Gov. Bob McDonnell says investing $50 million in tourism, movie making and luring new businesses to the state would create 29,300 jobs and $311 million in tax revenue over the next five years.
McDonnell announced the plan to much fanfare from both sides of the aisle, with the chairmen of the two powerful money committee's sponsoring bill for the new governor the plan appears to have some bi-partisan consensus. Add in the fact that House Minority Leader Ward Armstrong is carrying another piece of the plan and it looks like the ideas have a ton of support.
But it's those pesky little details about how economic experts predict job creation and increased tax revenue that tripped up McDonnell's financial gurus. Asked how they reached the numbers, Secretary of Commerce and Trade Jim Cheng said it was a simple formula that every dollar invested produces $6 back.
McDonnell's folks had taken the time to print the gains out on a big "economic impact" poster for everyone in the room to see.
Trouble was, left in the garbage after the press conference was an identical poster. Well almost identical. The landfill-bound prop said 34,300 jobs and $311 million in revenue. So you basically have a 5,000 swing in jobs - but the same amount of tax income.
Kudos to the Associated Press for snatching up the garbage posted and pressing McDonnell's folks on the math. Here's a snippet of the AP report:
Commerce and Trade Secretary Jim Cheng said the $50 million in incentives would yield a sixfold return on investment.
Less clear, however, were the criteria for estimating the number of new jobs by 2015. Cheng said the formula relied on "established industry and specific examples from our experience." The estimate came from the Virginia Economic Development Partnership, a quasi-governmental body created to foster maximum business and trade opportunities for the state.
"Those are very conservative numbers," he said.
Yet the administration had printed two different job-creation numbers - the 29,300 figure and one at 34,300 - on identical poster-sized boards for the news conference. The board with the lower figure was presented on an easel flanking the governor; the other was discarded and found later Tuesday in the meeting room. Both boards listed the same revenue yield of $311 million.
Cheng said he had rejected the higher number, preferring the more conservative one. "I wouldn't have been happy putting it in there and still calling it a conservative estimate," he said.
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