Category Archives: Economic development

Tax Preference or Tax Prejudice?

The Whitman exhibition of collector coins in Baltimore

Exhibit One: The Whitman exhibition of collector coins in Baltimore

by Steve Haner

Three times per year a massive coin show is held in Baltimore, packing a large convention space for several days and filling hotel rooms and restaurants all around the area. The photo above is from 2015. The dealers and the buyers include the key Virginia players in this industry.  A 2013 analysis by the Baltimore Tourism Bureau estimated that attendees spend $3 million inside and outside the arena at just one show, and they do it three times a year.  The expo may be an even bigger show now.

A similar show is held in a faded motel on Richmond’s Boulevard, near the Diamond.  I took this photo in October.  The comparison to the Baltimore show is obvious, but there is no other show anywhere in Virginia that compares to Baltimore’s either.  Maybe, just maybe, every show conducted in Virginia combined generates the $3-4 million in local spending that goes on at one Baltimore show.  No one has bothered to do a formal impact analysis.

Exhibit Two: Richmond numismatic show

What does Baltimore have that Richmond does not? It is the other way around.  Richmond and Virginia have something Maryland got rid of – a sales and use tax on collector coins. In fact, Maryland is one of 27 states that have no sales tax on those items, and then of course five states have no sales tax at all, for a total of 32 tax-free states.  Ohio just rejoined the list of tax-free states on January 1. It dumped the exemption a few years back because of one bad-apple dealer, but the local industry visibly shrank and the exemption is now back.

The national Industry Council for Tangible Assets, representing the bullion and coin dealers, surveyed its members and compared the responses from the states which do and do not tax bullion and coins.  You can see the results summarized here: Exhibit Three. Dealers in the tax-free states have more than four times the annual revenue.  Dealers in both kinds of states do mainly shows in tax-free states.  Dealers in the tax-free states, being bigger, sell more taxable items as well and remit almost as much tax as the dealers in taxing states.

Argue all you want about how Virginia ranks overall as a good place to do business – Virginia is a lousy place to do this business. Like everything else, the Internet is taking over. A Virginia buyer on a Virginia retailer’s website will get the tax added on at check-out, and often the transaction ends right there. The buyer clicks off and goes elsewhere.

Oh, in case you haven’t figured it out yet, I’m back with another bill on this issue for a client. In 2015 the Virginia General Assembly did approve legislation to remove the tax on large purchases of gold, silver or platinum bullion. Coins were removed from that bill and remained taxable. But it is the coins that are of interest to the bulk of the dealers and collectors, and only by removing the tax on the coins will the industry be able to build up the native shows, attract one of the national shows, and grow actual retail operations in storefronts. Would you like that, Virginia? Compared to the grants and tax advantages you provide other industries, the impact of this is just pocket change.

Tax policy has always fascinated me, and this issue is a classic example of how tax policy has consequences in a free market. Some may dismiss this effort as another tax preference or even, dare I say it, a loophole. But turn that around and in light of the 32 tax-free states and the tax-free U.S. Mint supply, it seems to me that the existing situation in Virginia represents a form of tax prejudice.

Stephen D. Haner is the principal of Black Walnut Strategies.

“It’s Not about Money. It’s about New Thinking.”

While nitwits in the national media stumble over themselves covering the president-elect’s latest tweets — Newt Gringrich calls them “rabbits” sent out to distract the news hounds — important things are taking place outside of public view. You can get a sense of the new thinking about to overwhelm Washington, D.C., in comments that the former U.S. Speaker of the House made to the National Defense University a couple of weeks ago.

The speech was long, wandering and provocative, as is typically the case with Gingrich, but also illuminating. What struck me as a Virginia blogger was the focus on the massive waste built into the Pentagon bureaucracy. The bureaucracy, which is leeching resources from the nation’s war fighters, is a national disaster, and it needs to be fixed. But fixing it would shake up the Northern Virginia economy, much of which revolves around the feeding and nurturing of that bureaucracy.

If you went back to Eisenhower’s generation, Gingrich said, the number of people it took to run the largest armed force in the nation’s history was tiny.

