WEDA Summer ConferenceAugust 18, 2010

By: Sean Stevens

How Wyoming Ranks!Business Friendly Tax Climate – 2nd – Tax Foundation, 2010Best Business Tax Climate – 2nd – Business Facilities, 2010Pro-Business States -3rd – Pollina Foundation, 2010Assets & Opportunities Scorecard – A – CFED, 2010Business Creation Rate – 4th- CFED, 2010Best Business Climate – 10th – Business Facilities, 2010Top States for Business – 14th – CNBC, 2010Best States for Business – 22nd – Forbes, 2009 (2nd

Business Cost)

U.S. Chamber of Commerce

http://ncf.uschamber.com/enterprising-states/

Status of EconomyU.S. has demographic advantage over Europe and East

Asia.Germany, France, Japan, South Korea and China =

declining workforceBy 2050, workforce pool of people 14 to 64 = grow 40%.

Growth of Population

Status of EconomyUniversity of Kentucky – 23 Million jobs to return to

prerecession level of employment40% are concentrated in California, Texas, Florida (26%

of US pop.)Less than 850,000 needed in ND, SD and WY.

Slow population growth

Top Overall Growth PerformersJob Growth rate since 2000 and since 2007GSP measures: real GSP growth since 2000, GSP per job

2008, Growth in GSP per job 2000-2008Income: per capita personal income 2000-2009 and

median four person income adjusted for cost of living, 2009.

Top Overall Growth Performers1. North Dakota2. Virginia 3. South Dakota4. Maryland

5. Wyoming6. New York7. Texas8. Iowa9. Nebraska10. Montana

Pillars for Economic DevelopmentEntrepreneurship and InnovationExport & International TradeInfrastructure InvestmentWorkforce Development & TrainingTaxes & Regulations

Entrepreneurship & InnovationNew Business Development – providing financial,

technical and managerial assistanceTechnology-based Development - creating an

environment where business can innovate and maximize the use of technology

Industry-cluster Development – geographical concentrations of businesses with channels for transactions, communications and dialogue

Entrepreneurship & InnovationMeasurement Values

Growth and Concentration of Science, Technology, Engineering & Math (STEM) Jobs

Total R&D activity in the stateState investments in R&DEntrepreneurial Activity

High-Tech Start-ups Kauffman index of entrepreneurial activity

Entrepreneurship & InnovationTop States

MontanaMarylandWashingtonAlaskaNew Mexico

Entrepreneurship & Innovation

Entrepreneurship & InnovationThe Good

WTBC/ Casper Incubator - provides services, physical space and support to start-ups.

Challenge Loan – buys down interest rates on loan to allow for affordable finance options; create jobs.

SBIC – program to assist Wyoming small business in receiving investment funding

Entrepreneurship & InnovationThe Good (Con’t)

SBIR Phase 0 – provides support grants for develop Small Business Innovation Research grant proposals

WyEn.biz – Assists Wyoming small businesses and entrepreneurs with counseling, management assistance, market research, patents.

Manufacturing-Works – provides technical assistance to manufacturers and technical oriented businesses

WWBC - Microloan

Entrepreneurship & InnovationThe Bad

Financing – “I want to start a business, can I get a grant” Access to Venture Capital

SolutionsArizona: AERO - www.azcommerce.com/About/AERO.htmAlabama: Launchpad – www.alabamalaunchpad.com Arkansas: ARCMF - www.arkansasriskcapitalmatchingfund.com Idaho: Kickstand - www.kickstandidaho.com New Mexico: Private Equity Program -

www.sic.state.nm.us/private_equity.htm

Entrepreneurship & InnovationThe Ugly

Foster High-TechCommercializing Innovation

SolutionsMontana: TechRanch - www.techranch.org/ Colorado: Renewable Energy Collaboratory -

www.coloradocollaboratory.org/ West Virginia : Coal Conversion Initiative

Export & International TradeOne in Four Manufacturing jobs in the U.S. depend on

exportsOne in Three acres of American farms is planted for

exports42% of US exports are purchase by Canada, Latin America

and the Caribbean

Export & International TradeMeasurement Values:

Value of exports as a share of total economic outputChange in export value as a share of economic outputChange in the state’s share of the nation’s total exportsOverall export growth 2002-2009

Export & International TradeTop States

LouisianaSouth CarolinaUtahTexasMississippi

Export & International TradeThe Good

Ag International Trade Development – Links Wyoming firms with new global markets.

