The Badger State keeps rising in the Chief Executive Best States/Worst States list, and that’s got Wisconsin businesses cheering — as well as investing …
http://chiefexecutive.net/will-wisconsin-rise-again

MADISON—Wisconsin’s per capita income rose 4.8% in 2011, the largest increase in five years. That is one of the bright spots in the state’s new report card, “Measuring Success: Benchmarks for a Competitive Wisconsin,” prepared annually by the nonpartisan Wisconsin Taxpayers Alliance (WISTAX) for Competitive Wisconsin, Inc. (CWI).

According to Scott VanderSanden, CWI President, “Competitive Wisconsin has long supported an economic development strategy that would help Wisconsin match Minnesota’s per capita personal income. In recent years, Wisconsin has closed the gap with Minnesota by 13% (or around $700) from $5,294 in 2008 to $4,600 in 2011.” CWI’s annual report card also found that, for the fi rst time since 2007, Wisconsin employment (measured annually) in 2011 rose by 0.4%. Manufacturing, the state’s leading economic sector, accounted for 16.1% of total state employment, the highest share in three years. The state’s unemployment rate also fell from 8.5% in 2010 to 7.5% in 2011.

Report card findings on the state’s business climate were mixed. The number of new private businesses in the state dropped for the fourth time in five years, falling 0.8% in 2010 (the most recent year available). Venture capital investments in Wisconsin also declined from $43.97 per worker in 2010 to $26.11 in 2011.

The report card suggests that the state’s workforce continues to be an asset. Students generally performed well on national assessments and graduated from high school at above-average rates. Wisconsin also made progress in adding college graduates, as the percentage of residents age 25 or older with a bachelor’s degree increased from 25.7% in both 2008 and 2009 to 26.3% in 2010. That said, Wisconsin’s percentage of college grads remains below the national average and trails both Illinois and Minnesota. Less positive fi ndings were reported in the area of doctoral work in the sciences. For the second consecutive year, the number of science PhDs awarded per million residents fell.

The report card also examined public sector performance, where debt, regulation, and taxes can affect state competitiveness. Wisconsinites paid 11.9% of personal income in state-local taxes and fees in 2010-11, up from 11.7% in 2009-10 and 11.3% in 2008-09.

As of early 2012, the state’s bond ratings also remain low, and they are unchanged since being reduced in the early 2000s. Among the states rated by Moody’s, 32 have higher bond ratings than Wisconsin. One contributor to state bond ratings is the persistent GAAP deficit reported on state fi nancial statements since 1990. Nationally, only California, Illinois, and New York had larger GAAP defi cits than Wisconsin in 2010.

Competitive Wisconsin — a consortium of state leaders in business, education, and other fields — originated the “Measuring Success” report card in 1997 in response to a recommendation from a gubernatorial commission. The report covers six categories: economic health, quality of life, workforce excellence, public sector, business climate, and environmental quality. In each area, state performance is compared with years past and with other states in the region. The report is prepared by the research staff at WISTAX, a nonprofit, nonpartisan organization devoted to public-policy research and citizen education.

Please find the full, electronic report here.

(Editor’s Note: An electronic version of this release is available at www.wistax.org)

For more information, please contact Todd A. Berry or Dale Knapp, 608.241.9789 or wistax@wistax.org.

The Wisconsin Taxpayers Alliance, founded in 1932, is the state’s oldest and most respected private government-research organization. Through its research, publications, civic lectures, and school talks, WISTAX aims to improve Wisconsin government through citizen education. Nonprofi t, nonpartisan, and independently funded, WISTAX is not affi liated with any group — national, state, or local — and receives no government support.

“When we released our Be Bold Wisconsin recommendations for economic development in 2010, Wisconsin ranked 42nd out of the 50 states and a number of people thought our goal of making Wisconsin a top 10 state to start, grow or relocate business was a real stretch. Now, that goal is clearly within reach,” said Scott VanderSanden, president of Competitive Wisconsin and president of AT&T Wisconsin.

“We believe the Be Bold Wisconsin recommendations implemented by Gov. Walker and the Legislature played a role in CEO Magazine’s decision to up-grade their ranking of our state as a good place to do business. We also believe that the great work being done by the regional economic development groups around the state was a critical factor,” said Bill McCoshen, executive director of Competitive Wisconsin and former Commerce Secretary. “The bottom line on the new ranking is that it’s very good news for Wisconsin workers, businesses and taxpayers and lots of people and organizations should take a moment to celebrate their role in making it happen.”

Competitive Wisconsin, Inc. is a nonpartisan public policy organization consisting of business, labor, education and agriculture leaders in Wisconsin who work together to focus attention on the state’s competitiveness. The organization was founded in 1981 and produced the game-changing Be Bold Wisconsin economic development plan in 2010.

The next Legislature will be seated and begin their work on January 7, 2013.

The 2011-2012 session, although one of the more contentious in recent times, did pass significant pieces of legislation aimed at improving Wisconsin’s economic environment. Below please find several pieces of legislation that were enacted into law, that were either supported by Competitive Wisconsin or targeted at growing jobs in the state.

