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Watered down bill would deny taxpayers info about how development dollars used


NASHVILLE, Tenn. (OSBORNE)  --   State lawmakers have this week stripped language from a House bill that would have required development officials to disclose the size of offers they make to entice companies to land in Tennessee.

The proposal comes in the wake of public unease over the $102 million in grants and tax incentives the state recently offered to Amazon. Failed development deals with Electrolux and Hemlock Semiconductor also raised concern.

In its original form, the bill called for the state to disclose exactly how many tax dollars are offered as development incentives. It also mandates that so-called “claw back” clauses be included in future agreements, forcing companies to return taxpayer dollars if they fail to honor agreements with the state.

The Tennesseean reports Gov. Bill Lee’s Administration has successfully lobbied lawmakers to remove the transparency language during committee debate.

Ron Shultis is Policy Director for the conservative Beacon Center in Nashville. He says getting the claw back provision is a step in the right direction, and hopes greater transparency will eventually follow.

“That’s something that we would like to address in the future and we do believe Tennessee should get to a place where its tax credits are more transparent, but we’re still happy with the bill as amended.”

The Tennessee Coalition for Open Government lobbied lawmakers to retain both provisions in the measure. TCOG’s Deborah Fisher says stripping out the transparency clause leaves Tennessee out of step with most states.

“Twenty-eight states who award tax credits for economic development make these awards public and we found only five states, including Tennessee that still allow them to be confidential.”

The measure, still in its original form, will get a hearing this coming Tuesday in the Senate Commerce and Labor Committee.

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