Guv's order makes service a new requirement for state incentives
Brice Wallace
High-paying jobs? Check.
Large capital expenditure? Check.
Volunteer service? New check.
Gov. Spencer Cox, though an executive order, is now requiring companies that receive future state economic development incentives to have their highly paid employees provide volunteer service during the period of the incentive. Specifically, those businesses will need to provide at least 20 service hours per high-paying job per year for the incentive period.
“This order was issued to encourage service and volunteerism to become an ongoing corporate value for those who receive state incentives,” the governor said in a news release about the new requirement.
It was one of two executive orders related to service and volunteerism issued by Cox, with the other encouraging state agencies to organize a department-wide service project. That order applies to the 24,000 state employees over the next year.
“Service is a core part of our administration and of Utah’s culture at large — it’s who we are,” Cox said. “In Utah, we have more volunteers per capita than any other state in the nation, and as governor, I want to do everything I can to keep it that way. By providing opportunities and incentives to our state employees, our students and the private sector, we can improve mental health, build community, and ensure service and volunteerism remain a defining part of Utah culture.”
The news release noted that Kirk Aubry, CEO of Savage, a privately held company focused on supply chain infrastructure and solutions, endorsed the new effort, saying his company allows employees to spend three hours per month volunteering.
The governor also said he will host a community symposium in January with experts discussing the science, benefits and practice of volunteerism and opportunities for the community to get involved. In addition, Lt. Gov. Henderson will be leading a pilot project for service opportunities in Utah high schools.
The executive order related to incentives notes that Utah’s economy consistently ranks among the highest in the nation, receiving high marks for employment, growth and business environment and that about two-thirds of businesses receiving incentives are based in Utah. “Encouraging businesses to engage in volunteerism will benefit people throughout Utah,” it says.
The Governor’s Office of Economic Opportunity (GOEO) and the GOEO board will coordinate to develop policies and rulemaking to implement the order.
“In Utah, volunteering is a lifestyle that is woven into the fabric of our communities,” said Ryan Starks, GOEO’s executive director. “People in Utah naturally step up to make a difference. We think this speaks to the caliber of Utah’s business community and economy as a whole. Our office is pleased to support the governor’s new initiative integrating community service with business incentives offered by the state.”
The most-common incentive awarded by the is the Economic Development Tax Increment Financing incentive, with companies evaluated on criteria that includes the average wage of planned new jobs, capital expenditure investment, the type and number of new jobs created, whether or not the jobs are related to headquarters or innovation operations, and the company’s corporate citizenry efforts.
EDTIF is a post-performance, refundable tax credit for a portion of new state revenues over the life of the project, which is typically five to 10 years.
Generally, to receive an incentive, companies relocating to or expanding in Utah’s urban areas must be in target industries: advanced manufacturing, aerospace and defense, financial services, life sciences and healthcare, or software and information technology. The company must create at least 50 jobs that pay at least 10 percent above the average county wage in urban areas.
Other criteria include the project competing with other locations, significant purchases from Utah vendors or suppliers, and obtaining a commitment from a local government to provide local incentives.
In rural areas, targeted industries are preferred but not required and new jobs must pay at least the average county wage.
GOEO does not provide upfront cash incentives.
Cox’s executive order related to state agencies encourages them to organize and implement a service project for employees to provide service together during working hours. It gives participating employees four hours of administrative leave as a reward for participation. It noted that Utah was the top-ranked state for formal volunteer service in 2021, with those efforts contributing an estimated $2.7 billion in economic value to the state that year.