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Earlier this week, a new audit of the Governor’s Office of Economic Development (GOED) was announced and discussed, in which the government agency was accused of manipulating data, misleading the public, and giving special treatment to certain businesses over others.

GOED’s own press releases support the latter allegation.

On August 14, GOED published a press release in which they announced a new tax credit incentive awarded to Overstock, a popular online retailer headquartered in Salt Lake County. Upon committing to creating 333 new jobs over the next 10 years, with wages and benefits at 200 percent over the county average wage, Overstock was awarded a 20% tax credit by GOED over 10 years.

Standing alone, this is likely a welcome incentive for Overstock and a reduction of their tax burden which will facilitate job creation and business growth. Stacked against another incentive, however, it becomes clear that Overstock (and many other companies competing for employees) has been placed at a financial disadvantage.

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A newly released audit of the Governor’s Office of Economic Development—an institution of which we have often been critical—claims that their primary tactic to lure business into the state entails “questionable incentive awards.”

The audit also alleges corruption within the office in the form of manipulation of data. “GOED regularly reports inaccurately” on certain items, and “provided special treatment for some companies by altering post-performance assessments for companies that failed to meet GOED’s contractual threshold.” Further, the audit alleges that GOED has:

  • used existing company employees to inflate wages of new employees in order to gain corporate incentive awards;
  • used incorrect benchmarks to improperly issue an economic development tax increment financing award;
  • removed low-paying jobs from averages; and
  • handed out incentives to companies that failed to meet the wage criteria under their contracts with the state.

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House Bill 105 from this previous legislative session had two important but distinct parts. The widely popularized portion related to legalizing cannabis extract for medicinal use, and earlier this year the Department of Health created administrative rules to implement this program.

The second portion of the bill, which few realize was included, authorized the Department of Agriculture, or any qualifying higher education institution, to “grow or cultivate industrial hemp for the purpose of agricultural or academic research.” Last week, the department issued its proposed rules to administer this program.

Upon review of the proposed rule, Libertas Institute has identified four problematic portions that deal with the department exceeding the authority they were granted under passage of H.B. 105. We have issued a letter, embedded below, to the Department of Agriculture seeking amendments to the proposal prior to its final enactment.

Letter Regarding Proposed Rule for Industrial Hemp Research

The following op-ed, written by our policy analyst Josh Daniels, was published today in the Salt Lake Tribune.

Missouri Gov. Lilburn Boggs used the coercive arm of the state to expel an unwelcome segment of society in 1838 using an “extermination order.” (In that era, extermination meant to drive something from within certain borders — in other words, expulsion.) Members of the fledgling Church of Jesus Christ of Latter-day Saints were forced to migrate elsewhere, ultimately settling in Utah. Now, lawmakers in Utah have implemented policies that similarly expel unwanted citizens from their communities.

These innocently named “Good Landlord Programs” are a discriminatory restriction on people with past criminal convictions (some of whom may have in fact been innocent). Almost all programs in Utah cities — with a couple of notable exceptions — actually require participating landlords to refuse to rent their residential properties to individuals convicted of a felony within the past four years.

Proponents of the programs characterize them as a purely voluntary way for landlords to, as Salt Lake City argues, “help eliminate code violations and public nuisances while controlling and preventing illegal activity on rental properties that impact the quality of life within our neighborhoods.”

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Salt Lake City, enforcing its arcane, anti-free-market transportation laws, has been imposing $6,500 fines on Lyft and Uber drivers. City officials argue that its laws are necessary for public safety, which is false.

To help ferret out drivers operating in violation of these laws, Salt Lake City employs secret shoppers to hire drivers and then report them to city officials. Correspondence obtained by Libertas Institute through an open records request includes numerous emails from these secret shoppers.

One such shopper, whose name was redacted, reported the following after her first experience using Lyft in April:

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In a presentation to the Law Enforcement and Criminal Justice Interim Committee this week, a representative from the Utah Commission on Criminal and Juvenile Justice presented legislators with a report on how much money has been obtained through forfeiture for the past year.

There are two types of forfeiture: civil and criminal. The former involves seizing property from a person who has not been charged with—let alone convicted of—a crime. See here for more information.

