Senator on listening tour

The Helena Independent Record

by Martin Kidston

Area business owners and economic leaders brought their concerns to a roundtable discussion Tuesday with Sen. Jon Tester, where some praised the recent stimulus bill, saying it’s been good for business, while others expressed concerns over higher taxes.

Much like his listening sessions with Montana veterans in recent years, Tester, D-Mont., is touring the state, listening more than talking. The topic, however, has turned from veteran issues to economic concerns such as jobs, business growth and work skills.

“I’m here to find out what we can do in Washington, D.C., if anything, to change the job situation,” Tester told those at the table. “There may be some ideas out there, some nuggets we can take back and get incorporated into policy.”

Those present at Tuesday’s discussion painted a picture far brighter than what’s been portrayed in the news.

There were concerns to be sure, but most told Tester they were weathering the economic storm or finding ways to sail through it.

“We’re very fortunate in Helena, and I think everyone recognizes that,” Mayor Jim Smith said, kicking off the discussion. “We’ve weathered the storm very well. We just have to be careful not to put too big a tax burden on our businesses, big or small.”

Smith used Summit Aeronautics to state the importance of keeping taxes low to create good jobs, which in turn benefit the wider community.

Last year, Smith said, the city granted Summit a tax abatement, and while it was a small amount, he said, every little bit helps.

“They’re getting their people from UM-Helena, and guys go out there (to Summit) and start at excellent wages,” Smith said. “Then they go and see the real-estate community, the home-building community. It’s the kind of economic engine we’re trying to preserve and enhance around here.”

Tom Hoffman, president of Summit Aeronautics, said tax breaks, such as the one granted by the city, add up at the end of the day. They help create additional jobs, he said, and keep people employed.

If the state wants to create more high-paying jobs — and if Congress wants to nurture that type of growth — it must understand the bigger picture, he said.

“We’re competing against companies from Japan and China,” Hoffman said. “One of the things we’re bumping up against is equipment tax. We pay hundreds of thousands of dollars a year in equipment tax, and that’s a struggle for us, because our competitors don’t have to pay that.”

Hoffman expressed concern about spending in Washington and whether it will lead to higher taxes.

Taxes placed upon businesses, he said, could hinder economic growth at a time when it’s most needed.

“At some point, that’s going to come down to the businesses,” Hoffman said. “It’s going to come down to whether you keep people employed, or look at reductions, because you still have to be competitive.”

The relationship between UM-Helena and Summit drew attention from others at the table, and Valerie Lambert, director of financial aid at the college, said she has seen the need for job training boom over the past year.

In fact, she said, UM-Helena has seen enrollment among full-time students jump 22 percent. A majority of them, she added, are transfer students and nontraditional students. The school has more full-time students now than part-time.

“Historically, we’ve had more part-time students than full-time, but that’s flip-flopped this semester,” Lambert said. “I can also tell you that in financial aid, over the last three months I’ve disbursed what I gave out all of the last academic year.”

The college is considered something of an economic bellwether, and Lambert attributed the school’s growth to the dour economy.

Not only has UM-Helena seen an increase in enrollment, it has also seen an increase in students seeking grants, as well as those looking to stay with work-study programs longer.

“Our students are having a hard time finding jobs out there,” Lambert said. “We have a work-study program, and we’re at max capacity, and we’ve never hit that before.”

Those present at the roundtable represented a wide cross-section of the local economic community.

Among them was real-estate agent Craig Plummer, who said housing sales and construction starts are down slightly from last year, and Sarah Scott with DA Davidson, who said more customers are looking at ways to save.

“The clients I talk with in Helena, and in Montana in particular, haven’t noticed as much of a problem as my clients have in California and other states,” Scott said. “I think the job losses haven’t been as bad in Montana.”

Scott attributed the steadiness of the Helena market to the city’s stable job base, including state government and the military.

And while her customers are cutting back on spending, more are saving for the likes of college and other life goals.

“I also work with a lot of nonprofit groups in Helena, and taxes on employees have been a real big issue for some of them,” Scott said. “But on the other hand, I’ve had two nonprofits in the last month start retirement funds for their employees.”

Local business owner Alex Rancon said he was alarmed when several other small downtown businesses closed in his area.

Yet, he said his business, fourOsix, has grown slightly over past year and managed to stay prosperous, even if the margin has been small.

“My numbers have stayed almost dead-even since last year,” Rancon said. “But my operating expenses have gone up. The more employees I try to employ, the more my expenses go up. My cash flow is very tight from month to month.”

Jim McHugh, director of Downtown Helena, Inc., said the city has actually seen several new businesses open or expand over the past year.

McHugh said he has also seen interest in small retail spaces increase. Rental rates and lease rates have remained stable, if not decreased, he said.

“There’s definitely an entrepreneurial spirit still out there,” he said.