Originally Published: February 10, 2013 10:08 p.m.
PRESCOTT VALLEY - State economic development legislation has helped Arizona recover by increasing business competitiveness, Arizona House Speaker Andy Tobin told people attending an Arizona Association for Economic Development gathering in Prescott Valley Friday afternoon.
Arizona rose from being the 9th most competitive state for businesses to the 4th most competitive in just two years, said Tobin, a Republican from Paulden.
"That is now what's fueling our job growth," he said after using a PowerPoint presentation to list nine successful pieces of Republican legislation in 2011 and 2012. They included a drop in the commercial property tax rate, corporate income tax rate and capital gains tax rate; an R&D tax credit; and a job creation tax credit. This year legislators are working on an R&D tax credit for small businesses and a lower commercial property tax classification, he said, and other proposals are in the works.
Arizona lost about 300,000 jobs since 2007 and has gained about one-third back, he said. The state is number one in the country for new business start-ups, he added.
"I don't think that gets around in the press," he said.
Health care is the biggest issue affecting the Legislature this year, said Sen. Steve Pierce, R-Prescott.
Pierce said he pledged to help Gov. Jan Brewer gain legislative support for expansion of Medicaid to get more federal dollars.
"I think this is an economic decision for the state," he said.
The state will get an extra $2 billion annually in federal dollars to insure about 300,000 more people by providing Medicaid to anyone earning up to 133 percent of the federal poverty level, according to the governor's plan.
Hospitals will cover the state's $154 million share and still save money, because hospitals that accept any federal dollars must otherwise provide free emergency room care to poor people who don't have insurance or Medicaid. Hospitals pass those costs onto people with insurance, Tobin said.
"I think it's time we step up and do what we can to help hospitals," Pierce said.
Tobin didn't express direct support but said Brewer is "brave" for her proposal.
Rep. Karen Fann, R-Prescott, was unable to attend Friday's event because of previous commitments.
Other federal activities aren't helping Arizona's economy, Tobin charged.
"We move five steps forward and the feds move us three steps back," he said. He cited lack of Congressional approval of a land exchange for the proposed Resolution Copper mine in southeast Arizona, new expensive clean air requirements on the Navajo Generating Station, and a payroll tax increase that will cost the average Arizona family about $900 annually.
"That's the one that hurts the most," he said.
The legislators also cited education and water as important to the state economy. Tobin said the state needs to commit a billion dollars to support water infrastructure development for future needs outlined by a committee he created.
City council members from Prescott, Prescott Valley, Williams, and Cottonwood attended Friday's forum alongside economic development officials.
Prescott City Council Member Chris Kuknyo said a state task force's recommendations to simplify the state's sales tax system would hurt rural communities. Charging sales taxes on construction materials at the point of sale instead of in the city where the building is taking place could cut $1.5 million from Prescott's revenues, he said.
Tobin said he's on record opposing that part of the sales tax reform, but the state needs to close loopholes. There will be amendments to the task force proposal, Pierce added.
Fann has been an important voice in this issue, they said, because of her experience as a mayor as well as a construction contractor.