Small Businesses First

Introduction

State economic development strategies in the United States are increasingly diverging along two paths: one prioritizes locally grown small businesses and “Main Street” enterprises, while the other chases megaprojects and corporate relocations with hefty incentive packages. Over the last two decades (2005–2025), many states have shifted toward nurturing firms with under 100 employees – especially microbusinesses with 20–50 or fewer workers – as engines of job creation and community vitality. These states have implemented targeted programs such as small-business tax incentives, accessible loan funds, and technical assistance networks that empower local entrepreneurs. The results often include more jobs per dollar invested, broader tax base growth, and strengthened economic resilience at the community levelwisconsinexaminer.com 1goodjobsfirst.org 2. In sharp contrast stands Idaho’s model, which remains focused on luring large corporations (for example, hyperscale data centers) with generous subsidies and confidentiality agreements. Idaho’s approach – exemplified by recent deals with Meta and Diode Ventures in the city of Kuna – emphasizes massive capital investment by a few firms, often under non-disclosure code names and with minimal public input[3][4]. This report provides a comprehensive analysis of these two approaches. We detail the small-business development programs and policies of several U.S. states (urban and rural alike) that have embraced a small-business-first strategy, and we contrast their outcomes with Idaho’s big-corporation strategy. We examine the historical evolution since the mid-2000s, present in-depth case studies (Colorado, Missouri, Vermont, Pennsylvania, North Carolina, Wisconsin, etc.), compare policy structures (from Small Business Development Centers to official small business advocacy offices), and quantify outcomes such as jobs per dollar, tax base impacts, and economic resilience indicators. A dedicated section focuses on rural strategies for very small firms, as an additive emphasis. Throughout, we cite government and primary sources to ground the analysis in documented evidence. The goal is to illuminate how focusing on “Main Street over megadeals” has played out across states – and how Idaho’s experience diverges – providing a fact-based foundation for policy discussions on economic development priorities.

The Evolution of State Economic Development (2005–2025)

Over the past 20 years, state economic development policy has undergone a notable rebalance. In the early 2000s, many states were still heavily invested in “buffalo hunting” – the pursuit of large corporate employers with tax breaks, land deals, and infrastructure subsidies. Big businesses were seen as trophy wins to generate headlines and rapid job gainsamericanprogress.org 3. Incentive packages often targeted manufacturing plants, corporate headquarters, and later, tech data centers, with promises of hundreds or thousands of jobs. However, the late 2000s and 2010s brought accumulating evidence of the downsides of this approach. High-profile deals sometimes failed to deliver the promised jobs, left states with huge bills, or even saw companies shutter or downsize after pocketing incentives. At the same time, research and experience highlighted that small businesses were punching above their weight in job creation and economic stability. Between 2000 and 2019, small firms (generally defined as <500 employees, but especially those under 100) generated roughly two-thirds of net new jobs in the countrysbecouncil.org 4border.bank 5. This trend, coupled with the 2008 recession recovery and later the 2020 pandemic, shifted state-level thinking. Policymakers began asking: what if the tens or hundreds of millions spent on one big factory were instead invested in thousands of homegrown entrepreneurs?

By the mid-2010s, a number of states launched initiatives to “grow their own” businesses. The concept of economic gardening gained traction – a strategy of supporting existing small businesses and startups (especially second-stage companies with ~10–100 employees) to expand, rather than relying solely on recruiting outsiderseconomicgardening.org 6esri.com 7. For example, Florida’s statewide economic gardening program (begun in 2009) was credited with creating over 10,000 direct and indirect jobs and $81 million in new tax revenue within a few yearsiedconline.org 8. Louisiana launched an economic gardening program in 2011 that assisted nearly 200 companies statewide in its first few yearsenergizingentrepreneurs.org 9. Even states traditionally known for large industrial recruitment, like Michigan and Ohio, started small business loan funds and mentorship networks post-2010 to diversify their economies after losing big employers.

Another evolution was the rise of entrepreneurship and innovation funds at the state level. Instead of only offering tax breaks, states created venture-style funds, grants, and incubator programs to boost high-growth startups (which, by definition, begin as very small firms). For instance, Pennsylvania had been ahead of the curve with its Ben Franklin Technology Partners since the 1980s, but it doubled down in the 2010s, increasing funding to nurture tech startups. By 2023, the cumulative impact was evident: Ben Franklin’s investments over 40 years created more than 58,000 direct jobs in client firms plus 101,000 spinoff jobs – totaling 159,000 jobs – and generated an estimated $4 return in state tax revenue for every $1 of state fundingbenfranklin.org 10. Other states took note and replicated aspects of this model.

At the same time, the “megadeal” approach did not disappear – in fact, in some ways it intensified for a period. The late 2010s saw a flurry of massive incentive offers for projects like Foxconn in Wisconsin, Amazon’s second headquarters (HQ2) sweepstakes, and various semiconductor plants. A 2018 analysis observed that even though many states expanded programs for small and midsize businesses (with such incentives tripling since 1990), political attention increasingly fixated on “moonshot” deals with extremely large corporationsamericanprogress.org 11. These deals came at extraordinarily high cost per job: according to Good Jobs First, major subsidy packages by the late 2010s and early 2020s routinely cost $250,000–$1,000,000+ per job when all tax credits and grants are talliedgoodjobsfirst.org 12. For example, in 2022, eight especially large deals in the U.S. averaged about $726,000 of incentives per job promisedgoodjobsfirst.org 13. West Virginia’s 2022 Nucor steel mill deal penciled out even higher – potentially several million dollars per job when fully accounted. Such figures sparked debate about sustainability and equity: Was it wise for states to spend upwards of half a million public dollars for one job, often in a capital-intensive facility, when the same money could support hundreds of small businesses that together employ far more people?

By the early 2020s, there is evidence of a turning point in some states’ strategies. High-profile disappointments (e.g. the downsizing of Wisconsin’s Foxconn project after a $3 billion incentive packageamericanprogress.org 14, or Amazon’s scuttling of its HQ2 deal in New York amid public backlash) led to greater skepticism of the megadeal approach. In states like Wisconsin, the new political leadership elected in 2018 explicitly shifted the Wisconsin Economic Development Corporation’s focus toward small businesses and community-driven development. WEDC’s CEO Missy Hughes (appointed 2019) remarked in 2023 that economic development “has really shifted” to include broadband, housing, and quality of life – “underlying investments” needed to help “our communities and our small businesses,” not just landing big companieswisconsinexaminer.com 15. Under her tenure, WEDC established programs like the Main Street Bounceback grants (discussed later) to revitalize small downtowns and launched an Office of Rural Prosperity to give rural entrepreneurs a voice.

Similarly, Colorado around 2015–2020 expanded its toolset for small firms, creating rural venture funds and matching grants, while still maintaining some large-firm incentives. North Carolina – historically a state that landed big manufacturers – augmented its strategy by bolstering small business counseling through public-private partnerships and providing matching grants for small tech firms winning federal R&D awards. And Vermont, never a major player in megadeals, recommitted to “buy local” and local enterprise support through initiatives like downtown tax credits and the Working Lands program to grow rural farm and forest businesses.

Meanwhile, Idaho took a different course, enacting in 2020 a major tax exemption specifically to lure data centers (large facilities with relatively few jobs)[27][28]. This set the stage for the Meta/Facebook data center deal, which Idaho officials hailed as a victory in 2022[29]. As we’ll explore, Idaho’s focus has remained on these large outside investments, with comparatively little state-level infrastructure tailored for small business development. The result is that by 2025, Idaho stands as something of an outlier: a state without an Office of Small Business Advocacy or a comprehensive small-business strategy, heavily invested in one or two giant projects (e.g. a 960,000 sq ft Meta facility) while peers are spreading investments across thousands of local firms.

In summary, the 2005–2025 period saw many states rebalance their economic development portfolios – not abandoning large employers entirely, but placing a much sharper emphasis on small-scale, broad-based growth. The rationale is supported by evidence: small businesses are responsible for the majority of net new jobs and often are deeply embedded in their communities, yielding more durable economic benefits. As the Center for American Progress noted in 2018, however, the political temptation of big deals persists due to the immediate headlines they generateamericanprogress.org 16. The following sections delve into the concrete programs and case studies of states that have prioritized small businesses, and contrast them with Idaho’s large-corporation-centric model. Each state profile will highlight how traditional “big business” tools (tax credits, financing, infrastructure support) have been modified to serve very small businesses, the outcomes achieved (job creation, downtown revitalization, etc.), and how transparency and public engagement differ from Idaho’s NDA-shrouded deals.

State-Level Programs Prioritizing Small Businesses

This section profiles a selection of U.S. states that have implemented notable small-business development programs, tax incentives, loan structures, or policy initiatives focused on enterprises under 100 employees. Both urban and rural strategies are included. We exclude states without such programs; instead, we highlight those with documented commitments to Main Street businesses, microenterprises, and locally rooted entrepreneurship. Each profile examines the state’s key programs, any shifts from big-business incentives to small-business support, and evidence of outcomes. We also note how traditional economic development tools (like Tax Increment Financing or job tax credits) have been adapted for small-scale use.

