California Gov. Jerry Brown created the Governor’s Office of Business and Economic Development, or GO-Biz, in 2012 to serve as a single point of contact for assisting entrepreneurs and others looking to start, grow or move a business that creates jobs in the Golden State. We recently sat down with Director Panorea Avdis to learn more about what the agency is doing to help California businesses.
How would you assess California’s business climate today?
We have great programs that target small businesses, such as our Jump Start program [for] entrepreneurs that really need very small loans, anywhere from $500-$10,000, just to get them started in their own business.
It’s important to look at the numbers. We’re the sixth-largest economy, we’ve been leading the nation in GDP growth, we’ve been leading the nation in our job growth efforts and our overall unemployment rate has dropped down to 4.9 percent, which is an all-time low for the state of California. I don’t think we’ve seen numbers like this since December of 2000. Even so, we do still have some parts of the state that are suffering from double-digit [unemployment] numbers, so we’ve increased our outreach efforts in terms of services we have available at the state level, in partnership with local and regional economic development organizations.
Your office seems to have a program for just about every kind of business. What is your strongest area of focus?
Well, for sure this governor has definitely modernized the way our economic development tools are shaped. A few years ago, Gov. Brown created within the Governor’s Economic Development Initiative a great program called the California Competes Tax Credit program, in which we are able to administer $200 million a year in tax credits to businesses looking to create new jobs and invest in the state. That is very effective for us. We have great programs that target small businesses, such as our Jump Start program [for] entrepreneurs that really need very small loans, anywhere from $500-$10,000, just to get them started in their own business.
A lot of small businesses are family-run. They often fail to take advantage of programs designed to help them. What kinds of offerings do you have geared to the small family-owned company, and how do you reach out to them?
That’s a great question. I came from a small-business family where we had our own cattle and sheep ranch, and my husband has his own business as well, so I’m constantly asking these questions of my own family. Why didn’t we take advantage of these opportunities? It really came down to just not understanding what was available to us. It’s really important that we identify the right partners throughout the state: Who are the folks we are trying to target in these communities, and who are our best partners to do that? For instance, our business investment services team can work with our local partners to help an aspiring entrepreneur with site selection or with identifying available incentives.
What is the biggest challenge you face in connecting with new businesses, or those that might want to relocate here?
It depends on the company and how sophisticated they are in terms of understanding where they want to be or what specific sector they are focused on. So if the companies that come in know where they want to be, we’re able to move a lot quicker. For those that don’t really know what skill sets are available throughout the state, or the difference in affordability across different regions, it sometimes ends up putting them in a little bit of a difficult situation because they didn’t expect there to be so many places that could potentially meet their needs.
For instance, we have our iHub program, which is a collection of 14 public/private partnerships comprising the state, academia, research institutions, local government and the private sector, all around different emerging technologies. These hubs are creating this ecosystem for new emerging technologies to come to market. So sometimes the challenge is helping companies narrow down just where the skill set is that they’re looking for: Where is the technology and an incubator they could potentially utilize to get their products to market?
Is part of that helping academic institutions fully assess what they need to be teaching, to make sure they have that workforce? Absolutely, it’s an opportunity where we can bring the private sector together with academia to speak to what that company’s needs are now, and most importantly what their needs will be in the future, so they can create a curriculum that can produce that skillset.
Many state and local governments turn first to tax incentives when they’re trying to attract a company. Is that also the predominant interest among most companies?
It’s just one of several issues they’re looking at. It [also] comes down to workforce. What does the skilled labor force look like? What opportunities are there to partner with existing research facilities? What does the supply chain look like? The available incentives to help that company grow is absolutely part of the conversation, but not the only factor.
California has defied many critics in that it has grown its economy while still aggressively moving to combat climate change. Now we’re doing something similar with our efforts to address our transportation infrastructure needs. Does this help or hinder your efforts to lure companies to California?
Overall, it’s a positive thing. Look at how much we’ve grown our ‘green sector.’ No other state in the Union has been able to grow that sector that much and it’s because these policies have brought about new technologies around energy storage and renewable energy and so on. I think the zero emission vehicle is the perfect example of that marketplace. We are definitely leading the nation in the automotive industries these days given specific opportunity around ZEVs.
What does the possible incorporation of Sacramento into the Bay Area mega-region mean?
[Companies that move from the Bay Area to Sacramento have] the potential to grow not only a startup, but also the supply chain it uses … If you get a solar manufacturer to locate here, their supply chain ends up locating here too, and it in turn starts creating an ecosystem that benefits more people. So how can we create the ecosystem for it to continue to grow, to bring its supply chain here and create a resiliency for that supply chain?
As the U.S. pulls away from international agreements, California continues to strengthen its partnerships with other nations. What are some of the biggest opportunities in this regard?
We continue to have many opportunities to collaborate with other nations, particularly around specific technologies. For example, we’re not the only ones that have challenges with water. So there are opportunities for our innovation hubs, research institutions and universities around sharing best practices and sharing the technologies some of them are putting forward [and] opportunities for companies here to take their products abroad … We continue to partner with any country and every country that is really interested in doing business with this state.
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