Anti-piracy legislation is a method by which regional governing bodies can prevent a company from forcing neighborhoods into a bidding war based on the size of the subsidies they are offering. Most legislation is written on the state level to prohibit communities from offering taxpayer subsidies to a business currently located within the state as incentive to relocate to another location still within the state. Other legislation provides for tax revenue sharing between affected communities in situations where retailers move to adjacent communities—potentially decreasing tax revenue in the old community and potentially increasing revenue in the new community. Companies are the big winners from bidding wars and taxpayers are the big losers. Effective anti-piracy legislation will prevent companies from placing communities into a bidding war against each other.
Examples
Alabama In 1987, the state of Alabama enacted a law denying enterprise zone benefits to companies relocating from other parts of the state. Enterprise zones are designed to encourage economic development and job creation in distressed areas by providing tax breaks and other assistance to companies that locate facilities within the zone. Under the 1987 law, companies are not eligible for these benefits if expanding in the enterprise zone causes job losses or plant closings elsewhere in the state.
For more details on this law, click here.
California Enacted in 1999, this law prohibits a redevelopment agency, city, or county from providing any form of financial assistance to an automobile dealership or big box retailer, or a business entity that sells or leases land to an automobile dealership or big box retailer, that is relocating from one community to another community within the same market area.
For more details on this law, click here.
New Mexico In 1993, the state of New Mexico enacted a law denying enterprise zone benefits to companies relocating from other parts of the state. Enterprise zones are designed to encourage economic development and job creation in distressed areas by providing tax breaks and other assistance to companies that locate facilities within the zone. Under the 1993 law, companies are not eligible for these benefits if expanding in the enterprise zone causes job losses or plant closings elsewhere in the state.
For more details on this law, click here.