Colorado: From Big Incentives to “Economic Gardening” and Rural Innovation

Colorado has cultivated a reputation as a startup-friendly state with robust support for small and midsize enterprises. In the mid-2000s, Colorado certainly competed for big projects (and still does to some extent), but over the last 15 years it has built out an extensive infrastructure for small business development under the umbrella of the Colorado Office of Economic Development and International Trade (OEDIT). The state’s strategy includes targeted tax incentives usable by small firms, grant programs for entrepreneurs, and a strong rural development focus.

Key Small-Business Programs: Colorado offers a menu of incentives and funding programs that explicitly cater to businesses of all sizes, including very small firms. For example, Colorado’s Job Growth Incentive Tax Credit can apply to expansions creating as few as 5 net new jobs in the state, and is frequently used by medium and even small employers. Uniquely, the state adds a Location Neutral Employment Incentive – an extra cash bonus for each remote job that a company bases in an eligible rural countychoosecolorado.com 17. This effectively encourages firms (even if headquartered elsewhere) to hire workers in rural Colorado communities, spreading job growth beyond the Front Range cities. Colorado also runs the Skill Advance Colorado Job Training Grant, which subsidizes training for employees at companies relocating or expanding in Colorado. Unlike some states’ training grants that mainly assist large factories, Colorado’s program can and does serve smaller employers who are adding just a few jobs but need to upskill their workforce – a critical need for second-stage small businesses.

A centerpiece of Colorado’s recent efforts is the Advanced Industries Accelerator Program, which provides grants and seed funding to startups in seven high-growth sectors (advanced manufacturing, aerospace, bioscience, electronics, energy, technology & info, and health). This program essentially delivers equity-free capital to small innovative firms – something that traditionally only venture capital would provide. By 2025, Colorado had awarded dozens of grants through this accelerator, helping local startups bring new products to market and scale up hiring. This indicates a reorientation of state support from purely “attracting outside industry” to growing homegrown tech companies.

Perhaps Colorado’s most distinctive initiative is the Rural Jump-Start Program, launched in 2016 to spark economic activity in the state’s distressed rural areas. Rural Jump-Start offers an appealing package to new small businesses that locate in designated counties: state income, sales, and use tax relief; county and municipal tax relief; and even personal income tax breaks for the new hiresstartupcolorado.org 18. In essence, a qualifying new business (often a startup or a relocating micro-business) in a Rural Jump-Start zone pays no state taxes for up to 8 years, and its employees’ state income tax on wages can be refunded as well. On top of that, grants up to $20,000 are available for businesses, plus $2,500 per new job, to help with startup costs. These are modest sums in the context of big economic development, but for a two- or three-person startup in a town on Colorado’s Western Slope, a $20k grant and a tax holiday can be transformational. The program smartly prohibits “double dipping” – a business that takes Rural Jump-Start incentives can’t also claim other Colorado job creation credits, ensuring the support is targeted and not redundant. By 2023, the results were encouraging: Rural Jump-Start had supported 31 new businesses across 31 rural counties, awarding $334,500 in grants to 9 businesses just in 2023, and providing over $155,000 in tax credits that year. Those businesses, in turn, exempted about $8.2 million in new hire wages from state tax, indicating significant payrolls created under the program. While those numbers may seem small, they represent new enterprises and jobs in communities that previously struggled to attract any outside investment. The state touts Rural Jump-Start as a success in leveling the playing field for rural entrepreneurs by effectively giving them a tax-incentive package similar to what big firms get, but on a micro scale.

Adapting Big-Business Tools: Colorado’s use of traditional incentives has been refocused to include small firms. The state’s Enterprise Zone program, for instance, isn’t limited to large factories; any business in a designated zone (often economically lagging areas) can earn credits such as a 12% state income tax credit for eligible job training expensesoedit.colorado.gov 19. That means a small local manufacturer that spends $10,000 on upgrading worker skills can get $1,200 off its taxes – a meaningful offset that originally was designed to entice bigger companies but now benefits mom-and-pop enterprises too. Moreover, Colorado has experimented with public seed funds akin to venture capital. Through the Advanced Industries grants and the Colorado Venture Capital Authority, the state has put public funds into startup investment, seeding hundreds of small firms. These programs modify the concept of state finance – instead of big infrastructure grants for one mega-plant, Colorado is taking smaller stakes in a broad array of local startups, hoping some will become the next major employer.

Another adaptation is Colorado’s “economic gardening” technical assistance. The state, often with support from the Edward Lowe Foundation, has supported economic gardening programs that provide market research, business intelligence, and mentoring to second-stage growth companies (usually those with 5–99 employees looking to expand markets). This service essentially offers the kind of data analytics that a large corporation’s strategy team would have, but to a local Colorado manufacturer or tech firm that is poised to grow but lacks those resources. By treating a cohort of small companies as a priority, Colorado is applying a high-impact tool (sophisticated market research) that traditionally only big companies could afford, now as a free or subsidized public service to small businessesiasourcelink.com 20economicgardening.org 21. Such efforts were part of Governor John Hickenlooper’s economic development plans in the 2010s, emphasizing innovation from within Colorado.

Outcomes and Public Impact: Colorado’s small-business focus has coincided with a period of strong economic performance. From 2010 to 2019, Colorado consistently ranked among the top states for startup activity and small business employment growth (over 25% growth in small business employment in that decade)advocacy.sba.gov 22. While large corporations like Lockheed or Google have a presence in Colorado, the state’s economic growth has been broadly distributed – from craft breweries in small mountain towns to tech startups in Denver’s RiNo district. Several measures illustrate the impact:

• Job Creation and Cost Efficiency: By supporting numerous small expansions, Colorado has achieved job growth at a lower public cost per job than many big-deal states. For example, consider the Rural Jump-Start numbers: 31 businesses created (with at least 9 in 2023 getting grants) at a cost of about $334k in grants that yearstartupcolorado.org 23. Even if each of those 9 businesses only created, say, 5 jobs (45 jobs total), the cost per direct job would be around $7,400 – an order of magnitude less than the six-figure subsidies common in megadeals. And many of those businesses are just starting and will grow, implying the cost per job will drop further. This aligns with broader research: Good Jobs First found that state workforce training programs typically spend only four-figure sums per job (often under $5,000), whereas megadeals average over $650,000 per jobgoodjobsfirst.org 24. Colorado’s strategy leverages this efficiency by funding training and startup growth rather than huge tax breaks.
• Economic Resilience: Small businesses supported by these programs have improved local resilience. A striking example occurred during the COVID-19 pandemic: Colorado quickly expanded grants and loans to small businesses to preserve them. By late 2020, thousands of Colorado small firms had received emergency grants or relief (often through programs administered by OEDIT). The state’s prior investment in the small business ecosystem paid off, as there were networks (SBDCs, local economic development offices, etc.) in place to rapidly disburse aid. Consequently, Colorado had a higher small business survival rate through the pandemic than many states that lacked such networks. In 2022, Colorado was reported to have one of the fastest recoveries in small business openings post-pandemic, a testament to the supportive environment.
• Downtown Revitalization and Tax Base: While Colorado is less densely populated with old urban centers than, say, the Northeast, it still has many towns with struggling main streets. The state’s Colorado Main Street program (run through the Department of Local Affairs) and incentives like historic preservation tax credits have helped revitalize downtowns from Trinidad to Montrose. A tangible metric is property values and tax revenues in those areas. For instance, Trinidad (a small city in southern Colorado) leveraged state historic tax credits and a Creative District designation to attract art galleries and restaurants to vacant buildings. As of 2025, the city reports significantly increased sales tax receipts from downtown businesses and rising property assessments after years of stagnation. This mirrors national data on downtown redevelopment: a mixed-use, small-business-filled block can generate far more tax per acre than a single large facility. As a generic illustration, one analysis in Sarasota, Florida found that a multi-story mixed-use building downtown yielded over $1.2 million in property taxes per acre while a big-box Walmart on the edge of town yielded only $8,300 per acre[48][49]. We wouldn’t expect Colorado’s small towns to hit Sarasota’s urban values, but even achieving, say, $80,000 per acre with a cluster of local businesses (a reasonable figure for low-rise Main Street development[50][51]) dwarfs the property tax density of a sprawling single-use site. Colorado’s programs incentivize denser, locally focused development that leads to such outcomes – in contrast to, for example, a 600-acre data center in Idaho that might lock land into low-value use.

Urban vs. Rural Balance: Colorado’s case also highlights both urban and rural strategies. In urban Front Range cities, the state’s role has been to fuel the startup and tech scene (advanced industry grants, venture funds, innovation incubators). In Denver and Boulder, this contributed to the rise of companies like SendGrid, Guild Education, and others that started small and grew into major employers – all without the state handing out huge tax-break checks, but rather through support programs and a favorable ecosystem. In rural Colorado, programs like Rural Jump-Start, along with initiatives such as the Strategic Fund matching grants for rural businesses, have addressed the chronic challenge of business attraction outside metro areas. The state even provides Location Neutral Employment incentives, as noted, which clever rural communities have used to market their towns to remote tech workers or small companies that could operate anywhere. This is essentially turning the script: instead of a town trying to get a big factory to relocate (unlikely these days), they recruit five remote workers or a 10-person firm with the promise of state cash incentives and the appeal of mountain living. That creates new payroll in town, filling storefronts and housing, which yields indirect jobs in services.

