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November 07 2017


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May 04 2015


N.H. promotes business climate but spends little to recruit

New Hampshire lawmakers repeatedly talk about the state's "business climate" and the need to attract and retain employers, but lately they haven't bought into the idea of spending money to make money.

When it comes to actually recruiting businesses, the state doesn't drop cash on several key tools necessary to compete with other states. There hasn't been a state economic development plan for more than a decade, and just last year the governor appointed the Division of Economic Development's first permanent director in roughly five years.

The division's two business recruiters also don't have money to travel out of state for recruitment meetings or trade shows, and the state lacks an online portal with key recruitment information that many states have.

"It's highly competitive, and the places that don't have the best product and don't have the best economic development delivery system are going to be at a disadvantage," said Mark Waterhouse, a certified economic developer and professor based in Connecticut.

The division will have an economic development plan by the end of 2015, after lawmakers passed a bill requiring one last year. It will be the first one since Jeanne Shaheen's tenure as governor more than a decade ago.

"It was an absolute embarrassment that the great state of New Hampshire did not have an economic development plan," said John Cebrowski, a former Republican state representative who served on the state's Economic Development Advisory Council and sponsored the legislation requiring a plan.

The Division of Economic Development, a part of the Department of Resources and Economic Development, focuses on two main areas: helping existing state businesses grow and recruiting new ones.

In 2014, 17 businesses relocated to New Hampshire, bringing roughly 1,200 jobs, according to the division's annual report. That's up from 2012 and 2013, which saw 10 and nine businesses relocate here, respectively. The division was not producing annual reports for several years before 2014, making it hard to find previous data on new property tax revenues ($4.6 million in 2014) and new capital expenditures ($130 million last year.)

The state's two business recruiters currently have no money to travel across the country; they can go wherever they can get on a tank of gas, which primarily means Massachusetts and Quebec, said Carmen Lorentz, director of the Division of Economic Development. Lawmakers have not provided money in the budget for long-distance travel since 2011.

Next year may be different. Gov. Maggie Hassan included $120,000 in her budget over two years for out-of-state business travel and the House kept it in its budget. The money would allow the state to send its recruiters to three trade shows and host one of its own and to set up out-of-state meetings to follow leads when necessary.

Companies in nearby states that already know about New Hampshire's advantages, such as its low tax structure and educated workforce, may be inclined to look here on their own, Lorentz said. But businesses outside the Northeast need a little nudge to put New Hampshire on their radar. For example, a California company looking to relocate because of the drought might not initially consider New Hampshire.

The roughly $2.3 million in general funds the division received in fiscal year 2015 is $1 million less than it was in 2008. The House budget increases the funding for the next two years, to $2.4 million and $2.6 million, slightly less than Hassan's proposal. Vermont, by comparison, spent about $4.5 million in state general funds for economic development in fiscal year 2015.

The proposed budget also includes $65,000 for new technology, including the building of a "site selection" website, a key resource for businesses in the early stages of the moving process and a near-industrywide standard. The websites allow businesses to see whether the state has the real estate, workforce and demographics they are looking for, along with other factors.

"If (businesses) go to your website and they can't find what they are looking for, they are more likely to cross you off the list than they are to pick up and call you," Waterhouse said.

Jeffrey Rose, commissioner of the Department of Resources and Economic Development, said he is proud of what his team has been able to do with limited resources.

"There are certain realities in terms of the types of goods and services that we can provide based on our funding," Rose said. "However, I feel as though we are effectively using the dollars we are provided by the Legislature."

Lawmakers agree and say they wish they could provide more.

"We can only do so much in New Hampshire, and we have to be aware of that," Republican Senate President Chuck Morse said.


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