Many Benefits in I.E. Enterprise Zone

SAN BERNARDINO, CA-Beacon Economics reported in its 2012 Inland Empire Economic Report that the economic recovery in Inland Southern California has been slow out of the gate but it is moving in the right direction. The team further noted that: the Inland Empire metropolitan area has added 30,800 new jobs to its employment base since hitting bottom at the end of 2009, which is a slower rate of growth than seen in the state overall but represents a recovery nonetheless.

The second quarter of 2012 marked the 12th consecutive quarter of rising taxable sales in Inland Southern California; importantly, this growth has been broad-based, reaching across virtually every industry in the region.

According to Beacon, rising employment, affordability, and low interest rates are all helping to increase activity in the inland Southern California economy.

To continue that momentum and to overcome the lingering impact of a slow-moving economy, the business community should look at what the public sector has to offer. There are advantages for the commercial real estate industry and business community available through Southern California cities and counties that include everything from tax incentives gained from locating in an Enterprise Zone to workforce training programs managed by local workforce investment boards.

For example, Parsons Brinckerhoff, a global planning, engineering and project/construction management firm, relocated to a 20,000-square-foot office building located in the Tri-City Corporate Centre complex in the San Bernardino Valley Enterprise Zone. The firm pursued the location to better serve its customer base and to leverage the enterprise zone program as a tool to bring in more employees, in a cost-effective manner.

In California, Enterprise Zone programs offer state tax credits such as hiring, sales and use tax credits. These bottom line savings can be advantageous at a time of modest growth expectations and help to bring about a more profitable 2013.

 The benefits of locating in a zone can be numerous. In addition to annual tax credits for hiring workers, businesses locating in an Enterprise Zone may also gain from an average cost savings of $.02 to $.03 per square foot, per month on lease rates for buildings that are 300,000 to 1 million square feet.

Even during the past two slow growth years, the San Bernardino Valley Enterprise Zone reported that 28 businesses, accounting for 1.8 million square feet of space, located to the area. This activity was driven by the potential incentives and proximity to the region's distribution and logistics channels.

There is no doubt that the economy will remain challenging. However, when businesses use the resources and assets offered on a local, state and federal level, there will be an opportunity for us all to work together to drive economic activity, business development and job creation.

Mary Jane Olhasso is economic development administrator for the County of San Bernardino, CA. The views expressed in this column are the author's own.