Out Of California – Into Arizona?

Via insidetucsonbusiness.com

I received an interesting email from a good friend recently with a message that really stuck with me.  Here is the email copied directly from the original:

“Just thought I’d let you know that I was on a flight on Monday and happened to sit next to a gentleman from San Diego who runs a very large real estate investment and development company. He said they are in the process of selling all of their interests in California and actively looking at other areas. The two main areas they are looking are Greenville, South Carolina and Tucson. He said they feel strongly that Tucson has been lagging and it is about to explode. He commented that, if AZ would put some money into education (specifically Tucson), that Southern Arizona’s potential is unlimited. He said the taxes and regulation in California have gotten out of control and they’re done with it. He also said Tucson needs to work closely with the U of A to bring in technology companies to keep the U of A students in Tucson post-graduation. I know that none of this is a surprise but thought you would be happy to hear someone from California bring this up.”

I could probably end this essay here, because the message is the point of this article. But there’s more.

A few weeks ago, a serial entrepreneur from the Bay Area of California contacted me. He has participated in a lot of business startups and he, too, is leaving California. He is deciding whether to plant his flag in Tucson or Austin. I met with this person last week to help him choose Tucson. He commented that the cost of living, as well as other urban conditions in his hometown, is influencing the creative class there to consider their options.

As the pundits have said for years, California seems to live in its own bubble.  Holly-weird. An unfunded state public employees’ pension fund of $279 billion (with a “B”) went up 22% in this year’s state budget alone. There are state regulations that require an official state sticker, disclaimer or warning on just about every door, window and piece of equipment at any place of business. Also, there is an insatiable thirst for more and more taxpayer money. And let’s not forget that California has long had a one-party domination of its state legislature and that public sector unions heavily fund the party in power.

Sure, California is a beautiful state. One out of eight Americans lives in California…but for how long?

The plight of California employers is not lost on the Arizona Commerce Authority or local/regional economic development organizations. California is the new business recruiting prize most valued by ED professionals for two reasons: 1) there are lots of major companies there; and 2) California laws and regulations are slowly squeezing them out of the state.

In Arizona, we can accelerate the capture of this opportunity. As the gentleman on the airplane commented, we need to put more money into our schools and work with educators to ensure a better return on taxpayer money. We need updated and upgraded infrastructure. We need to continue the efforts of the Doug Ducey administration to reduce regulatory burden on state business.

This isn’t rocket science, folks. Business goes where it is welcome. And when it does, it takes payrolls and philanthropy with it. Job creators need to be welcomed in our region like conquering heroes. They need to be at the top of the list when economic development opportunities are discussed, not way down the list behind narrow, and usually loud, special interest groups that often steer public policy.

As someone once said, “When opportunity knocks, answer the door.” And I might add, “Invite it inside.”

Mike Varney is the president and CEO of the Tucson Metro Chamber of Commerce, which is currently searching for Varney’s replacement after he announced his retirement earlier this year.

How did you feel when you walked into your business this morning? Did your employees appear to be engaged or simply doing their jobs?

Last week, the Rio Nuevo Board unanimously approved investing as much as $250,000 with Ray Flores of Flores Concepts, which plans to assume control of one closed nightclub, one operating club and an adjacent vacant building.

I knew that my time would eventually come, and turning 50 this summer seemed like the right context for comfortably and confidently ordering my first Singapore Sling.





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