OSU Professor Visits Fort Wayne: Speaks Out On Value Of Tax Abatements

By Jeff Neumeyer

December 14, 2011 Updated Dec 14, 2011 at 6:42 PM EDT

FORT WAYNE, Ind. (Indiana's NewsCenter) --- Elected officials don't always take full account of the "downside" when handing out tax abatements to try and lure new businesses to a community.

That's part of the message that an Ohio State professor planned to drive home in speaking to a Fort Wayne gathering on economic development Wednesday.

Robert Greenbaum, a professor of public policy at Ohio State, has conducted research on tax abatements since the mid-1990’s.

The Northeast Indiana Central Labor Council brought him to town to share his findings.

Local officials around the country commonly write off part of new property taxes owed by companies locating a new plant, or ones that expand an existing operation.

Greenbaum says tax abatements can heighten tensions between neighboring communities, by throwing them into fierce competitions for jobs.

He says the tax breaks awarded companies may also force taxes to go up on other payers.

Greenbaum believes counties would be better served by working in tandem to draw industry to a particular area.

Robert Greenbaum, Ph.D./The Ohio State University: " From a national perspective that makes lots of sense and even state boundaries, I mean, they're artificial boundaries that we create, but then we have competition across the boundaries, whereas if regions were working together, then you could have much more productive development policy, and this is one of the places we're behind other countries."

But economic development officials argue if communities don’t offer tax abatements, they can find themselves on the losing end of jobs battles.

Indiana’s NewsCenter will have a full report on Greenbaum’s presentation later Wednesday.

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