DC Velocity - October 2014

Furthermore, Texas is a “right to work” state, meaning that workers cannot be required to join a labor union in order to be employed, and overall union participation is relatively low.

Beyond all that, the state can offer companies space to grow. Unlike California, New York, or New Jersey, there is still land available for greenfield distribution sites near major cities. As a result, land costs and occupancy costs are reasonable compared with prices in metropolitan areas of a similar size. “We still have relatively cheap dirt,” says Condrey of Cushman & Wakefield.

THE PROMISED LAND?

Yet Texas is not without its flaws. Many of the state’s boosters tout the job training programs created by government agencies, local community colleges, and business.

However, the picture is not so bright when it comes to the school system in the state, according to a report by the Texas Legislative Study Group, Texas on the Brink. The 2013 report found that Texas ranks 50th in the percentage of its citizens who have graduated from high school and 44th in high school graduation rates. Additionally, the study reports that Texas has the highest percentage of uninsured adults in the nation and generates the most hazardous waste and carbon dioxide emissions.

But considering the state’s cen-
tral location, robust infrastructure,
low land costs, and access to avail-
able labor, industrial site selection
experts can perhaps be forgiven for
overlooking these weaknesses. Or
as Lovett sings: “So pardon me my
laughter/ ’Cause I sure do under-
stand/ Even Moses got excited/
When he saw the promised land.”
The state also has excellent short-line rail
service, which can bring freight right to a
company’s doorstep, according to Darrow.

For oceangoing freight, the state is home to the 12th-busiest port in the world: the Port of Houston. Historically, the port has been associated with exports, particularly of petroleum and petroleum products. But lately, a growing population base has created strong demand for imports. As a result, says John Moseley, the port’s senior director of trade development, imports and exports are fairly well balanced.

The state also provides excellent air-cargo service. The Dallas/Fort Worth International Airport (DFW) alone handles more than $50 billion worth of cargo annually, mostly high-value items like semiconductors, cell phones, and aircraft parts. According to Mabrie Johnson, you can reach anywhere in the continental United States in approximately four hours by air from DFW, which has been recognized as the best cargo airport in North America by Air Cargo World magazine. The state is also served by Alliance Airport, the first purely industrial airport in the world.

A BUSINESS-FRIENDLY CLIMATE

Texas also has a well-deserved reputation for being business-friendly and possesses a pro-business government structure. The state does not have a corporate or individual income tax, and many county, city, and local authorities offer generous tax abatement programs to encourage job creation. The state also offers healthy industrial development incentive programs, such as the Texas Enterprise Fund, which is the largest “deal-closing” fund of its kind in the nation, and The Texas Skills Development Fund, which provides financing for customized job training programs.

Texas also has a strong supply of labor, with a civilian work force of more than 13 million people, the second largest (and one of the youngest) in the country.

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