Business & Job Creation
Businesses need a friendly and fair business environment so they can compete, innovate, and create jobs. We’re keeping politicians from playing favorites by offering special deals and tax breaks to the favored few.
Arizona state parks continue to make news and be used as a pawn in the budget chess game. Budget reductions approved by the legislature in December will likely result in some park closures. Parks that make money like Kartchner Caverns, Slide Rock, and Lake Havasu will stay open, while money losers will close. Many legislators continue to decry budget reductions to the Parks department, but also refuse to look at realistic alternatives.
It was like a scene from Atlas Shrugged: Polly Shaw of China-based Suntech told an Arizona House Government Committee hearing that massive solar production subsidies and even bigger consumer subsidies were not enough. If the Legislature passed House Bill 2701 and repealed the Arizona Corporation Commission’s rules that require utility companies to purchase increasing amounts of solar energy over the next 15 years regardless of the projected $1.2 billion cost to consumers, her company would pull its operations and a few dozen jobs from the state.
The nation’s high unemployment rate has barely fallen this year, in part because many businesses are waiting for the other shoe to drop from federal health care reform.
At this point, business people can only guess at what new employees will cost in the near future. Already, health care benefits constitute almost 8 percent of the total cost of an employee. Though these costs were rising before, they did so predictably.
Good economic news in Arizona is hard to come by these days. The state unemployment rate has been at 9.6 percent for three months in a row. But on the positive side, the Wall Street Journal recently published an article worthy of a smile. It reported Amazon.com has signed the biggest lease, by square footage, in Arizona’s history. PayPal also recently leased an office building in Chandler. Both companies are expanding and creating jobs for Arizonans.
Arizona’s economy seems to be headed for a long, gradual recovery. Policymakers have the opportunity now to set the stage with thoughtful decisions about what kind of infrastructure will support future economic growth.
A recent story in the Arizona Republic described a luncheon sponsored by the Salt River Project and the East Valley Partnership to discuss future infrastructure needs. It is clear from the story that many policymakers understand that additional transportation options will be key to Arizona’s prosperity.
Arizona’s state constitution was modeled after the founding document of the state of Washington. Over the past century, both states have frequently looked to each other for policy ideas. In Washington’s general election last week, that state’s voters were inspired by Arizona and approved a constitutional measure requiring two-thirds of the legislature to pass any tax increase. Now, perhaps Arizona could look to Washington.
In choosing where to live, Arizonans generally consider school district boundaries, relative property tax rates, crime statistics, and the like. One factor that ought to figure into the decision is which utility company supplies the power.
Two of the biggest players, Salt River Project (SRP) and Arizona Public Service Co. (APS), are on divergent paths. Ordinarily, private companies like APS are more nimble and responsive to market forces than their public counterparts. But in Arizona, the converse is true, at least in terms of renewable energy.
Since 2007, Arizona has lost 300,000 jobs, more than 10 percent of total employment. So it’s understandable our elected officials are anxious to bring more jobs to the state. Governor Jan Brewer and other state officials want to create a Commerce Authority armed with $25 million for grants to businesses as enticements to locate here. They often point to the Texas Enterprise Fund (TEF) as a model. A close look at the TEF, though, raises questions about how effective it really is.