THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Sunday, March 3, 1996 TAG: 9603020014
SECTION: COMMENTARY PAGE: J4 EDITION: FINAL
TYPE: Editorial
LENGTH: Medium: 52 lines
Gov. George F. Allen is likely to be remembered best for the economic-development achievements of his administration; specifically, for new and expanded businesses and net gains in jobs for Virginians. That some of the projects announced during his term were in the works before he became governor matters little. Bargains sealed on his watch are properly credited to his account.
In mid-February, the governor announced that his promise of more than 125,000 net new jobs in Virginia had been more than fulfilled. Halfway through his term, net new jobs total 151,800 and commitments to new capital investment total a record $7.8 billion.
Virginia's success in getting Motorola and IBM-Toshiba to choose to construct semiconductor-manufacturing plants in the Old Dominion and attracting investment from other companies is attributable largely to the state's low corporate-income-tax rate, right-to-work law and extensive, flexible community-college system.
But the Governor's Opportunity Fund, established in 1992 during L. Douglas Wilder's governorship, likewise played a part by providing Mr. Allen with deal-sweetening money.
The fund has never been fat; Virginia is not going to give away the store to gain business, nor should it. But the fund enables the state to complement financial incentives offered by localities to lure out-of-state corporations or encourage the expansion of enterprises already here. Newport News, for example, offered United Parcel Service $750,000 in rent concessions plus $500,000 from the Governor's Opportunity Fund and other inducements to persuade the giant package deliverer to come to town. The payoff for Newport News - and Hampton Roads and Virginia - after UPS accepted the offer has included about 1,200 jobs to date. The Governor's Opportunity Fund was similarly helpful in bringing a TWA operation to Norfolk, aiding the Lillian Vernon catalog-sales expansion in Virginia Beach and drawing a projected major Japanese synthetic-paper manufacturer to Chesapeake.
Governor Allen asked $38 million for the Opportunity Fund in his proposed two-year budget, presented to the General Assembly in January. The Senate would grant him $34.5 million, which would be reasonable, but the House of Delegates would provide only $18 million, which is too little.
Virginia is in fierce competition with other states for new money and new jobs. The legislature should see to it that the governor has more in his Opportunity Fund pocket when he sits down with business prospects than the House would give him. by CNB