Corporate Tax Break for Food Company Unnecessary

The effort by Netherlands-based food company Ahold to secure a multi-year property tax break on a plant being built in Cumberland County presents a troubling picture of an economic development system that is costly, lacks real accountability and leaves the taxpayers paying more. Check out my op-ed on the subject in today's Harrisburg Patriot-News.

An excerpt:

The debate in Lower Allen Twp. about a proposed property tax credit for Ahold, the Netherlands-based food company, is an illustration of everything wrong with the economic development subsidy game.

Ahold is the poster child for a system that is costly, lacks real accountability and leaves the taxpayers paying more. Ahold, the corporate parent of Carlisle-based Giant Foods, made an economic decision to consolidate its meat-cutting operations at a central location serving hundreds of Giant stores.

Customers will no longer get their meat freshly cut in store, and some meat cutters will lose their jobs while others might be offered jobs at the new facility — at a lower wage.

It is no wonder Ahold selected Cumberland County. It offers easy access to the interstates to transport meat to Giant stores in the region. With a low cost of living, great schools and health care systems, and a recession-resistant local economy, the site is a winner. Construction on the plant began this summer. So a private company decides to build a plant based on cost, location and quality of life. That should be the end of the story, but it’s not.

State and local officials are desperate to claim they are creating jobs, and many are willing to surrender tax dollars normally spent on education and public safety when corporations begin playing the tax subsidy game...

Tax incentive programs can be beneficial if there is a clear public benefit beyond job creation, if new jobs meet wage and benefit standards and if companies are held accountable, including the repayment of benefits if they fail to meet targets or pick up and leave.

Lower Allen Twp. officials decided wisely to put the Ahold tax break on hold. It’s time more public officials followed their lead to stop playing the economic development game and direct tax dollars where they should be spent: on schools, public safety and other vital services. 

Read the full op-ed.

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