Don’t Mess with Texas?

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Texas’ three-decade old anti-littering slogan seems to capture the essence of being a Texan. With such a strongly worded slogan adorning road signs throughout the state, it is unsurprising then that the state is also an ardent enforcer of its economic development agreements. Communities throughout Texas are known to claw back subsidies when jobs or wages do not meet the standards agreed upon. Even the Texas Enterprise Fund, controversial as it might be, tells the public how much it has taken back from companies that do not comply. But recent events in Austin, Texas are beginning to make us question whether Texas is living up to its “Don’t Mess with Texas” reputation when it comes to enforcement of economic development agreements.

An Austin developer building a luxury Marriott hotel failed to follow the terms of the agreement by meeting wage standards. The City of Austin initially recommended enforcing the terms of the agreement, but now it appears that the city may reverse course and let the developer keep the subsidies without meeting the agreed upon wage requirements. The Austin city council will vote on the matter later this week.

We at Good Jobs First think it is imperative for the City of Austin, and cities throughout the U.S., to enforce the terms of its economic development contracts, not just because not doing so would diminish the taxpayer bang for the buck, but also as a matter of civic pride. Texas’ reputation as a place where economic development agreements are taken seriously is rare: don’t ruin your brand.

One Response to “Don’t Mess with Texas?”

  1. Fernando Centeno Says:

    What our state calls “economic development”, and everyone else for that matter, is simply BUSINESS development, hence, it is NOT “economic development” (ED), which is geared toward broad-scale socio-economic improvement and human capital development.

    After all, ED is a public term, not a private one. There is no such thing as “private sector economic development”; the private CEO doesn’t use his private funds to create “economic development”. I’ve never seen an ED Balance Sheet, or an ED P&L Statement, or an ED stock dividend, have you?

    It’s way past time to shift into a new paradigm, one which reflects a true understanding of a powerful concept rather than the one-trick pony which chiefly subsidizes “private enterprise”. To learn more, talk with ED practitioners rather than to the Chambers of Commerce, politicos, academics, or press pundits.

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