California’s enterprise zones have been a part of state government since the mid-1980s, but there is disagreement as to whether they have successfully attracted and retained businesses or merely shifted commercial activities from communities without zones to others where the program is in effect.
As a budget deal appears to be near, the fate of enterprise zones remains uncertain.
The governor has proposed eliminating the zones, which offer businesses tax breaks for hiring and capital investments, as part of his budget proposals.
“In its current form, it fails to encourage the creation of new jobs and instead rewards moving jobs from one place to another within the state, according to unbiased economic research. This, along with California’s persistently high unemployment rate, argues for changes to encourage economic development and increase the number of jobs in California,” reads an official summary of Brown’s plan.
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