A small number of people did an amazing amount of effective work. We’ve now replaced them with committees of 60, of whom 40 know nothing. …

This is particularly true in the American military bureaucracy including huge numbers of civilians right now. You have people who’ve been in Iraq and they’ve been in Afghanistan, and they’ve been in combat, dealing with people who have done none of that, and the people who have done none of that think they have the authority to question the people who have actually done it. …

It’s not about money. It’s about thinking. I’ll give you an example. The Pentagon was built in 1943, the year I was born. It was built to house 31,000 people, to wage global war, using manual typewriters with carbon paper. Beetle Smith, as Secretary to Chief of Staff George Marshall, used to run drills with his staff to see how fast they could find documents in the files, so that they could meet General Marshall’s request in the quickest possible time, manually.

What’s the exchange rate between filing cabinets with carbon paper, and manual typewriters, and the iPad, and the smartphone I carry with me all day? What would you guess? Ten to one? Twenty to one? Closing on infinity? … I propose, as a symbol, that we develop a plan that turns the Pentagon into a triangle. At least 40 percent of the current bureaucracy has to be superfluous. Literally. What does that cost? It means you have committees who think their job is to be important by asking stupid questions, and they have the power to then slow down everything while people answer the stupid questions, which will allow them to write a report that goes to a different committee, which wonders what that report really means, so they ask for another report about the report, and then you wonder how you get to the F-35. …

If Secretary Mattis goes in and says, we’re going to reform and modernize the Pentagon into a triangle, that would be transformational. You could either share the space with other Federal offices, or you could create a terrific museum of war. I mean, 40 percent of the Pentagon would be a great tourist trap. ….

You have to get it into your head. The current system is broken. It is obsolete, so don’t try to fix it. Try to replace it.

Perhaps this is Gingrich just being Gringrich, thinking the big thoughts. Perhaps the president-elect has other priorities than reforming the federal bureaucracy. Perhaps, as Gingrich has opined elsewhere, the administration “will lose its nerve.” But improving the military’s tooth-to-tail ratio is a national imperative. And with all the other plans the president-elect has for cutting taxes and investing in infrastructure, there will be precious few additional dollars for defense spending. If the new administration does get serious about restructuring the military, the next four years could be the most unsettling time in history for Northern Virginia.

Gas Pipeline puts Virginia in Race for Three Prospects

Gas pipeline puts Virginia in contention for three industrial prospects.

Gas pipeline compressor station.

Virginia is in the running for three economic development projects that would rely on natural gas,  and one is “mammoth,” Governor Terry McAuliffe told a group of manufacturers yesterday.

“The only reason I’m in the hunt is because of the pipeline,” he said, referring to the proposed Atlantic Coast Pipeline. The 600-mile gas pipeline would bring new supplies of cheap natural gas from the Marcellus shale basin to Virginia and North Carolina.

Speaking to the Infrastructure Roundtable held in Richmond by state and national manufacturing associations, McAuliffe said that nondisclosure agreements prevent him from revealing the identity of the prospects, reports Richmond Times-Dispatch.

However, Sen. Frank Wagner, R-Virginia Beach, a prominent pipeline backer, told the Times-Dispatch that he knew of a large industrial prospect that would convert natural gas feedstock into other products such as fertilizer and “would like to be located along deep water.”

The eastern part of Virginia — roughly from Interstate 95 east — has such limited supplies of natural gas that the region cannot accommodate a new large industrial customer. But several localities along the path of proposed Atlantic Coast Pipeline have said that access to low cost gas would make them eligible for projects that would have eluded them in the past. McAuliffe’s remarks are the first public indication that access to the gas pipeline had put Virginia in the running for tangible industrial prospects.

While 92% of the Atlantic Coast Pipeline capacity is  reserved by electric and gas utilities, 8% is unreserved and potentially available to large industrial customers.

“We are actively marketing to potential industrial projects and potential utility customers,” said ACP spokesman Aaron Ruby.

Hundreds Seek Pipeline Construction Jobs

Atlantic Coast Pipeline construction will create 7,200 temporary jobs.

Pipeline construction.

The proposed Atlantic Coast Pipeline (ACP) is highly controversial in Augusta County, where property owners fear pipeline construction will jeopardize water supplies, create a safety hazard for nearby residents, and drive down property values. But hundreds of mechanics, welders, electricians and other blue-collar workers see the $5 billion project as a potential boon.

By noon Thursday, 157 people had signed up at the Augusta Expo put on by the ACP to inform local vendors and workers of opportunities to work on the 600-mile pipeline, according to the News Virginian.