Brazil Forum – Forum hosted by WBC to link Wyoming manufacturers to opportunities in Brazil.

Export & International TradeThe Bad

Trade Missions

SolutionsTexas: Texas One – www.texasone.us Maryland: International Incubator - www.mii.umd.edu Nebraska: “Reverse Trade Mission” - www.neded.org/rtm/ Ohio: Export Assistance Network

Export & International TradeThe Ugly

Establishing an Office of Trade

SolutionsUtah: World Trade Center of Utah/Utah International Trade Hub

- www.wtcut.com Iowa: International Trade Office/Export Trade Assistance

Program - www.iowalifechanging.com/business/intltrade/technical_assistance.aspx

Arkansas: World Trade Center/$70M multi-modal facility - www.arwtc.org

Infrastructure InvestmentCritical Role in Economic DevelopmentBasic Infrastructure Package: Highways, Airports,

Harbors, Utility Distribution systems, Railways, water and sewer systems, and Communications networks

Development of High Speed Broadband = Job Creation

Infrastructure InvestmentMeasurement Values

Share of lines that are high-speedShare of zip codes with at least five high-speed providersResidential high-speed penetration rateFunding investments in air and seaportsBridge and Road Condition

Infrastructure InvestmentTop States

FloridaNevadaColoradoUtahArizona

Infrastructure InvestmentThe Good

BRC – Wyoming’s “biggest success story”

Infrastructure InvestmentThe Bad

Broadband Local Funding – Economic Development Sales Tax

SolutionsIdaho: Broadband Investment Tax Credit -

http://commerce.idaho.gov/assets/content/docs/Final%2009-2009.pdfKansas: Connect Kansas – funded with ARRA -

www.connectkansas.org Massachusetts: Broadband Institute/ Innovation Corridor in

Pioneer Valley - www.massbroadband.org Nebraska: Power Parks -

http://www.neded.org/files/rdc/library/2009/PowerParksandBroadbandMapping-O'Brien.ppt

Infrastructure InvestmentLocal ED Sales Tax

.25% to 1% additional Sales Tax for Economic Development (W.S. 39-15-204 vi)

Goshen County is the only county to pass Uses:

Operating Funds Marketing/Travel Revolving Loan Fund Supplement BRC

Infrastructure InvestmentTexas Local Economic Development Sales Tax

Created in 1989 (1/8% to ½%), Known as 4A and 4B4A – To acquire or pay for land, buildings, equipment,

facilities, expenditures, targeted infrastructure and improvements for purposes related to manufacturing and industrial development

4B – To undertake projects for quality-of-life improvements that will attract and retain primary employers. Money may be spend on land, buildings, equipment and facilities expenditure and improvements for tourism, entertainment, recreation, athletic facilities and parks, affordable housing and municipal infrastructure

Infrastructure InvestmentTexas 4A Sales Tax (as of 2005)

208 citiesUses

Direct incentives – 24.4% Marketing – 2.5% Debt service – 15.8% Capital Costs - 40.1% Personnel – 5.2% Administration – 5.7% Affordable Housing - <1% Payments to taxing units – 1.9% Job Training – 0.2% Other – 4.3%

Infrastructure InvestmentTexas 4A Sales Tax (as of 2005)

238 cities with tax (20% of eligible cities)243 large business investments announcements from 1989

to 2003 (40% of all eligible cities)Texas State Comptroller -

http://www.window.state.tx.us/taxinfo/taxpubs/tx96_302.htmlTEDC - https://www.texasedc.org/files/File/4a%204b/ED%20sales

%20tax%20update%202008.pdf

Infrastructure InvestmentThe Ugly

Access to MarketTrucking Permitting

SolutionsAlaska: Invested in infrastructure projects that increase

access to market for its existing extraction industries.New York: Erie Canal

Workforce Development & TrainingKey element for job creationNation is not preparing enough students for careers in

