Tag Archives: arizona chamber of commerce and industry

Restaurant Industry

NLRB puts thousands of small businesses, franchises at risk

Need convincing that the National Labor Relations Board is an agency in desperate need of a management change?

The NLRB, which ostensibly is charged with protecting workers’ rights and remedying unfair labor practices, has morphed into an arm of organized labor.

Consider the board’s hit parade of the last few years: There was the case against Boeing over the company’s decision to locate a new factory in right-to-work South Carolina; the Obama administration’s abuse of recess appointments to name a union sympathizer to the agency’s general counsel post; its obsession with card check, which would end workers’ right to a secret ballot in union elections; calling on employers to post notices about employees’ rights to join a union; and the pursuit of so-called snap elections, a way of ambushing employers with union elections before they can communicate their side of the argument to employees.

But now there’s another dubious distinction to add to the list, and the NLRB’s latest adventure has the potential to completely upend decades of the franchise restaurant business model.

In a late July determination, the NLRB found that McDonald’s Corp. could be treated as a joint employer with its franchisees in labor disputes. In other words, to the labor board, there is no daylight between the corporate parent and the franchisee operating his or her own restaurant.

The finding is not only potentially devastating to the restaurant industry, but to other businesses that rely on the franchisor-franchisee relationship, which affects many small businesses. It could also affect businesses that use subcontractors or temp agencies.

Organized labor, which has long sought to unionize the fast-food industry, but that has seen its influence in the private sector on the wane, hopes the NLRB decision opens the door to union organizing in these restaurants. If there’s no difference between McDonald’s corporate and the franchisee at your neighborhood outlet the thinking goes, then unions might have new leverage to negotiate over organizing and higher minimum wages because they can pressure one corporate entity rather than hundreds of small businesses.

This is bigger than a minor administrative filing by an obscure agency within the federal government. Thousands of jobs are a stake here. More regulations and mandates inflicted on small businesses make hiring more expensive and investment more elusive. Entrepreneurs who take the risk to open a new restaurant, whether an established franchised brand or an exciting new concept, face plenty of obstacles without the government throwing up new barriers to entry. If these small businesses can’t get off the ground, they can’t hire, which will only hobble the economy, not help it.

The decision will be appealed and could even end up before the Supreme Court. This is far from over.
What is unlikely to cease, unfortunately, is this administration’s seemingly endless desire to insert itself into the employer-employee relationship. In its apparent desire to help workers, the government is doing far more harm than good for the individuals it claims to protect.

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry. Steve Chucri is the president and CEO of the Arizona Restaurant Association and supervisor for Maricopa County District 2.

Rob Dalager - Headshot

Dalager Re-Appointed to County Commission

The law firm of Gallagher & Kennedy announced that Robert D. Dalager has been re-appointed to serve on the Maricopa County Commission on Trial Court Appointments. Dalager was first appointed to the commission in January 2010.

The Arizona judicial system operates under merit selection, in which judges are chosen through a non-partisan commission of lawyers and non-lawyers which investigates and evaluates applicants. Dalager serves on the Maricopa County Commission on Trial Court Appointments, which is one of four judicial nominating commissions in the state of Arizona. He was nominated by Governor Janice Brewer and confirmed by the Senate for re-appointment to the commission in April. His term expires in January 2018.

Dalager is a shareholder practicing in the areas of government affairs and lobbying. Prior to joining Gallagher & Kennedy, he spent 13 years working directly with and for State government, ten of which as the Chief of Staff for the Arizona State Senate. In addition to his role with the Maricopa County Commission on Trial Court Appointments, he also serves on the board of directors for the Arizona Chamber of Commerce and Industry and is a member of the City of Phoenix Citizen’s Transit Commission, the Encanto Village Planning Committee and the Phoenix Pedestrian and Bicycle Task Force. He earned his J.D. from Creighton University and his B.S. from Arizona State University.

Cushman & Wakefield Leasing

The 2013 Hammer Awards

It’s the most wonderful time of the year; time to hand out some virtual hardware to the winners of the 4th annual Hammer Awards, Arizona Chamber of Commerce and Industry President and CEO Glenn Hamer’s look back at the wild and the wacky of the year in politics and anything else that’s on his mind.

State Leader of the Year: Gov. Jan Brewer

This one was a runaway. Not even close. The governor at the outset of the 2013 legislative session took on a set of issues that would make most elected officials wilt: Medicaid restoration and sales tax reform. She spearheaded highly effective campaigns on both issues, stood strong against a motivated opposition, and won the day in each case. Her accomplishments as governor are too numerous to mention, but she outdid herself this year, adding to her profoundly positive record for the state’s business environment for which the state will reap rewards for years to come. She’s building a legacy that will be tough to match.

National Politician of the Year: New Jersey Gov. Chris Christie

Are you a Republican interested in running for statewide or national office? Take a lesson from two-time Hammer Award winner Gov. Chris Christie. The governor worked hard in his first term to burnish his image as pragmatic problem solver, and it paid off in 2013 when he won re-election in a route. Buoyed by a bevy of must-see YouTube videos, Gov. Christie made deep inroads into segments of the electorate that have been leaving the GOP in droves. I have no idea whether a Christie presidential campaign in 2016 will be a winning one, but his opponents underestimate him at their own peril.

Legislators of the Year: Reps. Debbie Lesko and Heather Carter

Some legislators get drafted into a fight, others volunteer. Rep. Debbie Lesko and Rep. Heather Carter volunteered to champion the year’s most contentious policy issues, and for that they each win a Hammer.

Rep. Lesko expertly navigated the thorny issues surrounding the reform of the state’s byzantine sales tax system in the face of an opposition that was perfectly willing to run out the clock on the legislative session and stick with the status quo. Rep. Lesko teamed with the governor’s tax guru, Michael Hunter, and refused to the let the session end without real reform.

Courage is an overused term in politics, but Rep. Carter has it in spades, as demonstrated by standing shoulder to shoulder with Gov. Brewer in her campaign to restore the Proposition 204 AHCCCS population. Rep. Carter didn’t waiver and remained committed in her belief that backing the governor’s plan was the right move. She was right on the policy, and I’m confident she’ll be proven right on the politics.

Rising Star of the Year: Adam Deguire

Rep. Matt Salmon’s Chief of Staff Adam Deguire has quietly become a mover and shaker in western politics. The Brophy grad has hit his stride as Rep. Salmon’s top aide after guiding Salmon’s return to Congress in the 2012 elections. Adam has done stints at the Republican National Committee as a field rep, was a senior level campaign and transition team aide to New Mexico Gov. Susana Martinez in her 2010 run, and led the Hawaii GOP as its executive director. I always think it’s risky for a Hill office staff not to have ties back to the home state. Having Adam lead the staff and earn the frequent flyer miles between Phoenix and D.C. is a great move by Rep. Salmon, who will be well served by Adam’s commitment and loyalty.

Fighting the Good Fight: Sens. John McCain and Jeff Flake

I’m in the camp that firmly believes that we’re going to see a true immigration reform package land on the president’s desk in 2014. (For those keeping score, I was also confident that we were going to get a deal in 2013, but who knew that a government shutdown and an amateur hour website were going to crowd out every other issue.) But as we sit here on the cusp of a transformative shot of adrenaline for the American economy, let’s give a Hammer where a Hammer is due. We would not have gotten this far were it not for Sen. John McCain and Sen. Jeff Flake. Arizona is incredibly fortunate to have these men representing us in the world’s greatest deliberative body.

The Great Communicator: Matt Benson

Gov. Brewer has an outstanding team, including a few members who have won Hammers over the years. This year the governor’s former press secretary, Matt Benson, takes the honors for his outstanding work as the 9th Floor’s flack.

Issues like Medicaid restoration and TPT reform were incredibly complicated and they required their own public relations campaigns, but Matt communicated the governor’s positions on these and a host of other issues and acted as a liaison between the governor and her supporters, all while making it look easy. I should also note that there is no such thing as a day off for a gubernatorial press secretary, and Matt deserves a shout out for taking incoming fire from the fourth estate while he and his wife are still navigating the toddler years. Matt’s new firm, Veridus, is lucky to have this Hammer winner on board.

I Miss You, Man Award: David Cavazos

Phoenix is the best run big city in America. That’s in large part due to the dynamic Mayor Greg Stanton and a city council of professionals. But Phoenix this year bade farewell to its terrific city manager, David Cavazos. David was able to move effectively between different political factions in order to do what was right for the city. Having led efforts that ranged from attracting new investment to downtown Phoenix to spearheading trade missions to Mexico, he leaves big shoes to fill here. I don’t envy the search committee on this one.

A testament to David and Phoenix’s work is the appointment of Ed Zuercher as acting city manager. David left a great team behind as evidenced by Ed, a consummate professional, stepping into the top job.

An Apple a Day Award: Sandra Watson

I continue to be impressed by Arizona Commerce Authority CEO Sandra Watson’s talents. She’s taken the economic development toolbox assembled by the governor and Legislature and built something significant here. Constructing the deal that brought Apple to Mesa was a master stroke.

I can tell you from having traveled to Taiwan with the governor right after the deal was announced that bringing one of the most recognized brands to Arizona was a worldwide story. I did not expect dozens of Taiwanese reporters and businesspeople to pepper our delegation with questions about what makes Arizona so attractive to high-tech manufacturers. Sandra’s work is rippling around the glove, and for that she deserves a Hammer.

The Youngest Elder Statesman Award: Jaime Molera

The business community in 2013 rallied around Gov. Brewer’s health care restoration plan, but the campaign didn’t start to gel until Jaime Molera took on the role of a sort of campaign chairman. Jaime had the credibility and talent to bring together a host of lobbyists from across the health care and business community and assemble a dynamite team of political operatives to get the deal done. I hesitate to call a young man like Jaime an elder statesman, but the results leave little doubt that he was the right man for the job. Arizona owes a debt of gratitude to Jaime for stepping into the breach.