At peak construction in 2018, said ACP spokesman Aaron Ruby, the pipeline will employ 7,220 workers.

Wrote the News Virginian:

Scott Bazzarre, the founder and president of Budget Electrical & Mechanical in Palmyra, wants to be considered for electrical work on the pipeline. He calls the pipeline a boon for workers like him and for the economy. “It’s a no-brainer, not just for the tax base but for a struggling economy.”

Unlike landowners, who will have to live with the pipeline as a permanent fixture on their property, construction workers will benefit only for the duration of the construction project. But there are undoubtedly thousands of workers who think like Bazarre: “We have to have good-paying jobs for my kids and grandkids.”

Bacon’s bottom line: Is it a stretch to suggest that the ACP pipeline controversy reflects the same societal schisms as the 2016 election: the propertied, educated class versus blue collar workers struggling to survive economically? Such a framework over-simplifies a complex reality, but I think there’s something to it. Even though Virginia’s unemployment rate stands at 3.7%, theoretically full employment, rural/small town Virginia has a higher jobless rate, and the “unemployment” figures don’t take into account discouraged workers who have dropped out of the workforce. Pipeline construction would throw construction workers a lifeline.

On the other hand, property owners can’t be blamed for wanting to be left alone. The value of land in the Shenandoah Valley is determined increasingly by aesthetics — bucolic rural landscapes, mountain views, wildlife habitats — not by farming/timbering income streams that traditionally determine compensation for land taken by eminent domain. One can argue that Virginia’s eminent-domain laws do not provide fair compensation for lost value.

In any case, Virginia’s blue collar workers have been largely invisible in the pipeline debate until now. Don’t be surprised to see ACP maximize their exposure.

Virginia as Best-Educated State – a Worthy Goal?

How does one determine "best-educated state" status? This map shows top states by percentage of population with advanced degrees.

How does one determine “best-educated state” status? This Wikipedia map shows top states by percentage of population with advanced degrees.

The Virginia Plan for Higher Education, the strategic plan for Virginia’s public colleges and universities, has set a bold objective: to make Virginia the best-educated state in the nation by 2030.

To accomplish this goal, the State Council for Higher Education in Virginia (SCHEV) plans to increase the number of degrees and workforce credentials granted from 80,000 per year to 118,000 by 2030 — 1.5 million in all. There are many interesting facets to this plan, particularly SCHEV’s ideas on how to provide affordable access, and I hope to get around to blogging about them in time.

But for now, I want to focus on the goal of making Virginia the best-educated state in the country. What does that mean? And is it even an appropriate goal?

By some metrics, Virginia is a well-educated state. Measured by the percentage of the 25-and-older population with an advanced degree, Virginia is the 4th best educated state in the country, according to Wikipedia. Measured by bachelor’s degrees, we rank No. 6. Ranked by high school graduates, the Old Dominion falls to 29th.

The higher education establishment cannot get Virginia to No. 1 entirely on its own. The Commonwealth needs to increase the pipeline of high school graduates seeking degrees and workforce certifications. Fortunately, the gap between Virginia (where 86.6% of the population 25 years or older has a high school degree) and No. 1 Massachusetts (89.0%) is less then three percentage points. That’s a ravine, not a chasm. It should be bridgeable.

Next issue: What do we gain by churning out thousands of graduates with bachelor’s and advanced degrees? Educated people, like anyone else, need jobs. And if they can’t find jobs in their home state, they will move to a place where they can find them. Thus, Massachusetts, the best educated state in the country as measured by college degrees, suffered a net domestic out-migration between 2010 and 2012 of 9,721 people. Likewise, No. 2-ranking Maryland suffered a net loss of 2,540. By contrast, Virginia enjoyed a net gain of 22,299. The stats don’t tell us how well educated Virginia’s newcomers were, but it is a truism that better educated people are more geographically mobile overall than their less-educated counterparts, so it’s a good bet that they improved the state’s average educational achievement.

States can create more well-educated people than local labor markets can absorb. If Virginia’s economy doesn’t create jobs for those well-educated people to fill, we’re spending millions of dollars to educate citizens who leave the Old Dominion. Here’s the concern:  SCHEV selected the goal of 1.5 million degrees and certifications as a way to get to the No. 1 “best educated state,” not because there is a demonstrated demand for 1.5 million degrees and certifications.

