State Weighing Tax Breaks to Keep Taco Bell : Incentives: The fast-food chain, a top employer in O.C., seeks legislative inducements to stay in Irvine. Company has hinted it will move to Texas.

State officials acknowledged Friday that they are scrambling to devise a package of tax credits and other inducements to keep Taco Bell Corp., one of Orange County’s largest employers, from moving to Texas.

But Taco Bell’s self-imposed deadline is due any day now, and lawmakers don’t know whether the fast-food company would postpone a decision based on the introduction of any new legislation. Corporate executives would not comment Friday.

The Irvine company, the county’s sixth-largest employer with 1,000 employees and full-time contract workers, already delayed for a few weeks its self-imposed March 31 deadline for revealing its plans.

A so-called red team, composed of state and local public officials and local business executives, has been trying for six months to persuade the fast-growing restaurant chain to remain in the county. Red teams often can cut through bureaucratic red tape to help most companies, but Taco Bell’s needs require legislative changes.

Taco Bell has asked the state for tax credits on new wages created by expansion, on wages created by construction jobs and for construction costs and land purchases, according to a state government source close to the negotiations.

Assembly Speaker Willie Brown (D-San Francisco) is weighing Taco Bell’s request for tax law changes, and may put together legislation as soon as next week to entice the company to stay, said Michael Galizio, Brown’s chief of staff. But any changes in the law would have to be offered to all businesses, which could make it unaffordable to the state.

“We’re trying to fashion something that’s going to be good for the California business climate overall,” Galizio said. “Part of that consideration is what the cost to the state is going to be. That’s got to be a consideration. That’s what we’re in the process of doing right now.”

Gov. Wilson, who pushed last year for workers’ compensation reform and other business-friendly revisions to state law, asked the Legislature in his January State of the State address for more benefits for business, including tax credits of $1,000 for every job created and financial incentives to local governments to abolish red tape hindering business.

But coming up with enough incentives to compete with a state like Texas, where land is much less expensive and state and corporate income taxes don’t exist, may prove difficult. Gov. Ann Richards has a war chest of incentives to dole out to attractive corporate citizens like Taco Bell.

Taco Bell told California officials that Texas has offered the firm a $10-million package of incentives, according to the California government source close to negotiations with the company.

The package includes about $4.5 million in property tax relief over 10 years and the suspension of permit and developer fees. In addition, Taco Bell employees and their families who move to Texas would not have to pay out-of-state tuition if they enrolled at state colleges and universities.

Spokesmen for Wilson and Brown refused to discuss details of California’s negotiations.