Message from the President

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Grater Yuma EDC Quarterly Investor Luncheon

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U.S. Ranking in Education 4

New Year = New Taxes 5

Meeting Updates 6

Investors Increasing Their Investment in Greater Yuma EDC

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Greater Yuma EDC Website

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Greater Yuma EDC Staff Members

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Greater Yuma EDC Board of Directors

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Greater Yuma EDC Mission Statement: To expand economic activity within Yuma County by attracting commerce and industry to the region, and by assisting in developing the region's existing industry to its fullest potential.

Greater Yuma EDC Vision Statement: Greater Yuma will be recognized as a globally competitive region— one that embraces advancing technology, attracts and retains human capital and continues to develop & foster the amenities that make the Yuma Region a great place to live and work.

very lucky, get to spend this time of year with family and friends. We can all be thankful for the climate we live in and rest easy knowing we aren’t shoveling snow or praying our car battery is not dead in the minus zero temperatures. We haven’t any excuses to not go out and shop local for our Christmas gifts. The stores are festive with decorations and music. Smiles are contagious and everyone is genuinely happy to revel in The Season. I love this time of year and having lived in Nebraska for 30+ years, you absolutely can’t beat a Yuma Christmas.

GYEDC will be open through the Holidays with the exception of Christmas Day and New Year’s Day. Please come by the office the week of Christmas for baked goodies.

I hope you can all join us on Wednesday of this week (12/11/13) at the Pivot Point for our Quarterly Investor Luncheon (11:30-1:00). The guest speakers are George Frisvold and Kurt Nolte, both of the University of Arizona. This study is very important to the Yuma County Economic Landscape. Please join us for the final report presentation regarding the Economic Impact of Agriculture for Yuma County.

In October the Arizona Commerce Authority announced the open application period for their $2million Rural Grant. The scope of the grant this year is geared towards infrastructure improvements that stimulate job growth. Yuma County applied for a portion of the grant funds for the Gary Magrino Industrial Park. Greater Yuma EDC applied for two grants on behalf of DC Logistics and Gowan Milling to offset infrastructure costs for expansions of both facilities. Unfortunately, none of the Yuma applications were awarded in this round. The good news is we can reapply in January and hopefully we will be successful in that round. Here are the award winners:

The Arizona Commerce Authority (ACA) is pleased to announce that the Town of Prescott Valley and City of Coolidge are recipients of Round 1 - FY14 Rural Economic Development Grant (REDG) awards.

This round was very competitive and it was exciting to see Greater Arizona’s efforts to create new quality jobs, retain existing quality jobs and stimulate private capital investment.

Round 2 – FY14 REDG

A Request for Proposal (RFP) for Round 2 will be released in early January; proposals will be due late February. If you have received this email, you are included on the REDG distribution list and will be notified by email of the release. An announcement will also be posted to our website:

The total funding available for Round 2 is: $1,130,844. An individual REDG award cannot exceed $500,000.

Happy Holidays Everyone and we look forward to seeing all of you in the New Year!

Julie Engel President/CEO

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Holiday Greetings to all our GYEDC Investors! This time of year brings so many things into focus. “Tis the Season to be Jolly” but it is also the Season of gratitude. Blessings are top of mind and if we are

http://www.azcommerce.com/arizona-commerce-authority-announces-first-round-recipients-of-annual-rural-economic-development-grant/

http://www.azcommerce.com/arizona-commerce-authority-announces-first-round-recipients-of-

annual-rural-economic-development-grant/

http://www.azcommerce.com/about-us/public-notices/

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https://www.eventbrite.com/e/greater-yuma-edc-quarterly-investor-luncheon-tickets-8519631447

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This past week, the Organisation for Economic Cooperation and Development (OECD) released the Programme for International Student Assessment (PISA) test results, which compares performance between over 60 education systems across the world.

2012 PISA results

http://www.oecd.org/pisa/keyfindings/PISA-2012-results-US.pdf

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On October 31, 2013, Mexico’s Congress approved a wide-ranging overhaul that was championed by President Enrique Pena Nieto that raised the country’s tax-collection rates, in order to provide funding for social programs. Specifically, the changes will pay for a national pension system, unemployment insurance, and is aimed to reduce dependence on oil revenue. In addition to eliminating the preferred sales tax rate to 16% nationwide, the plan also adds taxes on capital gains, higher income tax rates for the wealthy, royalty payments on profits of foreign mining companies, and new surcharges (+8%) on “junk food” and soft drinks. Critics say that the plan threatens a fragile economy, and could also hurt the Maquila Industry. Recently, the Finance Ministry lowered the 2013 growth forecast to 1.7%, down from 3.5% at the beginning of the year. Currently, Mexico’s maquila industry is exempt from paying taxes on the materials it imports for assembly. This exemption will now be eliminated, and the new plan proposed that the maquilas would be reimbursed for the 16% import tax once the final product is exported. January 1, 2014 marks the end of the preferential 11% sales tax. The rate will jump to 16% in areas within 20 kilometers of Mexico’s International land borders. This preferred sales tax rate also extended into buffer zones such as Cananea, Caborca, Puerto Penasco, and the entire states of Baja California, Baja California Sur and Quintana Roo. The lower rate was meant to help retailers in the northern border region compete with their counterparts in the United States. Local business leaders in the border areas affected in Mexico are concerned that this change will impact their sales negatively, and that they will lose business to merchants on the U.S. side of the border. Locally, the sales tax rates are as follows:

