Toyota Fever (Jeff Hankins Publisher’s Note)

Can and should Arkansas compete to land a major auto manufacturing plant?

Absolutely.

The news is out that Toyota Motor Corp. is weighing site options for a $750 million operation. Industrial sites in Marion; Jackson County, Ala.; Jackson, Tenn.; San Antonio; and Como, Miss., appear to be in the running.

These opportunities don’t come around very often, and Arkansas needs to step up to the plate with a competitive package of incentives. Jim Pickens, director of the Arkansas Department of Economic Development, has maintained a reasonable stance on performance-based enticements for job development. He knows that you have to be competitive, but you don’t give away the farm in the process.

Courting an auto manufacturing plant is minimally a 50-for-1 economic development effort. I’m told about 50 additional companies set up shop in the vicinity to support the major assembly operation. We’re talking about thousands of jobs for the Delta and mid-South regions.

It’s an exciting prospect for people like Glen Fenter, the president of Mid-South Community College in West Memphis, whose institution would almost certainly take a leading role in work force training programs. Nearby cities such as Blytheville, Osceola and Jonesboro stand to benefit as well.

I can already hear the critics questioning the wisdom of funding the level of incentives that would be necessary. Maybe they will bless the situation as a worthwhile investment in the Delta instead of corporate welfare.

Then we have the unavoidable politics of the situation. If this project is indeed on the fast track, Gov. Mike Huckabee could be forced to call the Legislature into session. The leadership of the Democrat-controlled General Assembly would be asked to approve extraordinary incentives, then the Huckabee administration would get a grand announcement just before the election. This isn’t an ideal prospect for Democrats who would like to see State Treasurer Jimmie Lou Fisher unseat Huckabee, but an economic development effort of this magnitude can’t fall victim to politics.

No one has been willing to give me a prediction on the Toyota decision. Companies keep their decision-making process tight-lipped, and economic developers typically follow suit. We seem to be in the hunt, and that’s better than where we’ve been with other auto manufacturers, considering we’re one of the few Southern states with no major automotive plant.

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I had a chance to catch up with Dr. Harry Ward, retired chancellor and key builder of the University of Arkansas for Medical Sciences, at the recent groundbreaking for a new bioventures technology facility.

He says he’s not getting around the tennis court as quickly as he used to. He’s trying to spend more time on the golf course. And, a bit sheepishly, he confided that he had agreed to chair a group that is fighting the ballot initiative to exempt food and medicine from the state sales tax.

Dr. Ward thought I would be opposed to his stance on the issue. Actually, my initial response was: “Why in the world would you want to take time from your well-deserved retirement and jump into something like this?”

It’s not a totally surprising move for Dr. Ward to take on the chairmanship of Arkansans to Protect Police, Libraries, Education and Services. He knows the initiative, which does nothing to provide replacement revenue, would create havoc for local and state governments.

The initiative has merit with the concept that food and medicine should not be taxed. But that’s a battle that has been fought time and again in the Arkansas General Assembly. I could support raising taxes in other areas to exempt food and medicine.

But tax revenues have to be generated somewhere, and tax options are in the forms of sales, property, income, severance or fees. Interestingly, most of the supporters of the food exemption also are opposed to property taxes and think we should follow suit with Texas and other states to eliminate the state income tax.

We don’t need to get suckered into the something-for-nothing game.

(Jeff Hankins can be reached via e-mail at [email protected].)