A national watchdog group gave Tennessee, Georgia and 11 other states failing grades Wednesday for not disclosing enough information to the public about tax breaks, grants and other assistance to businesses considering locating in their states.
Good Jobs First of Washington D.C., a nonprofit group that tracks government aid to business, said states too often don't report information about the subsidies they award.
"We think it is critical for taxpayers to know how their money is being spent and which companies are getting what type of assistance," said Phil Mattera, research director for Good Jobs First and the principal author of a study on state subsidies released Wednesday.
Mark Drury, assistant commissioner for Tennessee's Department of Economic and Community Development, said the Volunteer State has been successful in recruiting more than $34 billion in new and expanded business investment and adding 197,000 jobs in the past eight years while maintaining relatively low taxes overall.
"We're proud of those numbers and believe they are a better measure of the progress we've made in making Tennessee a good place to live and work," Drury said.
State and local development officials in Tennessee and Georgia decline to detail recruitment incentives while negotiating to attract new businesses.
But the Tennessee Department of Economic and Community Development did detail incentives used and the returns expected from its richest aid package -- the $587 million of state, local and federal incentives used to recruit the $1 billion Volkswagen plant to Chattanooga in 2008.
The Chattanooga Area Chamber of Commerce uses a matrix to guide the property tax breaks granted to new or expanding businesses based upon the investment and jobs created. But Chamber and local government officials don't publish the matrix to provide greater discretion in negotiating with prospects.
"We would prefer that the details of these incentives be disclosed in advance, but what we are really interested in is having states make the information available about what incentives they provide once the deal is arranged," Mattera said. "Enhanced disclosure makes it much easier to monitor the tens of billions of dollars in taxpayer revenues that are being diverted to private parties each year."
Illinois, which was rated as the best state for providing incentive information, reports on its state business assistance for each company aided on its website, Mattera said.
Contact Dave Flessner at 757-6340 or dflessner@timesfreepress.com