Colorado’s comprehensive approach – blending tax credits, grants, and support services for small businesses – stands in stark contrast to Idaho’s emphasis on landing one big data center. As we’ll see in the Idaho section, the job density and tax benefits per acre or per dollar of investment are vastly different. Colorado has essentially chosen a higher-volume, lower-cost strategy: fertilize the ground for thousands of small enterprises and let the successful ones grow, rather than bet the farm on a couple of giants. The empirical outcomes (job growth, diversification, rural revitalization) suggest this strategy has been fruitful in the Centennial State.

Missouri: Low-Threshold Incentives and Local Incubation

Missouri provides an interesting example of a state that has modified its traditional economic development tools to be accessible to very small businesses. Historically, Missouri, like many Midwest states, often competed for large manufacturing plants (autos, aerospace, agri-processing) with sizable incentive packages. In recent years, however, Missouri has implemented programs to encourage home-grown startups, support minority and women-owned small enterprises, and make its incentives more flexible for small firms.

Key Programs and Policies: Missouri’s flagship incentive, the Missouri Works Program, was redesigned to accommodate businesses creating as few as two new jobs. This is a notably low threshold; many states set minimums of 10, 20, or more jobs for their main job creation credits. Missouri Works “recognizes the importance of both large and small businesses” by allowing companies with just 2 new employees to qualify for benefits in certain areasclaconnect.com 25. For example, in an Enhanced Enterprise Zone (often rural or high-unemployment areas), a company need only create 2 net new jobs with wages at least 80% of the county average and invest $100,000 to qualify. The benefit for that small company is the ability to retain the state withholding tax from those new jobs for several years, effectively a cash savings, and potentially receive a refundable tax credit if the project is deemed competitive. This kind of arrangement was previously used mainly by bigger firms (with Missouri letting them keep employee withholding as an incentive), but now a mom-and-pop manufacturer or a new retail business in a small town can tap into it. A tax advisory analysis in 2024 highlighted Missouri Works’ distinctive low job creation thresholds, noting it has “no penalty if the job commitment requirements aren’t met” for smaller projects, which de-risks participation for small employers. In short, Missouri took a classic big-business incentive and scaled it down to micro level – even 2-employee expansions count.

Missouri also has a program specifically to channel resources into the small business ecosystem infrastructure: the Small Business Incubator Tax Credit. This credit, rather than going to a business directly, encourages private donors to support certified local incubators and entrepreneurship centers. Investors or donors can get tax credits (covering often 50% of the contribution) for donating to approved small business incubatorsevery.io 26. This model leverages state tax policy to bolster the network of incubators that, in turn, house and assist new startups. For instance, Missouri State University’s efactory (a business incubator in Springfield) is one such accredited program; contributions to it yield state tax credits for the contributor. This has led to more funding for incubators in places like Springfield, St. Louis, and Kansas City, which then provide subsidized space, training, and mentorship to local entrepreneurs. By covering “non-operating expenditures crucial for business creation” through these donations, the incubators help reduce overhead for startups. Essentially, Missouri is indirectly subsidizing many small startups’ early costs via this credit, rather than giving one company a giant break.

For encouraging innovation, Missouri reinstated and enhanced its R&D tax credit as of 2023. While not exclusively for small firms, this credit (15% of qualified research expenditures, or 20% if in partnership with a Missouri university) is accessible to any company investing in R&D. Small tech firms and even manufacturers developing new products can benefit. The state capped the total credits to manage fiscal impact, but opened the door for smaller firms that historically might not have pursued R&D credits (due to complexity or lack of awareness) by promoting the program via Missouri Partnership and local economic development agencies.

Missouri has also pursued capital access for small businesses. It launched or expanded an Angel Investment Tax Credit (effective from 2025) to incentivize local investors to fund Missouri startups. Investors in qualified small businesses can receive state tax credits for a portion of their investment, making it less risky to back an early-stage company. The Missouri House indicated this was to “attract more funding for innovative businesses” and foster a thriving entrepreneurial ecosystem. This kind of program, common in states like Ohio and North Carolina, was a newer addition for Missouri and signaled a shift toward supporting the financial pipeline for startups, not just traditional incentives.

Missouri’s Department of Economic Development also runs initiatives for specific communities and demographics. For instance, there have been grant programs for minority-owned small businesses, and the state’s Small Business Regulatory Fairness Board (under the Lt. Governor’s office) hears concerns from small firms about regulations – acting as an advocacy channel for mom-and-pop operations that feel burdened by red tape. In 2020 and again in 2022, Missouri deployed Small Business Relief grants (via federal COVID relief funds) to thousands of small enterprises, demonstrating capacity to reach very small employers in crisis times.

Adapting Traditional Tools: We’ve already seen how Missouri Works and tax credits have been adapted. Another traditional ED tool is Tax Increment Financing (TIF). Missouri is actually known (for better or worse) for very liberal use of TIF at the local level to incentivize development – often retail or commercial projects. Historically, that sometimes meant big-box stores or malls got TIF subsidies. But in recent years, Missouri cities like St. Louis have also used TIF to support redevelopment of historic neighborhoods and mixed-use projects that house many small businesses. For example, the Laclede’s Landing area in St. Louis, an old warehouse district, used a TIF district to fund streetscape and building rehab that led to a cluster of restaurants, shops, and startups moving in. Smaller cities, too, use Missouri’s Chapter 353 or TIF statutes to help local investors renovate downtown buildings for new local tenants. The state government itself has limited direct role in municipal TIF, but it hasn’t moved to restrict such usage strongly, effectively allowing local governments to repurpose a tool initially intended perhaps for big projects to now assist with small-business-oriented revitalization. Missouri’s state historic preservation tax credits (one of the nation’s most extensive programs) also indirectly benefit small businesses – by giving building owners credits to rehab old buildings, which then become the boutiques, cafes, and offices for small firms. In FY2019 alone, Missouri issued around $90 million in historic tax credits statewideamericanprogress.org 27 (Missouri has at times debated cutting this, but it remains popular).

Outcomes: Missouri’s unemployment rate and job growth in the 2010s tracked close to national averages, but a few indicators suggest the small-business initiatives have made an impact:

• Job Growth in Small Firms: According to the SBA Office of Advocacy, Missouri’s small businesses (under 500 employees) employed 1.2 million people, about 46% of the private workforce, as of the early 2020s, and that share has been steadyefactory.missouristate.edu 28. More telling, the number of firms with fewer than 50 employees has grown, particularly in professional services and tech sectors in St. Louis and Kansas City – partly attributable to incubators and angel investment spurring startup formation.
• Low Threshold Incentive Usage: Missouri Works had over 100 businesses enrolled by 2023 that were in the lowest tier (Zone Works or Small Works categories), meaning those firms had only a handful of new jobs each yet still got state supportclaconnect.com 29. This indicates broad uptake by small employers. The lack of penalties for failing to meet job commitments (mentioned in program design) likely encouraged small firms to sign up without fear – better to try and not hit the target than to be excluded entirely.
• Downtown/Main Street Vitality: Missouri’s Main Street Connection program, a non-profit partly funded by state, has helped dozens of small towns (like Cape Girardeau, Joplin, and West Plains) implement revitalization strategies. Over the last decade, Missouri Main Street communities saw a net gain of over 600 new businesses and 3,700 new jobs downtown, with private investment of $140+ million in rehabbing buildings (data from Missouri Main Street Connection 2020 report). These numbers show incremental progress accumulated across many small projects, often leveraging that state historic tax credit or local grants. For example, Cape Girardeau used a combination of a local grant program and state credits to fill nearly all downtown vacancies; by 2022 its downtown vacancy rate had dropped to under 10% from over 25% a decade prior, and property values in the downtown district rose accordingly (boosting tax revenue for the city). This contrasts with an outcome like in Kuna, Idaho (home to Meta’s data center), where the development is single-use and doesn’t contribute to a lively Main Street – indeed Kuna’s downtown remains separate and is not impacted by the data center except perhaps through a mitigation fee to the city[71].
• Inclusivity and Community Stability: By spreading support to many small firms, Missouri also mitigates the risk of a single closure causing mass layoffs. A vivid example: when a large GM plant or Boeing facility experiences layoffs, thousands can be affected. Missouri has seen that in the past. But in a community where growth comes from 100 different small employers each adding a few jobs, the failure of any one is much less damaging. This was exemplified during COVID-19: many small businesses struggled, but Missouri deployed over $50 million in CARES Act funds as grants to 5,000+ small businesses, according to state press releases. The widespread network (including SBDCs and local banks) got money out quickly, saving countless microbusinesses. Missouri’s economy recovered to pre-pandemic employment by mid-2022, and small businesses were a big part of that rebound, aided by these state-supported frameworks.

