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Senate Majority Leader

Bob Duff

Representing Norwalk & Darien

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Interstate Compact to End Business Poaching

Senate Majority Leader Bob Duff (D-Norwalk), Rep. Jason Rojas (D-East Hartford) and Rep. Josh Elliott (D-Hamden) today joined a national bipartisan campaign to phase out corporate giveaways by establishing an interstate compact. The legislators hope to end the constant subsidy battles between states to secure corporate headquarters and other large employers.

Sen Duff, Rep. Rojas and Rep. Elliott are backing efforts to enable Connecticut to join an interstate compact to end corporate poaching between states.

"States should work to create business friendly environments that spur new start-ups, grow existing companies, and attract new businesses from other places," said Sen. Bob Duff. "Connecticut's highly productive and educated workforce, quality of life, education system, environment, and health care all contribute significantly to making our state a great place to do business. Unfortunately, the competition between states has too often devolved into a race to the bottom and a game of chicken. Specific and targeted incentives are at times appropriate, but states are played against each other and taxpayers are caught in the middle. One state cannot unilaterally disarm, which is why I am excited for the potential of a national bipartisan agreement benefiting all states.”

"This is an issue that is long overdue for action, given that most businesses would prefer that government focus more on providing a better business and regulatory climate than providing subsidies to entities that have the resources to more effectively lobby for incentive packages,” said Rep. Rojas, co-chair of the Finance, Revenue and Bonding Committee. “The business community would prefer we invest in transportation, education and workforce training rather than subsidies that go to a select few and have a limited return on investment.”

There are two main provisions to the compact. First, member states would agree to end the practice of offering tax breaks to entice an employer to move. Second, member states would participate in a national commission to discuss and propose enhancements to the existing agreement for future consideration by each state.

“We should not be in the business of poaching," Rep. Elliott said. "Connecticut should not be targeting businesses in other states and other states should not be targeting employers in Connecticut."

According to EndTaxGiveaways.org, a similar bipartisan agreement among the governors of Missouri and Kansas reached over the summer to end corporate giveaways for companies moving within their shared Kansas City region demonstrates the shifting winds on using company-specific subsidies as an economic development policy.

New York, Hawaii, Florida, Illinois, West Virginia and New Hampshire are considering similar proposals.

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