Subsidizing thy neighbor

May 14, 2008
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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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  • This is silly. Muncie and Yorktown should be working together. There is no public benefit to pay a company to move a couple of miles down the road. Without a doubt the state should not encourage such nonproductive activity by local communities. They should be concentrating there efforts and incentives on attracting NEW companies from Ohio, Illinois, Michigan, California, New York, Tokyo, Berlin, not fighting over a company already here.

    It's much better to make the pie bigger than fight over the crumbs.
  • Stupid turf wars and some folks that don't have enough to do.
  • This is from Muncie to Yorktown, litterally accross the creek from West Muncie. It seems we are missing something in this story. Were the original employees Muncie residents? Is there a reason the current employees are not continuing to work for the relocated business, or are they continuing to work for the company and were already not from Muncie? The reality is they are adding 13 NEW jobs to the Muncie area. Are these new jobs not going to generate revenue for Muncie businesses? Are there that many options for the employees of this company to spend all their hard-earned money in Yorktown? Have you SEEN Yorktown? No? Not suprising. If you've driven through Yourktonw you could very well have mistaked it for part of Muncie. Help me out here.

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