CCJJ’s report this week combines both types of forfeiture into a single data point, making it impossible to distinguish how much property was seized under the objectionable civil form.

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Libertas Institute announces its latest hire—our new development manager: Heather Williamson!

Heather joins us having recently worked with FreedomWorks as their Western States Director, organizing grassroots campaigns to implement conservative policies and elect liberty-minded candidates in several states. Her educational background is in political science, which is in her blood—Heather’s first lobbying effort was at the age of 12, lobbying Congress as the Youth President of the National Right to Life.

Heather and her family have made Utah their home for the last 15 years, and has been active in politics since that time. She has managed several local and statewide campaigns, most recently helping elect Senator Mike Lee and managing his offices in Utah for over a year and a half.

As Development Manager, Heather will be working to expand Libertas Institute’s profile across the state, network with prospective donors and allied organizations, and to create outreach programs and efforts to help our mission succeed.

Curious to know more? Send Heather an email at heather@libertasutah.org.

 

Monday, September 8, 2014 | 6 comments

Policing for Justice, or Profit?

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Throughout the country, police officers are able to seize a person’s property without that person being charged with—let alone convicted of—a crime. The policy giving legal sanction to this action is known as civil asset forfeiture, one of worst by-products of the so-called “war on drugs.”

Civil asset forfeiture has received modest media attention over the years, and was thrust into the spotlight once more by a lengthy investigative piece by The Washington Post titled “Stop and Seize.” This article surveys to what extent this legal strategy has been used to confiscate a citizen’s property since 9/11, finding that officers charged with upholding the law (and presumably protecting people and their property) have seized, without a warrant, $2.5 billion since that time from innocent individuals.

Concurrently released with the Post article is a new report on civil asset forfeiture by the Institute for Justice, titled “Bad Apples or Bad Laws?” “The study concludes that civil forfeiture abuse isn’t a problem of just a few ‘bad apple’ police officers or rogue prosecutors, but rather bad laws that encourage bad behavior,” said Scott Bullock, a senior attorney at the Institute for Justice. “Civil forfeiture creates a real and perverse incentive for law enforcement to pursue profits instead of justice.”

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In an exclusive interview published last month, we broke the story regarding Salt Lake City’s heavy-handed fines being imposed on Lyft and Uber drivers operating without the city’s blessing. Citations amounting to $6,500 and more have been issued to drivers for daring to drive consenting passengers without the drivers having jumped through the city’s regulatory hoops.

Records obtained by Libertas Institute this week suggest more reasons why the city may be resistant to the innovative disruption that these ride-share companies bring. In the last fiscal year, Salt Lake City received $362,361.65 in fees from the three authorized taxi companies for the ~200 authorized vehicles operating throughout the city. This is in addition to license fees paid by the three companies to the city.

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Monday, September 1, 2014 | One comment

Organized Labor in a Free Society

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“Freedom in capitalist society always remains about the same as it was in ancient Greek republics: Freedom for slave owners.” —Vladimir Lenin

Labor Day is an interesting holiday for those that love liberty. For some, Labor Day reeks of the success of the socialist workers movement and should be eschewed; for others, it is merely a celebration of those whose labor is critical to our diverse economy. I propose that for those that love liberty, Labor Day can be a positive holiday that recognizes the importance of voluntary exchange in a free society. While we disagree with Lenin’s assessment of freedom in a capitalist society, we understand the source of his frustration.

Capitalism in Lenin’s view is more about individuals than about a system. Lenin and other socialists saw powerful individuals as “capitalists.” These were the individuals who owned capital or the means of production. By owning machines and factories the capitalists could leverage their ownership into profits by hiring wage laborers to carry out production. In Lenin’s view, this employment relationship was exploitative of the worker in the same fashion as slavery. However, there is a key difference. In the slave relationship the master literally owns the slave and can coerce the slave’s labor to the master’s profit. In contrast, the employment relationship in a capitalist system is voluntary. The worker owns their labor just like the capitalist owns their factory. Thus, a worker voluntarily offers their labor to the owner in exchange for the owner’s voluntary payment of wages. If the owner feels they can profit more from the worker’s labor than from the wages they offer to pay, then the exchange is beneficial for the owner.

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