I would be remiss if I did not also acknowledge the work of Anne DeGraw, Jaime’s colleague at the firm of Molera-Alvarez, and Brittney Kauffman at the Arizona Chamber, both of whom ran the statewide campaign’s day-to-day affairs. Though he didn’t need it, they made Jaime look good.

The Mariano Rivera Best Closer Award: Jim Norton

On the last night of a legislative session, you can practically hear “Enter Sandman” echoing throughout the Capitol. This is the time that Chamber lobbyist and R&R Partners big shot Jim Norton shines.  When it comes to closing a deal, he’s the Mariano Rivera of lobbyists. He’s the best in the business, and I am incredibly fortunate not only to have him as the Chamber’s advocate at the Capitol, but to call him a friend.

He’s also a pretty good dancer. Give the man a Hammer.

The Legislative Branch Foreign Service Award: Speaker Andy Tobin and
his Mexico City trade delegation

Arizona in very recent history has had its share of missteps when it comes to our relationship with Mexico, which is why Arizona House Speaker Andy Tobin and the seven legislators who traveled to Mexico City with him this year all deserve Hammers for hitting the reset button south of the border.

The speaker was joined by Rep. Tom Forese, Rep. Catherine Miranda, Rep. T.J. Shope, Rep. Karen Fann, Rep. Juan Carlos Escamilla and Rep. Lydia Hernandez. The bipartisan delegation was received warmly by everyone we met from Mexico’s executive and legislative branches, with everyone appreciating the genuine effort made by the bipartisan Arizona delegation to make clear that we view the Arizona-Mexico relationship as a special one characterized by friendship and trust.

Also deserving recognition are Phoenix Mayor Greg Stanton and Tucson Mayor Jonathan Rothschild, who led their own delegation to Mexico City this year. Both the mayors’ and the speaker’s trips drove home the potential benefits that could be gained by putting down deeper roots and elevating our presence in Mexico’s political and financial capital.

The Next Great Buddy Cop Tandem: Luis Gonzalez and me

I had the pleasure earlier this year of traveling to Guadalajara, Mexico with a delegation led by Mayor Stanton. As a big baseball fan, I was thrilled when I found out Luis Gonzalez was joining our group as a representative of the Diamondbacks.

By the time trip was over, I had been able to give Luis my keen insights on the improper use of closers, the proper execution of a suicide squeeze play, hidden ball tricks and when to pitch out against left-handed batters. I got the feeling there was some real chemistry there, the kind that a Hollywood screenwriter might want to tap into for the next buddy cop hit. I sense box office gold.

Most Versatile Player Award: Steve Macias

One of the reasons I love my job is because I get to work with an absolutely first class board of directors. The boards of the Chamber and the Arizona Manufacturers Council are comprised of some of the most outstanding leaders in their industries across the state.

One of these leaders is Steve Macias, the chairman of the AMC. Steve is the consummate champion for manufacturing in Arizona. As the president of Pivot Manufacturing, Steve knows the shop floor firsthand, which makes him such an effective advocate for this critical sector of Arizona’s economy.

Steve does it all for the Chamber. In addition to chairing the AMC, he’s always willing to serve as a master of ceremonies or moderator, and he’s an outstanding writer, providing insight through his occasional Made in Arizona columns. And the guy’s got a biting wit. He deserves a Hammer.

The Milton Friedman Rock Star of the Year Award: Bono

U2 frontman Bono has long been a champion of foreign and charitable aid to Africa as a means to alleviate poverty across the continent.  But in a speech at Georgetown this year, he said, “Aid is just a stopgap. Commerce [and] entrepreneurial capitalism take more people out of poverty than aid. We need Africa to become an economic powerhouse.”

Bono, your Chamber membership form and PAC solicitation are in the mail along with your Hammer.

Book of the Year: Immigration Wars: Forging an American Solution
 
Former Fla. Gov. Jeb Bush and Goldwater Institute legal beagle Clint Bolick win the Hammer for their book Immigration Wars.

The book is an excellent piece of work, full of real, actionable solutions on the immigration front that could find themselves into the House’s immigration package.

Citizen Advocates of the Year: Linda Stanfield and Craig Barrett

One of them owns a plumbing franchise; the other is the former CEO of one of the world’s most respected tech companies. But both of them win a Hammer for stepping into the arena of public advocacy.

Linda Stanfield runs Benjamin Franklin Plumbing in Arizona. She was the public face for TPT reform this year, testifying in committee hearings, appearing in campaign videos and standing alongside the governor at press conferences and, deservedly, at bill signing ceremonies. We need more Linda the Plumbers shaping policy in Arizona.

Craig Barrett heads Gov. Brewer’s Arizona Ready Education Council. He’s also the former CEO of Intel. If he wanted to, he could spend his days on a beach sipping mai tais, but instead he’s devoting his energy to ensuring that Arizona has an absolutely world-class education system, with high standards and expectations, accountable principals and teachers, engaged parents and students ready to learn.

Supreme Court Decision of the Year: Campaign contribution limits (award accepted by Rep. J.D. Mesnard)

Since it might seem unseemly to bestow state Supreme Court justices with the acclaim and notoriety that comes with a highly valued Hammer award, I’ll recognize state Rep. J.D. Mesnard, the architect of legislation that ushered in the modern era of political free speech in Arizona in a law recently upheld by the state’s highest court.

Also deserving recognition are attorney Mike Liburdi, who successfully argued in favor of the new contribution limits and Andy Gordon who, on behalf of the business community, filed an amicus brief that argued for the removal of aggregate limits on a candidate’s ability to accept PAC donations. Hammers all around!

Chairman of the Board: Rep. Tom Forese

Who needs a Hammer when you’ve got a gavel? Give Rep. Tom Forese a Hammer Award for expertly using his position as state House Commerce Committee chairman to hold informational hearings on topics that matter for Arizona’s economy. I was able to participate in his hearing on the state’s aerospace industry and the mining industry this year, and both were filled with outstanding content. There are true industry leaders in Arizona, and Rep. Forese deserves kudos for urging them share their knowledge with lawmakers.

From all of us at the Arizona Chamber, we wish you all the best this holiday season and in 2014.

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry. The Arizona Chamber of Commerce and Industry is committed to advancing Arizona’s competitive position in the global economy by advocating free-market policies that stimulate economic growth and prosperity for all Arizonans.

carey school - graduate

Creating high performance schools

A central part of this year’s state budget debate is over Governor Brewer’s Performance Funding proposal for district and charter schools. Her plan helps ensure that tax investment in our schools yields measurable results.

Employers from across the state have fought against across-the-board cuts to our K-12 system, and we’ve supported the governor’s budget request to help make new, more rigorous standards successful. But we cannot support millions of dollars in additional new funding without some exchange for true accountability. Lest we forget, the voters agreed with this premise last November when they overwhelmingly rejected a ballot measure that would have raised taxes for education, but with little oversight in how the dollars would be spent.

A modern school funding system should be based on transparency, giving parents the information they need to choose schools and to choose communities in which to live and work. And the job creators we work hard every day to keep and recruit deserve a system that makes clear that our elected leaders are serious about excellent educational outcomes that prepare today’s kids for tomorrow’s jobs.

For more than a decade we have been building and adjusting such a system. We started with school accountability that tells us how schools and districts perform. We articulate this information using the same A-F letter grades that our students receive. More recently, Arizona implemented a teacher and principal evaluation system to ensure schools intervene with struggling educators, amplify the impact of high performing teachers and engage all educators in between.

These and other mechanisms implemented thus far seem to be moving the needle in most schools and providing the kind of transparency education hawks have demanded. But some persistent challenges remain. With billions of taxpayer dollars going to fund our K-12 system, Arizonans are demanding accountability that doesn’t just advertise performance, but also predicates some amount of schools’ annual funding – particularly hard-to-get new resources – on learning outcomes.

In response, the governor is proposing a first-of-its-kind model for schools to earn more funding than they currently receive. What’s really revolutionary is that a small amount of their current funding will be on the line as well. This percentage will grow over the course of the next five years.

Under Gov. Brewer’s plan, districts and charters at all performance levels can earn new dollars for improving their outcomes. For schools that reach state performance levels, even more money can be earned. But the greatest earning potential is in doing more than before, rather than being rewarded for perpetuating the status quo, the theme of the current funding model.

The Arizona Chamber of Commerce and Industry has called for a redesign of the education funding system that provides the right incentives to focus on outcomes rather than just seat time. The governor has proposed a modest move towards such a model. For fiscal year 2014, 1 percent of total funding is set aside for this model, reaching 5 percent at the end of five years.  One third of the funding would be from existing revenue, but nearly two thirds – more than $150 million by Year Five – would be new funding that all schools and districts would have an opportunity to earn simply by showing improvement.

A variety of reforms have been tried over the years and more will be tried during our time and after. Not all of them will work, but not trying at all is unacceptable. Combined with new standards, Gov. Brewer’s Performance Funding plan provides the right amount of tension in the system to move Arizona schools to the next tier.

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry. The Arizona Chamber of Commerce and Industry is committed to advancing Arizona’s competitive position in the global economy by advocating free-market policies that stimulate economic growth and prosperity for all Arizonans.  

real estate - expanding to california

Shine coming off the Golden State

The Tax Foundation in its 2013 State Business Tax Climate Index tells us something most of already know: California has high taxes. Really high.

In its state-by-state rankings, California checks in at 48, duking it out with New Jersey and New York at the bottom of the barrel. Breaking out the ranking in its component parts, California comes in at 45 for corporate taxes and 49 for individual tax rate.

The hits keep on coming. The California Taxpayers Association reports that California has the highest statewide sales tax in the nation and the country’s second-highest gasoline tax.