Here’s how the 2015 annual report justifies the best-educated-state goal:

Becoming the best-educated state supports the future prosperity of Virginia, its citizens and its regions. An educated population and well-trained workforce increase economic competitiveness, improve the lives of individuals and support greater community engagement. The best-educated state means that Virginia supports higher education at all levels. This spectrum includes workforce credentials, such as industry certifications, state licensures, apprenticeships, and certificates, as well as traditional degrees.

That’s it. Without more data, we don’t know if becoming the best educated state will contribute to the state’s economic development or will steer resources into an unnecessary and expensive expansion of Virginia’s higher ed establishment.

There is abundant anecdotal evidence that there are widespread skills shortages in certain occupations. So, clearly, there is a need to ramp up education/training in specific areas. Many if not most of these skills can be delivered by community college-level certifications and associate degrees. Whether becoming the “best educated state in the country” will address those specific skills or churn out locally unemployable college graduates is an open question.

New VEDP Chief Brings Workforce Training Credibility

Steven Moret, Louisiana's economic development and workforce training guru

Steven Moret married economic development and workforce training in Louisiana. Photo credit: The Advocate

Steven Moret, an economic development executive from Louisiana, has been selected to run the Virginia Economic Development Partnership (VEDP) on the strength of his track record of attracting private investment to Louisiana by building one of the most respected workforce training programs in the country.

The VEDP board approved the hire in a special meeting yesterday against the backdrop of a devastating report by the Joint Legislative Audit and Review Commission (JLARC), which charged that VEDP suffered from “systemic deficiencies” in administration and management.

Moret, selected from among six finalists after a nationwide search, will receive a base salary of 340,000 with benefits and, he would be eligible for an annual incentive bonus up to 15% tied to performance. He has strong family connections to Virginia. His mother lives in Richmond, and his in-laws are planning to move to the city.

Among all of Virginia’s economic development programs, VEDP is the most important. VEDP itself administers a $27 million budget, and it is influential in dispensing tens of millions of dollars more in incentives through the Commonwealth’s Opportunity Fund.

In an interview with Virginia Business, VEDP Chairman Dan Clemente explained the board’s rationale behind the pick:

Clemente said that hiring a new, highly qualified leader will help shepherd through changes resulting from JLARC’s review. Saying that he had consulted with legislative leaders before calling Monday’s meeting, Clemente noted that Moret was hired to head up Louisiana’s economic development efforts in 2009 under conditions similar to those facing VEDP today. “He came in and straightened that out and brought in billions in new capital investment, “ Clemente said.

What really impressed him, Clemente added, is that Moret traveled to Georgia to study its workforce development initiative, developing a similar model in Louisiana called FastStart. “He hired the No. 2 guy in Georgia and brought him to Louisiana to make the program work,” Clemente said. “He’s good at executing ideas.”

Clemente said Moret —who was not present at Monday’s meeting — has read JLARC’s 132-page report. “He looked at it and said, ‘Dan, this is all administrative. I can take care of it. ’” Clemente said Moret wanted to come to Virginia because “ ‘your location draws Fortune 500 companies, and that creates a lot of opportunities for me.’ ”

Bacon’s bottom line: Moret seems like a promising choice for the job, and it will be interesting to see where he takes VEDP. An experienced executive should be able to address the managerial issues raised by JLARC. Of greater import will be his ability to connect corporate recruitment with workforce development.

The number one driver behind corporate investment today is gaining access to a skilled workforce. As we have blogged on Bacon’s Rebellion repeatedly, tens of thousands of jobs across the state are going unfilled because of the inability of existing employers to find employees with the necessary qualifications. Needless to say, staffing is an issue to out-of-state company considering an investment in Virginia as well. The skills gap tells us that a massive disconnect has developed between the workforce, employers and the educational/ training institutions that impart needed skills.

Since 1965, the Virginia Jobs Investment Program (VJIP) has provided training to companies creating new jobs. That program has undergone considerable bureaucratic turmoil over the past 20 years, shuffling in whole or in part between the old Department of Economic Development, the Department of Business Assistance, the Department of Small Business and Supplier Diversity, and then back to VEDP, according to a 2014 VEDP presentation.

Between 2010 and 2014, the program shrank from 16 operational and support personnel to six. In other words, while Louisiana was building a best-in-class workforce development initiative, it appears that Virginia was decimating its own program.

