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HomeMy WebLinkAboutPackets - Council Packets (1654) AGENDA JOINT MEETING OF PIMA COUNTY/CITIES AND TOWNS OCTOBER 30, 2000 SHERATON EL CONQUISTADOR RESORT PRESIDIO BALLROOMS III, IV & V 10000 N. ORACLE ROAD JOINT SESSION AT OR AFTER 6:30 PM CALL TO ORDER PLEDGE OF ALLEGIANCE Welcoming Remarks - Mayor Loomis Welcome • League of Arizona Cities and Towns Legislative Awards - Cathy Connolly, Executive Director, League of AZ Cities & Towns Legislative Items • State Shared Revenues, Mary Okoye, City of Tucson • Transportation Funding/Vision 21 - Sharon Megdal, MegEcon and Tom Swanson, Executive Director PAG • Technology Cluster Funding, Bob Hagen, President, HCS Inc. • Air Quality Funding Opportunities - Ursula Kramer, Director of Environmental Quality, Pima County Closing • Regional Topics for Spring Meeting • Host Site League of Arizona f N Cities ANDTOWIIS Towns The 87 members of The League of Arizona Cities and Towns would like to honor these Legislators for their consistent support and show of understanding that "Strong Cities Make a Strong State" Carolyn Allen *Ramon Valadez Carlos Avelar John Verkamp Linda Binder Roberta Voss Bill Brotherton Christine Weason *Carmine Cardamone Linda Aguirre Ted Carpenter Gus Arzberger Jim Carruthers *Keith Bee Ken Cheuvront Ken Bennett Harry Clark Jack Brown Franklin "Jake" Flake Ed Orilla Kathi Foster Chris Cummiskey Susan Gerard *George Cunningham Jeff Hatch-Miller *Ann Day Tom Horne Tom Freestone *Herschella Horton Sue Grace *Steve Huffman Herb Guenther Leah Landrum Mary Hartley Barbara Leff Jack Jackson John Laredo Joe Eddie Lopez Mark Maiorana Harry Mitchell Bob McLendon Pete Rios Richard Miranda *Elaine Richardson *Andy Nichols Tom Smith *Debora Norris *Ruth Solomon *Marion Pickens *Victor Soltero Rebecca Rios John Wettaw `Southern Arizona Delegation State Shared Revenues and the City of Tucson Budget I. General Recurring Funds A. $108 million is the State Shared Revenues or 33% of Total 1. $49 million (15%) State Income Tax 2. $59 million (18%) State Sales and Auto Lieu Taxes B. General Recurring Funds Budget of City 1. 37% is for Public Safety (Police and Fire) 2. 12% is for Transportation, most of which is Mass Transit and Special Needs Transportation ($33.5 million Transit and modifications for Other activities including Streets) 3. 11% Parks and Recreation 4. 8% Solid Waste Management 5. 32% All Others II. Street Program Funding A. $97.1 million 1. $54.5 million (56%) Highway User Revenue Funds 2. $18.5 million (19%) Highway User Revenue Bonds 3. $31.1 million (25%) Other B. HURF Bonds are a direct function of the amount of available HURF revenues. If HURF revenues are lowered, the City's ability to sell HURF bonds is reduced. C. The City has no voter approved General Obligation bonds. III. What Can the City do if State Shared Revenues are Reduced? A. City Charter imposes limitations on the City's revenue sources. 1. City Business Privilege Tax is capped at 2% with food exempted. 2. Property Tax is capped at$1.75 per 100 assessed valuation which in reality is limited $1.50 with the$.25 difference set aside to provide coverage assurance to bond rating agencies 3. Charter Amendment is required for a City Use Tax B. If Revenues aren't raised, services would be cut 1. Basic services would need to be reduced 2. A growing Tucson would suffer City of Tucson General Recurring Funds Budget 2000-01 Total Budget = $331 million* State Revenue Sharing 15% Shared State Sales and Auto Lieu Taxes 18% Other General Recurring Fund Revenues 67% Funding in $millions State Revenue Sharing (Income Tax) $ 48.6 Shared State Taxes (State Sales and Auto Lieu) 59.1 Other General Recurring Fund Revenues 223.3 Total General Recurring Funds Budget $ 331.0 * Excludes funds brought forward from prior year and debt service funds City of Tucson General Recurring Funds Budget by Department 2000-01 Total Budget = $331 million* Police 25% Fire 12% Transportation 12% Other Departments Recreation 32% t*,,.,,,, , 1, Parks and 11% Solid Waste Management 8% * Excludes funds brought forward from prior year and debt service funds City of Tucson Street Program Funding 2000-01 Total Budget = $97.1 million Highway User Revenue Funds 56% Highway User Revenue Fund Bonds 19% General Recurring Fund Revenues Other Capital 1 Funds* 24% Funding in $millions Highway User Revenue Funds $ 54.5 Highway User Revenue Fund Bonds 18.5 \MN VI V 1111 Total Highway User Revenue and Bond Funds $ 73.0 General Recurring Fund Revenues 0.8 Other Capital Funds* 23.3 Total Street Program Funding $ 97.1 Primarily federal funds, contributions from other agencies, and