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Brewer creates AZ Commerce Authority – but no authority yet

The Arizona Commerce Authority is officially on the job, though it currently exists in name only.

Gov. Jan Brewer on June 29 signed an executive order creating the Arizona Commerce Authority, a public-private partnership that she wants to eventually replace the Arizona Department of Commerce as the main agency in charge of business attraction and development in the state.

The change, however, requires legislative approval that would not happen until at least January.

While it awaits legislative approval, the Arizona Commerce Authority will consist only of a 30-member board of directors that includes top executives from some of the state’s largest companies. The authority will be led by a chief executive officer who will be selected by the board of directors, which will be chaired by the governor.

Once it is officially established, Brewer said, the authority will use the expertise of the private sector to spearhead initiatives to attract new businesses to Arizona and strengthen existing ones.

The governor heralded the Arizona Commerce Authority as a major step in the state’s economic recovery, and said it would be a marked improvement over the Department of Commerce, which garned animosity from some conservative lawmakers and became infamous for its revolving-door leadership through the years.

“I truly believe this is probably one of the biggest changes in Arizona in the last couple of decades,” Brewer said at the signing ceremony for her executive order.

Commerce Director Don Cardon, who oversaw the planning of the Arizona Commerce Authority, said the new agency would be far more effective than the “fragmented” Department of Commerce. Whereas the Department of Commerce is split into seven divisions with responsibility over 58 statutory requirements, Cardon said the new authority would have just two primary objectives – the attraction, expansion and retention of businesses in Arizona; and the “integration of our energy pursuits.”

“I believe this is an amazing day. Many of you may think this is a reorganization. It is not a reorganization. It is a focus. It is an engagement of the private sector,” Cardon said.

Other divisions of the Department of Commerce will be transferred to other state agencies.

Brewer also announced an award of $10 million in discretionary federal stimulus money to the Department of Commerce for economic development in rural Arizona. The governor said she and the Department of Commerce have not yet determined exactly how the money will be spent.

Business mogul Jerry Colangelo, who was named vice chair of the commerce authority’s board of directors, said the authority’s goal was to create a more acceptable environment for business attraction in Arizona.

“I’ll use whatever means I can to sell our state and attract businesses and new companies. And I want a toolbox of all kinds of initiatives, tax breaks, whatever it takes,” Colangelo said.

Brewer, Colangelo and Cardon said they had broad legislative support for the plan. Shortly after the announcement, House Speaker Kirk Adams released a statement praising the governor’s actions.

“It is a much needed first step in the broader economic development strategy sorely needed by Arizonans to restore job growth,” Adams said.

Adams said the state also needed lower corporate income and commercial property taxes, possibly foreshadowing a larger economic recovery package in the 2011 legislative session. Adams spent much of the 2010 session pushing a bill that would have lowered business taxes and implemented other job creation incentives, but the bill stalled in the Senate over concerns that the state could not afford the tax cuts.

After Brewer unveiled her plans for the Arizona Commerce Authority in April, there was talk of including it as part of the Adams plan, but that proposal never materialized.

The board of directors will hold its first meeting Sept. 23.

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