John Cheves, investigative reporter at the Lexington Herald-Leader, presents during the Reynolds Center's free workshop, "Investigating the Business of Government," in Lexington, Ky. For more information on business coverage training for journalists, please visit http://businessjournalism.org.

1. Covering Government Incentives
for Economic Development
John Cheves
Lexington (Ky.) Herald-Leader
jcheves@herald-leader.com

2. Economic Development
REP. MIKE SUMMERS, standing at Roseanne’s
door: That’s why bringing in new business is my
number one priority.
ROSEANNE: How?
REP. MIKE SUMMERS: Through tax incentives.
See, we’re going to make it cheaper for out-ofstate businesses to set up shop right here in
Lanford.
ROSEANNE: So they get a tax break?
REP. MIKE SUMMERS: Yeah, that’s why they come
here.
ROSEANNE: Well, who’s going to pay the taxes that
they ain’t paying?

3. Economic Development
REP. MIKE SUMMERS: Well … you will. But you’ll
be working. Good, steady employment.
ROSEANNE: Union wages?
REP. MIKE SUMMERS: Well, now, part of the
reason these companies are finding it so
expensive to operate in other locations—
ROSEANNE: So, they’re going to dump the
unions, so they can come here and hire us at scab
wages. And then, for that privilege, we get to pay
their taxes.
REP. MIKE SUMMERS: Um. Is your husband
home?

4. Economic Development
• Who is responsible for it at the
local, regional and state level?
• When and where do they meet or
publicly report their actions?
• Understand these agencies –
their budgets, how their boards
are chosen, their powers, their
strategies, how they are funded
and by whom, and who oversees
them.
Photo by flickr user MDGovpics

5. Economic Development
What are we
giving?
• Tax breaks; tax refunds;
grants or loans; worker
training; land, buildings
and roads
Photo by flick user Matt Seppings

6. Economic Development
What are we
giving?
• Use the Open Records
Act to get full terms of
the deal (you may face
exemptions on pending
land sales and other
specifics)
Photo by flickr user USDAgov

7. Economic Development
What are we getting?
• Do they get incentives regardless, or are
conditions attached, such as a number of
jobs to be created at agreed-on wages?
• Does anyone check to make certain we got
what was promised? Does anyone check
five years later to see if it’s still there?

8. Economic Development
Does it add up?
• Check jobs claims by calling employers to ask
how many jobs exist and what role, if any,
incentives played. How much did we pay per
job?
• Use economic data to track the big picture. Did
your small town add 100 jobs while gradually
losing 200 jobs? What kind of jobs? Is local
income rising or falling over time?

9. Economic Development
“If you build it,
he will
come.”
Building industrial parks, factories
and retail spaces “on spec”
Photo by flickr user Rob Young

12. Economic Development
Follow the money
Who gets the incentives?
• If land is purchased, from whom?
(And check the deeds for shady deals.)
• If something is built or paved, by whom?
• Consultants and attorneys?
• Relationships between recipients and public
officials or economic development agencies?

14. Economic Development
What’s the plan?
• Luring distant factories? Aiding small businesses?
• Creating a new local industry, like tourism?
• Is it realistic, given the education of the labor pool,
access to major transportation systems, quality of
life and – frankly – common sense?
• Can anyone show you specific goals and results?
Get out and look and talk.

15. Economic Development
Experts to guide you through the spin:
- U.S. Census Bureau http://www.census.gov
- U.S. Bureau of Labor Statistics
http://www.bls.gov
- U.S. Bureau of Economic Analysis, Federal
Reserve Bank studies

16. Economic Development
Experts (continued):
- Economists at State U., retired public
officials, nonprofit economic development
agencies, authors of published economic
studies of your community or state
- Local residents and local leaders who can
say from experience what has worked for
their community and what has not