Lawyer Reaping Millions Over Decades as a Cut of Tax Incentives - Bloomberg Tax by Laura Mahoney

Wednesday, May 8, 2019

Some experts frown on deals like those negotiated by Cendejas.

“Commissions really smell bad to us,” Greg LeRoy, executive director of nonprofit think tank Good Jobs First, said in an interview. “If a consultant can get a bigger commission in one place or another, that’s their incentive. It may not be best for the client.”

The group, which tracks tax subsidies around the country, is critical of site location consultants and views their activities more as lobbying than consulting, he said.

The state legislature wants more transparency. In addition to Glazer’s bill to ban them in the future, the California Labor Federation is pushing A.B. 485 by Assemblyman Jose Medina (D), to increase disclosures related to the tax-sharing deals

“We are very concerned that a consultant is siphoning off millions in limited public dollars from cities and taxpayers for a so-called service that is unnecessary at best,” said Sara Flocks, policy coordinator for the federation. “Every taxpayer dollar spent on consultants is a dollar that would be better spent on local schools, parks and roads.”

Medina’s bill passed the California Assembly May 2 on a 45-15 vote.