WYOMING #17 Lowest Tax Burden
Extraction of natural resources has been driving the Wyoming economy for decades. Increasingly, a combination of expanding regulations and softening commodity prices are causing investment to sift to other sectors, including technology, manufacturing, tourism and infrastructure. Cheyenne is emerging as a data center hub with deals inked by Microsoft, EchoStar and Green House Data. Last year, a gun manufacturer, Magpul, relocated to Cheyenne from Colorado after Colorado passed gun-control legislation.
Last year was a strong year for the hospitality industry, and 2015 has continued the pace. Both the Eastern Shoshone Tribe and the Northern Arapahoe Tribe are expanding their casinos, near Lander and Riverton respectively, to include convention centers, water parks and other amenities. Several regional hydration projects are underway, including the Gillette Regional Water Supply Project and an addition to the Cumberland Rail Spur. A slate of community college, undergraduate education and professional training programs, some housed in new or nearly complete construction, is in progress.
Wyoming’s tax burden ranks lowest out of 50 states, and it ranks first in the Tax Foundation’s State Business Tax Climate Index. Wyoming spends over $89 million per year on incentive
IDAHO #28 Agriculture Is Still the Story
Agriculture continues to drive Idaho’s economy. Farming has expanded at 5.5 percent annually since 1980, with roughly three times greater than the U.S. as a whole. Most job growth, however,
is non-farm. Healthcare and social assistance jobs are expected to pace job creation through at least 2022, followed by growth in retail, hospitality and professional and business services, according to the Idaho Labor Department. Last July, Idaho introduced a new tax reimbursement incentive program that provides a tax credit as high as 30 percent for up to 15 years on sales, payroll and income taxes.
A dozen companies have tapped the program so far, including Skywest Airlines, which is building a new facility in Boise, and Amy’s Kitchen, which produces organic foods in Pocatello.
The Gem State’s seasonally-adjusted unemployment continued to fall this spring, reaching a seven-year low of 3.8 percent in March. Meanwhile, total employment jumped 5,400—the largest
one-month increase on record—to exceed 757,000 for the first time. Still, business leaders would like the state to invest more in infrastructure upgrades. Backlogged bridge and highway projects—valued at over $260 million and with no funding in sight—concern business leaders, says Roy Eiguren at Eiguren Fisher Ellis Public Policy, a lobbyist in Boise. He says business leaders support a fuel tax to pay for the projects, but have not found the political support to make it happen.
Idaho’s tax burden ranks 24th out of 50 states, and it ranks 19th in the Tax Foundation’s State Business Tax Climate Index. Idaho spends over $338 million per year on incentives.
MONTANA: #29 More Sustainable Growth
Patrick Barkey, director of the University of Montana’s Bureau of Business and Economic Research, calls the first half of the current decade “something of an economic miracle” in Montana. Thanks to the Bakken oil boom, rural communities that had been depopulating for decades have revived and are growing again. Tumbling crude prices late last year have dashed cold water on the miracle talk—mining earnings were down in 2014, and will drop lower this year—but forecasters like Barkey call the current situation more sustainable.
Economic growth is occurring more evenly across the major industries, with healthcare, professional business services and retail trade adding workers and paying higher wages. Tourism is counting on gains during the decade’s second half, as well, but other key industries face less cheery paths. Metal prices have been in retreat for three years running, and the state’s ranchers and farmers face a slowdown in the growth of global demand.
Says Barkey: “It all adds up to… more balanced, but possibly slower, economic growth.” Montana’s tax burden ranks 37th out of 50 states, and it ranks 6th in the Tax Foundation’s State Business Tax Climate Index. Montana spends over $101 million per year on incentives.