presented by: fernando jimenez, vice-president ...rustec.asu.edu/2012/presentation with overview on...

© Confidential, All Rights Reserved.

November 5, 2012

Presented by:

Fernando Jimenez, Vice-President, International

Arizona Commerce Authority

(ACA)


The Arizona Commerce Authority (ACA)

• The ACA is Arizona's premier economic development

organization

• It combines the power of top state government officials with internationally renowned business executives.

• This dynamic partnership attracts business to Arizona and grows business already in operation... utilizing some of the most competitive programs and incentives in the United States.


Location of Arizona

Arizona, a Great Place for Living

• More sunny days than any other U.S. City – including Florida (the

sunshine state)

• Steady climate and lack of natural disasters

• Exceptional value in new and used homes plus low property taxes

• More than 400 public, private, and incomparable scenic golf courses

• Home to some of the most recognizable healthcare facilities in the

world

• Dozens of world-class resorts and spas, theatres, and entertainment

• All four major sports leagues

• Three ski locations

• Only 18 centimeters of rain per year


Innovation in Arizona

• ACA's focus on science, technology and innovation. These high-growth industries are vital to providing Arizona with a competitive edge in the global market.

• Arizona's bright minds breed incredible ideas. Trough a suite of programs, the ACA is helping to make those ideas realities.

– Arizona Innovation Challenge: $3 Million a year

– Arizona Innovation Accelerator Fund: $18.2 Million Loan Program

– STEP Grant: Grant to increase international sales and revenue

– AZ Fast Grant: provides money to help initiate commercialization process


Mega-Regions in the U.S.

The Sun Corridor, Arizona

The Sun Corridor is at a crossroads of two trade corridors, (CANAMEX and California to Texas)

Major Railroads - BNSF - Union Pacific

Labor Force in Arizona

JOBS:

2.3 million

140,081 businesses

GEOGRAPHIC DENSITY:

113,635 square miles

56.3 people / sq.mi.


POPULATION: Average age: 35.9 Statewide: 6.4M MEDIAN WAGE: Statewide: $30,889

Cities within easy reach

Phoenix Flying

TO: Las Vegas 1 hour

San Diego 1 hour

Los Angeles 1.25 hours

Albuquerque 1.25 hours

Salt Lake City 1.5 hours

San Francisco 1.8 hours

Denver 1.6 hours

Tucson Flying

TO: Las Vegas 1.25 hours

San Diego 1.25 hours


Albuquerque 1 hour



Denver 1.75 hours

Flagstaff Flying

TO: Las Vegas 1 hour

San Diego 1.25 hours


Albuquerque 1 hour



Denver 1.5 hours Source: Author’s Calculations, May 2012

Access to markets/transportation

Connectivity:

• Two Interstates and five freeways into California, Mexico and the Southwest

• Two transcontinental railroads and 10 interstate railroads

• Tucson is 415 miles from Southern CA and 64 miles from Mexico and offers substantial freight handling and air service


Global Air Connectivity • Phoenix Sky Harbor

• Airport ranks 15th world- wide for take-

offs and landings.

• Serves over 100 cities.

• Domestic & International

Strategic Southwest Location

• Tucson International • 60 Miles from Mexico • 500 Miles from California • Vital Connection for Canamex


Abundant Competitive Energy • Arizona is a surplus generator

of electricity utilizing hydro, nuclear, solar and coal resources.

• AZ is an energy exporter to California and other states.


Abundant water resources

• AZ has abundant water

resources at very cost competitive rates.

• Inexpensive water is still

supports a strong Agricultural base in AZ.

Educational Infrastructure

• Large concentration of science and technology students

• Strong network of junior colleges and specialty universities and AZ is home to major on-line learning institutions


Business Focused

Arizona Competitiveness Package

Job Training

A job-specific reimbursable grant program that provides training plans for employers creating new jobs or increasing workforce skill and wage levels.

Quality Jobs Tax Credit

Each eligible job qualifies for up to $3,000 per year credit for three years. AZ has set aside $30m/yr for each of the coming three years - $90m total investment.

100% Sales Factor

Reduces taxes for out-of-state exportation businesses while encouraging capital investment and employment growth.

Business Focused

Arizona Competitiveness Package

Corporate Income Tax

Reduces corporate income taxes by 32%, with a progressive reduction down to below 4.9%

Personal Property Tax Reform

Enhances accelerated depreciation schedules and increases personal property exemptions.

Commercial Property Tax Reform

Reduces the commercial property assessment ratio to 18% by 2017.

