The Town of Marana has overhauled its job creation incentive program to reflect rising economic benchmarks and comply with Arizona legal standards.

The changes significantly tighten qualifications for business incentives and eliminate perks now deemed legally untenable.

Originally enacted in 2010, the job creation incentive program aims to enhance Marana’s competitiveness in attracting, retaining and expanding job-creating businesses and industries.

The program supports business relocation or expansion in Marana by reimbursing construction sales tax based on specific employer qualifications. It has undergone several amendments over the years.

Economic Development Director Curt Woody explained the necessity of the changes during last Wednesday’s Town Council meeting, after which they were unanimously approved by the council.

“The program has been in place for 15 years, and as markets change and business trends change, we adjust the program,” said Woody. “Since COVID, construction costs and salaries have risen.”

Under the updated program, businesses seeking to qualify as a "targeted employer" must now generate a minimum of $120,000 in Marana construction sales tax, a significant increase from the previous $24,000 threshold.

Additionally, businesses must create at least two new jobs with salaries of $60,000 or more, a big bump from the previous $40,000 salary requirement.

“The $40,000 salary number is now basically minimum wage,” Woody said. “We need to adjust to what the markets are doing and where we are as an economy.”

A targeted employer is an organization that actively seeks out and hires people from specific groups or areas that have been identified as facing barriers in finding employment, including veterans, people with disabilities, low-income individuals and people who have been incarcerated.

The amendments also address compliance with a 2021 Arizona Supreme Court decision that limits the incentives municipalities can legally provide to developers.

As a result, Marana is eliminating certain program elements that do not provide a "direct benefit" to the town, including reimbursement for sustainable development costs, employee relocation expenses and job training programs.

“We’ve been looking at all of our incentive programs to make sure we are in alignment with the (decision),” Woody said. “Out of the six elements, we are proposing to eliminate three: sustainable development costs, job training and relocation expenses, because those are not considered direct benefits to the town.”

The revisions are not expected to have a significant impact on Marana's budget, according to staff reports.

Lauryn Abozeid is a journalism major at the University of Arizona and Tucson Spotlight intern. Contact her at labozeid@arizona.edu.

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