Oklahoma’s Newest Jobs Program Looks To The Chicken Egg For Help

04.08.2015 | Surge Wire |

The Oklahoma Legislature narrowly passed a bill Tuesday that would make chicken egg producers eligible for cash incentives through a state jobs program.

The Oklahoma House voted 51-43 to approve the Senate-passed legislation expanding the state’s Quality Jobs Act, which provides cash incentives to companies that create jobs with good salaries and benefits, according to the Greenfield Daily Reporter.

Republican Rep. John Bennett, the primary House sponsor of Senate Bill 71, claims that adding chicken egg producers to the program would encourage poultry companies to create new jobs and expand operations in and around his eastern Oklahoma district.

Some opponents, though, grumble that the measure singles out egg producers while excluding other agricultural operations, while others consider the Quality Jobs Program a form of corporate welfare and oppose any expansion. (RELATED: McAuliffe Sets Record for Business Incentive Deals)

The Quality Jobs Program “targets manufacturers and certain service industries that have a new payroll investment of $2.5 million or more,” providing them with a quarterly cash payment of up to 5 percent of new taxable payroll, the Oklahoma Department of Commerce explains on its website.

Companies are required to meet the payroll threshold for four consecutive quarters within three years of applying for the incentives, but although payments cease if a company fails to achieve that objective, payments that have already been received do not have to be paid back. (RELATED: Arkansas Lawmakers Ask Voters to Give Businesses More Money)

Since its creation in 1993, the program has paid out $949 million to companies that said they would create over 235,000 new jobs, but Oklahoma Watch reported in December that, “fewer than half of the jobs projected materialized by the required deadline.”

State officials counter that companies are not paid if they fail to create the jobs they promise, and insist that the program is revenue neutral because “the cost of the subsidies is offset by additional tax revenue generated by the people who get the jobs.” (RELATED: States May Have to Disclose Business Subsidy Costs)

A legislative analysis of the bill likewise claims that, “No reduction in revenue is anticipated as a result of this proposal due to the revenue neutral features of the Oklahoma Quality Jobs Program,” but economists who have studied the program told Oklahoma Watch that assertion is difficult to prove.

“Just because a job is counted as being supported by the program doesn’t mean it was created because of the program,” pointed out Mickey Hepner, dean of the University of Central Oklahoma College of Business.

“The incentive is not producing the full effect that the Commerce Department is saying that it is,” Hepner claimed, adding that, “They’re systematically overstating the benefits.”

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