So it doesn’t take an economic development wizard to figure out that California’s pain could be Arizona’s gain. After all, while our governor and Legislature have been reforming Arizona’s tax code to make it friendlier to business, California has been going in the opposite direction.

As the Arizona Commerce Authority made clear last week in a presentation by ACA CEO Sandra Watson before the House Committee on Commerce, our state’s job creation authority is well aware that our proximity to California and our fertile jobs environment can drive job growth here at home.

But as Watson said in her testimony, “the opportunity in California goes way beyond a tax discussion.” The state’s California strategy is about opening doors to the world’s ninth largest economy and taking advantage of the opportunities our nearness to that market allows.

The ACA has set up offices in Santa Clara and Santa Monica where it has two executives working full-time as market representatives, spreading the word about what Arizona has to offer for firms exploring expansion, while also helping Arizona take advantage of the benefits our proximity to California has to offer, such as improved supply chain access.

As Chamber board member Pete Bolton of Newmark Grubb Knight Frank said at the same hearing, the tremendous growth in warehousing seen in the West Valley can be attributed to logistics. The area, according to Bolton is “zoned properly and that’s where the trucks come from. You get on I-8 and mostly I-10, it is a very serious line of trucks coming from the ports. The ports in Los Angeles distribute a huge amount of the products that we all consume.”

Sharing a border with California is advantageous to our other neighbors as well.  Currently, Texas and Mexico are tied for the 14th largest economies in the world and they, too, enjoy the access to California that Arizona provides. Arizona is well positioned to easily ship goods to market, while companies looking to hire California talent can set up shop in Arizona and have easy access to that talent pool.

As Watson pointed out, “Businesses generally don’t pay attention to a state border when they’re looking at access to markets. They’re going to ship their goods in and out, [and] they’re going to access the talent in those markets.”

Arizona is making tremendous strides in emerging technology and aerospace and defense. Having a flag planted in California, home to venture capital firms looking to invest in the next big thing, means opening doors for Arizona firms looking to be that next big thing. Beyond just access to capital, locating in Arizona means Arizona companies can enjoy the benefits of California without the high cost of doing business next door.

But the ACA’s strategy in California is more than just one state versus another or one region’s economic dynamism versus another’s. This is about global competition. By hanging a shingle in California, the ACA has access to the many multinational firms that call California home and is more easily able to interface with them to help Arizona companies reach customers around the world, especially since the world’s fastest-growing economies all have consulate offices in California.

Currently, the ACA has been in touch with over 200 potential leads and partners through their offices in California. Of those leads, more than 40 are truly qualified and are currently being pursued. The ACA is hopeful that more of those leads will become solid partnerships and that Arizona will continue to grow our presence within California. Greater Phoenix Economic Council President and CEO Barry Broome nailed it when he said, “California’s economy and Arizona’s economy are intertwined.”

But I close with a note of caution. For all that Arizona is doing right and California is doing wrong, let’s remember that the Golden State is our next door neighbor. While we’ve got the manicured lawn, our neighbor’s yard is overgrown with weeds and there’s a car up on blocks. It’s an eyesore and bringing down the value of the whole block.

The U.S. Chamber of Commerce is so concerned about the direction California’s taken that it’s launched the California Comeback, a policy initiative designed to help advance California’s recovery. A state with as much to offer as California is too important not only to Arizona but to the entire country to allow it to fail.

Admittedly, Arizona has much to gain by California’s struggles; we’re an escape hatch from their high taxes and stiff regulations. But we have so much more to gain when California makes a full recovery.

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry. The Arizona Chamber of Commerce and Industry is committed to advancing Arizona’s competitive position in the global economy by advocating free-market policies that stimulate economic growth and prosperity for all Arizonans. 

Labor Unions, City of Phoenix

Grand Canyon-sized tax reform

The recent Grand Canyon Institute report “The Effects of Tax Reductions In Arizona: Significantly Reduced Government Revenue and No Apparent Impact on Economic Growth,” dismisses the bipartisan efforts to improve Arizona’s tax competitiveness over the past two decades and defies common sense.

Does anyone really believe that Arizona would be better off with significantly higher personal, corporate and business property taxes?

Yes, we need adequate revenues to fund the core areas of state government, including education, health care and criminal justice. But, without a healthy economy this task becomes very difficult. And reform efforts can be more valuable than simply new money.

A quick history lesson:

Former Gov. Symington got the party started with sharp decreases to personal income taxes. Gov. Hull kept it going by insisting those tax cuts continue. And while further reductions in the personal income tax may not have been at the top of her agenda, the fact is that then-Gov. Napolitano signed legislation reducing the personal income tax rate as well as reducing tax rates for business property and research and development.

Gov. Brewer and the architects of the last two major job bills, including Speaker Andy Tobin and former Speaker Kirk Adams, took the matter of tax reform to a new level.  We have now put in motion tax reductions to business property – real and personal – capital gains, corporate income, sales factor for manufacturing and service industries, new job creation tax credits, bonus depreciation and even further enhancements to the R&D tax credit.

The evidence is clear that tax rates do matter. The Wall Street Journal recently reported that the nine states with no personal income tax accounted for 62 percent of the three million net new jobs over the past 10 years despite representing just 20 percent of the country’s population.

And Steve Moore and Art Laffer’s recent report, “Rich States, Poor States,” found that Census data consistently shows that people choose where to live, engage in commerce, and invest based on economic competitiveness, driven primarily by low tax rates.

California is a perfect example of why tax rates do matter. We have written about Phil Mickelson and Tiger Woods fleeing or preparing to flee the state due to excessive taxation. They are just two examples of a greater trend of athletes and other wealthy Californians looking to relocate. Could it be that these movers and shakers are looking for better weather? Less crowded beaches? Or simply looking to take their money to states where they can keep more of it?

So what is the bottom line? Arizona is now among the top-10 best states for business according to Chief Executive Magazine. We are in the game when it comes to significant job relocations for high-wage jobs that could go anywhere in the country and oftentimes the world.

Arizona’s economy is adding jobs at one of the fastest clips in the nation. We have been one of the fastest growing areas for population over the past two decades.

While we have made great progress, other states are not standing still.

Noting the success of Texas and Florida’s zero income tax rates, Oklahoma, Kansas and Louisiana are looking to lower or eliminate their income taxes.

Rather than go backwards, let’s continue to make progress on our tax rates and improve Arizona’s ability to create jobs for our people.

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry. The Arizona Chamber of Commerce and Industry is committed to advancing Arizona’s competitive position in the global economy by advocating free-market policies that stimulate economic growth and prosperity for all Arizonans. 

medicaid program - new patient eligibility

Arizona Chamber Foundation issues Medicaid reports

The issue of Medicaid expansion continues to loom large in state policymaking circles, and the Arizona Chamber of Commerce and Industry’s research arm, the Arizona Chamber Foundation, has produced new reports on this important topic.

The Foundation recently released a new Policy Brief titled The Business Case for AHCCCS Expansion. The brief outlines the impact of cost shifting and hidden health care taxes on Arizona businesses, along with the effect expansion of the Arizona Health Care Cost Containment System – AHCCCS – will have on the state economy and budget. It’s an excellent overview of the issue and the reasoning behind the growing support from governors throughout the United States, including Governor Brewer.

In addition, the Foundation has released a FAQ sheet to help individuals better understand what AHCCCS is and what voters passed into law when they adopted Proposition 204 in 2000. It’s an outstanding primer on the state’s best-in-class Medicaid program, the ballot measure that extended coverage to childless adults and the challenges facing the state posed by uncompensated health care.

I encourage you to dig into both of these publications and to share them with your network.

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry. The Arizona Chamber of Commerce and Industry is committed to advancing Arizona’s competitive position in the global economy by advocating free-market policies that stimulate economic growth and prosperity for all Arizonans.

Download Understanding AHCCCS and Proposition 204 and The Business Case for AHCCCS Expansion.

immigration

I love it when a plan comes together

This is a heady time for supporters of real immigration reform. A bipartisan group of U.S. senators, including our own John McCain and Jeff Flake, have announced their support for a framework of sweeping changes that have long been supported by Arizona’s – and the nation’s – business community.

It is natural that Senators McCain and Flake are at the forefront of this effort. They have been consistent voices for reasonable changes to our immigration system that will secure our borders and grow our economy.

We are seeing real leadership on display. To have a New York Democrat like Chuck Schumer standing next to Florida Republican Marco Rubio, someone who could easily sit this one out in order to protect his status as the latest potential GOP presidential nominee du jour, is an example of putting policy over politics that we could use more of.

That’s not to say that there aren’t politics at play here. Just look at the walloping the Republicans took from Hispanic and Asian voters last November to get a sense of why that party would be wise to alter its posture towards this fast-growing demographic. But as someone who has done his time in the trenches of partisan politics, a bold move like this one won’t necessarily earn valentines from grassroots activists.

Here’s the framework for legislative action on immigration reform that the senators laid out:

1.  Creating a path to citizenship for unauthorized immigrants already here that is contingent upon securing the border and combating visa overstays;

2.   Improving our legal immigration system and attracting the world’s best and brightest;

3.  Strong employment verification; and

4.  Admitting new workers and protecting workers’ rights.

This emerging framework and the cast of characters involved make me truly optimistic that there is a very real opportunity to advance immigration reform in 2013.

The desire to find a way to keep and attract high tech workers is especially encouraging. Even when unemployment was coming dangerously close to double digits, time and again I heard from employers who were having trouble finding qualified workers. Yet we have a visa system that will train up potential workers in sought after fields through our universities, and then wish them well as they head back to their home countries, and it’s almost a consensus item that we have to fix our broken agriculture worker visa system.

As the president said in his speech Monday in Las Vegas, “… the time has come for common sense, comprehensive immigration reform. […] I’m here because business leaders, faith leaders, labor leaders, law enforcement, and leaders from both parties are coming together to say now is the time to find a better way to welcome the striving, hopeful immigrants who still see America as the land of opportunity.”

