Anaheim's Enterprise Zone, Praised by Conservatives for Helping Small Businesses, Doles Out Nearly Half of its Tax Credits to...Disney and Wal-Mart
Anaheim's 'Enterprise Zone' (AEZ) has come under increasing public scrutiny in the first year after its implementation. The Weekly checked in on the program back in February to see how it was holding up to its supposed aim to create new jobs and spur economic development in distressed areas through tax break subsidies. Based on the data given at that time, a whopping 180 new jobs had resulted from the zone.
The lingering question as to what specific businesses had taken advantage of the AEZ remained unanswered...until now!
A six-page document obtained by the Weekly unsurprisingly shows that, as of August 20, 2013, Walt Disney Parks and Resorts as well as Wal-Mart have been the chief beneficiaries of the Anaheim Chamber of Commerce-administered AEZ gobbling up nearly half of all processed vouchers--two notorious poverty wage-paying all-stars there!
Nearly 250 companies have participated in the program with 181 of them claiming 10 hiring tax credit vouchers or less. By comparison, Walt Disney Parks and Resorts yielded
1,667 1,660 of the total 4,308 alone. Together with Wal-Mart's tally of 347, the two mega-corporations comprise 47% of those taking advantage of what the zone has to offer. Countless other big business interests are among the top 50 listed including Fed Ex, Angels Baseball, Starbucks, and Staples.
The AEZ became a hot button issue during the impending layoffs for hundreds of Honda Center concession workers. Anaheim Arena Management could have taken advantage of tax credits for new hires, but declined to do so. Ironically, Aramark, the company whose contract with the workers expired earlier this summer, appears on the list, but with only seven vouchers claimed.
The Anaheim Chamber of Commerce, amidst efforts by state legislature and Governor Jerry Brown to 'repurpose' Enterprise Zones, apparently has been trying to squeeze the program for all its worth before the end of the year or as councilwoman Kris Murray put it, gain "tremendous momentum." Back in February, city figures stated that roughly 1,800 vouchers had been received, a number revised down to 1,417 in the annual report that finally came out in May. Since that time, according to records obtained by the Weekly, that number has more than doubled.
The Anaheim Enterprise Zone came into being on January 24, 2012 by way of unanimous vote. The program appeared to enjoy consensus support from an otherwise fractured council. "I know that the governor is talking about making changes to the program," Mayor Tom Tait said during his 2013 State of the City address. "I just want to let you know that the city will work vigorously to keep this economic program in place."
Since that time, he became the lone voice on the dais that reasonably insisted on reviewing a performance audit that wasn't finished at the time before voting to increase the Chamber's five-year contract by $600,000. An additional amendment of $388,000 inflated to total terms of the deal to $2.75 million. Last month, Mayor Tait moved to modify and cancel it outright at the end of the year in another politically isolated move. The council majority, including Jordan Brandman's comment that the motion for termination upon termination date would be "reckless," argued for patience.
The Chamber is due another installment payment related to its work on the AEZ this month. The city informs the Weekly that no such transaction has taken place at this time, but that $112,334 is due by the end of September.
Recommendations for revisions for the implementation of the zone are slated to come by either the September 24 or October 8, 2013 meeting of the city council.
Follow Gabriel San Román on Twitter @dpalabraz