Every now and then, the truth seeps out, even in a chamber of commerce press release.
"The significance of this analysis cannot be understated," Fort Worth Chamber Chairman Dan Berce said in a written statement last week.
Berce, or whoever wrote the line, must have meant that the significance could not be overstated. But like a Yogi Berra quote, the mix-up was spot on.
He was referring to a recent study commissioned by the chamber that showed an incredible 17-to-1 return on investment in economic development. It said the chamber's $1 million budget, provided by donations, "assisted" on 15 business expansions that will lead to $586 million in private investment and 3,458 new jobs.
Take a snapshot of all construction and the first full year of operations, and that $1 million generates $17 million in local tax revenue, the study claims.
Wow. Can I put some of my 401(k) into that?
Most people probably dismissed the report (and newspaper and radio coverage, and a full-page ad) as promotional and self-serving. This is a chamber of commerce, after all.
But the Fort Worth group, led by Bill Thornton and David Berzina, doesn't usually do much chest thumping. It's the first time in at least a decade that the chamber hired an outsider to quantify its impact.
Many speculate that it's part of a new fundraising push, because some chamber members received calls this week to renew their pledges to the economic development campaign. There's also been blow back on the tax breaks doled out by City Hall, in which the chamber is often chief cheerleader. A 10-year abatement for a distribution center for In-N-Out Burger was widely panned (including by yours truly).
Berzina, who ordered the study, said there was no ulterior motive.
"We're constantly asked, 'What do you guys do?'" said Berzina, executive vice president for economic development. "We had a good year, and we wanted to quantify it."
The chamber helps attract businesses, usually by setting up the right connections with city officials and promoting the area. But city staffers and private developers do the heavy lifting, including finding locations and cutting deals.
The chamber's report has the usual computer-model multipliers, plus good old-fashioned spin. It discounts the costs of the tax breaks, assuming that the companies won't hit all the requirements. But it counts the full upside in capital investment and new hires, assuming that they'll do all of that.
The report said that Bell Helicopter will add 220 jobs, even though workers are simply moving from nearby locations (and the city incentive allows for the company to actually reduce its headcount over time). It calls the In-N-Out Burger distribution center a headquarters, which would be news to the Irvine, Calif., company.
Berzina said the Fort Worth location will have a marketing executive and serve as the base for the company's expansion here, so the HQ destination is appropriate. He didn't defend the discounting of the tax breaks, saying, "I didn't write the report."
Impact DataSource, an economic consulting firm in Austin, did the report for "less than $2,000," Berzina said. For some consultants, that's a daily rate.
My biggest problem with the report is how it overstates the influence of the chamber and its cause celebre, economic development.
"This is a classic social science gaffe, implying that correlation equals causation," said Greg LeRoy, executive director of Good Jobs First, a Washington advocacy group that often criticizes corporate tax breaks.
"The chamber may have helped these companies, but that doesn't mean it's responsible for their expansion," he added. "From afar, it looks like the chamber had a good year and is jumping in front of the parade."
It's hard to imagine that the chamber was crucial in Alcon's decision to expand here, but Alcon's 800 jobs are the most on the chamber list. Alcon has a long history of success in Fort Worth, and this location is benefiting from the company's global merger with Novartis.
The chamber had a bigger role in recruiting Ferris Manufacturing. The Illinois company considered several locations in Texas, and Berzina accompanied a city official on a visit.
Berzina understands that taxpayers are suspicious about corporate incentives, but he said, "Tax abatements are an unfortunate price to play the game."
If so, cities and chambers should blame themselves. LeRoy said that 99 percent of business costs have nothing to do with taxes. Relocations and expansions are made on business basics, such as costs of labor, occupancy, energy, logistics and raw materials.
Those factors make Texas and Fort Worth so competitive, which is why Houston, Austin and other Texas cities are landing plums, too. A chamber of commerce isn't the differentiator, no matter how good it is.
"Tax breaks seldom matter, but there's a lot of easy money lying around," LeRoy said. "Companies have to pick it up or they look incompetent."
So the next time there's a call for another round of corporate welfare, remember this: The significance cannot be understated.
Mitchell Schnurman's column appears Sundays and Thursdays. 817-390-7821