The fact that the world’s most talented and hardest working want to come to the United States is an asset that no other country can claim. It speaks to the dynamism of our people, culture and economy. I can personally attest that it was a net win when my wife, Tali, and her family immigrated to the U.S. from Israel. Ask North Korea about how well they’re doing attracting new immigrants and you‘ll get a sense of how beneficial immigration can be to a country’s health.

We can secure our borders and secure our economy. Let’s get this done this year.

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry. The Arizona Chamber of Commerce and Industry is committed to advancing Arizona’s competitive position in the global economy by advocating free-market policies that stimulate economic growth and prosperity for all Arizonans. http://www.azchamber.com/

phil-mickelson-masters-2006_t640

An open letter to Phil Mickelson

Dear Phil,

I read your recent comments about the crushing tax burden California has imposed on wage earners like yourself. You said that you might even move out of California. Allow me to suggest Arizona – your former home – as your next home.

Though my time playing golf is usually limited to courses where I try to hit the ball into a miniature windmill, you and I have a lot in common. We’re both left-handers. We’re both Arizona State grads, you with a Bachelor’s, me from the law school. You’re a member of the ASU athletics Hall of Fame. I enjoy watching ASU sports.

More importantly, though, we both understand the impact high taxes have on a state’s economy and its hard working residents. A high-tax environment drives capital and people out of state, which explains why California is currently experiencing an unprecedented exodus of wealth.

It’s apparent you’re not alone in your high-tax sentiments. Even your sometimes rival on the golf course, Tiger Woods, said California’s high-tax environment is why he left the state for Florida.

California’s current top income tax rate of 13.3 percent is a good enough reason to pack up one’s clubs and move on.

Sure, California has sandy beaches and sunshine, but that doesn’t dull the sting of paying out nearly half your income in total taxes. It’s hard to enjoy the ocean when you’re watching your hard earned money float out to sea.

Arizona has sunshine and sand (traps), too. And while California has been pursuing a flawed economic strategy, we’ve been making all the right moves.

Over the past two years, Gov. Jan Brewer and the Legislature have worked hard to make Arizona a state that is known for job growth and creation. They’ve decreased the corporate income tax rate, lowered the tax on business property and equipment, cut taxes on investment income and have made Arizona’s tax code more attractive to businesses selling goods and services outside our borders.  While California was raising its taxes (again), our voters rejected a massive permanent tax hike. We’ve also balanced our budget.

The per-capita income going to taxes in Arizona is just 8.7 percent, compared to the national average of 9.8 percent and California’s burden of 11.8 percent. That leaves more money for vacations to your favorite beaches (including those in California) or for purchasing a Major League Baseball team.

We’ve also cut back on unnecessary regulations, freeing up businesses to expand without the worry of frivolous government interference.  You can’t even go into a Starbucks in California without a Proposition 65 warning of the dangers of coffee.

All of these efforts have resulted in Arizona’s move up the leaderboard.  Arizona received the title of number one state for entrepreneurial activity in 2011 and was ranked a Top-10 state for business in 2012. We also ranked second – just behind North Dakota – for states with the best job-growth forecast.

I’ll put this all in terms you can appreciate:  If Arizona competed in The Masters of economic competitiveness, we’d end up with the coveted green jacket.

Phil, you know better than anyone that you can’t beat the golf here. You’re already a crowd favorite come Waste Management Phoenix Open time. So go pack your clubs and call the movers.

Just don’t take too long. I could really use some tips on my swing.

Sincerely,

Glenn

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry. The Arizona Chamber of Commerce and Industry is committed to advancing Arizona’s competitive position in the global economy by advocating free-market policies that stimulate economic growth and prosperity for all Arizonans. 

Brewer

Gov. Brewer, legislators ready to lead in 2013

Just as we always do this time of year, the Arizona Chamber of Commerce and Industry today kicked off the next legislative session with our annual Legislative Forecast Luncheon. This year’s edition was held at a packed Phoenix Convention Center, where the 1,000-person crowd had the opportunity to hear from Gov. Jan Brewer and state House and Senate legislative leaders about their vision for the 2013 session.

We also use the event as the Chamber’s opportunity to roll out our Business Agenda, and this year was no different. The Business Agenda outlines the top legislative priorities for Arizona’s business community. The Agenda, in addition to highlighting the Chamber’s priorities at the Legislature and in Washington, outlines the short and long-term goals for the Arizona Manufacturers Council and the Chamber’s policy issue committees.

In 2013, we’ll be working at a state level to:
> Support a world class education system, including the successful adoption of the Arizona > Common Core Standards.
> Reduce health care costs for business and restore Proposition 204.
> Expedite business permitting and licensing requirements.
> Support sales and use tax uniformity and simplification.
> Reduce the insurance premium tax.
> Allow relevant military experience to count towards training requirements for professions that require a state license or certification.

I thought Gov. Brewer’s comments today were excellent. She spoke with conviction behind her contention that the state’s sales tax system – known in Arizona as transaction privilege tax, or TPT – is overly complicated and needs reform. She was backed up in that assertion by the comments from the panel. The Chamber looks forward to adding its voice to this choir that business needs a simpler TPT system, which will in turn lead to greater compliance. TPT reform will make a great next chapter in the tax reform that this governor and the Legislature have advanced the past two years.

I was also heartened to hear the governor make clear her support for Arizona’s Common Core Standards. These new rigorous education standards will play a big role in ensuring that Arizona’s students are prepared for higher education and the workforce. By raising the bar and our expectations, we’re also strengthening Arizona’s competitiveness, making our state even more attractive to job creators as an outstanding place to invest. The Chamber will be in full support of the full integration of the Common Core into Arizona classrooms and the transition from the current AIMS exam to the PARCC assessment, which will be closely aligned with the Common Core curriculum.

The governor also took the opportunity to reflect on a major accomplishment from last session, personnel reform. Because of the work of the governor and the Legislature, more Arizona state employees are treated like their counterparts in the private sector. Last year’s reforms are not just about making it easier to dismiss poorly performing state employees, but rather about making it easier to attract talent and position the state to retain its talented workforce. We were proud to have supported the governor’s personnel reform plan so vigorously.

During our panel featuring Senate President-elect Andy Biggs, Senate Minority Leader-elect Leah Landrum-Taylor, House Speaker Andy Tobin and House Minority Leader Chad Campbell, I was encouraged by the comity (and a little comedy) on display from all four legislative leaders. While there are clear differences in ideology and policy, I know everyone in attendance was impressed by their commitment to service and doing the right thing for Arizona.

Like any legislative session, there will no doubt be some dust ups over the path the state should take in critical areas of importance like health care, education, taxation and regulation. But because of our governor and Legislature’s desire to ensure a bright future for our state, I am confident that 2013 will be an excellent year at the state Capitol.

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry. The Arizona Chamber of Commerce and Industry is committed to advancing Arizona’s competitive position in the global economy by advocating free-market policies that stimulate economic growth and prosperity for all Arizonans. http://www.azchamber.com/

boeing-phantom-ray

It takes fuel to win tech race

Many of us can relate to thinking of Arizona’s economy as an automobile race. To win, you need a smooth race course, a fast car, a winning driver and high-powered fuel.
Carrying that analogy into Arizona’s technology sector, it’s clear that a lot of resources have been invested and progress has been made in building a world-class race course.  We’ve made tremendous strides in creating a business climate and technology environment for facilitating both private and public sector support to address the needs of Arizona’s technology businesses.

The Arizona Technology Council has worked collaboratively with many different technology champions to build this course. Technology issues are supported by the Governor’s office, the state’s legislature, the Arizona Commerce Authority, the Arizona Chamber of Commerce and Industry, and more.

Technology incubators and shared space facilities such as Gangplank in Chandler, Avondale and Tucson; Hackspace and Venture Catalyst at ASU’s SkySong in Scottsdale; BioInspire in Peoria; Innovation Incubator in Chandler; AzCI in Tucson; and AZ Disruptors in Scottsdale are making sure that today’s innovators are being given the right support, tools and environment to create the next big thing.

Collectively, our wins have included the passage of a tax credit for qualified research and development that is the best in the nation, the creation of the first statewide Arizona SciTech Festival and the birth of the Arizona Innovation Institute, to name a few.
Arizona’s technology industry also has great race cars. These are the technologies and intellectual property that create wealth and jobs driven by both Fortune 500 companies and entrepreneurs.  Companies such as Intel, Microchip Technologies, Freescale, ON Semiconductor and Avnet can all be found here.  Nearly all of the largest aerospace and defense prime contractors in the nation are located in Arizona, including Boeing, Honeywell, Lockheed Martin, Northrop Grumman and General Dynamics.

The state’s entrepreneurial spirit is reflected in companies such as WebPT, Infusionsoft, Axosoft, iLinc and Go Daddy that were founded in Arizona along with the many innovators that are coming to the table every day with new ideas rich in technology.

These companies large and small are driven by some of the greatest race car drivers the nation has produced.

But when it comes to fuel, Arizona’s economy has always been running close to empty. We lack the vital capital needed to win the race. Having access to angel investors, venture capital and private equity as well as debt instruments is critical to Arizona’s success.
The situation has not been improving on the equity side of the fuel equation. To offer some relief, the Arizona Technology Council is proposing legislation that would create a system of contingent tax credits to incentivize both in-state and out-of-state investors to capitalize Arizona companies.  This program, called the Arizona Fund of Funds, would allow the state to offer $100 million in tax incentives to minimize the risk for those seeking to invest in high-growth companies.  The state government’s role would be to serve as a guarantor through these contingent tax credits in case the investments don’t yield the projected results.  Expect more information on this important piece of legislation as it advances.

