Does Over $40,000 In Subsidies Per “Centers Of Excellence” Job Sound Like A Good Deal For The Taxpayers?

According to a story by Fargo Forum reporter Patrick Springer, who chose to be a cheerleader for the policy rather than scrutinize the program’s reported outcomes, the Centers of Excellence program started by former Governor John Hoeven and perpetuated under current Governor Jack Dalrymple has “been credited with creating 973 direct jobs” while using “state funds totaling $39.6 million.”

That works out to $40,698 in subsidies per job. Which doesn’t exactly sound like a good deal for the taxpayers.

The “Centers of Excellence” may as well be called “Centers of Crony Capitalism” given that they represent an unholy alliance between the state’s bloated higher education system and big businesses who, frankly, don’t need the subsidies. Given that this program has, according to the Forum article, “attracted matching investments of $157 million from 185 companies” it makes me wonder why the taxpayers are involved at all.

Certainly the program isn’t very open to scrutiny from the taxpayers. After the Forum article ran I contacted Justin Dever at the state Commerce Department (Mr. Dever is in charge of overseeing the Centers of Excellence program) and requested details about the specific jobs created. I wanted company names, job descriptions and payroll data. What I got from Dever was the heavily-redacted, not-very-illuminating list embedded below along with the explanation via email that “payroll information for the private companies is confidential.”

Given that one problem we’ve had with these sort of jobs programs at the federal level is companies fraudulently inflating counts of jobs “created or saved,” the fact that North Dakota citizens aren’t allowed any more clear information on these matters is pretty frustrating. Mr. Dever did give me a list of third party firms which supposedly review the job claims made by the centers, but shouldn’t the public get to verify how their tax dollars are spent themselves?

Regardless, the idea that the Centers of Excellence program has been any sort of a success is a stretch, at best. Subsidies totally tens of thousands of dollars per job supposedly created (but which the public isn’t allowed to verify) sounds like a bad deal for the taxpayers to me. And there are some real problems with corruption within the centers programs. For instance, at Research and Technology Park at NDSU state Senator Tony Grindberg (who just happens to serve on the legislature’s higher education committee) has been allowed to double-dip on his university and legislative salaries while expensing top-shelf booze, expensive meals and even his country club membership.

It’s time for the legislature to cut spending to the Centers of Excellence program. This nearly happened in the last legislative session. Taxpayers should demand it happen in the next one.