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Fargo city leaders to be briefed by nationally known economic development expert

Jeff Finkle

FARGO — About a decade and a half ago, the Marriott Corp. based in Bethesda, Md., began looking for greener grass on the other side of the Potomac River in Virginia.

As economic developer Jeff Finkle tells it, the hotel company started a bidding war between the two states to see which could provide the most generous tax breaks.

At one point, Marriott told Virginia it had decided to stay put but didn't tell Maryland right away, he said. "They kept pushing Maryland to keep upping the incentive, and they did even though there was no competition."

Finkle, head of the International Economic Development Council in Washington, D.C., has plenty of stories from the field like that one for the Fargo City Commission when he briefs the group at 11:30 a.m. Monday, March 20, in Commission Chambers at City Hall.

He's aware that tax incentives have gotten more scrutiny here and around the state, but he said Fargo has little choice but to play the game or lose out to other cities or states in the fierce competition for jobs. It just has to play the game in a smart way, he said.

City Commissioner Tony Grindberg, a fellow economic developer, invited Finkle to stop in town while on his way to a conference out west. City tax dollars weren't used to bring Finkle here. He said he's watched the debate over incentives at commission meetings and wants to provide "some education" to colleagues who may not have a total understanding of economic development practices.

Finkle has been in the economic development field for 35 years, 16 of them at the helm of IEDC. It's a field where tax incentives are extremely common, but, he said, he would prefer that they not be available at all.

"So what happens if you don't have incentives?" he said. "Then we're competing on who has decent cost of living, who has well-trained workers, who has good infrastructure, who has good quality of life."

But, he said, that's also not the reality.

Finkle said incentives that are defined by policy so any business can apply can end up providing incentives to those that don't really require them. But such incentives are more transparent than negotiated incentives like those involved in Maryland's and Virginia's bidding war, he said.

In general, Finkle said he prefers incentives with benefits that don't evaporate should a company go out of business or leave, such as grants for training employees or tax-increment financing that pays for infrastructure.

Asked if governments ever talk about a truce so they don't end up in a bidding war, Finkle said it's possible but the problem is so many players are involved and a truce would have to encompass them all. Ohio can declare a truce with Indiana, he said, but South Carolina could take aim at Ohio. "You may well end up losing some firms if you're not on guard. And what you get to stave off attacks from Indiana did not stave you off from attacks from other places."

Tu-Uyen Tran
Tran is an enterprise reporter with the Forum of Fargo-Moorhead. He began his newspaper career in 1999 as a reporter for the Grand Forks Herald, now owned by Forum Communications. He began working for the Forum in September 2014. Tran grew up in Seattle and graduated from the University of Washington.
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