Open For Business Despite Its Policies, State Ranks High Among Business Leaders As Relocation Target

For a state that’s trying to curb corporate welfare, Idaho did rather well in a recent national publication’s rankings of states’ business incentives.

The “Corporate Finance” magazine published by Financial World listed Idaho among eight states atop its “Gauging the Open Arms Race” report in the fall issue.

Writer Ellen Benoit said some states are doing considerably better than others in building a reputation among business planners as top relocation targets.

“Sure, companies want a soft touch, but increasingly they’re heeding state development officials who say the smartest course is one that improves the overall business climate,” Benoit said.

Idaho received a top ranking for income-franchise tax credits, property tax exemption and preferred financing. The state received a secondary rating for sales tax exemptions, and zero for job training grants.

The rankings, however, were based on business leaders’ opinions, not a study of actual incentives offered by different states.

In fact, Idaho Gov. Phil Batt’s administration opposes using financial perks to lure business here.

Department of Commerce head Jim Hawkins has repeatedly said that companies come to Idaho because of the good business climate here, and not because of handouts from the state.

North Idaho used some incentives to bring furniture manufacturer Harpers Inc. to Post Falls in 1993. The package included job training grants, which contradicts the zero rating Idaho got in the category.

But medium-sized companies like Cabletron Systems, which moved a sales office to Post Falls in 1992, came without free land or property tax relief, incentives other states commonly use to attract businesses.

Still, Idaho’s rankings made it one of eight states with a rating of 11, on top of the business incentive listings.

Others were Alabama, California, Delaware, Indiana, New Jersey, Ohio and West Virginia.

Utah and Washington received 7 points in the list, with top marks for property tax exemptions, zero for job training grants and lower ratings for the other categories.

Oregon, Montana and Nevada ranked next with 6 points overall and Wyoming was among four states with the lowest ratings, 5 points.

The article said two-thirds of the companies responding said they have moved or expanded facilities in the past year, and 62 percent said they received incentives averaging $2 million, mostly in property and income tax rebates.

The survey said 51 percent of the companies responding said they plan to relocate or expand in the next 12 months, 77 percent in the next five years.

“Corporate Finance” has a circulation of 60,000 to chief executive officers, chief financial officers and senior financial executives.

, DataTimes