Santa Clarita pushing for enterprise zone designation: despite growth, city moves to attract more business.

Santa Clarita officials are feverishly bidding for a new state designation that would make a portion of the city an Enterprise Zone.

As many as 35 California cities are submitting applications for 23 available Enterprise Zone designations, which provide financial incentives and tax credits to businesses within a certain area.

Santa Clarita Economic Development Director Came Rogers said that more than 30 staffers have spent the last six months preparing a comprehensive economic development plan to be sent to Sacramento before the Sept. 6 deadline.

"We're part of an extremely competitive process," she said. "We've been working 16 hours days to get this thing done."

The Santa Clarita bid calls for the Enterprise Zone to cover most of the city's existing industrial and commercial properties and addresses job development, underemployment, infrastructure, capital improvement and marketing.

Businesses within the zone would receive income-tax credits from the state up to $31,544 per employee, accelerated business expense deductions, preference points on state contracts and use- and sales-tax credits for machinery.

The Santa Clarita application targets biotech, entertainment and aerospace businesses.

California has 42 Enterprise Zones, 23 of which will expire from September through March. Each one lasts 15 years.

Locally, Enterprise Zones include portions of Lancaster and Palmdale as well as Pacoima, which was nearly disqualified earlier this month after it was discovered the area did not meet the minimum amount of industrial and commercial land in the zone. Gov. Arnold Schwarzencgger eventually changed the regulation.

Enterprise Zones have usually applied to economically-depressed areas, similar to the federal Empowerment Zones.

Santa Clarita, however, has for years been one of the fastest growing cities for business in the region. It was recently named one of the most business-friendly cities in the area by the Los Angeles County Economic Development Corp. because of its ample available land and lack of business license fee and utility user tax.

More housing than jobs

Still, Rogers said the city would benefit from even more businesses moving there. She cited a recent city-commissioned study that showed Santa Clarita has more housing units than jobs and that 70,000 residents leave the city for work each day.

"As our population continues to grow, if we're not able to attract the right types of businesses to get the workers off the freeway, it's going to continue impacting not only traffic, but the jobs-to-housing imbalance will be even more significant," Rogers said.

She also pointed to recent local closures, including that of Delta Scientific and US Borax, and the possibility of the Magic Mountain theme park following suit. Other businesses have moved to other states.

Dena Maloney, the dean of economic development at the College of the Canyons in Valencia, said the lost businesses have to be replaced. The Enterprise Zone designation will help draw new companies while ensuring existing ones don't leave, she said.

"This is a trend that we would like to address early on and provide the right type of economic climate," said Maloney, who helped on the Santa Clarita application. "We need to make sure we're creating jobs locally."

Rogers is optimistic that the state Department of Housing and Community Development, which administers the program, will agree.

"We wouldn't be applying if we didn't think we had a good chance," she said.

Zone Benefits

The California Enterprise Zone Program uses financial incentives to jumpstart industrial and business growth in more than 40 designated areas, 23 of which expire through next year.

Benefits include:

* Tax credits for sales- and use-taxes paid on qualified machinery and equipment.

* Tax credits of more than $30,000 for hiring qualified employees.

* Accelerated business expense deductions.

* Net operating loss carryover.

* Interest deductions for lenders on loans.

* Preference points on state contracts.

* Unused tax credits can be applied to future tax years.

Source: California Department of Housing and Community Development

BY CHRIS COATES Staff Reporter