles Times.)

“The governor would use an unexpected multibillion-dollar influx of tax receipts to fill the gap left in his budget by the shorter period of income tax increases. He would also use the new money to keep in place “enterprise zone” tax credits for businesses that hire workers from blighted areas.”

A second important impetus for the change is the significant political support expressed for keeping the program.

“Brown’s decision to retain enterprise-zone credits comes amid Republican opposition and an active campaign by businesses and others who hired multiple public relations firms and spent $130,000 on lobbying in the first three months of this year.”

To be fair, it is not just Republicans who oppose elimination of the program.  Influencial Democrats had also announced their opposition to eliminating enterprise zones.
So, what will this change mean for the future of the enterprise zone program? Until the details come out on Monday, I am hesitant to predict. It is my hope that the Governor’s revised plan will support Assembly Bill 231 (by Assembly Members V. Manuel Pérez and Luis Alejo) — a proposal to reform the enterprise zone program.
Without meaningful reforms now, I would expect renewed political attacks in the future.  But for now, let’s enjoy the good news and see what happens next.

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