Fresno Mayor Lee Brand has just over one year left in office. He promises his focus will be on creating more new jobs for unemployed Fresnans.
To that end, the mayor scored a huge win over the weekend when Gov. Gavin Newsom vetoed a bill that would have hurt the city’s efforts.
The governor refused to sign Senate Bill 531. It was a measure sponsored by Bay Area Democrat Steve Glazer. The bill would have stopped cities from giving sales-tax rebates to major companies as an enticement to get them to town and have them hire locals for their work force.
Fresno has used that kind of incentive four times. Most recently and notably, the city has entered into rebate agreements with Gap, Amazon and Ulta — big retailers that have set up e-commerce centers in town.
Currently, Fresno gets sales-tax revenue whenever a product is shipped from an e-commerce center to an online buyer living elsewhere. Glazer wanted the sales tax to go to the community where the consumer lived. Fresno leaders expected him to introduce a bill to do just that in the upcoming session, had SB 531 taken effect.
Fresno projects it earns $3.3 million a year from Amazon, Ulta and Gap — and that comes after rebating. The agreements with the firms are for 30 years, so over the lifetime, Fresno is set to receive $99.9 million.
But it is the employment of local residents that is most beneficial. About 3,800 positions have been created by the three companies. That means steady work — with benefits for full-time employees like medical insurance, a 401(k) retirement and company stock opportunity — for someone who might previously have needed public assistance.
Brand has made landing such big businesses a cornerstone of his mayoralty. Now that the specter of SB 531 has been removed, Brand should redouble his efforts to get more deals done before his term ends.
The warehouse-type operations also come under criticism by some for offering jobs that don’t pay that well. In reply, Brand says pay ranges typically between $15 and $20 an hour, plus benefits. If a young husband and wife both worked for Amazon or Ulta, Brand likes to say, they could afford an entry-level home thanks to Fresno’s affordable (by California standards) real estate market.
Being employed is good
Such jobs are much better than no work at all — and Fresno has chronically suffered from unemployment. In August unemployment statewide was 4.1 percent. But in Fresno, joblessness stood at 6.6 percent. Add to that the chronic poverty of the central San Joaquin Valley — Fresno County had the fifth-highest rate in the state last year — and the need for jobs that are not farm based becomes paramount.
This was duly noted by Newsom in his veto message. He called the sales-tax incentive plans “an important local tool that captures additional economic activity, particularly in rural and inland California cities that continue to face significant economic challenges like high unemployment rates.
“Therefore, completely removing these tax options from local decision makers is the wrong approach.”
Brand’s cell phone jumped with text messages over the weekend congratulating him on securing the governor’s veto.
“This is a victory for the people of Fresno and communities like us up and down the state where these jobs can change lives, make families stronger and help struggling local economies grow,” Brand said in a statement. “Now we will turn our attention to bringing those jobs to our communities.”
The success or failure of that will be the mayor’s legacy. May his final campaign be expanding Fresno’s work force.