Report critical of Nevada economic outlook; local experts disagree

RENO - A new report critical of Nevada's business and development climate was refuted by area leaders who believe the state's economy is in better shape than the study suggests.

The annual study by the Washington, D.C.-based Corporation for Enterprise Development gave Nevada a D in the categories of business vitality and development capacity.

''First you have to look at the source, which is Washington,'' Kris Holt, executive director of the Northern Nevada Development Authority, told the Reno Gazette-Journal. The authority oversees development and recruitment of business in Carson City, Douglas, Lyon and Storey counties.

''The report looks at the entire state and in our area things are good,'' Holt said.

''According to trade publications, this area has the fastest growth in the state in terms of manufacturing. Things have slowed a little, but are still very competitive.''

The report graded states in three areas - performance, business vitality and development capacity. Nevada earned a C on performance, which was based on such factors as quality of life and employment.

''I point to every other study that is being done and we are ranking very high,'' said Chuck Alvey, president and chief executive officer of the Economic Development Authority of Western Nevada, which helps recruit businesses to the Reno, Sparks and Lake Tahoe regions.

''Last year we helped move more than 20 companies to this area. This year we already have 28 companies that have moved here and they will have more than a $100 million impact during their first years. Things are going very well.''

Alvey said some social issues in Nevada could be addressed better but in term of business growth, northern Nevada is on track.

Nevada scored high on performance in previous years until the group began to consider social problems in grading.

High numbers of low-income children without health insurance and high rates of teen pregnancy were major factors in the latest study.

JoAnne Kock, child and youth specialist at the University of Nevada, Las Vegas, agreed with the study's findings on social issues.

''Nevada ranks pretty terribly in terms of teen pregnancy,'' Kock said. ''There are insurance plans out there for low income families. But because this state has such a population influx many people go uninsured.''

Despite earning a No. 1 ranking for long-term employment growth, Nevada's lack of economic diversity contributed to the D score.

State officials argue diversity is not an easy task since one new hotel-casino can hire as many people as most of the non-gambling companies attracted by the state Economic Commission in a year.

''A state's economic prospects cannot be judged by simply counting the number of factories, the availability of low-paying jobs, or how low taxes may be,'' said Brian Dabson, Corporation for Enterprise Development president.

''The quality of jobs, standards of living, investments in innovation, education, sustainable growth and infrastructure and many other factors must be taken into account in determining a state's long-term economic health.''

Nationally, the Midwest and the Northeast are the strongest regions economically, according to the report.