Bill would disclose which companies get state tax credits
Arizonans deserve a better accounting of what they get in return for state tax credits given each year to companies, a public interest advocate says.
“We want to make sure this money is a good use of taxpayer dollars,” said Serena Unrein with the Arizona Public Interest Research Group.
“We have very little information on what actually happens,” she added.
PIRG and the Arizona Free Enterprise Club The bill covers the Quality Jobs Tax Credit, Qualified Facility Tax Credit, Research and Development Tax Credit, Credit for Renewable Energy Industry and Renewable Energy Production Tax Credit.
The Qualified Facility Tax Credit Program, for example, applies to firms investing in or expanding facilities in ways that add good-paying jobs. The credit is the lesser of 10 percent of the investment, $20,000 per job created or $30 million.
Mitchell didn’t return telephone messages seeking comment on his bill but told the House Ways and Means Committee, which endorsed the measure unanimously Feb. 17, that publicizing the information would increase transparency.
The provisions would apply to companies that claim $5,000 or more in any single tax credit.
In addition to being made public, the information would be reported to the governor, leaders in each legislative chamber and the secretary of state.
Kevin McCarthy, president of the Arizona Tax Research Association, opposed the bill, saying it would be too easy for a breach of confidentiality to occur. He also said that the tax credit information is already available to the public in an aggregated form and that reporting information on individual companies may deter businesses from relocating to Arizona.
“It’s not good economic development. That’s for sure,” he said.
Scot Mussi, of the Arizona Free Enterprise Club, said the bill would increase accountability and transparency.
“There isn’t really a lot of transparency with these tax credits that cost Arizona taxpayers about $100 million,” he said of current statute.
Rep. Warren Peterson, R-Gilbert, who voted for the bill, agreed with that idea.
“I think our constituents deserve to know this information, and I think it will help us going forward,” he said.
PIRG’s Unrein said taxpayers have a stake in understanding how tax credits are used.
“It’s one of those common-sense solutions,” she said.