Virginia has spent $679 million for performance and ongoing economic development incentives since 2010, according to a presentation received by the House Appropriations Committee on Monday. The presentation also indicates that annual incentive payments have grown 298 percent since the 2004-2006 biennium. The staff presentation was given Monday as part of the committee’s ongoing review of economic development spending, which began at the direction of House Appropriations Committee Chairman S. Chris Jones last fall.
“Creating jobs and strengthening Virginia’s economy has been and will remain a top priority of the House of Delegates,” said Chairman Jones (R-Suffolk). “This report shows Virginia has made major investments across the board, including one-time, performance, ongoing and tax-based incentives, to foster job creation and attract new companies to our state. The size and scope of our investments in economic development since 2010 reflects our commitment to improving the economy of the Commonwealth. The question now is are we getting enough bang for our buck? The committee will carefully review this report as it considers how much and where to invest any additional economic development spending this biennium.”
“State government plays a vital role in fostering business growth in the Commonwealth,” said House Appropriations Committee Vice Chairman R. Steven Landes (R-Augusta). “Economic development incentives are an important tool as Virginia competes against other states to attract businesses and encourage growth, but Virginia cannot afford to write blank checks. We need to carefully evaluate our current and future investments to ensure we are maximizing the use of scarce resources. This is an informative report that will assist the committee as we develop our budget proposal.”
The full presentation can be found here. Major findings from the presentation include:
- Economic development growth outpaced overall general fund spending through the last two administrations
- Virginia has spent $216 million on performance incentives since 2010, and has $97 million in outstanding incentives
- Virginia has spent $463.2 million on ongoing incentive based programs since 2010
- Overall incentive payments have grown 298% since the 2004-2006 biennium
- Ongoing incentive based programs have grown 84% since 2010
- Virginia spent $40 million on various tax credit incentive programs in FY2014
- Virginia has invested $36.5 million in new and expanded incentives since 2010
- The Commonwealth Opportunity Fund has grown 81% since the 2004-2006 biennium
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