States spend too much money on economic development subsidies for big businesses to the detriment of small businesses.
That's one of the key opinions expressed by U.S. small business owners in a new survey gauging their attitudes toward state economic development incentive programs.
Leaders of 39 small business organizations in 25 U.S. states, including Illinois, were surveyed by Good Jobs First, a Washington, D.C.-based organization that studies corporate tax breaks. The 39 groups collectively represent 24,000 individual businesses.
In the survey, most small business leaders said they were skeptical of the overall effectiveness of state economic development incentives and believe such programs favor big businesses.
"Our findings are absolutely consistent with what we have heard for years from small business leaders," Good Jobs First Executive Director Greg LeRoy said in a statement. "Despite their pro-small business rhetoric, state officials' programs are perceived as biased in favor of large companies that receive big tax-break packages."
The survey was released the same week that Chicago was named as the new corporate home of ConAgra Foods. Illinois lured the prepared food company to the Prairie State from Omaha, Nebraska with unspecified tax incentives.
Here are the key findings from Good Job First's survey:
92 percent believe that the spending balance on incentives between small and large businesses in their state is biased toward big businesses (69 percent strongly believe).
79 percent believe that their state is overspending on big incentive deals, hurting state finances (56 percent strongly).
77 percent believe that incentives in their state are not fair to small businesses (46 percent strongly).
87 percent say that small business interests in economic development issues are not effectively represented in their state's capital (36 percent strongly).
85 percent believe that economic development incentives in their state are not effectively addressing the current needs of small businesses that are seeking to grow (36 percent strongly).
Amanda Ballantyne, national director of Main Street Alliance, said small business owners are seeking investments in their local communities, not tax breaks.
"Over the past five years, we have surveyed thousands and thousands of small business owners across the country, asking the question, 'What do you need most to help your business thrive?' The overwhelming response that we get is not necessarily what you'd expect," she said in the report.
"Small business owners don't call for more tax breaks or fewer workplace standards," she added. "They call for more customers. Small business owners need more customers in their stores, purchasing the products and services that they sell. For this reason, we need more investment in our communities, and policies that ensure that more customers have stable jobs, earn decent wages, and have access to the benefits they need to keep their families healthy and economically secure. Those policies ensure a strong customer base for local small businesses. We know that Main Street businesses thrive when the customers in their communities are also thriving."
The Illinois groups surveyed for the report included Local First Chicago, Illinois Main Street Alliance and the Small Business Advocacy Council.