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Revising Tucson’s Economic Blueprint

Joe Snell, president and CEO of Tucson Regional Economic Opportunities (TREO), provided insight on the latest growth initiatives in Tucson and what the city needs to do to continue its upward trajectory.

Joe Snell

Joe Snell

What are Tucson’s strongest assets coming into the recovery?
❚ The University of Arizona is a Top 20 research university with amazing strengths in engineering, science, optics, entrepreneurship and provides a robust talent pipeline companies are looking for.
Tucson has an established, diverse aerospace and defense industry, with more than 200 companies, and an emerging bioscience sector with strong contribution to the state’s Bioscience Roadmap.
❚ Its strategic location. Southern Arizona is truly a gateway to Mexico. In addition to the unique rail assets we already have, we will leverage Mexico’s Port of Guaymas expansion to our benefit. Also Tucson’s position at the southern end of the Sun Corridor location in our mega region, expected to have the most growth in the next 35 years, positions us for business investment for years to come.
❚ On the heels of Arizona’s high national entrepreneurship rankings, Tucson is beginning to receive national recognition for its own entrepreneurial culture. For example, Entrepreneur magazine recognized Tucson last August as one of the best cities for entrepreneurs. With these state and local rankings giving Tucson needed exposure, the McGuire Entrepreneurship Program at The University of Arizona’s Eller College of Management, the new Tech Launch Arizona initiative, Start Up Tucson, a strong Desert Angels group, and various public and private organizations, Tucson supports start-up businesses and entrepreneurs with resources for launching new ventures.
❚ Progress in downtown revitalization.

TREO just released its 2014 updates to its Economic Blueprint. Describe the “urban renaissance” on which Tucson is focused.
❚ As the national and local economies slowed around 2008, Tucson’s long-term downtown development momentum picked up steam. Over the last three-plus years, huge and exciting changes have come to downtown Tucson by way of over $320M in public and private investment. Some notable projects include UniSource Energy’s new corporate headquarters, other headquarters such as Providence Service Corp., Mr. Car Wash, Sonoran Institute and Madden Media; the Tucson Modern Streetcar and a new UA downtown branch, among many other retail and restaurants new to downtown. Some of those changes are more visible than others, but together they add up to a more exciting, more vibrant, more inviting downtown for everyone, but especially the young, creative class that is just discovering Tucson.

Infrastructure, specifically related to transportation, is another big initiative in TREO’s Economic Blueprint. What are some of the short-term goals TREO hopes to see happen?
❚ Infrastructure investment is really a path for economic growth, and expansion of existing highway, rail and airport capacity is the key to global competitiveness. We are fortunate in southern Arizona. Our location in the Sun Corridor puts the Tucson region at the crossroads for trade corridors in all directions. Many communities would covet this position, so we must be laser-focused and smart about how we go about ensuring that we invest in the right transportation infrastructure. We are focusing on three key areas. First, achieving seamless connectivity to Mexico and other southwestern markets. We, as a region, have the ability to influence the inclusion of the southern segment of I-11 and the border-to-border vision of the Intermountain West Corridor in federal and state planning. We have made a great start but have much more to do. Second, we are focused on supporting Tucson International Airport, rail asset capacity growth and local mobility initiatives. Expanding passenger and freight service at Tucson International Airport will mean increased commerce for the entire region. We also have to make the proposed Aerospace Corridor and associated research park, rail reclassification facilities and the 10/I19 Bypass realities. Third, how do we pay for all this? Creative funding and private sector solutions are required to ensure our region continues to have the resources to be competitive in the marketplace. We will be actively participating in the development of new funding mechanisms.

What are some of the challenges TREO has overcome or anticipates?
❚ Over the last nine years, we have made progress in our focus on business development and economic diversification through targeted industries. We are laser-focused on four industries that can shape our future: aerospace and defense, alternative energy and natural resources, transportation and logistics, and bioscience/healthcare. Most of our successful projects over the last several years fall into these categories. In addition, we have dramatically increased private sector support of TREO and the understanding of the importance of economic development with all of our regional partners, public and private. Obstacles and opportunities include the unification/cooperation among many groups, accountability, common definitions of economic development and increased funding is critical for success.

