Rural jobs bill would bring new investment to small towns
Access to capital has been identified as a significant challenge for rural communities at AWB’s Rural Jobs summits and HB 1324 is important legislation for AWB’s Rural Jobs Task Force.
The measure received a hearing Wednesday in the House Rural Development, Agriculture and Natural Resources Committee.
“I think this bill is a significant piece of legislation that will definitely help the rural economy throughout rural Washington, and it’s going to bring capital for investment,” Chapman told the committee members.
Here’s how it works: Investors would help finance Rural Development and Opportunity Zone Funds, whose management teams have been vetted and approved by the U.S. Small Business Administration or Department of Agriculture. Fund managers would be required to submit detailed business plans and follow other requirements.
Investors in the Rural Development and Opportunity Zone Fund would be eligible for tax credits to offset B&O taxes and insurance premium taxes.
The bill also provides several taxpayer protections, ties the incentives to results through performance measures, and requires the investment firms to carry the risk. The funds must stay invested in Washington state for at least six years, and the investments must generate more tax revenue than the program provides in credits.
The program would be overseen by the state Department of Commerce.
Dru Garson of the Greater Grays Harbor Inc. told lawmakers about AWB’s Rural Jobs summits, where employers, private and public sector leaders came together to identify challenges and solutions to help all Washington communities thrive.
“I think that this bill really is a step forward in helping provide resources for rural Washington towns and cities to incentivize economic development,” Garson told the committee.
Andy Mesojednik, a commercial lender from Bank of the Pacific, explained how this program could help. Sometimes businesses are strong enough to not need the help of a special loan program. But sometimes market conditions or regulations change, and companies have to change the way they do business, which means more risk for the bank.
“What this bill would do is it would allow us another tool in our toolbox so that we would be able to use another program to get money out to our clients,” Mesojednik said.
The bill also received support from Sierra Pacific Industries. Tom Nelson, the company’s Washington timberlands manager, said it would help people in rural communities where the company employees more than 900 people.
“We believe it will facilitate rural economic development in a lot of the communities like those we operate in,” Nelson said, including Aberdeen, Shelton and Centralia.
To learn more of get involved, please contact AWB’s Mike Ennis at 360.943.1600 or MikeE@awb.org.