AUSTIN (AP) – Comptroller Susan Combs has recommended more openness for the Texas Enterprise and Emerging Technology funds as part of a wide-ranging review of the state’s job incentive programs.
The two high-profile programs are administered by Governor Rick Perry.
Perry spokeswoman Katherine Cesinger has defended the programs, saying both meet their legislative goals in job creation.
“The TETF vetting process provides multiple layers of review and scrutiny, as well as unanimous approval by the speaker, lieutenant governor and governor, to secure the highest quality of investment opportunities to maximize technology innovation for the state of Texas,” Cesinger told the Austin American-Statesman.
Combs on Wednesday released a 116-page analysis of nine state programs that use tax breaks or grants to create or retain jobs and to attract businesses to Texas.
Legislators are expected to convene next month with a projected $20 billion budget shortfall looming.
The state’s economic incentive programs account for about 1 percent of the jobs in Texas, according to the analysis in which Combs reviewed nine state programs that use tax breaks or grants to create or retain jobs and to attract businesses.
The report notes weaknesses in some programs, including film incentives and the governor’s primary job-creating funds.
“The Texas economy will continue to grow, with or without incentives,” Combs wrote. “Effective incentive programs, however, can help signal the state’s aggressive desire to attract business and in encouraging growth of targeted industries.”
She urged greater transparency for the Texas Enterprise and Emerging Technology funds.
“Due to the flexibility of the decision-making process, the program appears less transparent at times, causing a perception of outside influence,” she wrote about both programs.
The state auditor in November announced plans to review the Texas Emerging Technology Fund after questions arose over links between contributors to Perry’s campaign and companies that had been awarded job-creation grants.
Perry, who was re-elected last month, has said nothing improper occurred.
The Combs report also suggested that someone other than only the executive director of the Texas Film Commission, who works for Perry, should decide which movie, TV and video projects get tax money.
The state recently denied incentives for “Machete,” an immigration-related movie from Austin filmmaker Robert Rodriguez. The governor’s office cited “inappropriate content or content that portrays Texas or Texans in a negative fashion.”
State Rep. Mark Strama, a Democrat from Austin who chairs a House committee studying incentives, predicted that the Enterprise and Emerging Technology funds would receive less money to spend over the next two years.
“If a company has failed to raise money in the private market, why is the State of Texas investing taxpayer money?” said Strama. “What qualifies the government to make investments in companies?”
Pike Powers, an Austin veteran in recruiting jobs and industries, said the state should take a balanced approach to supporting education and work force training and using incentives to attract business.
“The rest of the country, even in these hard times, is trying to be as competitive as they can,” said Powers. “To say, `No, no, no,’ would altogether be wrong and put us in a bad position to compete.”
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