Originally Published: January 6, 2010 10 p.m.
Arizona's economy is struggling. Our state budget has a $1.4 billion deficit, with another $3.2 billion facing us in FY2010. Arizona's unemployment rate at 8.9 percent is second only to Michigan. After years of population and construction growth, we're flat in both areas with no relief in sight.
On Tuesday, the House Republicans announced the Arizona Economic and Job Recovery Bill, which is focused on creating a more business-friendly climate, attracting and retaining base industries, creating jobs with good pay and benefits, and providing needed tax relief to businesses and citizens.
This bill contains recommendations that are a direct result of an extensive review of the state's economy conducted by Elliot D. Pollack, who is widely regarded as one of the state's foremost economists.
The analysis focused on Arizona's current tax policy and economic development practices, both of which are critical to improving the state's economy. It also analyzed other states that have successful, proven economic development programs to determine best practices for diversifying Arizona's economic base and raising the overall standard of living.
One clear conclusion of the report: Arizona is not competitive when it comes to attracting new base industry companies to the state and is challenged in retaining existing business. The Arizona Economic and Job Recovery Bill is focused on changing that.
Attracting and retaining base industries is crucial to Arizona's turnaround efforts. A base industry includes those in high-wage sectors such as manufacturing, research and development, and high-tech companies. These companies create both direct and indirect jobs, generate new tax revenue for the state, create growth for local suppliers and vendors, and by employing more Arizonans who will in turn spend money, creating additional revenue for the state and local businesses.
In addition, each base industry job creates additional jobs in local businesses throughout the state. Some examples here in Arizona include Boeing, Honeywell and Intel.
Measures in this bill will make Arizona more competitive by lowering the tax burden on new companies and adding incentives for relocating to our state.
However, the Arizona Economic and Job Recovery Bill is not focused only on bringing new business to the state. It also relieves the tax burden and makes it easier to do business for existing companies. Many of the recommendations will provide immediate relief to small and large businesses and, in some cases, to Arizona citizens.
Challenging economic times require new and bold ideas, swift decision-making and rapid, yet strategic, implementation. Without strategic policy action, we risk further decay of our economy and standard of living compared to the U.S. as a whole.
Lucy Mason is a Prescott resident and Arizona House representative for District 1.