On the debt side of the fuel equation, there are encouraging signs that the worst of the credit crunch may be over. Early-stage companies need access to debt instruments, or loans. Capital is needed for equipment and expansion. A line of credit can help early-stage companies through ongoing cash-flow issues. But loan activity is still modest in Arizona for small companies. It remains heavily weighted toward the strongest corporate and consumer borrowers.

Capital goes hand in hand with innovation, high-paying jobs and cutting-edge technology, products and services. Before Arizona’s economy can win the race, we will need to become more self-sufficient at providing the fuel necessary to be a winner.

Steven G. Zylstra is president and CEO of the Arizona Technology Council.

Hamer - June 2011-fornewsletter

The 2012 Hammer Awards

It’s that time of year to hand out some honors for the year’s best. So it is without further ado that I bring you the Third Annual Hammer Awards.
Impact Player of the Year: State Treasurer Doug Ducey
The keeper of the state’s checkbook took down Proposition 204 in a rout, and for that Doug Ducey wins a Hammer. Before he arrived on the scene, the tax measure was poised to coast to victory with no opposition. Ducey rallied opponents to make a clear case to voters why Arizona could do better by its education system than to saddle the state with a permanent tax increase that wouldn’t advance proven reforms. Ducey hit the exacta when Proposition 118, which would help create a more reliable funding stream into the K-12 system, also passed.
Best Public Policy Effort of the Year: (tie) Personnel Reform and Competitiveness Package 2.0
Two major policy efforts in 2012 deserve Hammers.
Gov. Jan Brewer and the Legislature, led by Senate President Steve Pierce and House Speaker Andy Tobin, were firing on all cylinders in 2012 with their passage of a sweeping personnel reform package that injects a new and much needed level of accountability and professionalism into the state’s employment system. Newly appointed Brewer chief of staff Scott Smith deserves kudos for shepherding the package through the Legislature with the help of two of  the state House ’s brightest rising stars, Justin Olson and Justin Pierce.
As if that weren’t enough, though, the governor and Legislature also passed a major economic competitiveness package in 2012 that built on the gains passed in 2011. Who says you can’t have back-to-back once-in-a-generation job creation bills? This year’s wins included the state’s first ever reduction in the tax on investment income (capital gains), and it now makes Arizona more attractive from a tax standpoint to service providers who sell their services beyond the state’s borders, bringing the service sector into alignment with manufacturers. Gov. Brewer’s lead policy adviser and tax guru Michael Hunter, state Rep. J.D. Mesnard, who was honored as the Arizona Chamber’s Representative of the Year, and Arizona Commerce Authority CEO Sandra Watson all deserve a Hammer for a job well done.
Comeback Player of the Year: Matt Salmon
The Hammer goes to former and now Congressman-once-again Matt Salmon for his return to the U.S. House 12 years after he stayed faithful to his term limits pledge that he made when he was a member of the class of 1994. As someone who had the honor of spending a good chunk of his professional life working for Matt, the East Valley will be well served by its incoming congressman who, by having served three terms in the 1990s, brings to his job a perspective (and seniority) few have.
Expect Big Things: Steve Chucri
Maricopa County Supervisor-elect Steve Chucri is one to watch, so he earns the Expect Big Things Hammer. Steve is one of the most affable guys you’ll ever meet. Adding his voice to the Board of Supervisors will ensure that the needs of Maricopa County will always come before any personal political agenda. Drawing on his experience as the chief of the Arizona Restaurant Association, I expect he’ll inject a pro-business point of view into the Board’s work that will help Maricopa County grow more jobs.
Southern Arizona Star: Lea Marquez-Peterson
Lea Marquez-Peterson, the president and CEO of the fast-growing Tucson Hispanic Chamber of Commerce, wins the Hammer for her groundbreaking work to illuminate business issues for southern Arizona’s Hispanic and Spanish-speaking community. Through her work on votaaz.org, an online guide to candidates and election information, Lea is ensuring that more people than ever understand public policy’s impact on business.
I’ll Be Back: Kirk Adams
Former state House Speaker Kirk Adams may have come up short in his bid for Congress, but he’s simply too talented a leader and respected as a conservative voice to be gone from the scene long. Here’s hoping it’s won’t be too long until Kirk returns to a position of influence.
Emerging Mayor: Phoenix Mayor Greg Stanton
If I were pressed, I might be able rattle off the names of a dozen or so big city mayors around the country. Phoenix Mayor Greg Stanton gets the Hammer Award for now having clearly joined that small list of mayors whose influence exceeds the borders of his or her city. Mayor Stanton and his colleagues on the Council are doing great things in Phoenix. The Mayor has taken the lead in advancing trade with Mexico, developing a biotech hub, education and pension reform. Because of Stanton and City Manager David Cavazos, when cities around the country are looking for best practices, they’ll look to Phoenix.
Councilmen of the Year:  Sal DiCiccio and Tom Simplot
Phoenix has dramatically reduced the time it takes to get a project through the permitting process, an initiative headed up by Councilmen Sal DiCiccio and Tom Simplot.  This effort has received national attention, including from columnist George Will.
Buy this Stock: Danny Seiden
Danny Seiden, Maricopa County Attorney Bill Montgomery’s political adviser, wins the Hammer for being a stock to watch in 2013. He was on the inside of two big wins in the 2012 election cycle: the defeat of Props 204 and 121, the so-called open primary measure, all while working with Montgomery to return the office of county attorney to respectability. And to boot, he’s married to one of Arizona’s most talented women, Southwest Gas executive Ann Seiden. Buy this stock!
The Next Generation: Martinez and Romero
They’re barely old enough to rent a car, but Gretchen Martinez (formerly Conger) and Lorna Romero each wins a Hammer for representing the next generation of Arizona politics. Martinez was the successful No on 204 campaign manager while doing her day job directing advocacy efforts at the Arizona Chamber of Commerce and Industry. Romero last month was named Gov. Brewer’s director of legislative affairs, where she helps shepherd the governor’s priorities through the legislative process.
Serious Work for a Funny Man: Chris Bliss and the Bill of Rights Memorial
Professional juggler and comedian Chris Bliss wins a Hammer for his dogged determination to install monuments to the Bill of Rights in civic spaces across America. Thanks to Bliss’ work and legislation introduced by U.S. Rep.-elect Kyrsten Sinema, Arizona last week became the first state to dedicate a monument. The limestone pieces with the words of the first 10 amendments to the Constitution can be found at Wesley Bolin Plaza at the state Capitol.
Former Roommate of the Year: Steve Voeller
This is no slight to anyone else who split the rent check with me during my 20s, but Steve Voeller wins the Hammer for Former Roommate of the Year for his tireless and effective tax policy work at the state Capitol as head of the Arizona Free Enterprise Club. Steve is now headed off to serve as Sen.-elect Jeff Flake’s chief of staff. A trusted adviser for years to the senator-elect, Steve will be an excellent leader for the Flake office as he shuttles between D.C. and Arizona. The Chamber wishes him the best of luck in his new post.

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry. The Arizona Chamber of Commerce and Industry is committed to advancing Arizona’s competitive position in the global economy by advocating free-market policies that stimulate economic growth and prosperity for all Arizonans. http://www.azchamber.com/.

sales.tax

Governor’s task force making right moves on sales tax

One of the Arizona Chamber of Commerce and Industry’s top legislative priorities for 2013 is to simplify our state’s sales tax system.  Our sales tax is so complicated that you might be surprised to learn that Arizona does not technically have a sales tax. Rather, we have a transaction privilege tax (TPT), something that requires certain merchants to pay for the “privilege” of selling taxable items and a use tax, which is aimed at consumers who purchase certain goods to pay.

Thanks to the leadership of Gov. Jan Brewer and the state Legislature, we have made tremendous progress in tax reform over the past two years. Our corporate income tax rates, capital gains tax rates, business equipment and property assessments are all being reduced to put the state in a better competitive position and to win back the jobs we lost in the Great Recession.

But when it comes to the TPT and use tax, the state is out of kilter. After the expiration of the temporary one-cent sales tax in June 2013, our overall sales tax burden (state and local) will be among the 15-highest in the country. However, perhaps even more problematic than the tax rate will be the incredible complexity of the system, which places substantial administrative burdens on companies – particularly small businesses – and also leads both to willful and inadvertent tax avoidance.

Gov. Brewer on May 11 wisely issued an Executive Order establishing the Transaction Privilege Tax Simplification Task Force, premised on the following three points:

> Arizona has one of the most complex sales tax systems in the country;
> Taxpayers have expressed a clear desire to see reforms enacted that will modernize and simplify the TPT; and
> It is in the interest of taxpayers and state and local governments to make the tax code easier to understand, comply with and administer.

Lead by one of the state’s smartest and savviest tax and policy experts, the governor’s director of policy, Michael Hunter, the task force recently released a draft report. The report, which in an easy to digest 22-page document captures the group’s 17 meetings conducted over a five-month period.  The key recommendations:

State law should allow only a single audit, in accordance with existing statutory schedules, including a multi-jurisdictional audit if applicable.
The current tax structure for contracting activity is a mess and should be transitioned to a tax on materials at the point of sale, which if done properly should ease compliance and increase the overall pot of tax dollars available to local communities.
The State Legislature should act to ensure that Arizona is well-positioned to benefit from the taxation of online retail and remote sales.
The state, cities and towns should standardize TPT licensing
When fully implemented, the online portal required by legislation authored by Rep. Rick Gray (HB 2466) should be expanded to issue all TPT licenses and allow for all TPT tax returns to be filed through the portal.

These are all sound, commonsense ideas. While there is much work to be done to implement all of these recommendations, it is exciting that we have taken the first step to simplify a tax system so complicated that few Arizonans even know what it’s called.

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry. The Arizona Chamber of Commerce and Industry is committed to advancing Arizona’s competitive position in the global economy by advocating free-market policies that stimulate economic growth and prosperity for all Arizonans. http://www.azchamber.com/

immigration

Tackle Popular Immigration Reforms Now

Following the results of the election, there appears to be a real window in Washington, D.C. to do something meaningful on immigration.

