• Large print
• Print this
• E-mail this

Take a ride around Fairfield and the tour will surely pass several new businesses moving to the City or undertaking a major expansion. Some of these businesses are coming to Fairfield or expanding as the result of a dedicated, aggressive economic development strategy undertaken by the City.

Economic development is a formal plan developed by communities to stimulate their local economy and encourage the establishment and growth of commerce and industry. As businesses grow or locate in the City, employment opportunities also increase, benefiting the financial strength of the community.

Fairfield has natural positives

Fairfield has a host of positives to attract business and industry. Any one element can be a deciding factor in a business executive’s decision to move to Fairfield or remain in the City for a significant expansion. When all the potential benefits are combined, Fairfield becomes a highly attractive community for businesses and industry. Fairfield has benefited from several factors that have led to positive economic development trends in recent years. These factors include a skilled and plentiful workforce, the City’s central location in the region with easy access to I-75 and I-275, strategic investments in public infrastructure (roads, water, sewer, etc…), and a low tax rate that encourages business development.

Tax revenues & building permits are a measure of prosperity

Fairfield has experienced several positive economic development trends in recent years. Nationally, communities can gauge their economic success by reviewing the growth trends of their withholding tax revenue collected from employees working in the city. A healthy community should expect withholding taxes to grow, enabling a reinvestment of those revenues in community improvements and services. Fairfield has experienced a positive growth in such revenues over the past six years (see chart above). While collections were flat during the recession years of 2001-2002, they have since grown at a healthy and sustainable five percent rate since then. These tax revenues are directly used to pay for services for city residents.

Another measure used to evaluate success is building permit valuation. Fairfield’s building permit valuation has demonstrated great strength over the past six years. Total permit valuation in any community typically ebbs and flows annually depending on numerous factors. In Fairfield, the positive news is that commercial/industrial investment continues to greatly exceed residential investment (see chart above). Capital investment in buildings and other fixed assets is evidence of a prospering business community.

Tax incentives entice decisions to locate or grow a business

In today’s ultra-competitive environment, the use of tax incentives is sometimes necessary to secure new business investment and job creation in a community. The City of Fairfield utilizes tax incentives selectively and strategically.

As of December 31, 2006, the City had 41 active tax incentive agreements. These 41 agreements have resulted in investment (land, buildings, equipment, etc.) in excess of $392 million. These incentives were important to the creation or retention of 7,466 jobs with a total annual payroll of $332 million (equating to more than $44,000 average salary per job). City staff reviews all tax incentive agreements annually to ensure that the companies are fulfilling their job and investment commitments. Should a company’s performance fall significantly below its commitment, the City has the ability to reduce the incentive or terminate the agreement.

Since a city’s decision to offer a tax incentive can impact school funding, companies that receive tax incentive benefits from Fairfield are still required to make annual cash contributions to the Fairfield City School District to offset the loss of tax revenue that would have otherwise benefited the schools.

Looking to the future

As Fairfield matures, the City’s economic development strategy will continue to evolve. Challenges include a growing number of aging buildings, limited remaining vacant land, and increased regional competition. With continued strong leadership, active participation from business leaders, and support from the community, the City will meet these challenges and continue its positive momentum well into the future.

Questions about economic development in Fairfield can be directed to the Development Services Department at (513) 867-5345.