‘Earn As You Go’ program launches to boost state jobs

HARTFORD — David Lehman has been on the job as Connecticut’s economic development commissioner for seven months and he has big plans to change the state’s approach to growing jobs and the economy.

No longer will the state lead with upfront grants or loans to businesses who want to come to Connecticut or expand in the state. Lehman’s new “Earn As You Go” program will require companies to create the jobs first in order to receive in return a percentage of the “net new income tax” from that job.

The percentage that businesses get back by creating a job will be greater in Opportunity Zones, which were designated as part of the 2017 Tax Cuts and Jobs Act.

Opportunity Zones are lowerincome areas around the country that were selected to encourage private investment.

Connecticut has Opportunity Zone sites in 27 towns, including the largest cities like Hartford, New Haven, and Waterbury as well as medium to small communities like Meriden, Windham, and Putnam.

Lehman said the “Earn As You Go” program won’t be for all industries in the state, but for targeted industries like manufacturing, life sciences, aerospace, and health care to name a few of Connecticut’s “core industries.”

Sen. Joan Hartley, DWaterbury, who cochairs the legislature’s Commerce Committee, said the “Earn As You Go” program is “laudable.” She said it “builds in firewalls” for Connecticut.

Since Gov. Ned Lamont took office there have been no large economic development deals for the state to announce, mostly because the borrowing the state does to offer the incentives has been pared back.

Connecticut expanded its economic development incentives in 2011 during Gov. Dannel P. Malloy’s administration, and since then the state has borrowed nearly $1.8 billion to fund those incentives.

Earlier this year, Lamont put the state on what he called a “debt diet,” and has been negotiating with lawmakers over his insistence that transportation be put at the top of the state’s list of areas in need of funding.