This year, like every campaign year before, we will hear promises to "create jobs." Truth be told, there aren’t many things our elected officials can do to create jobs. The best contributions our state government can make, generally, are sound budgeting and investments toward a healthy and prepared workforce.
However, there are a handful of policies that reside solely in state government and have a direct impact on Arkansas’s ability to compete for quality jobs. Arkansas’s suite of targeted economic development incentives are funded by the Arkansas legislature and carried out by the administration. These incentives are essential to attracting quality jobs to Arkansas.
In 2007, the legislature created the Governor’s Quick Action Closing Fund. They put in $50 million. That $50 million was to last two years—essentially $25 million per year. In 2009, the fund was replenished to $50 million.
But in 2011, the legislature only replenished the fund to a $15 million dollar balance and $16 million in 2013. Arkansas has gone from $25 million per year down to $7-8M per year. Most recently, during the 2014 fiscal session, the governor’s budget requested an additional $5 million and received nothing. Now, Arkansas is left with a fund balance of less than $7 million. That is supposed to last until July of 2015.
The Quick Action Closing Fund has helped attract several thousand quality jobs to every corner of the state. It has been an unqualified success. The projects are subject to strict performance standards and a thorough cost-benefit analysis is done on the front-end. When projects fail to perform, funds are recovered. It works.
Incentives are only a part of successful economic development. But it is foolish to think that the targeted funding the closing fund offers is anything but essential to deal-making. Consultants, local industry and growing businesses around the world need to know that Arkansas has the capacity to compete when the deal is right.
That’s why the Arkansas Economic Developers, the Arkansas State Chamber of Commerce, and the Arkansas Chamber of Commerce Executives have joined together to challenge every legislative and gubernatorial candidate to commit to full funding of the of the Quick Action Fund annually. To replenish the fund to $25 million each year.
This year, when you hear a candidate promise to create jobs ask them where they stand on funding the Quick Action Closing Fund. There’s only one right answer.