Cities raid neighbors in quest for jobs, but the benefits they receive in actual job creation aren’t always clear | | The Bulletin

When the leaders of this small Iowa city became desperate to land a new department store, they didn’t have to look far: They lured one from the city next door, along with up to 100 jobs.

The store called Von Maur agreed to leave Iowa City for a platter of incentives offered by Coralville, which promised to put up a bigger, $9.5 million building, to provide a $1.5 million parcel of land and to discount the store’s property tax bill. It even offered $650,000 to cover any penalties related to the store’s departure.

As the economy slowly strengthens, neighboring cities and states can be pitted against one another in the competition for jobs and development. But it’s not always clear how many positions are actually created, rather than just poached and shuffled around. And some people question whether the deals are worth the high cost.

“I think it’s ridiculous,” Amber Wherry said after buying a pair of jeans at Von Maur in Iowa City, expressing concern about what will happen to Sycamore Mall when the store moves five miles to the new location, probably sometime in 2013.

via Cities raid neighbors in quest for jobs; • But the benefits they receive in actual job creation aren’t always clear | | The Bulletin.