From a philosophical perspective, investment incentives such as special subsidies and tax breaks smack of corporate welfare. The beneficiaries are corporations, often highly profitable ones. There is no moral justification for such transfer payments, only the practical justification of bribing an out-of-state company to locate in Virginia. By contrast, workforce training benefits both the corporation and the employees benefiting from the training. While some such skills imparted in highly tailored training programs may be company-specific, employees often acquire skills they can apply elsewhere. Viewed another way, workforce training is an investment in Virginians, not out-of-state corporations with no demonstrated long-term commitment to the state.

Given a choice between bribing companies with subsidies and tax breaks or subsidizing their workforce training, I would choose training in a heartbeat. Indeed, if one of Mr. Moret’s priorities is to recreate his Louisiana workforce-training success here in Virginia, I would suggest that the General Assembly could provide him with all the money he needs from the Commonwealth’s Opportunity Fund.

McAuliffe, Koreans to Cooperate on Smart Grid

Korea, the land of the smart gridHmmm, I wonder what the story behind the story is on this: Governor Terry McAuliffe announced yesterday the signing of a Memorandum of Understanding between the Korea Electric Power Corporation (KEPCO) and the Virginia Economic Development Partnership (VEDP) for “comprehensive cooperation” on the Smart Grid and new energy projects. States the press release:

This MOU allows KEPCO, the largest electric utility company in South Korea, and Virginia to collaborate and promote information sharing, develop strategies, facilitate understanding, identify challenges and stakeholders. The agreement will encourage non-governmental organizations, research institutions, businesses and government institutions at all levels to participate in cooperative activities to support the energy sector. Recognizing their common interests in the industry, both parties will promote mutually-beneficial cooperation on the Smart Grid, technologies and approaches, and other areas of mutual interest.

By way of explanation, McAuliffe said: “Working with an international company like KEPCO to share and promote best energy practices will help us develop a strong partnership and will open the door to future investments in Virginia.”

Bacon’s bottom line: It is good for McAuliffe and Virginia to think about the future of the electric grid. The so-called “smart grid” — using information technology to promote energy conservation and renewables — is advancing by leaps and bounds. KEPCO has spent nearly $250 billion developing and testing its own smart grid technology, so Virginia undoubtedly has much to learn — and possibly technology to adopt.

I can’t help but wonder, though, if this is the economic development equivalent of vaporware. Will McAuliffe, who has only one year remaining in office, have time to build institutional relationships that can accomplish anything meaningful? Or does he think that KEPCO actually might invest in Virginia?

Pipeline Creates Opportunities in Buckingham

Kyanite Mining Corp. , one of the largest employers in Buckingham County, has entered into an agreement to access a natural gas tap off a lateral line from the proposed Atlantic Coast Pipeline (ACP). And now the county is exploring the possibility of acquiring 200 acres of land along the tap line for industrial development. The line would have enough capacity to supply Kyanite Mining as well as three or four companies of comparable size, reports the Farmville Herald.

Atlantic Coast Pipeline opens up economic opportunities in Buckingham County.

Blue Kyanite crystal

Kyanite Mining, which mines and processes Kyanite ore, runs the mineral through a rotary kiln in which the temperature exceeds 1450° Centigrade. The operation can produce more than 150,000 tons of commercial grade Kyanite concentrate every year. Kyanite is used in products as diverse as dishware, porcelain plumbing fixtures, electronics, electrical insulators and abrasives.

According to County Attorney E.M. Wright Jr., the 200 acres would be available to be marketed  as a site that would have gas and other amenities. Two non-binding memorandums of understanding are needed from the county, he said, “so definitive agreements can be made.”

While the pipeline has inspired stiff opposition in the mountainous Augusta-Nelson-Bath county area, partially on the grounds that it would negatively impact views, property values and economic development, the project has garnered support in other localities along the route. The availability of natural gas puts numerous counties into the running for new categories of industrial investment.

“This is a great example of how the Atlantic Coast Pipeline can serve as an economic development tool for counties to support their local businesses and even attract new industries to help grow their economies,” said ACP spokesman Aaron Ruby.

“For more than two years, we’ve worked very hard to find opportunities across the region to expand access to natural gas in under-served communities, including Buckingham County,” he said. “We’re pleased that after more than two years of discussions with Buckingham County, Columbia Gas and Kyanite Mining Corporation, we’ve reached an agreement in principle that will help facilitate natural gas service to the county. More work remains to be done to finalize the agreement, but we’re very pleased with the progress that has been made.”

