The competitive nature of todays business environment requires companies to conduct ongoing assessments. Taking stock ensures business success.
When Gov. Taft asked me to serve as State Development Director, I took stock of the Ohio Department of Development. With an extensive private-sector background, I have initiated a comprehensive assessment to examine the department. I will formulate Ohios economic development strategy one that will build upon the strong foundation of programs that create business growth.
Ohio has enjoyed tremendous economic development success. Our reputation has led U.S. companies to select Ohio for more investments in new facilities and expansions than any other state, based on Ohios favorable economy, record low unemployment and strong partnerships between government, the legislature and Ohios business community.
Gov. Taft outlined an opportunity agenda, the foundation for the future. Key elements include an increased focus on education and training, a competitive environment for electricity, business assistance programs and continued development of high technology resources.
Education and work force development are critical. Businesses must be able to hire skilled workers. I will forge strong ties between business and higher education, strengthening the departments training and work force development initiates.
I plan to meet with local elected officials, business leaders, economic development professionals and university and community college presidents to discuss economic and community development issues and gain a better understanding of what the Department of Development can do to help.
There are two issues that must be addresses in the short term if Ohio is to maintain its competitive position in the national and international marketplace. Ohio must renew the Ohio Enterprise Zone and the Manufacturers Machinery and Equipment Investment Tax Credit (M&) programs. Both are set to expire shortly and the department is advocating their extension in the FY 2000-2001 biennium budget.
The Ohio Enterprise Zone Program has leveled the playing field and allowed Ohio to compete for business expansion and location projects. It provides cost reductions to business considering new investments and allows local governments to exempt the value of first used personal tangible property.
This offsets the onerous property tax on machinery, equipment and inventory. Without the Enterprise Zone Program, many major investments, such as Daimler-Chrysler-Toledo-Jeep, the Aristech Chemical project in Scioto County and the International Paper project in Clermont County would not have moved forward.
The M&E Tax Credit provides a nonrefundable credit against the Ohio corporate franchise or income tax for manufacturing machinery and equipment purchases made by Ohio companies from July 1, 1995, to Dec. 31, 2000. Since its inception, 2,100 companies in 87 counties have filed more than 3,700 notices of intent to use this credit. Projected new investment from expected manufacturing machinery and equipment purchases, eligible for the credit, is more than $4.9 billion.
These are investments in Ohios future, resources designed to assist companies in making their expansion and new location decisions. They have been instrumental in Ohios ability to compete for major job retention projects. They can provide a win/win opportunity for companies and residents alike.
The components of Gov. Tafts opportunity agenda will encourage and support continued growth for Ohio companies and communities. Ohio has reached the pinnacle in the economic development arena.
We are proud of our success; however, we know that now is not the time to become complacent. As the economic development climate and needs of our corporate customers change, we must continue to foster an economic development strategies. I look forward to working with Gov. Taft and his team as we cultivate a business climate prepared to meet the challenges of the new millennium.
C. Lee Johnson is director of the Ohio Department of Development.