Dollars spent with local businesses have a far greater impact on Arizona’s economy, tax revenues and jobs, and that applies even when state government puts out contracts for bid, the head of a small-business group said Friday.
Kimber Lanning, director of Local First Arizona, said Arizona should establish a preference for local firms when the state government solicits bids such as those for goods, services or contracting work.
“We are on this never-ending quest to save money on the front end,” Lanning said during an address as part of the University of Arizona’s Start Smart lecture series. “We are hemorrhaging jobs, buying ourselves broke.”
Many other states offer such an edge to locally owned companies, she said.
“A local business will do more for the economy and should be accounted for at the beginning of the bidding process,” Lanning said.
Local First Arizona is an alliance of small businesses that promotes the benefits of buying from locally owned firms.
Lanning said that for every $100 spent with an Arizona business $43 stays within the state, while only $13 out of $100 spent with a company based outside of Arizona remains within the state.
During this year’s legislative session, Local First Arizona advocated for legislation that would give preference to local firms when competitive sealed bids for a state government contract are identical in price. Among other provisions, it would have required the Arizona Department of Administration to publish a list of states that give preference to local firms bidding for state contracts.
The bill, authored by Senate President Russell Pearce, R-Mesa, passed the Senate but failed to reach the House floor.
Lanning said supporters plan to try again during next year’s legislative session.
Speaking in the back of a Good Egg, part of a locally owned restaurant chain, she promoted Shift 10, a Local First Arizona effort to persuade residents to shift 10 percent more of their purchases to Arizona businesses.
A study found that if an entire community the size of Tucson did that, it would create 1,600 jobs and circulate an additional $130 million in the community, she said.
A Valley business owner since age 19, Lanning acknowledged the difficulty of committing to buying locally with so many national options available.
“I’d like to think I’m a pretty good example, but nobody’s perfect,” she said. “I can’t buy 100 percent locally.”
But it will be up to communities and their residents to lift America out of its long economic slump, and buying from local companies contributes to that, Lanning said.
“The economy is not something over there that someone else is going to fix for us,” she said. “The economy is in our hands.”