The just reelected president has made immigration reform a first tier priority.  And many Republicans believe that dealing with this issue is essential to restoring to their party some attractiveness with the two fastest growing groups of immigrants: Asians and Hispanics.  Both groups clobbered the GOP in the election, with approximately 66 percent of Hispanics breaking for the president and Asians going into the president’s column at a whopping 73 percent.

The inability of Republican candidates to capture votes from these important demographic blocs is jarring. In 1996, the GOP Dole-Kemp ticket won 48 percent of the Asian vote. In his successful 2004 reelection campaign, President Bush won over 40 percent of the Hispanic vote. Much has changed.

But more important than any political gains to be had are the economic benefits. As American Enterprise Institute fellow Ben Wattenberg wrote a few months ago, immigration is a comparative advantage for the United States. We need to take full advantage of the fact that the best and the brightest, the hardest working people from around the world desire to work and live in the United States.  This isn’t a situation that we should run from. This is something we should fully embrace.

While there may be the urge to try to fix the entire immigration system in one fell swoop, an all-at-once approach imploded a few years ago.  A step-by-step approach focused on making incremental gains may make more sense.

Yes, we need to bolster security and continue to work towards operational control of the border, but we also need to work on other areas ripe for reform now.

The three areas that should be addressed first:  1) some sort of codification of the president’s mini-Dream Act; 2) a path to increasing the number of STEM (science, technology, engineering and math) and higher-skill visas; and 3) improvements to our existing temporary worker programs.

Already the president has gone forward via executive order with a Dream Act-type plan that provides a renewable work permit for those who entered the country illegally at a young age and who meet certain conditions, such as military service or enrollment in college.

Shoring this up via legislation is not necessarily dead on arrival in Congress. You will recall that Republican presidential nominee Mitt Romney criticized the president’s process behind this new program, but he did not attack the substance.  And Republican Sen. Marco Rubio of Florida had been working on a similar proposal to the president’s actions before the executive order.

On visa reform, the U.S. House as early as this week is poised to act on legislation that would increase the number of STEM visas and make it easier for those with green cards to bring over family members.  The trade-off would be an elimination of the diversity visa program.

The public support for reform is there. A poll conducted for the Arizona Business Coalition over the summer found support for the president’s action on undocumented immigrants brought here as children, with 56 percent of respondents favoring the president’s policy while 41 percent were opposed.  This proposal was supported by 76 percent of Hispanics with only 21 percent in opposition.

Regarding Arizonans’ support for a proposal similar to the STEM legislation to be considered by the House later this week, the results are clear. The same poll asked the following question:

“The proposal would create a new category of green cards for highly-skilled foreign students who have earned a masters or doctorate degree in science, technology, engineering, or mathematics from an American university and have received a job offer to work in the U.S. This would allow these foreign-born students to stay, work, and pay taxes here in the United States. ”

The results?  Eighty percent support and only 19 percent in opposition.

In addition to this STEM proposal we should pass something along the lines of what Sen.-elect Jeff Flake has proposed with his STAPLE Act, which would exempt international STEM graduates educated in the U.S. from visa quotas.

There is also support for addressing obvious U.S. temporary worker needs. Arizona voters were asked:

“In general, would you support or oppose a guest worker program that allows workers from Mexico to cross the border legally and register with American authorities to perform seasonal work on a temporary basis in Arizona?”

The results were 83 percent of respondents in support and only 16 percent registering in opposition.

The Arizona Chamber of Commerce and Industry is prepared to help advise policymakers on these items, and we’ve established new policy committees – Federal Affairs and Hispanic Business and Emerging Markets – to help provide the analysis they require.

Forgive the sports analogy, but if immigration were a baseball game, we’re down by four runs. It would be nice to hit a grand slam and solve all of our immigration challenges, but we can get the same results by stringing together singles and doubles.

There’s a real opportunity to make substantive reforms to our country’s immigration system. Let’s not let this opportunity pass us by.

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry. The Arizona Chamber of Commerce and Industry is committed to advancing Arizona’s competitive position in the global economy by advocating free-market policies that stimulate economic growth and prosperity for all Arizonans. http://www.azchamber.com/

veterans

Advancing Arizona’s Heroes

This week, our nation took time to celebrate the enormous contributions and sacrifices of those who have served in our Armed Forces. Just in time for Veterans Day, the Arizona Chamber Foundation released its latest policy brief, Economic Opportunity for Arizona Veterans. This new report highlights the importance of veteran employment and outlines specific policy recommendations for Arizona.

Arizona is home to an estimated 76,000 Second Gulf War veterans. According to national unemployment numbers for August 2012, these veterans face an unemployment rate of 10.9 percent, compared to the national rate of 8.1 percent. These veterans serve as an untapped resource for Arizona employers – one that has the ability to significantly grow and help diversify Arizona’s economy.

Military service prepares veterans with work ethic, teamwork and leadership skills. There are clear economic opportunities and synergies between the talents veterans bring to the workforce and the needs of private industry. Yet many veterans continue to face obstacles when transitioning to civilian employment. As the report recognizes, it’s incumbent on business and elected leaders to harness this talent by:

1) Adopting best practices for hiring and retaining veterans

2) Implementing policies to  facilitate the transition from military to civilian life

3) Streamlining and clarifying the wealth of public, private and non-profit resources that are available

To that end, the Arizona Chamber has established the Veterans and Military Affairs Committee with a vision of making Arizona one of the most attractive states for veterans to live and work. The committee serves as a resource and connector for employers that are interested in helping veterans transition from military service to civilian employment. The committee also works to support public policies that aid in this transition.

The committee has created a resource toolkit to help veterans and employers navigate the wide array of resources available. Additional next steps in addressing this issue include:

1) Finalizing a specific policy proposal to allow relevant military experience to count toward the certification requirements for occupations requiring a professional license.

2) Developing a strategy for disseminating company best practices for hiring and retaining veterans, reservists and National Guardsmen.

3) Partnering with like-minded organizations and interested elected officials to provide meaningful connections between employers and veterans.

Media response to these efforts has been overwhelmingly positive. Yesterday’s edition of Arizona Illustrated featured Suzanne Kinney, executive director of the Foundation and Captain Craig Doyle, chairman of the Veterans and Military Affairs Committee, in a discussion on the report’s findings and the importance of this topic. The issue is gaining traction and the efforts of Arizona businesses are being recognized.

It’s important to acknowledge the cross-section of Arizona Chamber member companies that were interviewed for the Foundation’s report: Amazon, Intel, Magellan Health Services, Northern Arizona University, Raytheon, Swift Transportation, University of Phoenix, USAA, and Wells Fargo. These companies along with the Arizona Department of Veterans Services provided valuable insight regarding best practices for recruiting and retaining vets. Many other chamber member companies, such as US Airways with their nationally-recognized Honor Flight Network, are taking action to support veterans as well. A key goal of the Veterans and Military Affairs Committee is to help other interested employers adopt proven strategies that will lead to more veterans successfully transitioning to civilian employment.

The Chamber also owes many thanks to Captain Craig Doyle for his leadership and continued service.
An Operation Iraqi Freedom veteran, Captain Doyle recently returned from the Asian Pacific Theater, his third activation since September 11, 2001. While there, he was the first Naval Reserve Officer to serve as Commanding Officer of the Naval Supply Systems Command (NAVSUP) Fleet Logistics Center (FLC) Yokosuka.  His mission included all operational, planning and logistical support for the Far East region. With both business and military leadership experience, Captain Doyle brings indispensable personal experience to this important endeavor.

We look forward to further advancing the mission of the Veterans and Military Affairs Committee during the 2012 legislative session and continuing the recognition of this issue throughout the state. We will be working diligently to help more Arizona businesses implement proven programs to recruit, promote and retain veterans and to advance public policies that support veteran employment and entrepreneurship.

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry. The Arizona Chamber of Commerce and Industry is committed to advancing Arizona’s competitive position in the global economy by advocating free-market policies that stimulate economic growth and prosperity for all Arizonans. http://www.azchamber.com/

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Heroes, Goats and ‘Pure Idiocy’

In case you’ve been living in a cave, next Tuesday is Election Day. Here are a few thoughts about some of the folks that have distinguished themselves as true leaders and others who have made us tune them out this election season.

The Heroes
 
The Treasurer

Treasurer Doug Ducey’s leadership on Proposition 204 is astonishing.  Before his involvement the tax measure was cruising to what many – including me – believed to be a double-digit win.  But now, from every poll that I have seen – including in swing districts in southern Arizona – it is behind and headed for defeat.

Treasurer Ducey has raised dollars, rallied the major chambers and small business groups and an impressive list of mayors and has articulated a clear case on the ills of what would be the state’s largest tax increase. Win, lose or draw, Treasurer Ducey should be recognized for his efforts.

The real education reformers

One of the savviest and wisest policy minds in this state, Jaime Molera, deserves praise for his gutsy opposition when Prop. 204 first hit the streets.  Also making the case for real education reform is Dr. Craig Barrett, who has made clear that 204 is rotten policy. The retired chairman and CEO of Intel delivers as effective a speech as any educational leader in the country on what it takes to improve our schools.  We all agree we need to improve our K-12 education system.  A proposal that permanently raises the state’s sales tax to the second-highest in the nation without directing dollars to proven education reforms is obviously not the answer, though.

The President and the Speaker

Steve Pierce and Andy Tobin have been paragons of leadership at the Legislature the past two years, and in the last year have led their chambers as Senate President and House Speaker, respectively.  Not only have the two championed passage of the most comprehensive set of job creation proposals in the nation, they have passed responsible budgets and moved the state past divisive issues.  As a result of their work and the vision of Gov. Jan Brewer, Arizona is now ranked as a Top-10 state from Chief Executive Magazine and rated number one by the Kauffmann Foundation’s Entrepreneurial Index.

