Article from Colorado Politics
March 19, 2019
In the world of business one of the greatest enemies is uncertainty. Insecurity makes it difficult for businesses to formulate plans for the future and make investments or add jobs.
Making an investment of millions of dollars whether that is replacing equipment or expanding operations is a difficult decision for any business. It involves a number of considerations. A major factor though in any decision of this nature is the perceived future conditions not only as to the overall national economy but the current and future business environment within the state and communities where such an investment would be made. To a large extent this view is shaped by the laws and regulations of state and local governments today as well as where they may be headed in the future. It’s not only the companies, themselves, that must feel comfortable about the future but also the financiers responsible for providing the loans and capital for the business.
Colorado’s economic success over the years has been in many ways shaped by a somewhat stable environment for business. While control of the legislature and Governor’s Office may have changed with shifts to the left or to the right, those changes were for the most part muted by people in both parties who recognized the importance of preserving a stable environment for business and jobs to prosper in the state.
This situation has led to Colorado’s economy being ranked by US News and World Report as the #1 economy in the country last year after having several years of 3 percent or greater GDP growth. Such an achievement is a testimony to legislators and administrations over the past 20 years who have steered the ship of state in a direction in a manner which made businesses comfortable to make long term investments here and create one of the best economic success stories in the country.
Recent actions by the General Assembly and governor have given a jolt to the business community and uncertainty about the business environment is growing. Each week it appears that a new measure with some fiscal or regulatory impact emerges from the General Assembly. This has led many business people within the state as well as those from the outside, who may be considering Colorado for a future site, to take pause. Those businesses, like mine, must assess how the changes already enacted or being considered, may affect them and their operations and whether they can obtain a future return on investment. Many are asking whether they should invest in new equipment, add jobs, or consider business expansion in this uncertain and continually changing environment. Can they obtain a return on those investments or be able to support adding new employees? The fear is that in light of this uncertainty and a rapidly changing environment with no idea of the end game, many businesses begin to apply the brakes or even contract their business operations. When this occurs, the economic miracle that Colorado has experienced, may go in reverse, and in a hurry. Instead of a growing economy with budget surpluses and low unemployment, we may witness the Colorado economy retrench. Rather than being a state fielding offers for businesses to relocate here from other states, we may find ourselves engaged in retaining our existing ones from being drawn to more business friendly environments.
As we have seen in some other states, where measures were viewed to have gone too far, it’s difficult to “unring the bell” when businesses begin to view a state as being unfriendly.
The governor and the legislature are at a critical juncture. There is a need to slow down the legislative blizzard and engage the business community more on the possible impacts or implications. Taking a little more time and speaking with business people, affected by many of these changes, may help in better shaping the measures so as to avoid inadvertent or unforeseen problems that may severely damage our state and its economy today and into the future.
Jeff Cummings is the president and CEO of Duffy Crane and Hauling, one of Colorado’s oldest companies. He is a past chairman and current board director of the Colorado Motor Carriers Association, which represents over 650 companies involved in trucking in Colorado.