Colorado business leaders agree that voters took an important step toward restoring this state’s economic viability with passage of Referendum C last fall. But the state’s habit of locking routine tax and budget questions into constitutional concrete still hampers our prospects for attracting desirable new businesses or expansion of existing enterprises.
Kenneth Tuchman, chief executive and chairman of TeleTech Holdings, told the recent 2006 Rocky Mountain Economic Summit that Colorado finds it hard to attract and retain large corporate headquarters. Colorado now hosts 10 Fortune 500 companies, two more than in 2004, but has lost several headquarters in the last two years by mergers or relocation to other states.
Kevin Grieve, president of First Data Prepaid Services, noted that while major corporate headquarters are highly sought after, most job growth comes from small firms. Grieve urged Colorado to focus on maintaining its entrepreneurial culture. That strikes us as good advice – and helps explain why the business community worked so hard to pass Referendum C, to maintain the higher education system and transportation network vital for balanced economic growth.
“We know mountains and the quality of life are not enough,” said Joe Blake, president and CEO of the Denver Metro Chamber of Commerce. “The passage of Referendum C last Nov. 1 was a statement by the electorate that made it possible for higher education to be looking at an entirely different picture for their work force and needs than if they had been faced with hundreds of millions of dollars in cuts. We saw a spike of activity of out-of-state businesses interested in relocating here when Referendum C passed. When you look at what Colorado has chosen to do – including voter approval of issues like T-REX and FasTracks – we’ve made some extraordinarily wise investments in our infrastructure, and none greater than Referendum C,” Blake said.
But despite those positive voter endorsements, many experts believe Colorado’s future prosperity is still threatened by attempts to cast basic economic issues in constitutional concrete. Late in 2005, the nonprofit Colorado Economic Futures Panel concluded that Colorado’s “core problem” is decision-making by constitutional amendment, locking up much of its tax and budget policy in the process.
The latest example of that impulse is Initiative 38 on the November ballot. Business leaders warn it would hurt economic development efforts by opening up all local government actions, including routine zoning issues, to years of delay by legal or electoral challenges.
“Business just hates that kind of uncertainty; that’s why we will be actively opposing” Initiative 38, Blake said.
Brian Vogt, director of the state’s office of economic development, sums it up by saying, “Government can’t create wealth itself, but it can provide the fundamental steps toward integration, communication, culture, policy and strategy that leverage all resources supporting industry, academia and the financial community – resources that the private sector cannot marshal on its own.”
Such efforts to maintain a healthy overall economic climate, rather than offering special subsidies to specific industries, are the key to a vibrant Colorado future.