special assessments .e ........... Pima County Department of Environmental Quality — Key Air Quality Issues Ursula Kramer Director 10/27/00 Introduction . Key air quality issues in Pima County . Proposals to address those issues 10/27/00 2 „Topics of Discussion . Particulate Matter . Carbon Monoxide . Ozone 10/27/00 3 Pima County Department of Environmental Quality 1 •.:r Particulate Matter . Pima County had high levels of particulate matter(dust)in 1999 resulting in violations of federal air quality standards. . Dust problems were caused by high winds. . Pima County must develop a Natural Events Action Plan(NEAP)to address this problem. . Develop plan by June 2001. . Implement plan by December 2002. . Failure to develop the NEAP will result in nonattainment designation for Pima County. 10/27/00 4 Particulate Matter Natural Events Action Plan . Public notification and education programs. . Minimize public exposure. . Identify cost effective strategies to minimize blowing dust. 10/27/00 5 Particulate Matter Budget Public notification and education $100,000 program Minimize public exposure $340,000 Total $440,000 10/27/00 6 Pima County Department of Environmental Quality 2 Carbon Monoxide . Tucson now meets the federal air quality standard for carbon monoxide(CO). . Pima County needs to implement a CO Limited Maintenance Plan. . Pima County must expand the CO air monitoring network. . Failure to implement the Plan could result in a nonattainment designation for CO for Pima County. 10/27/00 7 Carbon Monoxide Funding Needs -------------------- Equipment $70,000 Operation and Maintenance $25,000 Personnel $75,000 Total $170,000 10/27/00 8 Ozone . Pima County currently meets the air quality standard for ozone. . Governor's air quality strategies task forces recommended and the legislature enacted: . Lawn and garden equipment buy-back program. . Voluntary vehicle repair and retrofit program. 10/27/00 9 Pima County Department of Environmental Quality 3 Ozone Lawn and Garden Equipment ��r---- . Lawn mowers and other gasoline- powered lawn and garden equipment have no emission controls. • This equipment contributes significantly to air pollution. 10/27/00 1 Ozone - Lawn and Garden Equipment PPDOOSal . Voluntary program to provide financial incentives to replace gas-powered equipment with less polluting equipment. . This program was originally established in 1998. • The program is currently unfunded. `0/27/00 " Ozone - Lawn and Garden 0O�O� Accomplishments • `��r---- =" .xv~ 160 wo M.=.,~^ 120 pollution� � ~ . ~ ~m xvEDnovv «v • ^,,~,^^^ m—���0�� — .~ _ m'o 1999 2000 10/27/00 1~ Pima County Department of Environmental Ozone Vehicle Repair and Retrofit . Up to 70% of ozone pollution comes from cars and trucks. . Voluntary program originally started in 1999 to fix high-emitting vehicles by subsidizing repairs and the installation of emission upgrade kits. . Current legislative funding will expire in December 2001. 10/27/00 13 In Conclusion . Particulate Matter. Develop and implement the Natural Events Action Plan; failure will result in nonattainment designation. . Carbon Monoxide. Expand the monitoring network; failure will result in nonattainment designation. . Ozone Fund voluntary programs to help us stay in attainment. 10/27/00 14 Pima County Department of Environmental Quality 5 Draft State-wide Cluster/Foundation Legislative Funding Proposal (GTSPED Legislative Working Group) September 15, 2000 Information Technology Association of Southern Arizona - ITASA-Tucson, Arizona overview: In order for Arizona to grow, diversify its economic base and remain competitive in the new economy (one which is knowledge as opposed to physical-asset based), it is essential that a close public/private partnership be developed and maintained among Arizona's clusters, foundations, universities, outlying communities and designated state/local economic development organizations- Such a partnership can best be established via a continuation of state cluster/foundation funding initiated this year. It would in turn be matched by local city, county, economic development, cluster and private-sector funds. Clusters/Foundations: Clusters are geographic concentrations of interdependent companies, technologies, suppliers, institutions and talent that constitute an important area of economic development focus or activity for increasing member company competitiveness, development and growth; creating new jobs; and generating additional state, county and city revenues- Foundations are organizations which help clusters grow and operate more competitively. The Governor's Strategic Partnership for Economic Development recognizes eleven