Opinion: Arizona’s economic credibility at risk as lawmakers eye fund sweep, tax credit elimination

This column by Arizona Chamber of Commerce & Industry President and CEO Danny Seiden originally appeared in the Phoenix Business Journal on May 27, 2026.

According to the latest Rich States, Poor States report from the American Legislative Exchange Council, Arizona ranks second in the nation for economic growth over the past 10 years. During that time, we’ve ranked in the top-5 for GDP growth, domestic migration, and employment growth, clear indicators of our strength as a destination for both business and talent.

Arizona has also ranked No. 1 on the Common Sense Institute’s Economic Momentum Index every year since 2019. That growth has translated into real gains for Arizonans: more jobs, rising incomes, and the largest percentage-point decline in poverty in the country.

Despite this undeniable track record, a misguided proposal from some lawmakers threatens to wipe out a key piece of our economic toolbox at precisely the wrong time.

Specifically, they are calling for a sweep of the Arizona Competes Fund, a move that would effectively pull the rug out from under dozens of projects already underway, inflicting lasting damage on the state’s economic credibility.

A complete sweep would jeopardize 34 projects for which grants have already been committed, representing more than 21,000 potential new jobs and more than $12.6 billion in capital investment. That’s like wiping out an entire year’s worth of economic development progress.

Even more concerning, forcing the state to renege on commitments — after funds were appropriated by the Legislature — would trigger a serious crisis of confidence. If Arizona is willing to walk away from its obligations to employers and investors, why would anyone trust it to honor future commitments?

As budget negotiations continue, some have talked about eliminate the Quality Jobs Tax Credit, a program that has been key to making Arizona a magnet for corporate headquarters relocations. CBRE reports that the Phoenix metro ranks in the top 4 for HQ relocations since 2018, projects that come with significant high-wage job gains — the type that fuel additional growth across the economic ladder.

The Arizona Commerce Authority is actively competing for an additional 51 HQ projects, representing more than 11,000 potential new jobs with average wages over $90,000 — demonstrating both the opportunity ahead and what’s at stake if Arizona gets this wrong.

At a moment when the state is competing for once-in-a-generation economic opportunities, maintaining Arizona’s credibility and business reputation is absolutely essential.

To be clear: Arizona’s transparent, effective economic development programs should be viewed as a model for the nation. Unlike so many of our competitor states, Arizona does not engage in opaque, backroom deals.

Instead, our programs are accountable and performance-based, with criteria outlined in statute and companies only receiving funds after they’ve filled their commitments. Arizona doesn’t place risky bets. 

These tools complement Arizona’s core advantages: a skilled workforce, modern infrastructure, and a pro-growth tax and regulatory environment.

They also deliver a strong return. Analysis from the ACA shows that companies participating in the Competes program have created more than 22,000 jobs with an average wage approaching $90,000. Those projects have generated over $1.2 billion in state and local tax revenue — meaning every $1 invested returns more than $22 to the public.

Eliminating this program would not produce meaningful budget savings. Instead, it would likely reduce future revenue by driving away jobs, wages and investment.

And if Arizona steps back, other states will step in. Competitors like Texas, Ohio and California would welcome the opportunity to capture projects that might otherwise have come here.

As Warren Buffett famously observed, it takes years to build a reputation and minutes to destroy it. Over the past decade, Arizona has earned a reputation as one of the most reliable places in the country to do business.

Lawmakers should come together to pass a responsible budget that protects and strengthens the policies driving Arizona’s growth. Arizona has spent a decade earning its reputation. Now is not the time to risk it.

Danny Seiden is the president and CEO of the Arizona Chamber of Commerce & Industry.