In what would be a sharp break from previous Virginia governors, Attorney General Ken Cuccinelli said he would curtail programs that offer corporations tax breaks and other multimillion-dollar incentives to bring new jobs to Virginia.
Cuccinelli, the Republican candidate for governor, said the current incentive system -- which he likens to the state picking corporate winners and losers -- should be replaced by lower taxes. Lowering the state's corporate income tax from 6 percent to 4 percent would attract more businesses to the state, he said.
"My focus is going to be on ... a better economic environment with lower taxes overall for everybody rather than trying to cherry pick a few folks to come in or to expand," Cuccinelli said this week. "You can expect me to take a much harder view of those than my predecessors have done. I would expect to veto more of them or they'll have to be a very sweet deal for Virginia."
As a limited-government fiscal conservative, Cuccinelli has often opposed giving taxpayer dollars to private companies. In 2007, then-state Sen. Cuccinelli was the only lawmaker to vote against a bill that expanded the Virginia Economic Development Incentive Grant, a program meant to bring high-paying jobs to the state.
Cuccinelli's Democratic opponent, Terry McAuliffe, called it short-sighted to limit the use of economic development funds. McAuliffe's former company, GreenTech Automotive, received economic incentives and tax breaks to locate in Mississippi.
McAuliffe and Cuccinelli are emphasizing their credentials as job creators to gain advantage in a race that remains a dead heat. An NBC/Marist poll released Wednesday showed McAuliffe with a statistically insignificant lead of 43 percent to Cuccinelli's 41 percent.
"We should always look for ways to streamline the process and find efficiencies, but slashing the programs used by [Govs. Mark] Warner, [Tim] Kaine and [Bob] McDonnell would directly hurt Virginia's economy," said McAuliffe spokesman Josh Schwerin.
Virginina governors and lawmakers have long agreed to provide financial incentives to relocating or expanding businesses, as do most other states. In 1993, Virginia governors were given additional authority to provide such incentives through the Governor's Opportunity Fund.
McDonnell, a Republican, has tapped that fund regularly to lure businesses from other states. Last year alone, he awarded nearly $15 million in incentives projected to facilitate private investment of $1 billion and creation of 5,000 jobs, according to the Virginia Economic Development Partnership. Companies must return the money if they don't reach established benchmarks for job creation.
"We are in competition with our fellow states, and the nations of the world, to attract and secure job-creating businesses," McDonnell spokesman Tucker Martin said. "Incentives are just one limited and targeted part of Virginia's overall job creation efforts, but they do play an important role in certain situations."