statewide clusters, three regional clusters and seven foundations. Arizona's economic development strategy is based on the cluster/foundation concept. On a national basis, clusters employ 57% of the US workforce, generate 61% of the nation's output and produce 78% of the nation's exports. Within Arizona, many of the clusters represent high-tech jobs which pay on average 50% or more than the average private-sector job, are export oriented in nature (bring in new money) and are growing at 5 to 10% per year. Statement of Need: Funds made available under this proposal would be specifically utilized in support of critically-needed cluster implementing organization business development programs in such areas as workforce development, capital formation, telecommunications infrastructure buildout, marketing/image building and technology development, transfer and incubation. Funds Requested: It is expected that $5 to $10 million in funds will be requested from the Arizona legislature for critically needed cluster/foundation business development initiatives which would be implemented on a statewide basis, including major metro and outlying areas. Return on Investment (ROI): It is contemplated that an adequately funded cluster business development program statewide over a period of five years would generate upwards of 20,000 to 40,000 new jobs. Assuming that half of the new jobs would be created at a pay scale 50% higher than the average state-wide private-sector wage of $30,000 and half of them would be created at it, approximately $70 to $140 million dollars of state/county/city revenues would be generated from them. This estimate is based on impact information made available by the UA. Implications of Not Implementing: Failure to provide the requested funding would jeopardize Arizona's future competitiveness in the unfolding new economy as others already have been actively supporting industrial growth for quite some time. For example, all of our neighboring states (i.e., California, Colorado, Nevada, New Mexico and Utah) as well as many states outside our region have been successfully developing their high-tech community with financial and other resources for a number of years. Administration: The Arizona Department of Commerce (ADOC) would administer funding under this proposal. It would be subject to an appropriate mechanism of justification. Moreover, a method of funding accountability (e.g., a reporting mechanism on specific accomplishments achieved) is also deemed part of this proposal. Contact: For more information concerning this proposal, please contact Bob Hagen, Co-chair of the GSPED Software Et Information Industry Cluster, bob@hcstucson.com or 520-742-6601. AGENDA JOINT MEETING OF TOWN OF ORO VALLEY, TOWN OF MARANA, CITY OF TUCSON, TOWN OF SAHUARITA & PIMA COUNTY OCTOBER 30, 2000 SHERATON EL CONQUISTADOR RESORT 10000 N. ORACLE ROAD DINNER: PRESIDIO BALLROOMS 1 & 2 - AT OR AFTER 5:30 PM JOINT SESSION: PRESIDIO BALLROOMS 3, 4, 5 - AT OR AFTER 6:30 PM CALL TO ORDER PLEDGE OF ALLEGIANCE Welcoming Remarks - Mayor Loomis Welcome • League of Arizona Cities and Towns Legislative Awards - Cathy Connolly, Executive Director, League of AZ Cities & Towns Legislative Items • State Shared Revenues, Mary Okoye, City of Tucson • Transportation FundingNision 21 - Sharon Megdal, MegEcon and Tom Swanson, Executive Director Pima Association of Governments (PAG) • Technology Cluster Funding, Bob Hagen, President, HCS Inc. • Air Quality Funding Opportunities - Ursula Kramer, Director of Environmental Quality, Pima County Closing • Regional Topics for Spring Meeting • Host Site ADJOURNMENT POSTED: Oro Valley Town Hall 11,000 N. La Canada Drive Oro Valley, Arizona 10/27/00 4:30 p.m. lh League of Arizona ;, "000100000100000, • Cities ANDTOWIIS D Towns The 87 members of The League of Arizona Cities and Towns would like to honor these Legislators for their consistent support and show of understanding that "Strong Cities Make a Strong State" Carolyn Allen *Ramon Valadez Carlos Avelar John Verkamp Linda Binder Roberta Voss Bill Brotherton Christine Weason *Carmine Cardamone Linda Aguirre Ted Carpenter Gus Arzberger Jim Carruthers *Keith Bee Ken Cheuvront Ken Bennett Harry Clark Jack Brown Franklin "Jake" Flake Ed Cirillo Kathi Foster Chris Cummiskey Susan Gerard *George Cunningham Jeff Hatch-Miller *Ann Day Tom Horne Tom Freestone *Herschella Horton Sue Grace *Steve Huffman Herb Guenther Leah Landrum Mary Hartley Barbara Leff Jack Jackson John Loredo Joe Eddie Lopez Mark Maiorana Harry Mitchell Bob McLendon Pete Rios Richard Miranda *Elaine Richardson *Andy Nichols Tom Smith *Debora Norris *Ruth Solomon *Marion Pickens *Victor Soltero Rebecca Rios John Wettaw *Southern Arizona Delegation State Shared Revenues and the City of Tucson Budget I. General Recurring Funds __ A. $108 million is the State Shared Revenues or 33% of Total 1. $49 million (15%) State Income Tax 2. $59 million (18%) State Sales and Auto Lieu Taxes B. General Recurring Funds Budget of City 1. 