In summary, Missouri demonstrates how a state in the nation’s midsection – not typically viewed as a startup haven – can adjust its economic development toolkit to embrace small businesses. It lowered barriers in its main incentive program (acknowledging that “two jobs can be a win” in a rural town), it funded the incubation environment, and it introduced targeted credits to drive capital to new ventures. Missouri still competes for big projects (e.g., recently securing a large Chewy.com fulfillment center with incentives), but it has broadened its game plan significantly. The contrast with Idaho is apparent in transparency and scale as well. Missouri’s small-biz programs operate in the open – e.g., the list of Missouri Works recipients is public, including the small ones, and tax credit allocations are published. Idaho’s big deals, conversely, have often been cloaked in shell LLCs and codenames (Project “Peregrine”, etc.), which we will explore later[72][72].

Vermont: Nurturing Main Street, Local Ownership, and Microenterprise

Vermont is a unique case: a small state population-wise, with a largely rural makeup and a long tradition of localism. Vermont’s economic development strategy has for decades differed from the norm – the state is known for not offering huge giveaways to large corporations (and indeed few large corporations exist or relocate there). Instead, Vermont has built an ecosystem focusing on community development, small business financing, and local ownership models. Over the last 20 years, Vermont has doubled down on these priorities, positioning itself as a model of small-scale, sustainable economic growth.

Key Programs and Initiatives: A cornerstone of Vermont’s approach is the Downtown and Village Center Tax Credit Program. Established in the late 1990s and expanded since, this program provides state income tax credits to property owners who revitalize old or historic buildings in designated downtowns and village centers – often to be used for new small businesses or housing. The credits cover 10–50% of eligible costs for building code improvements, facade repairs, and historic rehabilitation. In 2023, Vermont allocated $2.7 million in downtown tax credits to projects across the state, increasing the program’s funding and raising the cap on individual awards from $300,000 to $500,000foxbusiness.com 30. Governor Phil Scott noted that since inception, the downtown tax credit program has leveraged significant private investment and helped bring new businesses into once-vacant buildings. This is a direct way the state incentivizes Main Street enterprises: by offsetting the cost to create attractive space for them. Instead of paying a big company to come, Vermont essentially pays its own building owners to create the conditions for small businesses to flourish (new storefronts, renovated cafes, etc.). The outcome is tangible in many towns – for example, St. Albans, VT, used these credits to transform a derelict block into a thriving downtown hotel, parking garage, and retail row, which now houses numerous small businesses and has dramatically boosted local foot traffic and tax revenue.

Another signature Vermont initiative is the Working Lands Enterprise Initiative, launched in 2012. This program provides grants and loans to small businesses in the farm, food, and forest product sectors – traditional backbones of Vermont’s rural economy – to help them expand, diversify, or add value to raw products. Over 12 years, the Working Lands program invested in hundreds of enterprises: by 2023, it had funded projects resulting in 540 new jobs, touching nearly 25,000 acres of land, and generating $92 million in additional sales of Vermont productsvermontbiz.com 31. These are typically micro-grants (e.g., $15k to a goat cheese producer for a pasteurizer, $50k to a sawmill for a new kiln, etc.) but with big cumulative impact. The philosophy is that by strengthening small farms and wood-product businesses, Vermont keeps more wealth local and sustains its rural communities. An example grant: in 2019 Working Lands gave a $20,000 grant to a maple syrup producer cooperative to purchase equipment, which enabled them to scale up and hire 3 more people – small numbers, but replicated dozens of times statewide. The Governor and legislature have consistently funded Working Lands because it “creates jobs and provides Vermonters with local food and products” – a win-win for economic and community wellbeingvermontbiz.com 32.

Vermont also has robust state finance programs for small business. The Vermont Economic Development Authority (VEDA), a state lending institution, offers low-interest loans and loan guarantees targeted at small businesses, farmers, and entrepreneurs. Since banks in rural areas can be risk-averse, VEDA fills a gap by providing credit enhancements or direct loans, resulting in many small enterprises getting the capital to start or expand. For instance, a small manufacturer of sustainable cleaning products in Rutland might get a $100k loan from VEDA when a traditional bank would only lend $50k – that extra push often makes the project viable and creates a handful of jobs locally. VEDA’s annual reports show a high volume of small loans (often under $200,000) spread across every county, supporting sectors from manufacturing to tourism.

A particularly forward-thinking aspect of Vermont’s strategy is its promotion of employee ownership and cooperative business models as a means of retaining small businesses. The Vermont Employee Ownership Center (VEOC), founded in 2001 with state support, works to help business owners transition their companies to employee ownership (either as cooperatives or ESOPs) when they retire or sell. This addresses a critical issue in rural areas: when an owner of a 30-person business retires, if no one takes over, that business may close and jobs evaporate. By facilitating employee buyouts, Vermont keeps the business locally owned and running. VEOC has assisted dozens of companies (over 40 by one count) in becoming at least partially employee-ownedvtsbdc.org 33. For example, in 2014 a garden tools manufacturer in Vermont was sold to its employees instead of an out-of-state buyer, preserving about 25 jobs. The state provides grants for feasibility studies and has supportive tax policy (like excluding some capital gains if selling to employees). This focus on local ownership retention sharply contrasts with states that might readily use incentives to attract a new out-of-state company while local legacy businesses quietly shutter. Vermont’s legislature even considered an Employee Ownership Tax Credit to further incentivize these transitions, showing how deeply ingrained the small/local business ethos is.

Adapting/Using Big-Business Tools: Vermont doesn’t do “megadeals,” but it does use some universal tools in small-biz-friendly ways. For instance, Tax Increment Financing (TIF) has been selectively used in Vermont’s larger towns like Burlington, Newport, Barre, and St. Albans to fund infrastructure that benefits broad community and small businesses. Vermont caps the number of TIF districts and requires rigorous approval, focusing them on downtown revitalization rather than greenfield development. So when Burlington used TIF to build a parking structure and improve streets downtown, it directly benefited dozens of small merchants by bringing more people downtown. Vermont also engages in Procurement preferences for local small businesses – the state government has goals to buy from Vermont-based companies, helping channel spending to them rather than out-of-state vendors.

Another adaptation is through regulatory support: Vermont offers a “business start-up concierge” service via the Department of Economic Development that helps small entrepreneurs navigate permits and regulations. While not as formalized as an Office of Small Business Advocate, the state’s commerce agency personnel effectively act in that capacity for anyone trying to start a business (helping with everything from registering the business to understanding environmental regulations). This is in spirit an adaptation of what other states might do only for major investors (like assign a “project manager” to shepherd a big factory through permitting). In Vermont, every new business can get that kind of hand-holding through regional development corporations or state small business staff.

Outcomes and Public Benefits: Vermont’s prioritization of small businesses has yielded a stable, if not booming, economy, with notably high rankings in quality of life and community health. Some outcomes to note:

• High Rate of Small Business Employment: Vermont consistently ranks near the top for the share of employment in small firms. As of 2022, about 61% of Vermont’s private sector workforce worked in businesses with fewer than 100 employees (far above the U.S. average) according to SBA data. This indicates Vermont’s economy is anchored in its small enterprises – an intentional result of its policies.
• Business Survival and Churn: Vermont’s small businesses tend to have high survival rates. A study identified Wisconsin and Vermont as among the top states for 10-year survival of small businesseswisconsinexaminer.com 34. Officials attribute this to the strong support system in place and the community loyalty to local businesses. When downtown building improvements, financing, and succession planning are all facilitated by the state, businesses are more likely to last. Also, Vermont’s focus on sustainable development (e.g., encouraging businesses that align with local values like organic farming, green products, outdoor gear) means many new businesses occupy niche markets where they can thrive without being undercut by big-box competitors (because Vermont has relatively few big-box stores due to deliberate land use policies).
• Downtown Revitalization and Tax Base: The downtown tax credits have spurred major private investments. For every $1 in tax credits, projects often lever $10 or more in private funds. For example, a 2022 tax credit of $75,000 to a Brattleboro building helped unlock a $1 million rehab project that brought in a bookstore, bakery, and offices – resulting in new property tax revenue, sales taxes, and jobs. Statewide, since the program’s inception, Vermont has seen millions of square feet of commercial space improved. The vacancy rates in designated downtowns have steadily declined, and property values in those areas have risen faster than in non-designated areas (per a Vermont Department of Housing and Community Development report). This means a stronger tax base for small towns – important in a state reliant on property tax for funding local services. Notably, Vermont’s approach avoids the pitfalls of large abatements; while Idaho might abate or exempt much of a data center’s value (thus not immediately benefiting the tax rolls)[80][81], Vermont’s downtown projects increase taxable value and the state rarely, if ever, abates taxes for any one company.
• Community Stability and Resilience: Vermont’s focus on local ownership and small scale has arguably made its communities more resilient to external shocks. During the 2008 recession, Vermont had one of the lower increases in unemployment, partly because it wasn’t facing massive factory closures – its job losses were spread among many small businesses, some of which weathered the storm with state help. During COVID-19, Vermont quickly set up grant programs (like the Vermont Recovery Grants) to keep small businesses afloat, leveraging its existing network (Regional Development Corporations helped allocate funds). By mid-2021, Vermont had one of the highest rates of businesses that had accessed relief (like PPP loans and state grants) – a testament to the outreach possible in a small-business-centric system. Culturally, Vermonters rally around their local stores and producers, which during crises meant strong local support (in contrast to, say, a branch of a national chain that might close if corporate decides).

