Tuesday, September 16, 2003

Luken bemoans incentives

By Gregory Korte
The Cincinnati Enquirer

Cities and states should stop offering tax incentives for companies to move from one jurisdiction to the next, Cincinnati Mayor Charlie Luken said Monday.

Luken, speaking to the International Economic Development Council conference, also said a regional government to coordinate development incentives would create "political issues so enormous that it doesn't make sense to waste a lot of time talking about it."

Still, Luken said, there ought to be some agreed-upon ground rules among cities and states.

"Governments have gotten into the business big time of stealing companies from one community to the next. If I had my way, that would be illegal," Luken said, sparking laughter in the audience of about 400.

Luken has twice been on the defensive end of those efforts this summer, as the Convergys Corp. and the Kroger Co. both threatened to leave Cincinnati unless they got a subsidy.

Convergys got $52.2 million in city grants and tax incentives to stay, plus $144.2 million from Ohio. City Council agreed last week to build Kroger a $12 million parking garage. Luken supported both deals.

"If someone wants to go to Kentucky because they like the horse farms, or they like the low utility costs, or they like the tax structure, that's fine," Luken said.

But Luken said Kentucky wasn't playing fair when it dangled an "enormous" package of incentives for Convergys using a special state development fund.


E-mail gkorte@enquirer.com

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