37% is for Public Safety (Police and Fire) 2. 12% is for Transportation, most of which is Mass Transit and Special Needs Transportation ($33.5 million Transit and modifications for Other activities including Streets) 3. 11% Parks and Recreation 4. 8% Solid Waste Management 5. 32% All Others II. Street Program Funding A. $97.1 million 1. $54.5 million (56%) Highway User Revenue Funds 2. $18.5 million (19%)Highway User Revenue Bonds 3. $31.1 million (25%) Other B. HURF Bonds are a direct function of the amount of available HURF revenues. If HURF revenues are lowered,the City's ability to sell HURF bonds is reduced. C. The City has no voter approved General Obligation bonds. III. What Can the City do if State Shared Revenues are Reduced? A. City Charter imposes limitations on the City's revenue sources. 1. City Business Privilege Tax is capped at 2% with food exempted. 2. Property Tax is capped at$1.75 per 100 assessed valuation which in reality is limited$1.50 with the$.25 difference set aside to provide coverage assurance to bond rating agencies 3. Charter Amendment is required for a City Use Tax B. If Revenues aren't raised, services would be cut 1. Basic services would need to be reduced 2. A growing Tucson would suffer City of Tucson General Recurring Funds Budget 2000-01 Total Budget = $331 million* State Revenue Sharing 15% Shared State Sales and Auto Lieu Taxes . . .� 18% Other General Recurring Fund Revenues 67% Funding in $millions State Revenue Sharing (Income Tax) $ 48.6 Shared State Taxes (State Sales and Auto Lieu) 59.1 Other General Recurring Fund Revenues 223.3 Total General Recurring Funds Budget $ 331.0 * Excludes funds brought forward from prior year and debt service funds City of Tucson General Recurring Funds Budget by Department 2000-01 Total Budget = $331 million* Police 25% Fire 12% Transportation ,400 12% Other Parks and Departments Recreation 32°/a 11 Solid Waste Management 8% * Excludes funds brought forward from prior year and debt service funds City of Tucson Street Program Funding 2000-01 Total Budget = $97.1 million Highway User Revenue Funds 56% Highway User Revenue Fund Bonds 19% General Recurring Fund Revenues Other Capital 1 Funds* 24% Funding in $millions Highway User Revenue Funds $ 54.5 Highway User Revenue Fund Bonds 18.5 Total Highway User Revenue and Bond Funds $ 73.0 .General Recurring Fund Revenues 0.8 Other Capital Funds* 23.3 Total Street Program Funding $ 97.1 '` Primarily federal funds, contributions from other agencies, and special assessments 4 linis4. 441, , isounmetimpri 2 issue 3 October 2000 GOVERNOR'S TRANSPORTATION TASK FORCE IF Message from the Co-Chairs Vs you know, this election season suggestion and we have developed a is a busy one in Arizona. A revised schedule for the Task Force. umber of initiatives have been Our current draft would have the Task V filed proposing substantial public Force adopt its final report in mid- policy changes for our state. In April, 2001. addition, the legislature has referred a number of issues to the ballot. The Task Force has been actively VBeyond these policy choices, Arizona working to address a wide range of voters will also be selecting a state-wide transportation policy issues President, U.S. Senator, U.S. Cong- including such complex issues as ressmen, ninety members of the needs, revenues, overall system Legislature as well as local officials. planning, governance, and planning and programming. This newsletter All important public policy recom- and upcoming issues will bring you up mendations should incorporate public to date on Task Force discussions. input assembled through an appropriate public outreach process. We hope you share our view that this In recognition of the importance of decision will improve public outreach the work of the Task Force, we feel its efforts and facilitate us achieving our efforts should be provided the goals and objectives. We look forward greatest opportunity for thorough to seeing you at our public outreach public discussion and debate. Our meetings in 2001. original schedule called for our public meetings on our findings and proposed recommendations to occur Sharon B. Megdal, Ph.D. in September and October. There is Co-Chair however, a limit to the number of policy issues that can be Martin L. Shultz simultaneously