Throughout the Great Recession, as Indiana worked to add jobs through the efforts of the Indiana Economic Development Corp., the efforts of Gov. Mitch Daniels and his various leaders at IEDC were studied by many states. Indiana was the success story, in terms of job creation, and others wanted to follow suit, even states that weren’t suffering from unemployment rates as high as those in the Hoosier state.
And why not? The numbers being touted by Indiana and its governor were quite impressive.
Lately, though, the efforts of the IEDC are coming under scrutiny by elected officials, even though some newspapers across our great state have said much more openness has been needed of the state’s chief economic development agency and the myriad local EDCs that operate in a similar fashion, which is highly secretive.
Sen. Jim Banks, R-Columbia City, and Sen. Mike Delph, R-Carmel, are planning to push legislation that will provide a little more sunshine in how the state and local EDCs operate.
Delph says he will introduce his legislation because he believes the public is being intentionally misled.
WTHR-TV conducted yearlong study that showed as many as 40 percent of the more than 100,000 jobs promoted by Daniels and agency officials from 2005 to 2010 never materialized, but the IEDC won’t disclose which companies have not met their job commitments.
The IEDC says companies receive tax incentives only after they prove they’ve achieved their job projections.
The bill Delph is introducing would require each company to include updated job and investment information that would be available to the public.
Banks wants to make public the use of funds by local EDCs because the majority of their operating funds come from local government, as is the case in northeast Indiana.
One of the states that looked to Indiana as a possible model for its economic development efforts was Iowa. What the Hawkeye state came up with is a system that is similar to Indiana’s, to a certain degree, with much more opportunity for public participation.
In a nutshell, a due diligence committee of the Iowa Economic Development Authority meets in private to review economic development proposals requesting various incentives from the state. If the company passes muster, it must then go before a public meeting of the full Iowa Economic Development Authority for final approval. The meeting lays out what a company wants, what investment it is going to make, the number of jobs that will be created and the average wage to be paid, down to the penny. No hoopla, no press releases from the governor’s office.
And the public is invited to attend these meetings.
As secret as the IEDC has been, and with the recent bad press the agency has received, it is hard to believe a state looked at Indiana and came up with a plan as open as Iowa’s.
After it was exposed recently that an IEDC employee may have committed fraud and the numbers presented in the WTHR study, more and more scrutiny will be placed on the IEDC and there will probably be fallout for local EDCs. Perhaps they all should start offering up plans to provide a little more sunshine on their operations to potentially ease any potential blow from the Legislature.