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<br />Texas Economic Development Incentives 2003 <br /> <br />Page 7 of 29 <br /> <br />performance reviews of economic development corporations (after developing an <br />appropriate methodology). As in the case of the Texas School Performance Review, <br />such involvement could be initiated at the request of the economic development <br />corporation itself or by some involved elected official. Voluntary performance <br />reviews would provide lawmakers with a more detailed understanding of the uses of <br />the economic development sales tax, while affording local economic development <br />corporations an opportunity to receive a third-party perspective on their operations <br />and outcomes. <br /> <br />. Conduct statewide best practice survey and review. The Comptroller's office has <br />developed a widely respected database of school district best practices called AIMS <br />(A+ Ideas for Managing Schools). Texas lawmakers may wish to consider conducting <br />a statewide survey of economic development corporations with an eye towards <br />identifying innovative practices and developing a similar Internet-based database. <br />This type of review would provide local economic developers with new information <br />and ideas about how to attract new jobs, structure incentive packages and track <br />performance outcomes. <br /> <br />. Self-certified performance reviews. Another alternative would be to develop a <br />checklist of appropriate policies for economic development corporations based on a <br />review of existing practices and in consultation with the practitioners. Each <br />corporation could review this list of policies and procedures and self-certify that it is <br />in compliance with these policies and procedures. <br /> <br />. Modify state reporting requirements. As described above, the current state <br />reporting requirements for ~4A and ~4B corporations are limited. The legislative <br />intent was to minimize the administrative burden placed on local economic <br />development corporations. Some changes lawmakers may wish to consider include: <br />(1) developing a separate reporting form for ~4A and ~4B corporations to reflect their <br />different objectives; (2) adding "work force and education" as an expenditure <br />category given the growing importance of this type of economic development <br />activity; (3) requiring economic development corporations to provide the Comptroller <br />with the employer identification number of businesses that have received financial <br />incentives during the past twelve months; and (4) requiring economic development <br />corporations to provide more detailed information on the form and terms of incentives <br />offered, such as grants, loans, loan guarantees, etc. <br /> <br />. Continue and enhance mandatory training. HB 3178 (200 1 Legislature) requires <br />that certain individuals (e.g., city attorney, city clerk, executive director of the <br />corporation) complete a seminar on the proper and legal administration of the <br />economic development sales tax. The Texas Economic Development Council was <br />contracted by the Texas Department of Economic Development to conduct the <br />training, which is being offered across the state. <br /> <br />This training provides a valuable service. Prior to electric deregulation, most utility <br />companies had an active economic development staff that worked closely with local <br />economic developers to pursue new jobs and investments, as well as analyze the <br />economic impact of offering incentives. Since electric deregulation, the number of <br />economic developers working for electric utilities has dropped dramatically. For <br />example, prior to deregulation, American Electric Power (AEP) had eight full-time <br />economic developers on staff. Today, the company has only one for the entire state. <br /> <br />http://www.window.state.tx.us/specialrpt/ecodev03/06ch3 .html <br /> <br />9/27/2004 <br />