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The Big Picture San Diego Blog


January 2014

January 31, 2014

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Throughout the nation, and the world, the role of metropolitans is becoming more pronounced. Due in part to political gridlock in D.C., metropolitans have become living incubators for ideas and innovation. Although the rise of the metropolitan region can be seen by anyone who picks up the paper or flips on the T.V., it’s the Brookings Institute that has given this movement new momentum.

San Diego is one region to embrace this "metropolitan first" ethos. This week, EDC – along with numerous regional partners – released the “Global San Diego Export Plan” which focuses on growing our metropolitan economy and creating jobs through exports. The release of the export plan is part of San Diego’s continued participation in the Global Cities Initiative, a joint project of the Brookings Institute and JPMorgan Chase & Co.

In 2012, San Diego was selected by Washington-based Brookings Institute as one of the first eight U.S. cities to participate in a national initiative to pioneer new strategies that boost exports and global economic competitiveness. The Global Cities Exchange has now grown to include 20 U.S. metropolitan areas.

A focus on exports means a focus on all sectors of San Diego’s economy, from the established defense and communications sectors to emerging industries such as craft beer. Companies that export not only grow faster, but are 8.5 percent less likely to go out of business. Additionally, if you work at a company that exports, on average, you will earn a 10-20 percent higher wage than you would if you worked at a company that didn’t export.

San Diego’s Core Team Partners are streamlining four strategies to implement the export plan:

·         Leveraging the diversity of regional markets

·         Developing and increasing small- and-medium-sized enterprises’ capacity to export

·         Concentrating on San Diego’s unique infrastructure assets

·         Leveraging the trade potential of the CaliBaja Bi-National Mega Region

A newly-formed Global Competitiveness Council, comprised of key leadership from the Core Team Partners including elected officials and university leadership, will move forward on implementation of the strategies and provide insight into the region’s trade and investment plans.

In San Diego, we’re not just exporting San Diego products; we’re exporting San Diego culture as well. Core Team Partners have included a Global Outreach component to encourage San Diegans to adopt a more global mindset and use this initiative as a platform for communicating San Diego’s global fluency.

In the coming weeks, the Core Team will continue to push out information regarding San Diego’s plan to increase exports.

In the meantime, here’s what Brookings and some members of the Global Competitiveness Council are saying about this plan:

Brad McDearman, fellow and director of Metro Trade and Investment at Brookings said: “San Diego was selected to be part of the Global Cities Exchange due to its unique cross-border dynamic, Pacific Rim location, demonstrated regional collaboration, and commitment to being more intentional about positioning the region globally. San Diego is a region with tremendous potential in international markets.”

Councilmember Mark Kersey, City of San Diego, 5th District said: “Expanding trade opportunities for San Diego companies is critical to our binational economy. Although we currently have companies utilizing our regional opportunities for trade and commerce, there is a lot more potential. This initiative will provide businesses with concrete information to help them tap into the unique opportunities being a border region provides," said

Thella Bowens, president and CEO of San Diego County Regional Airport Authority said: “The Airport Authority is pleased to see the concrete steps laid out in this plan to improve our region’s export potential, based on the market assessment completed last spring. In terms of air passengers, air cargo and aviation infrastructure, San Diego International Airport plays a crucial role in our region’s export performance. We are committed to working with our partner agencies and the City of San Diego to enhance the export potential of the region”

Mark Cafferty, president and CEO or San Diego Regional EDC said: “We know companies that export not only pay their workforce higher wages, but also create more jobs. This plan is a solid foundation to not only boost employment, but to also start shaping the region’s distinct global identity. The good news is that we have room to grow.”

Brennon Crist, JPMorgan Chase market manager for Middle Market/Commercial Banking said: "Exports of goods and services represent a tremendous opportunity for San Diego businesses to grow and create jobs. The strategies outlined in this Export Plan will be instrumental to helping our region’s employers realize their export potential. The plan serves as a great example of the public-private sector collaboration that’s so critical to ensuring our region’s long-term economic success in a highly competitive global economy.”