Both President Pierce and Speaker Tobin have raised hundreds of thousands of dollars to protect viable and valuable incumbents, particularly those now thrust into more competitive districts as a result of the redistricting process.

I find it humorous that some would attack Pierce in particular on fundraising.  He has raised more than anyone in the state, perhaps ever (not counting unions; see below) for legislative races. Compare his Herculean efforts with any challenger or even the state GOP and it is obvious that any criticism is crass political posturing. But if you don’t think the president and speaker have done enough, there’s still time to write a check.

The Goats
 
The Pinal County GOP Brain Trust

Sen. Andy Biggs deserves credit for his role in shaping a strong budget this past year.  With that said, it makes no sense to listen to a few angry and misguided Pinal County GOP poobahs and change horses in legislative leadership when under President Pierce’s direction the Senate has been firing on all cylinders. The thought of replacing Andy Tobin’s steady hand with freshman Steve Smith, no matter his enthusiasm, is absurd.

What is particularly outrageous is that this call has been issued at the end of an election in an area of the state that is so hotly contested. Their time in these last precious hours before the polls close would be better spent working to ensure that candidates like Frank Pratt and TJ Shope have a seat in the House of Representatives come January.

Richard Carmona

Rich Carmona’s ad implying an endorsement from Senators Jon Kyl and John McCain is both deceitful and stupid.  Not to provide proper context from remarks made from our senators over 10 years ago is wrong.  Carmona launched his ad on the 45th anniversary of Sen. McCain being shot down over Hanoi. Instead of taking that day to thank and honor Sen. McCain, Carmona instead chose to use the senator to deceive voters.

The Carmona campaign didn’t do itself any favors when it, in response to Sens. McCain and Kyl’s anger over the ad, dismissed the senators as career politicians. The Arizona Republic nailed it in Tuesday’s editorial when it called the Carmona charge, “pure idiocy.”

Carmona left himself open for a strong counterpunch, and the senators connect in their response ad. The counter ad should be enough to put Congressman Flake over the top and into the U.S. Senate.
 
The name callers

If you want to talk about lazy language, the charges that John McComish is an extremist don’t pass the laugh test.  McComish is a business-minded, independent former chamber executive who supports jobs-friendly legislation and stands strong against the bad ideas.  And hopefully there is a price to pay for the bozos who took a page from the Carmona playbook and suggested that Sen. Jerry Lewis endorsed Russell Pearce.  For anyone awake in Arizona, you’ll recall Sen. Lewis defeated Pearce in a recall race last year. You can Google it.

Final Observations

For those not convinced that paycheck protection is urgently needed to prevent union members’ paychecks from being raided to underwrite political campaigns, one need just to look at what is going on in the Senate races involving Senators McComish and Lewis.

Some feel that appeasement works and that certain unions will play nice if left alone.  Well, after somewhere in the neighborhood of $300,000 in outside dollars -much of it union money – launched against Sen. McComish, we get a sense of how well appeasement works.

If you’re shopping for an early Christmas or Hanukkah gift for Arizona, I recommend paycheck protection legislation.

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry.

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The Arizona Chamber’s guide to the ballot propositions

With less than three weeks remaining before the 2012 General Election, many Arizonans are getting ready to put their early ballots in the mail. Before you fill in those boxes with ink and head to the post office, please take a moment to review the Arizona Chamber of Commerce and Industry’s recommendations on statewide propositions.

The Chamber has weighed in on five ballot measures, taking a position of support on four and opposing one.

Here’s a brief look at each of our positions:

Proposition 116 – Property Tax Exemptions – Support
The Arizona Chamber joins the Arizona chapter of the National Federation of Independent Business in supporting Proposition 116, which will help small businesses grow and create jobs by reducing the tax burden on their equipment and machinery. A tax on the value of equipment and machinery increases the fixed cost of operating a business in Arizona and creates a disincentive to new investment. Proposition 116 would exempt the value of equipment and machinery equal up to the wages of 50 Arizona workers (now about $2.4 million), making it more likely Arizona businesses will hire new employees and purchase necessary equipment.

Proposition 117 – Property Tax Assessed Valuation – Support
As our friends at the Arizona Tax Research Association have pointed out for years, our state’s property tax system is overly complicated, with two valuations: full cash value and limited property value. Under Proposition 117, the annual growth of the limited property value would be limited to five percent, and it wouldn’t exceed the full cash value. Also, the limited property value would be the only taxable value, helping to deliver a much greater level of predictability and stability in Arizona’s property tax system.

Proposition 118 – Establishment of Permanent Funds – Support
Passage of Proposition 118 will restructure the distribution formula for the Permanent Land Endowment Fund, whose largest beneficiary is K-12 education. Currently, in some years the formula distributes tens of millions of dollars; in other years zero.  This reform will smooth out the distribution so that there is some allocation to education every year.  The result will bring about reliable and consistent K-12 education funding with no new taxes and no new spending from the General Fund. Arizona Treasurer Doug Ducey deserves applause for crafting this reform.

Proposition 119 – State Trust Lands – Support
Proposition 119 will help prevent incompatible land use that could put at risk the jobs associated with military bases. Arizona’s military installations contribute over $9 billion in economic output. Proposition 119, whose supporters include Land Commissioner Maria Baier and Greater Phoenix Leadership, will help ensure they are able to complete their critical missions and remain an integral part of Arizona’s economy for decades to come.

Proposition 204 – Permanent Sales Tax Increase – Oppose
The Chamber recognizes that a high-performing education system requires the financial resources necessary to produce a highly qualified workforce. To that end, the Chamber strongly supported Proposition 100 in 2010, which established a temporary one cent per dollar sales tax, and over 10 years ago our organization supported Proposition 301. We also supported new funding this past year at the Legislature to fund Move on When Reading, a proven reform targeted at ensuring that students exit the third grade with the ability to read. Going forward we will support efforts to properly implement the Common Core standards, which is a state-led effort to increase educational standards so America’s students can compete with the best and brightest students from around the world.

Unfortunately, this new $1 billion a year permanent tax would leave Arizona with the second highest sales tax rate in the country — leaving a number of cities with a combined rate over 10 percent. It would make future efforts to reform our sales tax code and help to create jobs much more difficult. Not surprisingly, many chambers and prominent business groups oppose this effort including the Greater Phoenix Chamber of Commerce, NFIB, the Arizona Small Business Association, the Tucson Hispanic Chamber of Commerce and the East Valley Chambers Alliance. The education reform aspects are basically non-existent and simply not worth the risk to our state’s economy. Arguably two of the most prominent education reform advocates in the state, Dr. Craig Barrett and former State Superintendent of Public Instruction Jaime Molera have come out in opposition to Prop. 204. The Arizona Republic wrote a thoughtful piece opposing Prop. 204 as well. We strongly urge a no vote on Proposition 204.

We believe that by following the Arizona Chamber’s recommendations on these important ballot measures Arizona voters will be casting a vote in favor of growing jobs and increasing our state’s economic competitiveness. For more information on these items and candidate races, be sure to check out the Arizona Prosperity Project’s website, a convenient tool to learn more about the big issues in this election.

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry.

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Prosperity Project educates businesses about election issues

Last week I talked about jobs – the issue everyone should be talking about, but isn’t.

Jobs and the economy are the number one issues for voters this election season. The majority of voters want to enter the voting booth armed with facts about the candidates on their ballot. They want to know how these candidates plan on getting America back to work. Will the policies they support help lower the country’s too-high unemployment rate?

There is an easy-to-use tool voters can use to find out about the positions held by the individuals on the November ballot, including where candidates stand on jobs and the economy: The Arizona Prosperity Project.

The Arizona Prosperity Project is a non-partisan voter education tool available to all Arizonans. It’s based upon the belief that when Arizona citizens are informed and active in government and elections, our families, our communities and our state benefit.

Visitors to azprosperity.org can access objective information about each of the candidates they’ll see on their ballot. Information includes voting records for incumbents and candidate questionnaires for challenger candidates; everything necessary to make an informed decision when voting by mail or on Election Day.

In addition, azprosperity.org offers an issues section, which outlines topics important to Arizona’s job creators. It’s the go-to location for learning about legislative actions on each topic and how the public can be involved.

VotaAZ.org is another excellent resource for Arizona voters. Developed in partnership with the Arizona Chamber and the Tucson Hispanic Chamber of Commerce, VotaAZ educates Hispanic voters about issues that impact job security, economic competitiveness, wages and benefits.

Similar to azprosperity.org, visitors to VotaAZ.org can access – in Spanish or English – information on the candidates they’ll see on their ballot, along with viewing past election results and guides to the democratic process. VotaAZ also allows users to register to vote, find their local polling place and learn about Arizona’s voter ID Laws.

But the Prosperity Project is more than just an outstanding online education tool. The P2 can be deployed onsite at your business, too, with collateral material that explains to employees where candidates stand on important issues, voter registration drives, and even customizable websites for your company to share non-partisan information with employees about the issues important to your particular business or industry.

As we recover from the Great Recession, we’ve learned that good policy matters. Businesses of all sizes and industries have felt the effects – both good and bad – of decisions made in Washington, D.C, at the state Capitol or City Hall.

Voters have an opportunity to make a difference this election season and influence who will be making decisions in the next Congress, Legislature or city Council. They have the chance to initiate a discussion about jobs and ensure their candidates are offering real solutions to end our over 40-month streak of unemployment over 8 percent. Arizona Prosperity Project and VotaAZ provide a solid foundation for this important discussion.

To learn more about the Arizona Prosperity Project and how it can be put into action at your business, contact Erica Wrublik at (602) 248-9172.

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry.

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Hamer: Let’s talk about jobs

The main issue that every candidate from president to town council should be talking about this elections season – but isn’t – is jobs.

