Zoning in on distressed communities.

• Position: STATESTATS

Enterprise zones, one of the most popular programs designed to improve the economies of distressed communities, came to America from the United Kingdom in 1981. Businesses locating or expanding in poor areas are offered a variety of incentives to encourage further investment and development.

A simple idea, but does it work? After two decades of enterprise zone operations in the United States, the effectiveness of these programs remains open for debate. Economic development officials and many business owners praise the enterprise zones as a vital part of a complete state and community development strategy. Others, including a number of academics, point out that program reviews and econometric studies have not provided clear evidence that enterprise zones deliver the promised benefits.

What does seem clear is their popularity as an economic development tool. By 1995, over half the states had created enterprise zone programs; today only seven states remain zoneless.

COMMON GOALS OF ENTERPRISE ZONES

* Attract new business to the state.

* Encourage firms to locate in underdeveloped communities.

* Encourage existing firms to expand, increase investment.

* Provide jobs for...