CNBC, along with several business analysts, including the National Association of Manufacturers and the Council on Competitiveness, have ranked the state of Iowa #11 in terms of Top States for Doing Business. That is down two places over the past two years.
Although, ranking #11 is not bad, we aren’t going in the right direction. It tells us that in areas where we were weak, we continue to be and have dropped in an area where we were once the leader.
Iowa ranks #13 in terms of the overall lowest “cost of doing business” dropping from #1 only 3 years ago, and #5 a year ago, but before we place that blame on a corporate tax rate of 12% (Iowa’s corporate rates are 6% to 12%), that number has not changed and cannot, therefore, be attributed to the drop in rank.
Iowa sits smack-dab-in-the-middle when it comes to property taxes, and although historically low in terms of utility costs, wages, and rental costs for office and industrial space, it is in those latter categories that we’ve seen a rise in costs.
I join members of the House favoring a reduction in business property taxes, but part with Governor Branstad and Republicans at reducing (or eliminating) corporate taxes. Lower taxes will reduce our revenue, for sure, but do little to encourage new business because it’s not giving them what they are looking for, which is made possible by having such tax revenue.
Where Iowa fails in past and current rankings are in 4 categories: 1) Infrastructure and Transportation, 2) Technology and Innovation, 3) Access to Capital, and 4) Workforce.
“Access to capital” is out of our hands directly, but if we inform ourselves as to what that means we can begin close that gap. “Access to capital” is literally where venture capital goes and where businesses are therefore attracted. Iowa ranks poorly and continues to fall in this category because venture capitalists do not perceive this state to be sophisticated or technologically savvy.
We should not, therefore, be talking about cutting infrastructure spending as Governor Branstad insists, we should instead be focused like a laser on improving our transportation and communication systems, creating new opportunities in technologies and by promoting the quality of life we offer.
The latter is where I believe everything begins.
Iowa also fails in how we market ourselves. Instead of regretting what we geograpically cannot be, we need to focus on what we are. We don’t have mountains, but we have forests and rolling, green hills. We will never be on an ocean, but we have the longest rivers in North America along our borders, with streams and lakes of tremendous beauty and recreational value.
We have covered bridges, Victorian towns, great academic institutions, world class industries and a great quality of life from cosmopolitan opportunities to rural splendor.
We have the richest most fertile soil on earth (that is jeopardized by the current administration’s near-sycophantic courtship of chemical companies); rare for a relatively small parcel of land (only 300 miles wide by 200 north to south).
We have a strong work ethic and high ranking integrity.
This is a reality that we fail to market even amongst ourselves and this is where our attractiveness to investors falls flat.
Iowa is still a punch line in America in terms of the perception of our worth. Our graduates leave the state in record numbers because we have not shown them the value of what we have, and we have not shown them the salaries and commitment to new industries where their interests lie. We rectify this by creating those educational opportunities and we do this by understanding how we should be prideful.
Iowa Pride has to be more than regent university sports; it has to be in valuing our land, our history, cultures, cities, towns and farms; in recognizing the beauty of our unique corner of the world and by protecting our educational, business-friendly and geographical environments.
We don’t need to cut funding for pre-school and we don’t need to shortshrift the University of Northern Iowa– which retains the highest percentage of Iowa recruits and graduates compared to the other Regent Universities….we didn’t need to demolish our only laboratory school to train new teachers.
No help is coming from Governor Branstad who vetoed a bi-partisan agreement on a needed K-12 budget increase. House Democrats wanted a realistic 6% increase, but House Republicans refused to budge from a small 1.25% increase. Democrats compromised to 2.62 percent, but a break-through didn’t come until both sides agreed to 1.25% along with an additional $56 million in funding. Branstad vetoed the additional funding.
Branstad continues to confound Iowa’s growth by cutting infrastructure rebuilding and development even though, in reality, we have a surplus in our general fund and a stable economy. The previous administration left us with a budget surplus and the numbers wash to allow us to invest in what we need to do to attract growth. To then “balance” the budget we have to consider that the cost of doing business in Iowa is still low and we can afford to use corporate taxes to help fund the very things corporations are looking for and why they are looking past Iowa today.
In fact, we must put our investment there if we are to attract new business and retain our young workforce.
Gridlock continues in Des Moines, but we, as Iowa citizens, can start the process of moving the needle despite political loggerheads. We can become stewards at home of the Iowa Faith; this is our skin in the game and this is where we begin.