Saturday, October 22nd, 2016

Head for the Rockies?


Senator Ted Kanavas has a new column looking at the liklihood of MillerCoors moving their corporate headquarters here.

Is it “Miller Time” in Denver?

The proposed joint venture agreement between Milwaukee’s own Miller Brewing and Coors has Miller controlling 58 percent of the new company, MillerCoors, according to the Journal-Sentinel. With such a large controlling interest, it should be obvious that the corporate headquarters for the new company will be right here in Wisconsin, right?

If that was the case, why is Mayor Barrett already lowering expectations for where the corporate headquarters will be located after his meeting with executives from both companies? “I didn’t get the sense that it’s winner take all,” said Barrett, making it clear that Milwaukee would not be winning anything and would be lucky to keep important corporate functions in Milwaukee.

Why is locating the new corporate headquarters in Milwaukee not the obvious choice? Because we have done everything we can to make Wisconsin as unattractive as possible to corporations looking to relocate, whether they are looking to relocate to Wisconsin or from it.

Compare Wisconsin to Colorado. In the recent Forbes rankings of each state’s business climate, Colorado ranked 8th, while Wisconsin was 44th. Actually, taking these numbers into consideration, this merger might give Miller executives an opportunity to consider getting out of Wisconsin despite their historical ties and long-standing commitment to this area.

In their report on the process behind the decision on where to locate the new company’s corporate headquarters, the Journal Sentinel compared the two choices and found Denver to be better than or equal to Milwaukee in almost every category, including taxes, health care costs, transportation, overall business climate and quality of life.

Why would Miller executives fight to have the new corporate headquarters located in the less desirable of the two cities? Is this what they told Mayor Barrett in the meeting they had with him and Governor Doyle? Not to get their hopes up, or the hopes of their constituents, because soon the only trace of Miller that will be left here will be on the outside of the home of the Brewers?

Knowing that a high-profile merger was in the works and that a decision on where to locate a brand-new corporate headquarters was about to be made, what did the Governor and Mayor do? They proposed and supported a budget that would raise our taxes almost two billion dollars. Senate Democrats did their part by supporting a 16% payroll tax for health care when health care costs and taxes are already through the roof.

Is it any wonder why companies rarely consider Wisconsin when deciding where to locate or relocate their headquarters? We have a wonderful state full of natural beauty and fantastic attractions. Forbes ranks Wisconsin 8th in terms of Quality of Life (Colorado is 23rd).

If we have the 8th-best quality of life in the country, how can we be ranked 44th nationally for business climate? The answer is simple, we have done very little to make our state financially attractive to corporate citizens. Companies like to be good neighbors, but ultimately they operate on the bottom line. If they can make more money in another state (or make things better for their employees), they move. Nostalgia will not pay the bills or the shareholders.

Wisconsin needs to correct its course and we need to start immediately. Turning Wisconsin into a desirable corporate destination will probably require new leadership because the Governor and the Senate Democrats have demonstrated an amazing ability to talk about economic development without actually doing anything about it.

A plan that uses tax incentives as a tool to attract more people and companies to our state is a sustainable method of improving our economic climate while easing our top-ten tax burden. We need to cut taxes and use targeted tax credits to keep Wisconsin businesses in Wisconsin while attracting businesses from other states. More businesses mean more jobs, which means more taxpayers and less people requiring services, which reduces the overall cost of government. That allows for the cycle of reducing taxes to continue until we are in the bottom ten for tax burden instead of the top ten.

All of this is achievable with strong leadership and clear vision. It shouldn’t take an overtime touchdown pass to beat Denver; we can do it if we decide that we are more interested in prosperity than bureaucracy. Until we do, companies like Miller, one of our oldest and best corporate citizens, will continue to think twice about staying here.

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