The best thing we can do for small business, said Steve Maestas, is to increase their revenue.<\/p>\n
The best way to do that is to attract big businesses \u2013 the businesses that bring new dollars into the state\u2019s economy, making products that are sold everywhere and generating revenue from outside the state. Speaking recently to a group of small business owners, he said big businesses generate the jobs and pay the employees who support the local service economy.<\/p>\n
So \u2013 here comes the punch line \u2013 New Mexico needs a taxpayer-funded job creation fund with $50 million of taxpayer dollars. We already have such a fund under a law called the Local Economic Development Act (sections 5-10-1 to 5-10-13 of the New Mexico Statutes), but the law needs some amendment. And with only $15 million authorized so far, the fund doesn\u2019t have enough money to be competitive against the incentives offered by other states.<\/p>\n
Maestas is a partner of a major commercial real estate company and Deputy Chair of the Federal Reserve Bank of Kansas City. He\u2019s zealous about reversing New Mexico\u2019s dismal economic outlook and passionate about this job creation fund. The $50 million proposal comes from the Legislative Jobs Council and has bipartisan support. We\u2019ll be seeing it in January.<\/p>\n
Our arguments are predictable. If you are a conservative, you don\u2019t like spending taxpayer money this way. It\u2019s beyond what the function of government should be. And you don\u2019t like getting the state involved in, as the saying goes, picking winners and losers. If you are a liberal, you don\u2019t like spending our limited public funds on fat cat rich companies that ought to be able to finance their own company expansions. You are more concerned with social needs that are crying for attention.<\/p>\n
I don\u2019t like this any better than you do. I resent it. But New Mexico didn\u2019t make the rules. Big business has us all over a barrel as states and localities bid against each other to attract the companies. Texas has a $250 million fund and has created 70,000 jobs. California has just authorized $200 million.<\/p>\n
I\u2019m not alone. One fellow in the audience commented that he doesn\u2019t believe in the concept, but New Mexico has to compete or die. His children, with good educations and and professional skills, are moving to other states where the job opportunities are better. He\u2019ll suck up his philosophical objections and support the legislation.<\/p>\n
We know that New Mexico is lagging behind \u2013 the only state in the US with net job losses since the 2008 recession. It\u2019s commonly said we relied for too long on the national labs and other federal support (in other words, on Pete Domenici). The loss of federal funding and other factors have created what one audience member called a \u201csink or swim moment.\u201d<\/p>\n
Maestas said the New Mexico law limits how the public funds can be spent. They must be spent on infrastructure, land and buildings, so that if the company doesn\u2019t stay, the assets do. New Mexico has made money by investing in unsuccessful companies like Schott Solar and Eclipse Aviation, because the structures are still here and now being leased to other companies.<\/p>\n
Last year the legislature passed the \u201csingle sales factor,\u201d a tax law change that has been a major step toward making New Mexico economically competitive. Maestas believes a robust job creation fund is the next critical step.<\/p>\n
I\u2019d sure like a more comfortable approach \u2013 one that keeps the money in-state and also successfully expands the economy and grows jobs \u2013 but we\u2019ve been over this ground many times and we\u2019re not seeing results in the numbers we need.<\/p>\n
As things stand right now, a member of the audience said, we\u2019re all doing each other\u2019s laundry. That\u2019s no way to build an economy.<\/p>\n","protected":false},"excerpt":{"rendered":"
The best thing we can do for small business, said Steve Maestas, is to increase their revenue. The best way to do that is to attract big businesses \u2013 the businesses that bring new dollars into the state\u2019s economy, making … Continue reading