Survey rates Ohio near top

Dan Gearino

Nov. 3, 2009 (McClatchy-Tribune Regional News delivered by Newstex) -- Ohio's business climate is among the best in the country, according to an annual survey by Site Selection magazine, which ranked the state fourth.

The ranking, up from seventh last year, was applauded by business leaders. Those same leaders downplayed other surveys with less favorable results, such as the Tax Foundation's 47th-place ranking for the state, issued last month.

North Carolina, Texas and Virginia took the top three spots, respectively, in the Site Selection report. The rankings are based equally on new business activity in each state and a survey of executives.

"I think it's a reflection of the work that's been done over numerous years," said Andy Doehrel, president and CEO of the Ohio Chamber of Commerce.

The state has an enviable combination of high-quality infrastructure, a strong work ethic and a top-notch university system, he said.

On the downside, Ohio's regulatory system remains painfully inefficient, he said, naming particularly the Ohio Environmental Protection Agency.

"You just can't have the EPA sitting on a permit for 18 months in this day and age when companies want to do things yesterday," Doehrel said.

Ohio's tax climate might be one of its best assets, said Nate Green, director of the Pickaway Progress Partnership, an economic-development group based in Circleville.

Despite this, the state has had a tough time attracting businesses over the past year.

"It has been slow here, but it's been slow everywhere," Green said. He expects the tax climate to help Ohio recover from the recession more quickly than would have happened otherwise, particularly the changes in business income taxes the state legislature passed in 2005.

This has been a slow year for business expansion. In central Ohio, the largest announcement was from JPMorgan Chase (NYSE:JPM) , which said in June that it would add more than 1,100 jobs in central Ohio. Tax policy played a role, as the state and local governments committed to give $20.5 million worth of tax breaks to the company.

Although the state's Site Selection rank is high, the nonprofit Tax Foundation says Ohio has one of the worst business-tax climates in the country. The state ranks poorly because of high property taxes and high individual income taxes.

Green, who also is president of the Ohio Economic Development Association, said he thinks the Site Selection ranking is better than the Tax Foundation ranking as a gauge of what matters to businesses.

"What you have to look at are manufacturing companies and logistics companies and the cost of doing business," he said.

And for those companies, he thinks Ohio has a strong climate.

dgearino@dispatch.com

Top states

Site Selection magazine's top 10 state business climates:

1. North Carolina

2. Texas

3. Virginia

4. Ohio

5. Tennessee

6. South Carolina

7. Alabama

8. Georgia

9. Indiana

10. Kentucky

Newstex ID: KRTB-0147-39406028