Tucson is hosting the annual conference of the Site Selectors Guild at the J.W. Marriott Tucson Starr Pass Resort and Spa this week. This meeting of the nation’s premier corporate site selection professionals provides an excellent opportunity to showcase our state. The 300+ attendees arrived in Tucson to warm, sunny weather just as Winter Storm Stella was descending upon the East Coast. Not a bad first impression.
Fortunately, our enviable spring weather is only a prelude to the Arizona story. We easily check the box on having a low-tax, low-regulatory environment. Over the past decade, our state legislature has addressed some of the critical pain points in our tax code, such as the business property tax, corporate income tax and capital gains tax. We’ve strengthened important programs such as Foreign Trade Zones, the optional enhanced sales factor apportionment formula for corporate income tax, and the research and development tax credit to make our state more competitive for advanced manufacturing. Governor Ducey is working overtime to get rid of unnecessary regulations and make government more responsive to businesses that want to locate and grow in Arizona.
However, competitive taxes and manageable regulations are just the basic criteria that a state or city must meet to even get into the highly competitive game of site selection. The real test comes in the form of the less tangible assets that a location has to offer. While site selectors consider many criteria, three stand out as opportunities for Arizona to differentiate itself from the competition: Innovation, Talent and Market Access. And there are specific actions that we can encourage our state legislators and Congressional delegation to take right now that will advance Arizona’s position in each area.
Upping our game is essential if we want to keep good jobs coming to Arizona.
Foster Innovation – Fast Company recently ranked Arizona #1 in the nation for Entrepreneurial Activity. We’re leading the country in the testing of autonomous vehicles. We have a thriving MedTech industry connected to world-class hospitals and biotech research facilities. We have emerging strengths in cybersecurity. But we need more start-up capital to support our entrepreneurs and to develop an ecosystem of innovation that will draw companies from around the world to Arizona.
Action Item: This session, the Arizona legislature is considering SB 1212 to augment the state’s Angel Investor Tax Credit to attract more funding for start-up companies. Encourage your legislator to support SB 1212.
Developing Talent – Site selectors consistently identify the availability of a skilled workforce as a top consideration for businesses. Fortunately, Arizona is home to three highly innovative public universities that are moving up in the national rankings. The universities are producing thousands of graduates in high-demand fields. The majors with the greatest increases in degrees in the past decade are business, biological/biomedical sciences, social sciences, engineering and psychology – fields that are in high demand in the modern global innovation economy.
Action Item: This legislative session, Gov. Ducey is pushing for a novel bonding proposal that will enable the universities to build and maintain research facilities critical to educating the next generation of workforce talent. Encourage your legislator to support the university bonding proposal in the state budget.
Ready Access to World Markets – Arizona’s proximity to Northern Mexico provides not only access to the 10 million people living just south of the border, but also serves as a gateway to other major Latin American markets. Interstates 10, 8 and 19 are major corridors for commercial trucks carrying goods to and from California, Texas, Mexico and beyond. But these “Key Commerce Corridors” are in need of upgrades, as are our border ports of entry.
Action Item: Adding capacity to these roadways and hiring more customs service personnel should be part of any comprehensive federal infrastructure investment program. Encourage your representative in Congress to advocate for funding Arizona’s Key Commerce Corridors and upgrades to border ports of entry.
Being in the spotlight for the Site Selectors Guild conference certainly allows us to showcase our existing assets; but it should also make us think about how we can get even better. Competition for new businesses and the jobs they bring is never static. Upping our game is essential if we want to keep good jobs coming to Arizona.