by Clark Mercer – former Chief of Staff to Gov. Ralph Northam; now Executive Director, Metropolitan Washington Council of Governments
Will North Carolina match Virginia and make it a three-peat? About this time each year, a state is alerted that it has been named the “Best State For Business” by CNBC. The announcement is embargoed until a few months later. Virginia is the only state in the history of the rankings to win this accolade three years in row, though North Carolina has won the past two years and could pull off the three-peat this year. But wait a second– you’ll see that in 2020 there was no “official” winner, so what gives?! I think the statute of limitations has expired with regards to spilling the beans, so here goes.
In 2019, CNBC named Virginia the top state for business. The Commonwealth was coming off a string of major investments, including winning the largest economic development deal in U.S. history- HQ2. We also had also expanded Medicaid (now over 700,000 more Virginians have health coverage as a result), and Virginia law changed to prohibit Virginia courts from suspending someone’s driving privilege solely for failure to pay court fines and costs. Medicaid expansion and our change to driving privileges are notable, because we were operating under divided government, so both of these achievements were bipartisan. That year there were elections for the House of Delegates and the State Senate, and some claimed if Democrats took the majority in both chambers, we would see more laws like that passed, and surely lose our ranking as the best state for business. That November, Democrats did take the majority in both chambers.
What followed over the next two years was a continued string of impressive economic development wins. And an increase to the minimum wage for the first time in generations. And an increase to the felony larceny threshold for the first time in generations, along with a host of criminal justice reforms. And a change in law to give workers more rights to organize and advocate. And, collectively, a 15% raise for our teachers across the state. And, we were told we would plummet in the rankings. So, you can imagine my satisfaction when I received a call from CNBC letting me know that Virginia had won this distinction for a second year in a row. These rankings are based on around 70 some categories, with over 2,500 points being scored- the majority of them dealing with tax policy and business atmosphere. The date was set and planning began to make the big announcement. And then, Covid-19.
Days before the announcement was to be made, I received a follow up call that some states had complained that about the rankings in light of Covid-19, despite the fact that all the data and voting had been done largely before Covid-19 ever hit. The decision had been made to pull the announcement and not declare a “best state for business” in 2020. Given we were the reigning champs, Virginia would hold the title until 2021- best of luck next year and keep up the good work, I was told.
The Governor and our economic development team were disappointed. Here was our chance to show the world that, yes, you can be a great state for both business and for workers- the two aren’t mutually exclusive, in fact they are very much tied together! So, we made the obvious decision to keep doing the work. Working with the Assembly and our federal partners, we made a massive investment in the Port of Virginia making it the port with the deepest and widest channels in the country. We put more money in reserves that any administration in history, we kept investing in workers and our schools, we passed the Clean Economy Act and joined the Regional Greenhouse Gas Initiative. We passed the Marcus alert, Breonna’s law, the Crown Act, made major reforms to heirs property, eliminated the death penalty, passed a host of major gun safety laws, legalized simple possession of marijuana, and much more. Much of this work came amidst major pushback that Virginia was no longer business friendly. And then the call came. Virginia had won “Best State for Business” in 2021. Indeed, we had three-peated. The reaction from some corners was muted, or others claimed that the ranking was now partisan, despite the other states who placed in the top 10 including North Carolina, Tennessee, Georgia, Texas, Florida, Utah, and Ohio.
The whole experience demonstrated that you can be a great place for workers and people and at the same time be a great place for businesses to locate and expand. March Madness indeed!
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