President Obama's announcement that he plans to accelerate
job-creation efforts was welcome news. Though the recent plunge in
national unemployment statistics was heartening, big problems remain in
some parts of the country.
Nowhere is that more true than Los Angeles, with unemployment at 13.9 percent, far above the national average of 10 percent. And that's why I've asked the president to expand targeted tax credits to harness the private sector and create more jobs in cities hit hardest by the
economic downturn.
Under my proposal, the same employment tax credits now available to
businesses in Empowerment Zones would be expanded throughout any city
with higher-than-average unemployment rates. The two tax credits I
suggest expanding are:
● The EZ Employment Credit. It provides an annual tax credit up to
$3,000 per employee who lives and works in an Empowerment Zone.
● The Work Opportunity Tax Credit. It provides up to $2,400 in the
first year of employment for each 18- to 39-year-old employee who lives
in an Empowerment Zone.
The U.S. Department of Housing and Urban Development already
administers both tax credits, making it easier to quickly expand them to
cover all eligible cities rather than build a new program from scratch.
An expansion beyond the narrow boundaries of typical Empowerment Zones
also clearly is needed. The Los Angeles experience shows that a broader
regional approach is needed to defuse particularly stubborn unemployment
problems.
Los Angeles already is using economic recovery funds to drive job
creation, both through existing programs and with new ones under
development such as our Green Corps, which will train people for jobs
that also will increase our energy efficiency.
Expanding these tax credits will be another vital step in returning Los
Angeles to stability, creating jobs and giving people hope for a better
city, and a better future.
For more information about the Empowerment Zone tax credits, go here:
http://www.hud.gov/offices/cpd/economicdevelopment/library/taxincentivesez.pdf.