The problem for places trying to hold off on giving tax breaks to corporations: someone else will make an offer

You are a municipal or state leader who wants to take a stand on not providing tax breaks to corporations regarding land and/or development. You make the case that wealthy firms can pay their own way. You present evidence that tax breaks tend to benefit the companies, not necessarily communities. You say that tax dollars could be used more effectively in other ways.

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This may be a convincing argument to many. But then something happens. Another community or state offers a lot of taxpayer money. They say they will spend tax money to help a company move. They want that company and will pay the money needed to help make it happen. Can a community afford to lose a major actor? Can a local politician be the one who let them get away?

This could happen for a sports team – see what is going on with the Chicago Bears (even before the latest efforts from Indiana). It could happen with the headquarters of a big company – see the offers made for a second Amazon headquarters. It could happen with warehouse facilities or a shopping mall or a residential development.

Unless every body of government refuses to offer tax breaks, someone might jump in. All the places in a region might not offer a break but then someone across state lines offers money or someone in another region jumps in. There is value for organizations staying in place without tax breaks but it is also hard to do so if someone is offering a lot of money and/or savings to locate elsewhere.

This may indeed be the world we live in. Communities and places compete for jobs, resources, and firms. But hopefully the competition does not leave taxpayers paying for decades for minimal local impacts.

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