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This article was produced in partnership with The Business Journal, based in Youngstown, Ohio, which is a member of the ProPublica Local Reporting Network.
When the American steel industry collapsed in the late 1970s, few places were hit as hard as Youngstown, Ohio, a manufacturing powerhouse with a bevy of hulking mills. It never really recovered, and today the city’s name is shorthand for postindustrial decline. Desperate for investment, local officials tried a tactic that municipalities around the country have also embraced: awarding millions of dollars in property tax breaks to companies promising new jobs.
But in Youngstown, those efforts have largely failed to deliver, an investigation by The Business Journal and ProPublica has found. The results are instructive for communities across the nation as they try in the coming months to cope with the crushing financial impact of the coronavirus epidemic. Ohio regulators, for instance, warn that so-called enterprise zone agreements should be “a tool of the last resort” for local communities because of the “far-reaching” effects of tax breaks.
Perhaps the most prominent case study is Chill-Can, the world’s first self-chilling beverage can. As The Business Journal and ProPublica reported this week, the product’s developer, Joseph Co. International, pledged to build a $20 million facility on the city’s battered East Side that would employ more than 200 people. In return, the city awarded it a $1.5 million grant and massive tax breaks. But more than three years after breaking ground, a pair of metal buildings resembling airplane hangars sit empty on the site.