Bob Nelson, chairman, Port of San Diego said: “Leaders throughout San Diego share a desire to improve our region’s competitiveness in global markets, which is driven in large part by our goods movement capacity at the Port of San Diego. With two marine cargo terminals, the Port of San Diego is a major player in our region’s export activity. The release of our Brookings Institution Metropolitan Export Plan signals that our San Diego region as a whole is serious about offering businesses a simpler, easier path to exporting – and that we’re willing to work together to get there.”

More statements can be found here.

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January 16, 2014

A new pot of money brings discretionary economic incentives to the Golden State. Let’s make sure San Diego gets a piece of the pie.

Gov. Brown at Soitec dedication cermony

Pictured above: Gov. Brown speaking at the dedication of the Soitec factory. Soitec is a french semiconductor manufacturer that chose to open its North American headquarters in San Diego, creating approximately 450 jobs throughout the region.

Every day we hear from companies both in San Diego, and those looking to move into the region, that are impressed with all the county has to offer businesses. We have top-tier universities that churn out one of the most qualified talent pools in the country. From Oceanside to Otay Mesa, we have a diversity of commercial space that suits virtually every industry. And of course, we have near-perfect weather that helps create a work – lifestyle balance that is second to none.

But for all the things we have, there is one thing we don’t: discretionary economic incentives. All of that is about to change.

Last year, Governor Brown introduced the Governor’s Economic Development Initiative (GEDI), which is designed to give California the edge it needs to continue to attract, retain and expand businesses. GEDI has three main components: a Statewide Sales & Use Exemption for Manufacturing Equipment, which helps companies obtain qualified manufacturing equipment without having to pay the state portion of the sales tax; a New Employment Credit, which helps employers in designated regions around the state hire employees that meet certain criteria; and the California Competes Tax Credit, a discretionary corporate income tax credit available to businesses that want to come to, or stay and grow in California. GEDI went into effect on January 1, 2014.

San Diego can naturally lead the pack in the first two areas. The new employment credit is applicable to the hiring of recently separated veterans, of which the region has in abundance. Due to a strong biotech cluster, the region also has a plethora of high-tech manufacturers that can benefit from the equipment credit. But it’s the California Competes section that really peaks our interest.

Until now, states such as Texas have commanded headlines with grandiose economic incentives, while the perception is that California has no incentives to offer businesses. In reality, we know that more than 70 percent of a company’s productivity - and often its decision to operate in a region - depends on talent availability, but it’s frequently these economic incentives that give a competitive edge to regions looking to attract new investment. Yes, to many San Diego sells itself. But it’s a competitive market globally, and we can’t rest on our laurels any longer, hoping people will come to California because this is where innovation happens.

Starting Jan. 1, California Competes created a $30 million fund for companies that want to come to, or stay and grow in California. Interested employers can apply for these tax credits through the Governor’s Office of Business & Economic Development (GO-Biz), which will negotiate the credit before it is sent to the newly created California Competes Tax Credit Committee for approval. The fund will increase to $150 million in July of this year and $200 million in July 2015. GO-Biz has gone to great lengths to make sure that California remains competitive to businesses of all sizes, by marking 25 percent of the credit for small businesses (less than $2 million in profit).

When it comes to GEDI, EDC’s goal is to make sure that companies throughout San Diego County are aware that there are incentives available, and to ensure that as a region, we are taking advantage of them to attract new companies, and to support and grow those already here. California Competes is a competitive process, and we want to make sure San Diego gets its fair share of the benefit.

Here’s where EDC comes in: we realize that like many government processes, this one may be a bit complicated, and we’re here to help you navigate it. Contact us at info@sandiegobusiness.org to get started and help us by spreading the word about these valuable credits.

The next big idea- and employer- is out there somewhere. It is likely here already. If we add these economic incentives to the existing list of reasons to operate in the region, before long, even more innovators and innovative companies will be able to call San Diego home.


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