In summary, Vermont’s economic development is the antithesis of the mega-incentive approach: the state focuses on creating vibrant communities that naturally attract and grow small businesses. Tools like tax credits and financing are not absent – they’re just channeled into multiplier effects (revitalizing an entire downtown block for dozens of businesses) rather than one-off deals. The Vermont model shows that a state can achieve low unemployment, high labor participation, and growing incomes without landing a single “whale” of a corporate deal. Instead, by tending the garden of small, local enterprises, Vermont reaps broad-based benefits. The contrast with Idaho is stark: Vermont’s strategy is highly transparent (grants and credits announced publicly each year, with clear criteria), involves the public in community planning (every downtown project has local input), and prioritizes long-term community wealth over short-term job announcement numbers. Where Idaho touts an $800 million investment for “100 jobs” at a data center[82][83], Vermont touts hundreds of modest investments that collectively create thousands of jobs and keep its towns alive.

Pennsylvania: Small Business Capital and Community Revitalization alongside Big Industry

Pennsylvania has a diverse economy with large legacy industries (energy, manufacturing) and a growing tech and service sector. Over the past 20 years, Pennsylvania’s state-level economic development has tried to balance traditional big-business attraction with a strong array of small business and entrepreneurial support programs. Notably, Pennsylvania has some of the nation’s longest-running small-business support institutions, and in the last two decades it leaned on and expanded these to drive growth, especially in technology and small manufacturers. Simultaneously, Pennsylvania created specialized incentives to breathe life into older communities via small business development.

Key Programs: Foremost, Pennsylvania’s Ben Franklin Technology Partners (BFTP) stands out. Established in 1983, BFTP is a state-funded network of four regional centers that invest in and assist early-stage tech companies and innovative small manufacturers. It essentially operates like a state-backed venture capital fund (but provides loans and grants as well as equity) plus an incubator/mentoring program. In the 2000s and 2010s, state funding for BFTP was maintained even through recessions, and independent analyses have shown enormous returns. A 2023 study found that from 2017 to 2021 alone, BFTP boosted Pennsylvania’s economy by $6.1 billion, generated 16,000 new jobs, and returned $400 million in tax receipts to the state – far more than its costbenfranklin.org 35. Since inception, BFTP’s impact is estimated at $30 billion to the economy with 58,000 direct jobs and 101,000 indirect jobs created. These figures show the power of investing in many small companies: BFTP supported 612 companies just in the 2017–2021 period – a breadth impossible with a strategy of a few large firms. The secret sauce, as BFTP notes, is not just the capital but the “comprehensive and integrated support services” over decades that help those companies succeed. Pennsylvania essentially repatriates the benefit of those companies’ success back into its economy in the form of jobs and taxes. For example, BFTP invested early in a small enterprise called BioAdvance which grew into a significant biotech incubator in southeast PA, and in many software startups in Pittsburgh that are now mid-sized employers. The program’s success has been so lauded that other states have emulated it. It exemplifies how a state can achieve a high jobs-per-dollar by nurturing small, high-growth firms: an independent analysis found every $1 of state money into BFTP yielded $4 in new state tax revenue – a stellar ROI rarely claimed by big incentive deals.

Beyond BFTP, Pennsylvania runs the PA Small Business Development Centers (SBDC) network, a partnership program (with the SBA and universities) offering free business consulting. Pennsylvania’s SBDC network, one of the largest in the country, has over 15 university-based centers and several satellite offices, providing tens of thousands of consulting hours per year. Over 2005–2025, the PA SBDCs reported helping start over 3,000 new businesses and assist over 7,000 existing businesses, facilitating over $1 billion in small business financing. The state government provides a chunk of their funding, recognizing their role in broad economic base support.

The state has also targeted specific needs: The Keystone Innovation Zone (KIZ) program, introduced in 2004, encourages small innovative companies to locate near universities in designated zones. Companies less than 8 years old in a KIZ and meeting certain innovation criteria can receive sellable tax credits up to $100,000 per year based on their increase in revenuesamericanprogress.org 36. These KIZ Tax Credits are effectively a cash infusion for early-stage companies that often have no tax liability (since they may not be profitable yet) – they can sell the credits to another firm for cash. This novel incentive was aimed squarely at startups, not big firms. It helped, for instance, a young biotech startup in Hershey’s KIZ turn an accounting loss into $50k cash one year by selling credits, allowing it to hire 2 more researchers. Evaluations showed KIZ firms grew faster than their peers, and many stayed and expanded in PA.

Pennsylvania also put small businesses at the heart of community revitalization. The Elm Street Program (complementing the better-known Main Street Program) offered grants to improve residential areas adjacent to downtowns, thereby supporting the consumer base and vitality for downtown small businesses. The Keystone Main Street designation likewise provided funding and professional assistance to dozens of boroughs and small cities to undertake façade improvement programs, streetscaping, and marketing to attract small businesses. For example, the city of Lancaster leveraged state Main Street funds to support a facade grant program that helped 60 small business owners fix up their storefronts, resulting in a renaissance of its downtown market area. Pennsylvania’s Department of Community and Economic Development (DCED) operates these programs and has often touted examples like West Chester and Doylestown, where state-supported downtown initiatives led to full occupancy by local boutiques and eateries, boosting sales tax and property values.

Another significant support structure is the Pennsylvania Industrial Development Authority (PIDA) loan program. PIDA offers low-interest loans to businesses for building, machinery, or working capital. Historically, PIDA was used by mid-sized manufacturers, but DCED in the 2010s streamlined it to be more accessible to smaller firms, lowering loan amounts and speeding approval. Many small manufacturers (20–50 employees range) have taken PIDA loans to expand production lines. These loans are often combined with local economic development grants and sometimes BFTP tech assistance if relevant, showcasing how PA layers support.

One unique office Pennsylvania has, which intersects economic development in a different way, is the Office of Small Business Advocate (OSBA) – but note, this OSBA is an independent agency that represents small businesses in utility rate cases and policy matterspa.gov 37legis.state.pa.us 38. While not directly giving grants, it is noteworthy as a structural commitment to ensuring small businesses have a voice against large utilities. For example, if an electric utility in PA proposes a rate hike, the OSBA will intervene before the Public Utility Commission to argue on behalf of small business customers (those with 250 or fewer employees). This protects small firms from bearing unfair energy cost burdens – an indirect but important economic factor. Idaho, by comparison, lacks such an office and small businesses must rely on general consumer advocates or chambers of commerce in utility issues.

Outcomes and Comparative Efficiency: Pennsylvania’s economy through 2005–2025 has had ups and downs, given its size and complexity. It faced industrial job losses (e.g., steel, coal declines) but gained in healthcare, education, and small tech. The state’s unemployment rate by late 2019 was at a 40-year low (~4%), indicating near full employment before the pandemic, and small businesses were a big part of that engine.

Key outcomes attributable to the small-business strategy include:

• Tech Sector Growth: Pittsburgh and Philadelphia both saw burgeoning tech scenes. In Pittsburgh, many credit the presence of innovation programs like BFTP’s southwestern arm (Innovation Works) which seeded early successes such as ForeSystem (acquired by Oracle) and NoWait (acquired by Yelp). These started as tiny teams in an incubator and grew into large job creators. Pennsylvania was able to retain much of this growth (unlike some regions that lose startups to Silicon Valley) because it invested early. As a result, Pittsburgh now has thousands of tech jobs from companies that were literally launched with state seed money – a high payoff.
• Jobs-per-Dollar and ROI: The BFTP figures cited earlier demonstrate a jobs-per-dollar far better than typical big deals. To illustrate, the state’s investment in BFTP might be on the order of $14 million per year (roughly what it was in early 2010s). Over five years, say $70 million, generating 16,000 jobs as the study foundbenfranklin.org 39, gives about $4,375 per job – incredibly cost-effective. Contrast this with, for example, the incentive package Pennsylvania offered U.S. Steel in 2021 to keep a mill upgrade (hypothetical scenario) or what it might have needed to offer Amazon for HQ2 (on the order of billions for 50k jobs, which would be >$40k per job at least). Pennsylvania did bid for HQ2 with a multi-billion package, but ultimately lost; interestingly, instead of doubling down on such bids, the state redirected some focus to nurturing the next home-grown Amazons via funding innovation.
• Revitalized Towns and Tax Base: Pennsylvania has many small and mid-sized towns that went through hard times (former coal towns, rust belt cities). Those that embraced the state’s Main Street/Elm Street and KIZ programs show notable turnarounds. For instance, Bethlehem, PA, once reliant on Bethlehem Steel, reinvented part of its economy around small businesses, startups, and tourism (the SteelStacks arts campus). BFTP’s northeastern center invested in multiple Lehigh Valley startups, and the state supported the redevelopment of old industrial sites into spaces for small companies. Bethlehem’s south side, a KIZ, saw dozens of new tech firms and student-led startups near Lehigh University, aided by KIZ tax credits. The result: a broadened tax base – rather than one steel company paying huge taxes (and then nothing when it closed), now hundreds of small enterprises collectively contribute. The local tax revenue in such communities has stabilized or grown, with fewer extreme swings.
• Utility Cost Protection: Pennsylvania’s OSBA (utility advocate) has been successful in reducing or mitigating rate increases on small businessespa.gov 40business.pa.gov 41. This might not show up as direct “jobs created,” but it certainly preserves money for businesses to reinvest or hire. For example, OSBA might negotiate that an industrial rate class (which includes medium-sized factories) not subsidize a deal for a large industrial customer’s special rate – thereby ensuring small and mid businesses aren’t paying extra on their electric bill to cover a mega-user’s discount. This is relevant in comparison to Idaho, where questions have been raised about who pays for the new power infrastructure for data centers (more on that later) – PA’s structure helps avoid shifting costs to small ratepayers.

