Saturday, January 15, 2000
N.Ky. could have urban opportunity zone
BY PATRICK CROWLEY
The Cincinnati Enquirer
FRANKFORT — Businesses could receive tax breaks for locating in Northern Kentucky's urban areas under legislation unveiled this week by Gov. Paul Patton.
The Economic Opportunity Zones Mr. Patton wants the General Assembly to create could also provide jobs for the unemployed, for people trying to get off welfare and for residents of low-income neighborhoods.
“I believe these zones are one way we can revitalize our inner cities, take care of some of the abandoned industrial centers and employ minorities and those who are in poverty,” Mr. Patton said.
The Northern Kentucky zones are in the inner-city areas of Covington and northern Campbell County. Businesses, excluding retail, that locate or expand a manufacturing, service or technology company in one of the zones could qualify for tax credits, Mr. Patton said.
For an area to qualify, the criteria include:
• Having up to five contiguous census tracts in a city or county with a minimum poverty rate of 150 percent of the U.S. poverty rate.
• An unemployment rate higher than the state unemployment rate.
Northern Kentucky lawmakers who attended Mr. Patton's press conference appear ready to embrace the program.
“Like everything else down here, the devil is in the details; so I want to wait to see the final bill before passing too much judgment,” said Sen. Katie Stine, R-Fort Thomas, chairwoman of the Senate Economic Development, Tourism and Labor Committee.
“But I'm for anything that not only spurs development but also helps people become more self-sufficient by moving them into jobs and off wel fare,” she said.
To qualify for the tax breaks, a business would have to create and maintain 10 full-time jobs and fill those jobs with residents who have lived in the zone for at least a year. The business must also invest $100,000 in the project.
The companies could then receive up to a 100 percent credit against their Kentucky tax liability as well as a series of other tax breaks and incentives.
“I think it can do a lot to help stimulate some economic activity and development in our urban areas,” said House Majority Caucus Chairman Jim Callahan, D-Wilder, who, along with Mrs. Stine, represents Newport in the legislature.
Both Newport and Covington are also in state Enterprise Zones, areas where businesses can also receive tax breaks for building or expanding.
But the new zones proposed by Mr. Patton are more defined and offer more tax incentives than the broader Enterprise Zones, which in Campbell County includes Newport, Bellevue, Dayton, Silver Grove and Wilder.
A bill has been filed to extend the life of those zones for 10 years. Mr. Patton said he doesn't believe the enterprise zones have been all that effective.
Mr. Callahan, in a rare disagreement with the governor, said he wants to see the life of the zones extended because they have been successful in attracting economic development to portions of Northern Kentucky.
He points to the $100 million drywall plant LaFarge Corp. is building in Silver Grove as an example of how the zone can be successful.
“LaFarge didn't say the enterprise zone was the only reason it came to Silver Grove, but it was certainly one of the reasons and part of the equation in them coming here,” Mr. Callahan said.
“I think the enterprise zones have been a success and I want to see them continue,” he said.
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