JLARC review: VJIP widely used; recommends local wage thresholds and more review of small industry tax exemptions

The Joint Legislative Audit and Review Commission presented an in‑depth evaluation of Virginia—s workforce and industry incentives, covering ten programs including the Virginia Jobs Investment Program (VJIP), the Virginia Talent Accelerator (also called the talent accelerator program), a worker training tax credit, and seven smaller industry sales‑tax exemptions.

Ellen Miller, JLARC—s chief economic development analyst, said VJIP is "one of the state—s most widely used incentives and projects met their job creation goals." Over the 10‑year study period, JLARC staff reported nearly $50 million in VJIP grants and about $7 million in awards per year. The staff found VJIP produces moderate economic benefits and a moderate fiscal return but recommended two changes to increase effectiveness: tie VJIP—s wage eligibility threshold to local prevailing wages rather than 120% of the state minimum wage, and reduce eligibility thresholds in distressed localities.

On the Virginia Talent Accelerator, JLARC described the program as a turnkey, in‑kind service that helps employers recruit, screen and onboard workers and build relationships with community colleges. The staff found most early projects would have proceeded without the program, but stakeholders prefer the program and it meets most design criteria JLARC uses; total program spending to date was reported as about $17 million through fiscal year 2023. JLARC recommended setting a reasonable minimum capital investment threshold and codifying the program in statute if continued.

JLARC reported the worker training tax credit has low take‑up and negligible economic impact; the credit will expire July 2025 and JLARC suggested a grant framework might be a more effective approach if the Commonwealth wants to incentivize apprenticeships.

Seven small industry sales‑tax exemptions reviewed by JLARC have negligible to low economic benefits overall and were often adopted for purposes other than out‑of‑state attraction (for example parity with other industries or local social policy). JLARC recommended applying expiration dates to exemptions that lack them, updating revenue estimates and referring the exemptions to the Joint Subcommittee on Tax Preferences for a holistic review.

Speakers included JLARC analysts present to answer members— questions; legislators asked about prevailing wage settings and whether incentives move projects that would otherwise locate outside Virginia. JLARC noted geographic tailoring (higher thresholds in high‑wage areas; lower in distressed localities) could improve program targeting.

Ending: JLARC framed its recommendations as options for the General Assembly to adopt; no immediate statutory changes were enacted during the meeting.