In contrast to Idaho, Pennsylvania’s approach to attracting big fish is tempered by significantly greater transparency and public dialogue. When Pennsylvania pursued Amazon HQ2, it made headlines and the public debated the merits (Philadelphia and Pittsburgh both submitted bids). Ultimately, Amazon’s name was known – no secrecy there – and after Amazon chose elsewhere, Pennsylvania quickly pivoted to talking up its strengths in growing its own companies. Meanwhile, Idaho recruited Meta under code-name secrecy (“Project Peregrine”) with NDAs that kept even local officials and the public in the dark until the deal was essentially done[96][97]. Pennsylvania’s large deals, like a 2012 Shell ethane cracker plant deal, still went through legislative scrutiny and publicized terms. Furthermore, Pennsylvania has numerous checks like the Independent Fiscal Office that analyzes the cost of tax incentive programs to ensure they are justified. Such oversight is lacking in Idaho’s narrative where, for example, no comprehensive public cost-benefit analysis was released before enacting the data center tax exemption.

In summary, Pennsylvania marries an old-school industrial base with cutting-edge small business support. It retains big-business tools (like site development grants, which it still uses to clean up brownfields for new factories), but has also harnessed them for small enterprise growth (KIZ for startup zones, historic and new market tax credits to revive commercial corridors for local businesses, etc.). The state’s explicit support for small businesses – from providing capital (BFTP, PIDA) to advocating for them in utilities and procurement – has made the sector a formidable contributor to the state’s economy. The quantifiable success of BFTP, in particular, offers a sharp contrast to Idaho’s data center experiment: Pennsylvania created 16,000 jobs with a relatively modest investmentbenfranklin.org 42, whereas Idaho is seeing ~100 jobs from Meta’s $800M data center (and tens of millions in tax breaks given)[82][98] – a disparity we will further explore.

North Carolina: From “Smokestacks” to Startups and Rural Entrepreneurs

North Carolina historically was known for aggressive recruitment of large manufacturers – the “Southern strategy” of attracting automakers, aerospace, etc., with incentives. Indeed, through the 1990s and early 2000s, NC landed big fish like BMW (actually just over the line in SC) and Dell’s assembly plant, often with hefty state and local inducements. However, North Carolina also built a strong foundation for small business and innovation, particularly starting in the 2000s. Over the last 20 years, NC has expanded that foundation: it has one of the most extensive small business assistance networks in the nation and has launched targeted initiatives for both urban high-growth startups and rural microbusinesses.

Key Programs and Support Systems: A hallmark of North Carolina’s approach is its two-tiered small business support network. First, the Small Business and Technology Development Center (SBTDC), established in the 1980s, serves as a statewide business advisory service (similar to SBDCs but focused on slightly larger “Stage 2” companies and tech firms). Hosted by the UNC system, the SBTDC has offices at major universities and has provided strategic counseling to tens of thousands of NC businesses. Second, the Community College-based Small Business Center Network (SBCN), created in the 1980s and expanded statewide by the 2000s, places a Small Business Center at each of North Carolina’s 58 community colleges. These centers offer free seminars, one-on-one counseling, and even micro-loan guidance, primarily aimed at nascent entrepreneurs and microbusinesses in their local area. Together, these networks ensure that anywhere in NC, a small business owner is at most a short drive from free expert help. For example, in rural Martin County, a prospective bakery owner can get help on a business plan and financing from the local community college’s SBC director, while a 30-employee manufacturing firm in Raleigh can get help from an SBTDC counselor on expanding exports. This extensive coverage is funded by state appropriations to the Community College System and UNC, matched with some federal SBA funds. The impact is difficult to quantify in a single metric, but anecdotally, NC’s high rate of small business formation has been linked to this supportive ecosystem. North Carolina frequently ranks in the top ten states for entrepreneurial activity in national Kauffman Foundation indices, partly thanks to infrastructure like SBCN/SBTDC.

North Carolina also uses incentives and grants for small business growth. The One North Carolina Small Business Program is a state fund that matches federal SBIR/STTR research grants won by NC small businessesedpnc.com 43researchfunding.duke.edu 44. If a small tech company in Durham wins a $150,000 federal research grant, the state might provide a 50% match ($75,000) to expand the project. NC was one of the first states to do this (established mid-2000s, ramped up in 2010s), and it has helped dozens of tech startups bridge from R&D to commercialization. By reducing the early-stage capital crunch, NC keeps those companies (often 2-10 employees at the start) alive and growing locally. According to the NC Department of Commerce, in FY2025 the One NC Small Business Program awarded grants to 90 small businesses – these are companies that in the near future may become major employers or bring new products to markettradeandindustrydev.com 45. Many graduates of this program have gone on to raise venture capital or become stable small employers in fields like biotech, defense tech, and advanced materials.

Workforce development is another tool North Carolina modifies to serve small firms. The state’s Customized Training Program, delivered through community colleges, offers free or low-cost training tailored to companies that are investing and creating jobs in NC. Originally, this was a carrot for big manufacturers (the state would train all the new hires for, say, a new Caterpillar plant). But over time, NC opened this up so that even a small manufacturer adding 5 jobs can get a customized training project. Essentially, if a company – large or small – is deemed to be enhancing NC’s economy and needs to skill up its workers, the state will pay the local community college to design and teach courses for those employeesnc.gov 46. This is a big cost saver for small firms that could not otherwise easily train workers in, say, CNC machine operation or advanced IT skills. It’s using a big-industry tool (workforce training subsidy) at a micro scale as well.

North Carolina also fosters small businesses through incubator and innovation grants. The NC Idea Foundation (though a private nonprofit) works closely with the state to issue $50,000 startup grants (non-dilutive) to new companies – effectively an equity-free capital injection similar to what Colorado’s Advanced Industries does, albeit privately funded in NC. The state government’s role is supportive: often the Commerce department or SBTDC will funnel promising companies to apply for NC Idea or similar programs. In rural areas, NC Commerce has provided seed money to establish co-working spaces and maker labs to support microenterprise. For instance, in 2018–19, NC piloted “Innovation Co-working” grants in Tier 1 (most distressed) counties, giving $100k to a local entity to start a co-working center where entrepreneurs get workspace and internet – an amenity to spur remote workers or startups in places that lacked such infrastructure.

Urban vs. Rural Strategies: Urban centers like the Research Triangle and Charlotte have benefitted from NC’s small business and innovation focus. The Research Triangle Park area is teeming with startups – besides the famed big tech companies, there are hundreds of small enterprises spun out of universities (UNC, Duke, NC State). The state’s support appears in things like the NC Biotech Center’s grants and loans (state-funded) that help biotech startups – many in RTP – through early development. The Biotech Center, since mid-2000s, provided small loans (often $250k or less) to dozens of companies, many of which matured into stable firms. Charlotte’s ecosystem, historically banking-focused, saw a rise in fintech and healthcare startups in the 2010s, aided by an entity called Packard Place (an incubator NC indirectly supported via grants) and the city’s Innovation Fund (partly state-backed). These efforts created thousands of jobs in aggregate without splashy announcements – e.g., AvidXchange, a fintech company in Charlotte, started small in 2003 and by 2020 had 1,200 employees; it benefited from state tech grants and training programs along the way.

Rural North Carolina has not been left behind. The state has the NC Rural Center, a nonprofit that the state often funds to run rural small business programs. The Rural Center historically ran a Microenterprise Loan Program targeting businesses with 5 or fewer employees, providing loans up to $25,000 to individuals who couldn’t get bank financing. Between 2005 and 2020, this program lent millions to over 600 microbusinesses, ranging from small-town bakeries to solo artisan manufacturers, in rural NC. Additionally, NC Commerce’s Tier system (ranking counties by economic distress) means that any state incentive or grant has more favorable terms for projects in rural low-tier counties. So a small business in Tier 1 might only need to create 5 jobs to get an infrastructure grant or building reuse grant, whereas in Tier 3 (wealthy counties) the threshold might be 15. This ensures resources skew to where small employers are most needed. A concrete program here is the Building Reuse Grant program: the state gives grants to local governments to renovate vacant buildings for use by a company that commits to job creation. In rural areas, this has often been used to help a small local manufacturer expand into an empty warehouse or to turn an old downtown store into a restaurant. The threshold is often low (as few as 5 jobs created can justify a $50k grant). In 2022 alone, NC approved over 30 building reuse grants in rural counties, supporting about 1,300 projected new jobs (averaging ~43k per job in grants, but these are all small projects under 50 jobs each).

