As the race for the Silver State’s next governor heats up, we have a chance to build upon Gov. Brian Sandoval’s most successful policies. At the top of that list should be the continuation and strengthening of Nevada’s highly successful economic development system.
A recent Review-Journal article, “Price tag for Nevada’s tax incentives finally revealed,” implied that, until now, Nevada’s leadership hasn’t known the true cost of economic development incentives. This couldn’t be further from the truth. The article ignores the broad success of Nevada’s economic development system, the level of competition we face for new job creation and the many safeguards that are built into our performance-based incentive policy.
According to Gallup, Nevada has recently become the fastest jobs-producing state in the country. This is no small feat when you consider we were dead last in 2011. Our success has been fueled by the economic development system Gov. Sandoval launched that same year with broad bipartisan support.
Nevada’s economic development system — including incentives — has helped businesses create more than 49,000 new jobs and $15 billion in new investment statewide.
In fact, our economic turnaround has been the most dramatic of any state.
At the Las Vegas Global Economic Alliance, our team, along with partners and supporting organizations such as the Council of Chambers, leads the charge for economic development in Southern Nevada. Much like the state, our return on investment to stakeholders has been high. According to recent calculations from IMPLAN economic impact models, we know that every $1 invested in job creation through the alliance has led to $23 in new wages and $99 of economic impact for Southern Nevadans.
Incentives are a powerful and necessary tool we use to level the playing field with other states and help companies create new jobs and capital investment. While some states provide upfront payments to companies, Nevada instead focuses on reducing the tax burden for companies willing to generate new jobs, investment and tax revenue.
The structure of incentives in Nevada also means job creation does not come at the expense of school or government accounts. Instead, businesses receiving incentives produce new tax revenue at reduced rates. In fact, businesses approved for incentives since 2011 are scheduled to generate approximately $3.9 billion in net new tax revenue over the term of their contracts.
Each use of incentives is scrutinized at meetings that are open to the public.
These are not “crony handouts.” They’re based on performance and triggered only after a company has fulfilled its obligations.
The results of our economic development system are real, measurable and speak for themselves.
If we’re going to continue building the new Nevada, we must continue to make sensible investments in economic development programs and incentives that produce high-value jobs.
Over the coming months, newly minted gubernatorial candidates will outline their positions on what they believe to be best for Nevada. I hope all candidates will agree to continue and strengthen our current economic development system.
The future of Nevada’s economy depends on it.
Jonas Peterson is the CEO of the Las Vegas Global Economic Alliance, the regional economic development organization for Southern Nevada. The Council of Chambers is made up of CEOs from Southern Nevada’s eight largest chambers of commerce.