Arizona is up for the global challenge

Over 200 foreign companies have operations in AZ

Foreign Direct Investment estimated at $10B

73,000 workers employed by foreign companies

Major trading partners

Mexico (32.81% of exports, $5.71 billion)

Canada (11.83%, $2.07 billion)

China (5.74%, $1 billion)

Japan (4.78%, $836 million)

United Kingdom (4.51%, $789 million)

Germany (4.4%, $770 million)

Singapore (3.34%, $583 million)

Thailand (3.16%, $553 million)

Malaysia (2.85%, $500 million)


• Electrical Machinery ($5.4 Billion, 30.9% of total)

• Semiconductors, electrical appliances, wiring/cables

• Machinery, Non-electric: ($2.1 Billion, 12.1% of total)

• Gas Turbines, Computers + Parts, Office Machine Parts

• Aircraft & Spacecraft ($2.05 Billion, 11.8% of total)

• Civilian Aircraft, Engines, Controls, other

• Ores, Slag, and Ash ($1 Billion, 5.8% of total)

• Copper ore & Molybdenum ore (used to fortify steel)

• Optics and Medical Instruments ($971 million, 5.6% of total)

• Orthopedics, medical instruments, optics machines

Arizona’s Top 5 Exports to the World

Source: U.S. International Trade Administration, accessed May 2012


Arizona’s Top 5 Imports from Around the World

• Computer & Electronic Equipment ($4.3 Billion, 24.7% of total)

• Processors & Controllers, Electronic Integrated Circuits

• Machinery, Non-electric: ($2.4 Billion, 13.6% of total)

• Machines for Manufacturing Semiconductors, Gas turbines

• Agricultural Products ($2.18 Billion, 12.4% of total)

• Tomatoes (fresh), Pimenta Fruits (fresh), Grapes (fresh)

• Transportation Equipment ($1.96 Billion, 11.2% of total)

• Parts: Insulated wiring sets for Aircraft, refined copper cathodes,

electrical plugs and sockets

• Electrical Equipment ($1.34 Billion, 7.7%)

• Photosensitive Semiconductor Devices, turbojet & propeller parts

Source: U.S. International Trade Administration, accessed May 2012


$US Phoenix, AZ Tucson, AZ Los Angeles,

CA San Diego,

CA San Francisco,

CA Denver, CO

Las Vegas, NV

Albuquerque, NM

Materials $8,000,000 $7,852,911 $8,179,775 $8,114,402 $8,866,190 $8,310,521 $8,155,260 $8,065,373

Installation $2,000,000 $1,882,507 $3,015,666 $2,814,621 $3,715,405 $2,211,488 $2,890,339 $1,921,671

Total* $10,000,000 $9,661,017 $12,079,096 $11,638,418 $13,943,503 $10,644,068 $11,819,209 $9,909,605

Arizona Construction Cost Advantage,

vs. Southwest U.S.

On average, construction costs are 16.7% higher in nearby States’ largest MSAs’ compared to Phoenix.

*Not a sum of Materials and Installation.

Source: RSMeans Construction Costs Data, 2012


$US Phoenix, AZ Tucson, AZ Calgary, Alberta

Edmonton, Alberta

Montreal, Quebec

Ottawa, Ontario

Toronto, Ontario

Vancouver, BC

Materials $8,000,000 $7,852,911 $10,606,742 $10,623,085 $9,961,185 $10,042,901 $10,051,073 $10,467,824

Installation $2,000,000 $1,882,507 $2,430,809 $2,430,809 $2,399,478 $2,368,146 $2,579,634 $2,326,371

Total $10,000,000 $9,661,017 $12,836,158 $12,847,458 $12,282,486 $12,282,486 $12,689,266 $12,531,073

Arizona Construction Cost Advantage,

vs. Largest Canadian Cities

On average, construction costs are 25.7% higher in Canada’s largest MSAs compared to Phoenix.

Job Title Avg. Hourly

Canada Avg. Hourly

AZ Difference

Assembler $18.08 $13.71 24.2%

Inspector/Tester $24.23 $18.33 24.3%

Machine Operator $19.70 $15.36 22.0%

Material Handler $18.16 $12.46 31.4%

Packer $18.13 $10.92 39.8%

*Not a sum of Materials and Installation.

Source: RSMeans Construction Costs Data


Solar Industry in Arizona

Establishments: 100 significant, 500+ Total Employment: 4,700+ Growth: 24% from 2010 – 2011 Economic Impact in Arizona: $2 billion (2011) Renewable Portfolio Standard (RPS): 15% by 2025 Positive Facts - More sunny days than any other state - #1 Alternative Energy Leader - #1 Solar Energy Manufacturing Leader - Home to ASU’s School of Sustainability


Solar Industry in Arizona,

Interesting Projects

Enviromission, Inc. – In planning stage - 2,400 ft (800 meter) tall tower that uses a large glass canopy to trap heated air and funnel it to the top to generate power. - Selling the power to California - 200 MW project APS/Luke Air Force Base – Completed in 2012 - Designed by SunPower Corp. - 15 MW Photovoltaic Power System - Largest solar power installation at a US Government facility. - Generates the equivalent of 50% of annual req’s for the base.


A Great Place to do Business

Arizona has reduced or passed legislation favorable to business for 13 consecutive years. Workers compensation and unemployment insurance are lowest in the Southwest. Right-to-Work State No business inventory tax No corporate franchise tax Virtually all services exempt from sales tax Geographic access to major markets

•Ranked #1 for workforce quality and availability by CNBC’s 2011 Best States Rankings

A Great Place To Do Business

333 North Central Avenue, Suite 1900

Phoenix, AZ 85004

602.845.1200 800.542.5684

www.azcommerce.com

presented by: fernando jimenez, vice-president ...rustec.asu.edu/2012/presentation with overview on...

Documents