debated effectively in Co-Chair the public arena. It is unlikely that the Task Force's voice will be heard in the midst of a very active election season. Therefore, in recognition of the 0 cacophony of competing political and policy discussions that will occur important Dates leading up to the November election, we suggested to Governor Hull that public Meetings the Task Force take some additional 6 time to develop and refine our January and February, 2001 proposed recommendations and to conduct our public outreach meetings Final Task Force Report after the November election. The April, 2001 Governor has concurred in our Task Force Retreat Highlights ,;, fhe Task Force met to identify and y Clear responsibility and authority for prioritize overall transportation the transportation system should be system goals and objectives. This established to encourage greater summary reflects the results of coordination and consistency. These these discussions. responsibilities and authorities should be consistent with any recom- .-` Arizona must have an efficient, multi- mended governance structure. modal transportation system that con- tributes to the overall quality of life of its y Consistent, minimum statewide citizens and serves the future transport- standards for quality and perform- ation needs of the entire state. The ance should be established. Based on transportation system should address the these standards, system performance following goals identified by the Task should be measured and reported. Force. la,. The overall system must have con- The principal long-range expectations sistent, reliable, adequate, dedicated, for Arizona's transportation system but flexible, funding. All available are mobility, connectivity, economic sources, including federal funds, vitality, reliability and system financing innovations, private sources preservation. and public-private partnerships, should be explored to maximize The roles and responsibilities of all funding for the system. participants in the system (including state government, local govern- Dedicated transportation taxing ments, tribal governments and authority should be established or regional planning entities) should be expanded. determined, integrated and better coordinated. Planning, program- Emphasis must be placed on oper- ming, and reporting processes must ation and maintenance of system be integrated to ensure a sustain-able assets to protect the investment and and reliable system. to improve overall utilization of the system. y All federally funded state and local transportation programs should be Comprehensive financial manage- incorporated into the transportation ment processes (including revenue planning, programming and report- forecasting techniques and expend- ing processes. iture management techniques) should be expanded to all aspects of v. The governance of the system must the system. establish clear accountability and -- ____,— strengthen public confidence in the y In order to be effective, land use system. Planning, funding (including plans must consider state and source: taxation), implementation and per- regional transportationplans, Full Task Force Retreat, p March 17th and 18th, formance monitoring responsibilities especially with respect to future Casa Grande,Arizona should be linked to achieve this goal. transportation corridors. In turn, state and regional transportation y The planning and programming pro- plans should recognize local land use cesses should facilitate integration of plans. The coordination and consid- all modes. These processes should eration of the overlaying transport- optimize each mode's strengths and ation system plans and land use plans minimize intermodal conflicts. by all affected jurisdictions will increase the usefulness and benefits of those plans and will help avoid unintended conflicts in the future. 2 Continuing Activities of the Thsk Force The March Retreat helped that would serve as the basis for crystallize Task Force goals for planning and measuring the Arizona's overall transportation effectiveness of the State's multi- system. As shown in the highlights, modal transportation system in the Retreat helped outline future the future. Suggested expectations for the system. The performance criteria included: Retreat also helped guide future Task mobility and accessibility; Force discussions. reliability of the system; cost effectiveness of the system; The Task Force has taken a logical, safety; and the system's effect on IF multi-faceted approach to assess overall economic vitality. Arizona's transportation system. Task Force members felt strongly that wr the importance of preservingV' they needed a common baseline to future transportation corridors assess overall needs on the system. and the need to adopt appro- With the assistance of a consultant priate access controls for major k ;= team, the Task Force is assessing transportation facilities. transportation needs throughout the state. 