Where is Virginia's business aid going?
It’s a game Virginia’s good at -- at least when it comes to dishing out the funds. In the past 15 years, the state has awarded private companies $181.3 million through the Governor’s Development Opportunity Fund. The fund offers up-front payments to companies who promise to create a certain level of investment and jobs in the state.
Some of the companies keep their promise. Others fall short -- or fail altogether. The problem is, it’s difficult to find out exactly what happened because the state doesn’t mandate any final, comprehensive report on how things turned out.
Take the awards given in 2005, for example. From a report issued last year, 15 companies met expectations, six hadn’t and two had filed for bankruptcy. But the status of four companies was still unknown: one had been granted an extension, one still had some time left before its reporting deadline and two hadn’t checked in with the state at all.
While staffers at the Virginia Development Partnership say they continue to follow up on companies, they don’t do a final analysis of who held up their end of the deal. There’s no final report where legislators, reporters or interested citizens can see how much the state gained -- and lost -- by giving incentives to these companies.
States are expanding reward packages as competition for big companies becomes fiercer -- especially along the eastern seaboard. Gov. Bob McDonnell’s doubling of the development fund and the battle over Northrop Grumman kept incentives a central issue in Virginia this year.
If Virginia is going to keep unzipping its wallet for private companies, perhaps it should improve reporting on what those companies do with state dollars. The state could do a better job at making sure the money it’s showering on businesses isn’t going down the drain.
Paige Winfield Cunningham is an investigative reporter and managing editor at Old Dominion Watchdog. The Local Blog Network is a group of bloggers from around the D.C. region who have agreed to make regular contributions to All Opinions Are Local.
Paige Winfield Cunningham
| August 12, 2010; 5:30 PM ET
Categories: HotTopic, Local blog network, Va. Politics, Virginia, economy
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