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I BOOK 98 F -dill - and Palm Beach county jobs grant programs supplement the state's Qualified Target Industry Tax Refund Program by allowing smaller businesses to take advantage of funding provided by government sources. These programs are funded through local funds, and do not receive funding from the state if the industry applying for the program does not meet the Qualified Target Industry Tax Refund Program guidelines. ANALYSIS Like St. Lucie and Palm Beach, Indian River County could offer a local jobs grant program. This program could allow industrial businesses that do not meet the required criteria of the Qualified Target Industry Tax Refund Program to receive job grants paid for by the county. As with any proposed economic development incentive, a local jobs grant program should be approved only after an analysis demonstrates that it would be productive and cost effective. This section constitutes that analysis. • Costs To create a local jobs grant program, the county would need to establish a Job Growth Investment Fund that would provide the funds to be given to qualified industrial businesses. This fund would be maintained by the Budget Office. Presently, the county has no source of funds to finance a local jobs grant program. With rising infrastructure, law enforcement, and general government costs, there are many priorities for available county revenue. Complicating the issue even more is the fact' that some sources of county revenue are declining. Among these are state and federal grant funds and agricultural ad valorem taxes. Given the emphasis not only on preventing tax increases but achieving roll -back, the prospect of allocating funds for a jobs grant program is difficult. Also difficult is projecting the costs of a jobs grant program. Assuming that Indian River County adopted a jobs grant program similar to those of St. Lucie and Palm Beach Counties, with a $2,000/job maximum grant, minimum employment of 20 to 25 to qualify, and a three year payoff period, it would not be unreasonable to assume that such a program would cost the county $100,000 the first year, with costs escalating each year afterward. A $10'0,000 first year cost could represent as few as 100 new jobs created by qualifying industrial businesses, if the program paid $2,000 per job. This also assumes a three year period for providing the grant, with 50% of the amount provided in the first year. For both the second and third years of a jobs grant program, costs- would increase, assuming an equal or greater number of qualifying new jobs are created each: year. These costs would increase because the three year pay -out period provided by most jobs grant programs allocates 50% of the grant amount in the first year and 25% in both the second and third years. Consequently, the third year costs of a jobs grant program will include not only 50% of the job grant amounts approved in the third year, -but also 25% of the job grant amounts approved in the first and second years. 48 May 14, 1996 M M M