Solar Zone Activation, Joe Snell

TREO Leader Advocates For A More Diversified Economy In Tucson, Across The State

Time For ChangeJoe Snell, president and CEO of Tucson Regional Economic Opportunities
Q&A with Joe Snell, president and CEO of Tucson Regional Economic Opportunities

Like the Valley, Tucson and Southern Arizona were hit hard by the recession. Joe Snell, president and CEO of Tucson Regional Economic Opportunities (TREO), talked to Arizona Business Magazine about the recovery and challenges still facing Tucson and the rest of the state.

How did Tucson and Southern Arizona fare during the recession?

Since December 2007, Arizona has lost nearly 300,000 jobs and in Southern Arizona about 30,000 jobs. Due to extreme state-level budget deficits, many of the assets and tools that allowed Arizona to compete have been cut drastically or eliminated. Arizona is facing a slow recovery from the worst recession in 70 years and lawmakers are faced with the urgent and challenging task of restoring jobs and creating an environment where we can compete and win.

Arizona is not alone in addressing recovery from the recession — other competitor states face the same challenges. However, our competitor states like New Mexico, Colorado, Texas and Utah have advantages we do not:

  • Lower unemployment
  • Greater investments in education and innovation
  • Better business tax climates
  • Better economic development tools
  • Smaller deficits

Roche/Ventana Medical Systems created 500 jobsFortunately, Arizona has a history of adapting and overcoming challenges. This year represents one of those times in history where we must use our collective strengths and advance Arizona. The recently passed Competitiveness Package is a good start.

In this recovery phase, what are some of the bright spots you are seeing?

Many of TREO’s targeted industries in which we have strengths to compete for business development have held their own during the recession: biosciences, aerospace and defense and solar. In biosciences and aerospace and defense, TREO helped facilitate two major expansions in the last year here in Tucson:

    • Roche/Ventana Medical Systems, 500 jobs, $184 million capital investment
    • Sargent Aerospace & Defense

      Our solar companies are consistently doing well and expanding too. SOLON Corp employs about 150 people in Tucson and is bullish on the future of solar in Arizona. The Solar Zone at the University of Arizona Tech Park continues to attract companies and development.

      In September 2010, Global Solar rolled out a new flexible solar module, the PowerFLEX BIPV, which consists of Global’s CIGS modules laminated into 300-watt strips. The strips can be directly attached to rooftops with adhesive. That avoids the need for costly and heavy glass-clad panels and mounting frames.

      What did TREO do for itself and its members in order to cope with the recession and now the recovery?

      PowerFLEX BIPV, Global's CIGS modules

      During the depths of the recession, we developed a very aggressive plan called Tucson: Job One. We have implemented much of this plan and continue to advocate for more tools and resources to help businesses. More recently we have developed an aggressive strategy to support and expand our aerospace and defense industry, which is a major contributor to Southern Arizona’s economy, with over 200 companies and $5 billion in revenue. The plan is in early stages, but includes exciting new discussions with public sector partners. The plan will be shared further in the coming months. Finally, our TREO investors have continued to support the organization, recognizing its critical role in these tough economic times. Our investor retention rate continues at 90 percent.

      How do you see 2011 shaping up for Tucson and Southern Arizona?

      The time is now to reshape our future economy, take some bold steps and emerge as the state everyone else aspires to be. What do we need to do to reshape our economy? Supporting industries that give us the greatest returns. Over the past 30 years, spurred by its climate and quality of life, the population growth rate of the Tucson region has far surpassed the nation as a whole. The region nears 1 million residents, and economists project that our population base will grow to 1.7 million by 2036. The rapid population growth has presented many challenging issues for the Tucson region, and will continue to do so in the future. Our region needs to provide services and infrastructure to meet the needs of these new families and residents. Equally important, we need to provide quality jobs and career opportunities so our current workforce, our children and new residents to the community can build the life they desire.

      From an economic standpoint, industries like home building and construction have expanded along with the explosive population growth, resulting in an over reliance on these types of service and growth-related jobs to fuel the economy. As long as these non-primary jobs remain the main economic drivers, we will continue to suffer the consequences of a “population boom or bust” economy. Our current situation points out how important it is to diversify our economic engines. In order to build a more diversified economy we must create programs and policies that support those employers that value high skills and reward with high wages. Not all jobs and employers are equal. We must support those employers that give us the greatest return on investment.