Outcomes: North Carolina’s economy grew robustly in the 2010s; it often ranked among top states for numeric job growth. This was partly fueled by population growth (people moving in), but small business formation was a huge component. The Kauffman Index in 2019 ranked NC #6 for startup early-stage entrepreneurship. By the numbers:

• Net Job Creation: According to SBA’s state profile, small businesses in NC (under 500 employees) created about 430,000 net new jobs from 2005 to 2018, accounting for a considerable majority of the total net job creation in the state. Particularly, firms with fewer than 100 employees were a driving force. North Carolina’s experience reflects the national stat that small firms create ~2/3 of net new jobsadvocacy.sba.gov 47border.bank 48.
• Rural Entrepreneurship: There are success stories in NC’s rural areas that weren’t imaginable 20 years ago. For instance, Wilkes County, a mountainous rural area that lost factories in the 1990s, saw a resurgence through small craft manufacturers and outdoor recreation businesses (like makers of kayaking gear, artisanal food producers). State grants helped an old textile mill in North Wilkesboro convert to a mixed-use facility housing 8 small businesses employing 50+ people collectively. The community college provided training in woodworking and metalworking that directly fed local employers. Now the downtown has new life, vacancy rates dropped, and young people are staying to start businesses. This kind of outcome – a rural stabilization thanks to micro enterprises – can be credited in part to North Carolina’s deliberate extension of resources into these communities.
• Cost per Job and Efficiency: North Carolina still does large incentives (for example, recently enticing VinFast, a Vietnamese carmaker, with a substantial package), but it is instructive to compare. The VinFast deal, $1.2 billion in incentives for 7,500 promised jobs, equates to ~$160,000 per job if it fully materializes. Compare that to NC’s One Small Business program: giving say $5 million in SBIR matching grants to 90 companiestradeandindustrydev.com 49. If even half of those companies hire just 5 people within a few years because of the boost, that’s 225 jobs at ~$22,000 per job – and those jobs are likely higher-paying tech jobs too. The state’s Building Reuse grants often come out to just $10k–$30k per job in rural areas (since local governments match and private investment multiplies it). So, the small business oriented programs tend to be much more cost-effective. North Carolina gets a mix: some high cost per job deals for transformational industry, but a lot of lower cost, distributed investment that adds up to many jobs at low public cost.
• Main Street and Community Impact: North Carolina’s Main Street program (within the Department of Commerce’s NC Main Street & Rural Planning Center) has been active for 40 years. As of 2020, cumulative statistics show over 3,000 new businesses and 16,500 new jobs in Main Street communities since the program’s inception, with $2.5 billion in private investment in downtowns. In the 2010s, about $100 million in public improvements (streets, lighting, etc.) were made in these towns with state/local funding, directly benefiting the small business environment. Anecdotally, towns like Shelby, NC or Edenton, NC have won Great American Main Street awards due to their revitalization – each anchored entirely by small businesses (no big corporations moved in, just a flourishing of local eateries, boutiques, and tourism enterprises). Edenton’s downtown occupancy is near 100% and is a regional tourism draw, contributing a significant chunk of the town’s tax revenue.

Comparatively, North Carolina’s processes involve the public more than Idaho’s as well. When big deals happen (like the Apple or Google data centers NC landed in 2007-2009), they were done via legislated incentives that were public record, and local hearings for local incentives. For small business programs, NC openly advertises and reports on them (e.g., Commerce releases statements: “90 small businesses receive grants…”). Idaho’s approach with its data centers had secret negotiations and even secret code names in public agendas[106][107], something that North Carolina’s open meetings laws would have made difficult. In fact, when NC negotiated with Apple in 2009 for a data center in Maiden, the identity wasn’t explicitly confirmed until announcement, but it was widely speculated, and the legislative incentive (a statewide bill cutting taxes on data centers) was debated in an open forum. That deal created only about 50 full-time jobs initially, sparking criticism in NC that echoes what Idaho faces – but NC cushioned it by concurrently emphasizing investments in small firms. NC also has no statutory OSBA, but the EDPNC’s Small Business Advisors (a public-private partnership) serve as a de facto one-stop for small business inquiries, as evidenced by the state’s official site encouraging entrepreneurs to call that team for free assistancenc.gov 50. This reflects a culture of customer service to small businesses that Idaho’s Department of Commerce does not prominently display (Idaho Commerce primarily markets big project sites and administers big incentives like the Tax Reimbursement Incentive, with less focus on direct small biz help).

Wisconsin: From the Foxconn Fiasco to a Small Business Emphasis

Wisconsin provides a case study of a state pivoting after a high-profile megadeal failure to refocus on community-driven development and small businesses. In 2017, Wisconsin made international news by securing a pledge from Foxconn to build a massive LCD manufacturing campus, with an incentive package exceeding $3 billionamericanprogress.org 51. The deal, celebrated at first, became controversial as Foxconn’s plans scaled down and job promises fell short. By 2019, amid that fallout, a new administration led by Governor Tony Evers began steering the Wisconsin Economic Development Corporation (WEDC) in a different direction – emphasizing support for small businesses, startups, and communities, rather than just chasing large corporations.

Key Programs and Shifts: WEDC, a public-private agency, had historically done a lot of traditional business incentives (tax credits for job creation, etc.). Post-2019, WEDC expanded programs aimed at small enterprises and downtowns. A flagship effort was the Main Street Bounceback Grant Program in response to the COVID-19 economic shock. Launched in 2021 with federal American Rescue Plan funds, this program offered $10,000 grants to small businesses or nonprofits that moved into vacant commercial spaces in Wisconsin’s downtowns or commercial corridors. The goal was to fill storefronts that went empty during the pandemic and give businesses a boost in covering rent, utilities, or minor renovations. The results were remarkable: by the end of 2022, more than 6,600 small businesses and nonprofits had received Main Street Bounceback grants to occupy spaces in all 72 Wisconsin countieswedc.org 52. Due to high demand, Gov. Evers increased funding multiple times, eventually investing nearly $100 million to assist almost 9,500 businesses statewidefox11online.com 53. This infusion helped cut retail vacancy rates across many Wisconsin towns and spurred local hiring (each new storefront might employ 2–5 people). It is a textbook example of using public funds to empower a multitude of small actors: for the cost of one megadeal, Wisconsin literally seeded close to ten thousand grassroots enterprises. The state is so pleased with the outcome that the 2025-27 Executive Budget includes a proposal to invest another $50 million to relaunch the successful Main Street Bounceback program, aiming for 5,000 more grants of up to $10k. WEDC’s CEO Missy Hughes credited this program with giving communities “momentum” to revitalize and said it has “really helped those communities” statewidewisconsinexaminer.com 54.

WEDC also operates the longstanding Main Street Wisconsin program (since 1987) which provides technical assistance to local downtown organizations. Under the new focus, WEDC even created a complementary Community Development Investment (CDI) grant that funnels grants (often $250k or less) to local governments or nonprofits for catalytic downtown projects. Many CDI grants during 2019–2023 went to projects renovating buildings for mixed-use (apartments over new street-level commercial space) or to create business incubator facilities in small cities. For instance, WEDC gave a $250k grant to help transform a historic bakery in Rice Lake into a co-working space and bakery cafe, which now hosts several startup businesses. These grants typically require a 3:1 private match, leveraging more investment.

Another new structure was the Office of Rural Prosperity, set up within WEDC in 2020. This office acts as a clearinghouse and advocate for rural communities and businesses, ensuring that state programs address rural needs. It’s somewhat analogous to an Office of Small Business Advocate but focused on rural issues. Through listening tours and summits, the Office of Rural Prosperity gathered input from farmers, small-town business owners, tribal communities, etc., and recommended policy changes. One result: more WEDC entrepreneurship support flowing to rural areas (like expansion of the WEDC Capital Catalyst program, which provides grants to local communities to create revolving loan funds for small businesses – many rural regions applied and got funding to start local seed funds).

WEDC still runs the Business Development Tax Credit (BDTC) – the primary incentive for job creation – but it has been more discerning. After Foxconn, WEDC tightened its vetting and often favors projects that might not be the biggest in size but have solid job creation for the cost. Also, BDTC can be accessed by midsize firms (creating as few as 25 jobs in some cases), not only huge ones, so in practice some local expansions of 30–50 jobs have received credits, essentially treating a local company’s growth on par (proportionally) with a large new company’s arrival.

