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Long Beach Exploring Clean Tech Enterprise Zone

City Considering Ways To Recruit Green Businesses

By Joshua H. Silavent
Staff Writer

December 4th, 2012 – Following models set forth in Los Angeles, Sacramento and San Diego, the Long Beach City Council has directed management staff to explore the steps necessary to potentially create a Clean Technology Enterprise Zone that would provide incentives to green-friendly firms operating here or willing to relocate.

“Any time we can think creatively and explore ways to bring good jobs to our community, I think we should take the time to consider it,” Councilmember James Johnson said during discussion of the proposal at a November council meeting.

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Los Angeles has earmarked a 4-mile district on the eastern edge of downtown – stretching from the Los Angeles State Historic Park in the north to the CleanTech Manufacturing Center in the south, and including both the east and west banks of the Los Angeles River – as its own business cluster for green manufacturing firms. The La Kretz Innovation Campus, scheduled to open in the summer of 2013, will be home to clean tech demonstration centers, research and development labs, conference facilities and workforce training facilities.

Sacramento launched its own clean tech zone in 2008 with a focus on businesses that trade in renewable energy, specifically solar power. These green firms receive expedited permitting, sales and wage tax credits, and financing assistance, among other incentives.

In 2007, San Diego developed a clean tech initiative aimed at attracting businesses that produce environmentally sustainable solutions. CleanTechSanDiego.org reports that more than 800 such companies now call the city home.

Whether Long Beach actually pursues similar opportunities to attract and recruit such businesses remains to be seen, but it might benefit from the recent passage of Proposition 39, which requires out-of-state companies to calculate their California income tax liability based on the percentage of sales they have in the state. This voter-approved initiative is expected to generate about $1 billion annually, with half of that money directed to fund clean energy projects in the state for the first five years. This new revenue could potentially support new innovation and job training in the clean tech sector.

But some city officials have expressed reservations about creating a Clean Tech Enterprise Zone in Long Beach.

“My problem is this: I want employment here,” Mayor Bob Foster told the council. “Quite frankly, I’m happy to have industries such as accounting, such as engineering, which might not be defined as clean tech. I want employment and I don’t think we should limit ourselves to this. I think it winds up getting some firms in here that, quite frankly, may not be durable. I don’t want to say it’s like Solyndra. I know the energy area very well, and the clean tech renewable energy area has a lot of firms out there that are startups . . . they’re risky. My only point is that I want to concentrate on employment.”

“I too have some reservations about the enterprise model,” Councilmember Patrick O’Donnell said. “I don’t know, given the state’s financial condition, that we’d be able to push something like this through.”Councilmember Gerrie Schipske said she understood these concerns but thought that a clean tech zone would not interfere with other business recruitment efforts.

“I think this is about just getting more information, getting some research from city staff,” Councilmember Robert Garcia added.