Final
Presentation by Tom Clark on Business Location Decisions
ECONOMIC DEVELOPMENT
Votes:
Action Taken:
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10:28 AM -- Presentation by Mr. Tom Clark on Business Location Decisions
Mr. Tom Clark, Vice President, Metro Denver Economic Development Corporation, presented information to the committee on the reasons companies locate in a certain area. He explained the top reasons why companies locate in Colorado, such as its quality of life, its low tax and regulatory burden, and its highly educated workforce. He explained that although Minnesota has a high income taxes, it has a robust economy due to a highly productive workforce resulting from a good educational system. He indicated that Colorado experiences a shortage of suppliers and manufacturers.
Mr. Clark listed the major industries in Colorado. The construction of the Fitzsimons Life Sciences Center will make Colorado a major hub for the life sciences industry. He also commented on the state of the tech industry. Some larger companies have consolidated, but there remains a significant amount of smaller software companies in the region. He also discussed the needs of each industry. Some industries rely more on good roads and infrastructure, while others also have needs such as a good educational system and a good tax and regulatory climate. The renewable energy sector has significant potential in the state due to the existence of the National Renewable Energy Laboratory in Golden.
10:39 AM
Mr. Clark continued by discussing rankings on Colorado's economic competitiveness. Colorado ranks high in several categories, especially as it compares to its competitors. However, it scores mediocre in other categories, but he stated that he thought these areas can be addressed. Colorado consistently ranks among the most livable states, although it dropped in the ranking during the economic downturn that began in 2001. Colorado scores high in venture capital, research and development spending, and the number of patents granted. Colorado is in a strong position regarding the education level of its population, but weaker in its graduation rates and the percentage of students going to college. Although Colorado ranks high in educating college-bound students, it has a relatively low percentage of college-bound students. Colorado scores in the middle in its salaries for public school teachers, school spending, and other education-related rankings. However, Colorado does have a high population of individuals with science and engineering degrees.
Mr. Clark indicated that Colorado is a relatively healthy state. It has low infant death rates, low disease rates, and it is traditionally one of the thinnest states. However, health care costs are 30th highest in the country. The number of retail prescriptions filled are relatively low. Colorado has a nursing shortage. He indicated that the cost of housing in Colorado is generally considered high and it has a relatively high crime rate compared to other states - 33rd. He continued by stating that Colorado's air quality is improving, except for the Denver area's brown cloud problem. Colorado's charitable giving is in the top half of the country.
Colorado is a frugal, low tax state; it has the 10th lowest state and local tax burden. It is the 41st lowest in government spending and has high personal income per capita. However, the state ranks 37th in costs for doing business, mostly due to high wage demand and its tax structure. Colorado ranks 23rd in road spending and 5th highest in spending on bridges. It ranks 11th best in the productivity of the workforce. Mr. Clark concluded by stating that Colorado ranks favorably in many economic competitiveness indicators. However, it scores only mediocre in its ability to move products and services efficiently and in educational indicators. He stated that these rankings are going in the wrong direction.
Mr. Clark indicated that Colorado's entrepreneurial climate is somewhat similar to the Silicon Valley; Colorado businesses are able to foster and invest in good ideas. Representative Borodkin and Mr. Clark discussed the economic importance of transportation infrastructure and aviation centers in the state.
Senator Tapia discussed the importance of infrastructure and how a lack of a water supply can be a barrier to growth, especially for certain water intensive industries. Mr. Clark indicated that the water-intensive semiconductor industry was negatively impacted by Colorado's cost of water, and that some smaller beverage producers may locate elsewhere due to Colorado's water issues. He stated that the most important policy decision Colorado government can make is to invest in the state's infrastructure.
Mr. Tony Robinson discussed the need to improve access to higher education.
Senator Evans stated that 61 percent of students do not go on to postsecondary education, which is lower than national average. He stated that some of the 61 percent go back to community college at a later time, but the state does not know what the remainder of these students are doing. He stated that only 11 percent of Colorado high school graduates stay in college. He continued by discussing the state's need to improve its school to work programs. He discussed the smaller percentages of certain socioeconomic and minority groups attending college.
Representative Borodkin commented that individuals who do not go to college can be productive and earn high wages. The state needs to assess how it can improve educating and training individuals who do not go to college.