Across Arizona, small businesses are the backbone of our economy. Locally owned companies create jobs, serve families and reinvest in the communities where we live and work.

Arizona is home to more than 650,000 small businesses employing over 1 million residents. These businesses represent 99% of all businesses in the state and account for more than 42% of Arizona’s private-sector workforce. Together, these businesses form the foundation of Arizona’s economy.

When it comes to state contracting, local businesses often compete against large out-of-state companies for the same opportunities under rules that are outdated, don’t create a level playing field for local Arizona business owners and can cost Arizona taxpayers more money in the long run. Out-of-state companies often do not provide full health care benefits to all employees, pay lower wages or rely on workforces that are not rooted in the local community. While these companies may initially submit lower bids for state contracts, the broader economic benefits that come from supporting Arizona based businesses such as job creation, tax revenue and reinvestment in local communities are lost. 

Local businesses are far more likely to hire Arizona residents, provide stable employment and reinvest their earnings back into the state’s economy. When Arizona companies win state contracts, those dollars circulate within our communities, supporting other small businesses, strengthening local supply chains, and generating additional state and local tax revenue. 

Modernizing Arizona’s state contracting policies to better recognize the value of local businesses helps ensure that Arizona taxpayer dollars deliver the greatest overall benefit to the state. By creating a fairer and more competitive process, Arizona can support its homegrown businesses, strengthen its workforce, and keep more economic activity within the state.

Companies like Wist Office Products, Goodmans Interior Structures, Gateway Bank, Vertical Pivot, Original Neutral Building Materials and many other locally owned businesses across Arizona have built their success by investing in the communities they serve. When local businesses bid for and win state contracts, more money stays in Arizona supporting jobs, suppliers and local tax revenue. When local businesses grow, the benefits stay local. Arizona-based businesses also reinvest more of their revenue in the communities where they operate. In fact, dollars spent with companies headquartered here stay in Arizona at a rate several times higher than dollars sent to out-of-state corporations. 

According to the National Association of State Procurement Officials, Arizona is one of only two states that currently does not provide reciprocal in-state bidding percentages in state contracting or an in-state preference for locally owned businesses in state contracting. 

That’s why Arizona HB2858 matters. The bill keeps procurement competitive while recognizing the value of companies rooted in Arizona communities. It helps level the playing field for local businesses without sacrificing transparency or fiscal responsibility. For many small business owners in our community, this bill represents a simple and common-sense principle: Arizona should put Arizona businesses first. Arizona taxpayers deserve to know their dollars are supporting Arizona jobs whenever possible.

Putting Arizona first in state contracting simply means recognizing the businesses that are already investing in our workforce, paying taxes here, and helping build the communities we all depend on. For small businesses throughout Arizona, this bill is about fairness and opportunity. Arizona businesses should be given the opportunity to keep state government contracts here at home. Arizona’s economy is strongest when local businesses succeed and when Arizona chooses to invest in its own. 

Kimber Lanning is the founder and CEO of Local First Arizona, a non-profit organization dedicated to advancing Arizona’s economy.