Update: Michael Martz with the Richmond Times-Dispatch delves into this story, including the local politics, here.

VEDP Inefficient, Ineffective, Says JLARC

VEDP deeply flawed says JLARC

Best state for business? Not anymore. Virginia has slipped badly in the past decade.

The Virginia Economic Development Partnership (VEDP), once renowned as one of the top state economic development organizations in the country, suffers from “systemic deficiencies,” concludes a blistering report by the Joint Legislative Audit and Review Commission (JLARC).

Some of the conclusions:

VEDP is not an efficiently or effectively managed organization. 
The partnership “lacks many of the fundamental components or organizational management needed to operate efficiently and effectively and to coordinate well with external entities. Key elements missing from VEDP’s operations include a deliberate strategy to meet statutory responsibilities, adequate operational guidance for staff to carry out their job responsibilities, effective accountability mechanisms, useful performance measures, and effective coordination with external partners. Without these elements, VEDP risks wasting limited resources…”

VEDP’s approach to marketing Virginia compromises its effectiveness.
The partnership “has not taken basic steps to ensure it is effectively and efficiently marketing Virginia to new and existing businesses. … VEDP’s marketing services have been largely reactive and generated substantially fewer location and expansions decisions (“announcements”) than suggested by the agency’s performance measures.”

VEDP’s unstructured approach to administering incentive grants leaves the state vulnerable to fraud and poor use of limited resources.
The partnership’s “approach to administering incentive grants has exposed the state to avoidable risk of fraud and financial loss, and has increased the potential that state funding is not efficiently allocated. VEDP administers 10 incentives grant programs and awarded $384 million to companies over the past decade. During this time period, many of the projects supported through VEDP-administered incentive programs did not meet their performance requirements.”

The one ray of hope: Virginia’s export-promotion program: “VEDP’s export promotion (international trade) programs have demonstrated success in assisting Virginia companies with selling their products in international markets.”

Bacon’s bottom line: There’s an even bigger question to ponder. Of all the places that Virginia invests in economic development — corporate recruitment, incentives, tourism, agricultural marketing, the Center for Innovative Technology, university research — is corporate recruitment/incentives the best allocation of funds? Clearly, it was at one time in Virginia’s history. I’m not saying it isn’t now. But like every other expenditure of state dollars, we should seek the greatest return on investment of public dollars, which means periodically reviewing all state-funded initiatives. This might be a good time to step back and look at the big picture.

Economic Development Incentives Under JLARC Review

Are economic development incentives for movie making worth the expenditure?

“Evan Almighty” was filmed in Virginia. The economic impact was less than everlasting.

Virginia’s legislative watchdog agency has embarked upon an evaluation of 76 economic development incentives offered by the Commonwealth, starting with the Virginia Film Office. Grants and tax preferences cost the state at least $147 million in the most recent fiscal year, reports the Richmond Times-Dispatch.

“We don’t have any handle on what is going on,” said Del. Chris Jones, R-Suffolk, House appropriations chairman, and vice-chairman of the new subcommittee of the Joint Legislative Audit and Review Commission (JLARC).

JLARC staff has identified 76 specific incentives for study, including 34 grants, 20 income tax preferences, 18 sales tax exemptions, and four financing programs. The evaluation will focus on how much each program spends, the resulting business activity, and the economic benefits and state tax revenue generated by that activity.

Jones hopes the analysis will give General Assembly money committees a “report card” to guide the legislature when deciding whether or not it makes sense “to be putting this kind of money into incentives.”

Bacon’s bottom line: This is a welcome development. The General Assembly treats economic development incentives as “fire and forget” weapons; they enact the incentives but rarely check if they worked as advertised. In all likelihood, JLARC will find some programs to be effective and some to be obsolete or ineffective. The legislature needs to  diligently weed out the losers.

I hew to the philosophy that state and local governments should pick a few core missions — the administration of justice, public health and safety, education, transportation, utilities, environmental protection, basic social services — and dedicate their energies to achieving world-class excellence in those areas. Any activity that does not fall into one of those buckets is best left alone. The best economic development program in the world is a government that excels at providing core services with a modest level of taxation. All the rest is superfluous.