Living in a LiteBox*
Someone asked me what I thought about the recent controversy surrounding LiteBox. For those of you who may have been out of the loop, LiteBox is the pet project of Bob Yanigahara, an California-based entrepreneur who announced last he was bringing his company to Indianapolis and creating 1,100 jobs in the process. The problem with Yanigahara is that his financial past has some serious questions attached to it and it has put Indiana Governor Mitch Daniels and Indianapolis Mayor Greg Ballard in a somewhat awkward political position. And is gave a an arrow for Democratic Mayoral challenger Melina Kennedy to get in a shot at the incumbent. So with all that said, here is where I stand.
The LiteBox deal would only concern me if the city and state put up money up front to attract them here to Indy. The way I understand the deal, there is not one dime of incentives to be paid out unless a job is created. So as long as that remains the case, I don’t stay up at night worrying about this one. I do think that holding a news conference may not have been one of the better moves and the city and state should have let things go quietly and then be ready to answer if someone were to call.
I do worry though about what this says for someone who is looking to invest in Indianapolis and will they get similar treatment. The very nature of entrepreneurship involves a certain amount of risk taking and eccentric behavior; whether you are creating Apple, Angie’s List or IndyPolitics.Org (Shameless plug).
Also, if we are going to get upset over an economic deal where no taxpayer dollars have been given out, then shouldn’t there be an outcry from the critics over deals where incentives have been paid out and jobs promised where never delivered? Case in point, Eli Lilly. The company has received more than $1.6 billion in tax beaks and incentives in exchange for creating 9,500 new jobs in Indianapolis area. It not only never reached that goal, but actually shed more than 2,000 as part of restructuring. I am waiting for the outcry.
But back to LiteBox. Is it a bad deal? I don’t think so, if no jobs are delivered the taxpayers aren’t on the hook. If the jobs show up, all is forgiven. Does someone (i.e. BobYanigahara) need to hire a P.R. person for next time, definitely. See there’s a job right there that’s waiting to be created.
*My apologies to Richard Darbyshire.