Every public opinion poll cites jobs and the economy as the number one issue. Voters want to know what type of policies candidates are going to support that will get our country’s stubbornly high unemployment numbers down.

We’re sitting on 43 straight months of unemployment above 8 percent. Never mind the number of underemployed Americans or those so discouraged they’ve quit looking. These are numbers that have been too high for too long.

There is a way out of these doldrums, though, and it’s not exactly a state secret. Arizona has been named a top-10 state for business by CEO Magazine. The Kauffman Index of Entrepreneurial Activity has us ranked number 1. And Arizona ranks number 2 for expected job growth. If you’re a candidate looking for a jobs plan, look to Arizona.

First, don’t raise taxes on income and capital as we limp out of this economic downturn. A major element of the so-called fiscal cliff facing our country is whether we’re going to allow the Bush-era tax cuts to expire. We should not.

Gov. Jan Brewer and the Legislature over the past two years demonstrated they understand this well. Outside of fixing the state’s budget woes, more effort was placed on job creation than any other issue.
They made our state more fertile for job growth by lessening the tax burden on job creators and capital in Arizona. Together they’ve reduced the corporate income tax rate, lowered the tax on business machinery and equipment, instituted the state’s first cut in taxes on investment income and fixed our tax code to make the state more attractive for businesses selling goods and services outside our borders. They had a detailed plan and they executed.

Next, throw up a big stop sign on new regulations. Uncertainty is a jobs killer. Businesses aren’t going to expand if they’re constantly looking over their shoulder for the next new government rule or regulation. Arizona has gotten it right in this department. Gov. Brewer bolstered her pro-business bona fides when earlier this summer she extended the regulatory moratorium that she put in place as her first official action when she took office. The Obama administration has taken the opposite tack, pursuing an aggressive regulatory agenda at the EPA, NLRB and other agencies unlike anything this country has ever seen.

The feds should pass their own regulatory reform package. One bill, the Red Tape Reduction and Small Business Jobs Creation Act, seeks to slow the growth of regulations until the nation’s unemployment rate falls below 6 percent. The bill passed the U.S. House in July, but now it’s stuck in the Senate.

The path should also be cleared for America to take advantage of our robust energy sources. We have been given a gift in the emergence of hydraulic fracturing, or fracking, which has unleashed an oil and gas production boom in our country. This energy boom has occurred despite the Administration’s efforts to over-regulate this area, block the Keystone Pipeline, push back deepwater drilling and use every means available to block new coal production and shutter older facilities.

Every member of Congress should be required to make a fact-finding trip to North Dakota, where the energy boom has led to a strong housing market and the nation’s lowest unemployment rate. Energy is so critical to our economic recovery that it could be the lynchpin that would allow us to actually get serious about entitlement reform.

We should also be more aggressive in the area of trade. Some progress has been made here (finally) with the implementation of new trade deals with South Korea, Colombia and Panama. We should be wary of candidates in both parties who have a tendency to make noise about going down the road of protectionism.

Finally, say no to automatic spending cuts, especially in defense. As Secretary of Defense Leon Panetta says, if the budgetary axe known as sequestration falls on defense spending, “We’d be shooting ourselves in the head.”

This is lunacy. We are on the cusp of creating a man-made recession, with defense firms around the country preparing their workforces for potentially devastating layoffs. Arizona was far more surgical in its approach to closing its deficit than anything coming out of Washington.

While sequestration is largely out of our hands here on a state level, the Arizona Commerce Authority and Gov. Brewer should be applauded for positioning the state in as good a position as possible for the state to be named an unmanned aerial systems (UAS) test site and for their advocacy, along with that of many others, in Luke Air Force Base being named an F-35 training site. Defense jobs are desirable ones, and state leaders deserve credit while Congress and the president play a dangerous game of chicken. We’re fortunate that Senators John McCain and Jon Kyl are working to diligently to stave off sequestration.

In a presidential campaign that has seen more debate devoted to a candidate’s tax returns than how we’re going to get the American jobs machine moving again, these job-creation ideas might seem a little on the wonky side. Here’s hoping that in this final sprint to Election Day we at least give some hope to the millions of Americans out of work and to the job creators who have been stymied by a dysfunctional Washington.

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry.

Tourism Industry - AZ Business Magazine January/February 2012

Arizona Tourism Industry Has A Billion-Dollar Impact On Economy

Economic engine: Arizona tourism industry packs an economic punch of $17.7 billion yearly

Tourism is one of the largest industries in Arizona, but it isn’t just about hotels and golf courses.

Its direct economic impact of $17.7 billion has helped keep the state afloat during some of its darkest economic days, and the ripple effect is even greater. Those dollars spill over to a host of businesses, from the farmers who supply produce to the hotel restaurants to the car dealers who sell vehicles to the banquet servers. They also help keep our police officers and firefighters on the streets, thanks to tax revenues.

“That trickle-down money does affect everyone who is a citizen of Arizona, to some degree,” said Sherry Henry, director of the Arizona Office of Tourism.

And the money keeps coming, thanks to nearly 37 million overnight visitors annually.

“It’s so important to recognize the tourism industry is always here,” Henry said. “Even in recessionary times, people are still traveling.”

Tourism spending was up 7.9 percent in Arizona from 2009 to 2010 and has increased 25 percent since 2000. Overall, it’s still down 7 percent from its heyday of 2007, but most other indicators are moving in the right direction: Tax revenues, occupancy rates and demand are all up from 2009.

“It’s not that we don’t feel the effects of the recession,” Henry said, “but we’re still in the game.”

While the state has lost 11 percent of its tourism jobs since its high of about 173,400 in 2007, the industry still brings in $48 million a day. Tourism is the number one export industry in Arizona.

One way that benefits every resident directly is when the tax bills come. Taxes from tourism generate $1.3 billion in local and state revenue, which pays for everything from public safety to parks to libraries.

“When you look at the taxes generated, (tourism) saves every Arizona resident $1,000,” Henry said. Her agency, which was created in 1975, is responsible for marketing the state as a whole with multiple programs: advertising, public relations, community outreach, trade and media, and digital and social media, to all domestic and international visitors.
“(Travelers) have a lot of choices, so it’s important your destination stays in top of mind,” Henry said.

Part of the money for tourism outreach comes from tribal gaming. In the fiscal year ending June 30, 2011, tribal gaming revenues contributed $5.5 million to the state’s Tourism Fund. That comes from the $79 million total they deposited to the state, with another 12 percent of their annual revenue of almost $1.7 billion going to cities, towns and counties.

In addition, said Melody Hudson, public relations manager for Gila River Gaming Enterprises, “We have a deep and wide reach as far as our philanthropic activities, too.”

Tourism weaves through the fabric of our economy in ways that aren’t always obvious. Jesse Thompson, director of sales and marketing for the Hotel Valley Ho in Scottsdale, gave a list of local businesses that the hotel supports. Zuzu, its on-site restaurant, gets a good deal of its ingredients from local purveyors such as Red Bird Farms, McClendon Farms, Duncan Farms, Crave Artisan Ice Cream and Hickman Family Farms. Audio-visual contractors, limo and taxi drivers, independent conference planners, beverage distributors, decorators, and even the company that launders their linens – sheets, towels, tablecloths, spa robes – would all be affected if business dropped.

However, Thompson is proud that revenues at the 230-room Hotel Valley Ho increased 21 percent in 2011 over 2010, and he expects an 8 percent bump from 2011 to 2012. None of the 240 to 250 employees has been laid off in six years, despite the downturn. He attributes the increase in going after more group bookings.

Another way tourism boosts Arizona’s entire economy is by making the state not only an appealing place to visit, but to live. People might come to see auto shows, sporting events or festivals and decide to make a permanent move.

“People who visit Arizona often fall in love with Arizona and plot ways they can come to work here or bring their businesses,” said Glenn Hamer, president and CEO of the Arizona Chamber of Commerce and Industry. “It’s a gateway opportunity to sell the state of Arizona.”

Because the business community recognizes the importance of both visitors and tourists who become permanent residents, they work to bring major events such as the Super Bowl to the state. Hamer calls it a “showcase for our state.” In addition, the Super Bowl generated $500 million in economic impact in 2008. He expects the number to be at least that much when the Super Bowl returns to the University of Phoenix Stadium in Glendale in 2015.

The business community also supports sports tourism in general, including spring training baseball, college football bowl games, the baseball All-Star game in July 2011, the NBA All-Star game in 2009, and amateur events such as marathons, triathlons, bicycle tours and student sports meets. And it pushed for the 2008 expansion of the Phoenix Convention Center, now one of the top 20 such venues in the nation.

“Our convention business is an important part of our tourism economic engine,” Hamer said.

Unlike other industries such as manufacturing and technology, Hamer said, much of the tourism industry can’t be automated or outsourced. And thanks to the state’s natural and man-made attractions, it appears to be an industry that’s sustainable.

“Arizona as a whole relied so much on construction,” said Heather Ainardi, director of the Flagstaff Convention and Visitors Bureau, “and in the next 10 years, tourism is going to be one of the drivers of Arizona’s economy.”

Arizona tourism industry: Economic impact of major winter Valley events

College football bowl games
(Fiesta Bowl, BCS national title game and Insight Bowl)

Economic impact: $354.6 million in 2010-11
2010-11 attendance: nearly 200,000 at all three games

P.F. Chang’s Rock ‘n’ Roll Marathon

Economic impact: $59 million
2011 attendance: about 30,000 runners

Scottsdale Arabian Horse Show

Economic impact: $52-58 million
2011 attendance: about 250,000

Cactus League baseball

Economic impact: $360 million
2011 attendance: More than 1.47 million

Waste Management Phoenix Open

Economic impact: $180 million (estimated from 2008, when attendance was 538,356)
2011 attendance: 365,062 (event impacted due to weather)

Arizona Business Magazine January/February 2012