City of San Luis: 10.71%

City of Somerton: 10.01%

City of Wellton: 9.21%

City of Yuma: 8.41% Business owners in San Luis, Arizona are understandably looking forward to sales increases in the New Year. There is opportunity for many to capitalize on these changes, as they will assuredly result in increased North-bound border traffic for shopping purposes, and purchases made in the United States can be brought back into Mexico duty-free up to $150/person. Most obviously, this will include gasoline, retail, and food purchases, and San Luis, Arizona is gearing up to serve the needs of the expected increase to their customer base.

Arizona Economic Symposium

In November, GYEDC attended the Greater Arizona Economic Symposium to receive an update from business leaders on the economic landscape for the state leading into 2014. The message was very positive in regards to the legislation recently passed which has positioned Arizona as one of the more competitive business environments in the country. Legislative changes such as a 35% reduction in Corporate Income Tax, an increase in our out of state sales tax factorization to 100%, a more aggressive accelerated depreciation schedule on personal equipment and a number of incentive improvements place us near the top in most business decision factors. The diverse panel of real estate, educational, banking, economic development and transportation experts all predicted that Arizona was poised to continue its recovery on an upward ascent. The areas in which improvement was needed centered on educational reform and a more creative channel to prepare our students for the workplace. Various ideas and theories were proposed but the message was clear that Arizona‘s future prosperity was dependent upon changes occurring rapidly within our schools. A more flexible higher education model along with a K-12 system that is tied to the advanced demands of our economy was deemed paramount. A need for more accessible capital was also noted as a challenge that needed to be addressed. From a Yuma perspective, we certainly are set to benefit from the legislative improvements but we are also seeing our educational partners step up to the challenge as well. Arizona Western College continues to improve their ability to serve the business customer in Yuma while Northern Arizona University along with the University of Arizona are consistently adding new degree programs that are relevant to our diverse economy demands.

GYEDC Attends Aviation & Defense Conference

Aviation and Defense Magazine hosted a two day event in Scottsdale at which program managers in the defense contracting sector attended to discuss how future sequestration impacts would affect companies that specialize in many of the activities that are critical to Yuma. The forecast for the 2014 and 2015 was not bright as cuts and downsizing were guaranteed to eliminate some programs and consolidate others. Representatives from Lockheed, Boeing, and Deloitte spoke to the increasing federal focus on UAS testing as a cornerstone for future aviation and defense. Along with those impending changes, the industry also projects that a lack of future spending will not cause a slow down in innovation but will curtail projects that were set to create new jobs. The conference was an informative session that pulled back the layers of bureaucracy that clothe sequestration talks and discussed the real effects of the decisions being made in Washington. Some of the major implications include commercial aerospace approaching parity with defense, European improvements outpace U.S. on most metrics, while supplier/contract work continues to out grow OEMs. We were able to garner valuable defense related intelligence which will help us narrow our scope of focus for new aviation & defense attraction. This information will assist us in our strategy to work with the Yuma Proving Ground and Yuma International Airport as they grow their aviation and defense market share.

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THANK YOU FOR YOUR CONTINUED SUPPORT OF THE

GREATER YUMA REGION

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Thank you to Von Verde Development for increasing their Investment in Greater Yuma EDC to the Corporate Partner Level.

Visit our website at www.greateryuma.org

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Jonathan Lines Chairman of The Board

Dennis Booth Vice Chair

Terry Frydenlund Secretary/Treasurer

Doug Nicholls Past Chair

Board Members

Joni Brooks, Yuma Sun

James Deermer, Town of Wellton

Greg Ferguson, Yuma County

Stacy Gutierrez, Nicklaus Engineering

Bobbi Lewis, City of Yuma

Leslie McClendon, City of Yuma

Russell McCloud, Yuma County

Robert Pickels, Yuma, County

Martin Porchas, City of Somerton

Victor Smith, Skyview Cooling

Phil Smithers, Arizona Public Service

Mathias Rosales, City of San Luis

Greg Wilkinson, City of Yuma

Frank West, General Motors