3z future transportation develop- ments, especially as they relate to In addition, the Task Force recognized intelligent transportation systems that they needed a clear view of and various techniques for current revenues, reasonably expanding the utilization of the projected revenues, as well as an existing transportation system assessment of how Arizona's capacity. transportation revenues compared with other states. A preliminary In between full Task Force meetings, consultant report has been issued, the three committees of the Task with a final revenue assessment Force have met on numerous report expected shortly. The two occasions. In addition to the complex reports- Needs and Revenues-will task of assessing future needs and then be used to develop a set of revenues, the Definition of Needs, "hypothetical" transportation plan Revenues and Resources alternatives to meet Arizona's long Committee has discussed a variety of range transportation requirements. topics including: These alternative plan scenarios will be discussed by the Task Force and methods and techniques for used to develop a comprehensive standardizing the collection and long-range transportation plan that reporting of transportation will be submitted for public system data. comment. ir the "life cycle" management On a parallel track, the Task Force has process used in connection with also looked at a variety of areas that the Maricopa Regional Freeway can help strengthen the transport- system and how techniques used ation system. Some of the areas in that process might be discussed in recent months include: expanded into a comprehensive statewide financial management y the development and application process. of standardized transportation system performance measures Continuing Activities of the Task force (continued from Page 3) The Planning and Programming The Governance Committee has Process Committee has met on discussed issues including: several occasions to discuss potential improvements to the transportation iwir accountability of the overall processes at all levels within Arizona. transportation system. Specific subjects included: 'shy citizens' needs and expectations. V alternative planning processes and procedures, based upon a IF responsiveness of the current review of the practices in sample governance system to state, states throughout the country. regional, and local needs. potential capacity enhancement improving the relationship among strategies including improved transportation planning, design, design, improved operational funding, construction and techniques, enhanced utilization operation. of traffic signal synchronization, plus expanded utilization of the the need to balance local needs transit system through van and and desires with regional state car pools, and significantly needs and desires and vice versa. increased express bus service. alternative governance structures performance based planning in based upon a review of which performance measures are governance structures in other incorporated in the planning states. process and actual system operation data is collected and reported using the same measures, to ensure that the system is meeting expectations. In Upcoming Issues • Transportation Revenues in Arizona & How Our Taxes Compare with Other States ✓ Arizona's Long Term Transportation Needs vir Arizona's Transportation Alternatives - Recommendations from the Task Force ✓ Task Force Public Meeting Schedule 4 Future activities livith the revised schedule, the The current schedule for the Task Task Force and its Force calls for the development of Committees will have add- tentative recommendations in the itional time to examine issues in last part of this calendar year. Those greater detail as well as issues that recommendations will be the subject lir might not otherwise receive a full of a series of public meetings held in discussion. Among the issues that January and February of 2001. On will be discussed by the Task Force in the basis of the feedback received the months ahead are: during those meetings, the Task - Force is scheduled to then prepare V' the unique transportation issues and submit its final report to the surrounding Arizona's tribal Governor by mid-April 2001. - governments. ✓ transportation issues associated with aviation. 