Science, Technology, Engineering and Math (STEM) U.S. awards 33% bachelor's degree in science and engineeringChina – 50%South Korea – 40%

Link H.S. and College to business needsAdditional training opportunities for employees already

in the labor force

Workforce Development & TrainingMeasurement Values

Share of public high school student taking advanced placement exams

Educational attainment: Bachelor degree attainment of 25-44 year olds

Higher education output: rate of bachelor's degrees conferred per 18-24 year old population

Affordability: undergraduate charge as a share of disposable personal income

Total charge (state and tuition funds) per degree or certificate conferred Workforce development system performance: Job retention rate of adult workforce system customers compared to agree placement goals.

Workforce Development & TrainingTop State

ColoradoFloridaNew YorkMassachusettsConnecticut

Workforce Development & TrainingThe Good

Workforce Development Training Fund – up to $4,000 per worker

Hathaway Scholarship School of Energy Resources – developed to support

advanced energy solutions, providing tech transfer and educated workforce

LCCC Wind Tech Program – example of academia creating a program to assist industry

EWC Mobile Welding Unit – adapt to industry needs; ability to train in the field

Workforce Development & TrainingThe Bad

% of HS Diploma (91.9% tied for 2nd)% of College Degrees (22.5%, 44th)Brain DrainSTEM Education

SolutionsDelaware: STEM Coordinating CouncilMaryland: STEM and Competitiveness InitiativeNebraska: Dream It-Do It campaign -

www.dreamit-doit.com/Nebraska/ Oklahoma: Project Boomerang - www.okboomerang.com South Dakota: Dakota Roots - http://dakotaroots.com

Workforce Development & TrainingThe Ugly

Slow Population Growth

U.S. Census predicts Wyoming to grow 5.9% from 2000-2030 (U.S. – 29.2%)

Wyoming Economic Analysis – 25.8%

Taxes & RegulationsImpact decision and competitive position of all businessBusiness Climate

Cost of Doing BusinessTaxesEnvironmental RegulationsLabor Laws

Out of Your ControlNatural ResourcesAmenitiesLocation advantages

Taxes & RegulationsMeasurement Values

Taxes: Overall state and local tax burden and a state corporate tax index

A small business survival indexSize of state budget gap – Pew Center on the StatesState Liability Systems ClimateOverall Cost of Living Index

Taxes & RegulationsTop States

South Dakota

WyomingTennesseeIndianaNorth Dakota

We are NOT California!

Taxes & RegulationsThe Good

Tax Climate (#2 Tax Foundation, 2010)Business Friendly (#14 CNBC, 2010)Pro-Business (#3 Pollina, 2010)Manufacturing Sales Tax ExemptionGovernment TransparencyData Center Sales Tax Exemption

Taxes & RegulationsThe Bad

Tax Increment FinancingManufacturing Sales Tax Exemption

SolutionsColorado: Removed Exemption on energy used in Industrial

process. http://www.denverpost.com/search/ci_15707419Texas: Looking to remove Sales Tax ExemptionsUtah: Economic Development Tax Increment Financing

http://business.utah.gov/relocate/incentives/edtif/

Taxes & RegulationsThe Ugly

UI TaxesPermittingWind TaxPolitical Environment

Taxes & RegulationsSolutions

WY DOE – splitting manufacturing and construction sectors for UI

Minnesota: e-Licensing Initiative http://www.state.mn.us/portal/mn/jsp/content.do?subchannel=-536892923&programid=536906395&id=-536886806&agency=Excellence&sp2=y

Maine: Pine Tree Development Zones http://www.mainebiz.org/pine_tree_zones/default.asp

Pennsylvania: Keystone Opportunity Zone http://www.newpa.com/build-your-business/locate/keystone-opportunity-zones/index.aspx

SummaryWyoming has a good foundation of programs to help all

five pillars of economic developmentThere are some aspects that Wyoming can not controlWyoming can learn from other States

Thank you!Sean Stevens, Sr. Lead Development SpecialistWyoming Business Council214 W. 15th StreetCheyenne, WY 82001Sean.stevens@wybusiness.org307-777-2864