Commerce budget emphasizes recruitment

Idaho must continue to diversify the economy by recruiting and expanding in many sectors, Don Dietrich, administrator of the Department of Commerce Division of Economic and Community Development, told the Joint Finance and Appropriations Committee.

“Idaho is not insulated from general market hiccups,” he said on Feb. 5.
Dietrich is the acting director of the Commerce Department.
The Department of Commerce played a role in attracting 20 new companies to the state last year, Dietrich told legislators.
The new companies, which set up in all regions of the state, represented a diverse range of industries – from Hoku Material in Pocatello to High Desert Milk in Burley. The department’s efforts brought $588 million in new investment into the state, Dietrich said.
“For two decades Idaho has benefited from a growth economy, but Idaho must look carefully at what states are doing and compete aggressively,” Dietrich said.
He cited an annual report in Forbes magazine, which consistently ranks Idaho as the 6th best place in the country to do business.
While Idaho has held steady, Washington has moved from 12th to 5th.
Transportation was a component of the ranking, though Forbes measures the success of each state on a broad range of incentives and activities, Dietrich said.
Transportation is not a major issue for companies looking at Idaho, unless they happen to be in a rural part of the state with a specific need – like a distribution company. The labor market and telecommunications infrastructure tend to rank much higher, he said.
The availability of electric power has also limited the department’s ability to recruit new businesses, but it has not been a major obstacle.
“Ninety percent of businesses we’re dealing with don’t have power issues,” Dietrich said.
“We are seeing some larger companies that do have extremely large power needs. We did have a particular company that was looking for something that exceeded 200 megawatts. I believe it’s public record that Micron uses about 80 megawatts. This was something the power company could not plan for.”
Most of the department’s business development programs have been cut or significantly reduced.
The Economic Development Sales Force, marketing program, Entrepreneurial Fund, Small Business Assistance Grants, Merit Increases, Information and Communication Technology Upgrade, and Idaho TechConnect were all removed from Gov. Otter’s budget, while the budgets for the Business and Jobs Development Fund and the Rural Initiative Program were cut in half.
Rick Ritter, president of Idaho TechConnect, said he had been working with the Department of Commerce to keep funding TechConnect and the Small Business Assistance Grants.  
Ritter said Otter’s commerce budget is part of his “zero-based” budget philosophy.
“We don’t have a problem with justifying our existence every year,” Ritter said. “A lot of it was taken out of the budget with the expectation that if someone asked it would be put back in.”
Ritter said he provided reports of TechConnect’s activities for the previous year, and that he would be working with individual legislators for another one-time appropriation.