We’re not the only city and state torn by whether, or how much, to join the national game in economic development — offering hefty incentives to would-be major employers dangling thousands of high-paying jobs.
If you ask most government leaders in Colorado Springs and at the state Capitol about their philosophy, the answer probably will be negative. Or, as is usually the case in our region, a very low-key approval of incentives — but only in limited amounts based on performance, not just to bring companies here.
Then again, more than a few folks take a hard-line view, opposing any kind of incentives, no matter what.
We’re not the only city dealing with this issue. Across the country in Charlotte, N.C., about double the size of Colorado Springs (more than 1.2 million in the urban area), local and state officials are feeling good about persuading insurance giant MetLife to move more than 2,600 good-paying jobs — averaging more than $80,000 a year each — from New Jersey to North Carolina.
According to an editorial in the Charlotte Observer, MetLife made its decision after North Carolina “offered one of its biggest incentive packages ever,” totaling $94 million spread over a 12-year period. Along with county-level enticements, the deal surpassed $100 million.
Yes, those incentives are tied directly to MetLife guaranteeing a quick ramp-up of jobs, then sustaining those numbers through 2025. Nearly all of the funds would come from the North Carolina state government returning 75 percent of state income-tax withholding for MetLife’s employees back to the company. That way it doesn’t come out of other taxpayers’ pocketbooks, or from general funds.
Creative, yes. And the Charlotte newspaper did more math, computing that the state was committing “between $3,000 and $4,000 per job per year, or about what the state would pay in unemployment benefits to one of those workers over just eight weeks.” The return on investment is obvious: 2,600-plus jobs, plus an estimated 800 more caused by MetLife being in Charlotte, and all those jobs having an economic impact from real estate to retail and everything in-between.
That’s how they’re playing in North Carolina, but this is not to say that Colorado, and Colorado Springs, should find more ways to play the big-time incentives game.
On our level, it has to be more about developing the best, most supportive atmosphere for startup companies.
We’ve been seeing big crowds for “pitch-night” events where innovators present their ideas. But Colorado Springs doesn’t appear to have a way of pulling together that energy and channeling it to our best advantage.
We need to do something that could include making it easier for startups, even providing some low-level incentives. They might be microscopic in comparison to North Carolina’s deal with MetLife, but they could be huge difference-makers for tiny companies with great ideas that simply need a little time and help to develop.
And if Colorado Springs could become known as a magnet for young entrepreneurs, and a welcoming place for newborn companies, we could be on our way to a new identity.