• 2011 Act 1 (Tax deduction for HSAs): Act 1 created a state-tax deductibility for health savings accounts.
• 2011 Act 3 (Corporate Income Tax Holiday): Act 3 created a two-year corporate income tax holiday for new businesses that locate in Wisconsin.
• 2011 Act 5 (Job Creation Tax Deduction): Act 5 created a tax deduction for of $4,000 per new employee for companies with less than $5,000,000 in payroll and $2,000 per new employee for companies with more than $5,000,000 in payroll.
• 2011 Act 7 (Wisconsin Economic Development Corporation): A CWI initiative, Act 7 created the Wisconsin Economic Development Corporation, a public-private partnership with the sole mission to help businesses succeed in Wisconsin and to act as a welcoming committee to attract new businesses here.
• 2011 Act 15 (Dairy and Livestock Farm Investment Credits): Act 15 extended the investment credit for 5 years, which covers a portion of the cost of expanding or modernizing dairy or livestock equipment. Since 2004, the tax credits had generated more than $500 million in private investments for farms.
• 2011 Act 26 (Expansion of Economic Development Zones): Act 26 expanded the number of places that can be designated an economic development zone, and helped rural areas qualify to be labeled an economic development zone.
• 2011 Act 30 (Infrastructure Funding): Act 30 allowed for the bonding of major interstate bridge projects, securing a strong infrastructure for continued economic growth.
• 2011 Act 32 (2011-2013 Executive Budget): Act 32 contained several provisions supported by CWI, including the following:
• A no tax increase, balanced budget– Act 32 contained no new taxes, eliminated recurring deficits and is balanced for the biennium.
• Manufacturers Tax Credit– Act 32 contained a provision that significantly reduces the income taxes paid on income generated from manufacturing in Wisconsin, making Wisconsin an even more attractive place to maintain and grow manufacturing jobs.
• Capital Gains Exclusion for reinvestment in Wisconsin– Act 32 contained a long standing CWI initiative which excludes 100% exclusion for capital gains reinvested in a Wisconsin business within 180 days of the asset generating the gain, and 100% exclusion for gains from the sale of a Wisconsin capital asset held for 5 years.
• 2011 Wisconsin Act 88 (Expansion of Job Tax Credits): Act 88 doubled the amount of refundable income tax credits from $5 million to $10 million that are available for the Wisconsin Economic Development Corporation to give to help small businesses grow.

As I hope you’ve all noticed, after reviewing some very thoughtful analysis (special thanks to Committee Member Laurie Fischer of the Wis. Dairy Business Association for your guidance), the Executive Committee adopted a new dues structure that significantly enhances the value equation of a Competitive Wisconsin membership by reducing dues and increasing benefits. For example, our top gold level membership for companies with sales in excess of $10 million is now only $5,000 and comes with a host of benefits including free access to our planned 2012 Jobs and Training Summits and a number of other legislative and policy briefings.

The response to this effort has been excellent! 2011 members rejoined at a faster pace than usual, and we recruited more new members in the first quarter of 2012 than projected. In short, membership is up and we are committed to bringing you even more good news on this front in the months ahead.

In addition, thanks to the participation and contributions of some of Wisconsin’s leading financial and entrepreneurial thinkers, BE BOLD: The Role of Capital in the Building and Maintaining of Wisconsin’s Entrepreneurial Economy was shared with opinion leaders and policymakers in February and will be updated and formally released in April. And, working from the ideas and suggestions that emerged at our late September 2011 BE BOLD gathering on cluster industries, we developed and have shared, statewide, a draft white paper on the possibility of creating a Wisconsin Cluster Industries Council. The paper served as the focus of a well-attended meeting on January 31 and is now being revised based on the input from that and other meetings.

On the legislative front, Competitive Wisconsin supported the critical effort to increase the amount of investment capital to support start-ups and expansions. While those efforts will have to be continued in the next session, CWI supported a number of legislative initiatives that were acted on, which we believe will improve the state’s economic development efforts.

Perhaps the most intriguing development of the past few months has been the emergence of an opportunity for Competitive Wisconsin to play a major role in Wisconsin’s effort to understand and address its current and future work force challenges. We have discussed this possibility with representatives of the Wisconsin Department of Workforce Development, the Wisconsin Economic Development Corporation, private sector employers, educational experts and leaders in the state’s philanthropic community. At the moment, there is universal agreement that there is work to be done, and I believe it is fair to say, similar agreement that there is a role for Competitive Wisconsin when the work begins. Stay tuned!

In short, we’re getting the job done. We made progress on substantive issues in 2011, have made significant progress in 2012 and have strong plans for going forward. We worked hard at re-energizing our relationship with members and contributors in 2011 and are committed to building on and expanding our base in 2012. For all these reasons, Competitive Wisconsin hit the floor running in 2012.

We want to sustain the robust, BOLD and productive pace we set in 2011. To do so, however, we need your participation and help. Come to the meetings! Help us recruit new members! Share your thoughts about what we can do this year to improve Competitive Wisconsin even more!

Fundraising in support of this critical effort is underway and the project will be formally announced as soon as the necessary funding has been raised. [NOTE: Please contact Scott VanderSanden, Bill McCoshen or Jim Wood, at kdollhopf@wcgpr.com, if you would like to help fund and/or participate in BE BOLD 2.]

The Wisconsin Growth Capital Coalition, of which Competitive Wisconsin is a member, presents this comprehensive white paper as a road-map for the state on the best and most efficient way to leverage the state’s limited resources to catalyze angel and venture capital investments and management in Wisconsin. Learn More.