Welcome to the archives for NewsTalk, an IBJ blog published from November 2007 through December 2010.

Subsidizing thy neighbor

May 14, 2008
Should a city give incentives to companies that want to leave the city and expand in another town?

That question is dogging Muncie officials after they offered a $600,000 loan to a Spanish company that plans to move an auto-parts plant from Muncie to Yorktown.

Miasa Automotive LLC plans to create 40 jobs in Yorktown, which is on Muncieâ??s outskirts. The 17 existing jobs are in Muncie, which has been decimated by losses of manufacturing jobs.

None of the new employees added in Yorktown has to be a Muncie resident.

The loan in effect is bridge financing. Yorktown made a nonbinding commitment to permanently finance the loan by floating a bond of its own within six months.

Muncieâ??s newspaper, The Star Press, howled about the loan in an editorial today.

Accompanying the editorial is a picture of Lt. Gov. Becky Skillman announcing the expansion. Noting none of people on the platform with her were from Muncie, the caption says, â??Somethingâ??s wrong with this picture.â??

Yorktown should set up its own industrial loan fund if it wants to â??poachâ?? companies from other parts of Delaware County, the editorial contended.

Had you written the editorial, what would it have said?
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