'V the role of rail transport in the overall transportation system. ✓ further discussions of the relationship between transport- ation planning and land use planning. Information concerning activities of the Task Force may be obtained from the Vision 21 Task Force Administrative Coordinator, Matt Carpenter, at 206 S. 17th Ave., 310B, Phoenix, AZ 85007, telephone 602.712.7865 or by e-mail at vision21@dot.state.az.us. Visit our web site at: www.dot.state.az.us/vision2 1 - s Gover'nor'" " Transportation n BULK Vision 21 ,�'k Force MAIL 206 S. 17th Ave., Mail Drop 310B PERMIT Phoenix, Arizona 85007 No. 373 ADDRESS CORRECTION REQUESTED 11,441 GOVERNOR'S TRANSPORTATION TASK FORCE Draft State-wide Cluster/Foundation Legislative Funding Proposal (GTSPED Legislative Working Group) September 15, 2000 Information Technology Association of Southern Arizona - ITASA-Tucson, Arizona Overview: In order for Arizona to grow, diversify its economic base and remain competitive in the new economy (one which is knowledge as opposed to physical-asset based), it is essential that a close public/private partnership be developed and maintained among Arizona's clusters, foundations, universities, outlying communities and designated state/local economic development organizations- Such a partnership can best be established via a continuation of state cluster/foundation funding initiated this year. It would in turn be matched by local city, county, economic development, cluster and private-sector funds. Clusters/Foundations: Clusters are geographic concentrations of interdependent companies, technologies, suppliers, institutions and talent that constitute an important area of economic development focus or activity for increasing member company competitiveness, development and growth; creating new jobs; and generating additional state, county and city revenues- Foundations are organizations which help clusters grow and operate more competitively. The Governor's Strategic Partnership for Economic Development recognizes eleven statewide clusters, three regional clusters and seven foundations. Arizona's economic development strategy is based on the cluster/foundation concept. On a national basis, clusters employ 57% of the US workforce, generate 61% of the nation's output and produce 78% of the nation's exports. Within Arizona, many of the clusters represent high-tech jobs which pay on average 50% or more than the average private-sector job, are export oriented in nature (bring in new money) and are growing at 5 to 10% per year. Statement of Need: Funds made available under this proposal would be specifically utilized in support of critically-needed cluster implementing organization business development programs in such areas as workforce development, capital formation, telecommunications infrastructure buildout, marketing/image building and technology development, transfer and incubation. Funds Requested: It is expected that $5 to $10 million in funds will be requested from the Arizona legislature for critically needed cluster/foundation business development initiatives which would be implemented on a statewide basis, including major metro and outlying areas. Return on Investment (ROI): It is contemplated that an adequately funded cluster business development program statewide over a period of five years would generate upwards of 20,000 to 40,000 new jobs. Assuming that half of the new jobs would be created at a pay scale 50% higher than the average state-wide private-sector wage of $30,000 and half of them would be created at it, approximately $70 to $140 million dollars of state/county/city revenues would be generated from them. This estimate is based on impact information made available by the UA. Implications of Not Implementing: Failure to provide the requested funding would jeopardize Arizona's future competitiveness in the unfolding new economy as others already have been actively supporting industrial growth for quite some time. For example, all of our neighboring states (i.e., California, Colorado, Nevada, New Mexico and Utah) as well as many states outside our region have been successfully developing their high-tech community with financial and other resources for a number of years. Administration: The Arizona Department of Commerce (ADOC) would administer funding under this proposal. It would be subject to an appropriate mechanism of justification. Moreover, a method of funding accountability (e.g., a reporting mechanism on specific accomplishments achieved) is also deemed part of this proposal. Contact: For more information concerning this proposal, please contact Bob Hagen, Co-chair of the GSPED Software a Information Industry Cluster, bob@hcstucson.com or 520-742-6601.