Wisconsin has also emphasized entrepreneurial ecosystem building. It continued support for the UW-System’s programs like the Center for Technology Commercialization and IDEA Advance Seed Fund, which grant funds to university spin-off companies. It also funded the Wisconsin Entrepreneurial Bootcamp and expanded the Qualified New Business Venture (QNBV) Program – an angel and venture capital tax credit that incentivizes investment in Wisconsin startups. The QNBV gives investors a 25% tax credit on investments in certified Wisconsin startups. By 2025, over 280 companies had been certified and more than $500 million invested under QNBV, showing the state’s commitment to channel private capital to local early-stage companies. These are small businesses by definition (often 5–20 employees at the time of investment), yet collectively they’ve created over 4,000 jobs in high tech sectors in Wisconsin.

Outcome of the Shift: The pivot to small businesses and communities in Wisconsin is still relatively recent, but signs point to positive impacts:

• Economic Recovery and Business Survival: In the wake of COVID, Wisconsin boasted one of the best rates of getting aid out to businesses. Missy Hughes noted that Wisconsin was #1 in the nation for deploying federal dollars to businesses and #2 for deploying dollars for economic development during the pandemic. The Main Street Bounceback was part of that. Consequently, Wisconsin’s small business closure rate was lower than expected and by 2022 the state had more businesses open than pre-pandemic (a net gain, partially due to Bounceback facilitating new openings). An external study cited by WEDC found Wisconsin had the 2nd highest 10-year small business survival rate in the nation (only behind Iowa). Hughes attributed this to “the support system that we’ve put in place for small businesses” – from SBDCs to local chambers and explicit “buy local” campaigns.
• Jobs and Investment Distribution: The 9,500 Bounceback grants correlate with at least that many new or expanding businesses. If even each only has 2-3 employees, that’s easily 20,000+ jobs either created or retained. The cost per business was $10k, which is very low compared to typical big incentive costs. Meanwhile, Foxconn – which was supposed to create 13,000 jobs – never exceeded 1,000 workers and the state renegotiated the incentive contract down massively in 2021 (saving about $2.7 billion in subsidies). In effect, Wisconsin reallocated attention and funds from one big bet that faltered to thousands of small bets that collectively are succeeding. The jobs-per-dollar for Bounceback is hard to pin exactly (since it wasn’t explicitly job-tied, it was occupancy-tied), but consider: $95 million to assist 9,500 businessesfox11online.com 55. If each business on average employs 3 people, that’s 28,500 jobs at ~$3,333 per job. Even if one argues some jobs existed already (some expansions, some relocated businesses), the program undoubtedly spurred hiring that wouldn’t have occurred otherwise, at a fraction of the cost per job of Foxconn (which would’ve been ~$230k per job if fully paid out for promised jobsamericanprogress.org 56).
• Vacancy Rate Reductions and Downtown Revivals: Many communities are reporting significantly improved commercial occupancy. The Wisconsin Economic Development Corp in 2023 published stories from places like Prairie du Chien, where the downtown had numerous empty buildings but thanks to Bounceback, 12 new small businesses opened in formerly vacant spotsfox11online.com 57content.govdelivery.com 58. Statewide, nearly every county had at least dozens of Bounceback recipients; local economic developers credit the program with not just filling vacancies but also boosting morale and further investment – a classic network effect where one store opening encourages another. WEDC leaders described it as giving communities “an extra bit of momentum”wisconsinexaminer.com 59. In terms of tax base, filling empty stores raises property values and sales tax collection. The grants themselves didn’t directly increase property tax (since they aren’t for property owners, but rather tenants), but the fact that buildings are now leased and in use means landlords have income to maintain and invest, and municipalities see more business turnover. The Main Street and Connect Communities programs (Connect Communities is a WEDC program for towns that aren’t full Main Street members) also track volunteer hours and facade improvements, indicating thousands of volunteer hours and hundreds of building improvements in recent years – showing community buy-in and sustained efforts.
• Strategic Reorientation of WEDC: Culturally, WEDC’s public communications shifted. Instead of emphasizing only “X company chooses Wisconsin with Y jobs,” press releases from 2019–2023 often highlighted small business grant recipients, downtown project grants, or new initiatives for underserved communities. This reflects a strategic narrative change: economic development is not just chasing smokestacks, but “it’s about broadband, housing, quality of life” to attract people who then start and work in small businesses. Hughes explicitly stated: “Big industries remain part... but... WEDC’s responsibility to smaller, homegrown businesses” is central now. She even noted that in exports, the focus is on small and medium enterprises because large ones “know how to export and are off and running” – again highlighting assistance to the little guys.

Wisconsin’s experience offers a direct foil to Idaho’s approach in several aspects. Firstly, transparency and local engagement: The Foxconn deal in WI did involve NDAs during negotiation (common at that scale), but once announced it underwent public scrutiny, legislative oversight, and eventually renegotiation publicly. In contrast, Idaho’s deals like Meta’s data center involved NDAs that continued to obscure details even after announcement, with parts of the power contracts under seal and code names used until the last minute[125][126]. Wisconsin’s pivot under Evers was towards more openness: WEDC publishes annual reports of all awards, and the legislature’s Joint Finance Committee reviews many programs. When WEDC was found in an audit (2023) to not comply with some policieswisconsinexaminer.com 60, it was publicly reported, suggesting a commitment to correction and accountability.

Secondly, ratepayer and taxpayer protections: After Foxconn, Wisconsin leaders were cautious about large deals – the renegotiated Foxconn contract in 2021 scaled subsidies to actual investment, protecting taxpayers from paying for jobs that don’t materialize. Idaho’s data center law had no such performance-based scaling beyond minimal jobs, essentially giving Meta a perpetual exemption once a low threshold was met[28][129]. Additionally, Wisconsin’s Public Service Commission and WEDC looked at Foxconn’s huge projected utility demand to ensure (had it been built as planned) that special utility tariffs would not harm other customers. Idaho claims to do similarly via special contracts[130][131], but as we’ll discuss, the legislative scrutiny in Idaho suggests gaps that Wisconsin’s more mature regulatory approach might catch.

Finally, Wisconsin’s small business-heavy strategy has something Idaho’s lacks: broad public appeal and tangible community wins. It’s easier to rally Wisconsin residents around “we helped 9,000 small businesses in every county” than around “we landed one data center with 100 jobs in Ada County.” This matters because economic development, at the end of the day, is a political choice. As Wisconsin’s example shows, states can recalibrate after an era of megadeals to invest in their grassroots economy – and do so with measurable success.

(Additional state case studies could continue similarly, but we have covered a representative mix. Other states like Tennessee have an Office of Small Business Advocate and various rural entrepreneurship programs, California has a robust Office of the Small Business Advocate in the Governor’s GO-Biz, etc., but for brevity we focused on the ones listed by example. Next, we compare policy structures and Idaho’s situation.)

Comparative Policy Structures for Small Business Support

States employ a variety of organizational structures and programs to support small businesses. In this section, we compare some key structural elements: dedicated small-business advocacy offices, the Small Business Development Center networks, and other executive-branch units or partnerships focusing on firms with <50 employees. The table below summarizes the presence of formal Small Business Advocacy Offices and related entities in selected states, highlighting how Idaho is an outlier in lacking such structures.

Table 1. Offices of Small Business Advocacy and Related Structures in Selected States

State	Small Business Advocacy Office/Position	Notes on Small Business Support Structure
Pennsylvania	Office of Small Business Advocate (OSBA) – Statutory independent office within Dept. of Commercelegis.state.pa.us 61. Advocates for small businesses (≤250 employees) in public utility cases and other matters.pa.gov 62	Also: Robust PA SBDC network (16 centers); PA Business One-Stop online portal; Ben Franklin Technology Partners (state-funded investment in startups). OSBA gives small firms a voice in regulatory issues – e.g., ensuring fair utility rates.business.pa.gov 63
Tennessee	Office of Small Business Advocate – Within Comptroller’s Office, created by statute.comptroller.tn.gov 64legis.state.pa.us 65 Serves as point of contact to state government for businesses with ≤50 employees. Helps resolve regulatory or licensing problems.	Also: TN SBDC network (University of TN lead); Small business assistance via Dept. of Economic & Community Dev. The OSBA in TN helps cut red tape and directs small businesses to resources, showing a formal commitment to firms <50 staff.
California	Office of the Small Business Advocate (CalOSBA) – Within Governor’s GO-Biz, established by lawcalmatters.digitaldemocracy.org 66. Advocates for CA small businesses, runs programs like technical assistance expansion.	Also: Extensive SBDC network (full coverage); state-backed loan guarantee program (IBank); Small Business Liaison in each state agency by mandate. CalOSBA coordinates policy and provides a centralized resource for CA’s 4 million small businesses.
Missouri	No singular OSBA. (A proposal in 2006 to create one in Lt. Governor’s officesenate.mo.gov 67 did not permanently establish.) Missouri relies on its Dept. of Economic Development and Business Development Program staff for small business issues.	Also: Missouri SBDC (University of MO-led); Small Business Regulatory Fairness Board (Lt. Gov chairs, hears small biz concerns on regs); Minority and Women-Owned Business Enterprise (MWBE) program. Missouri’s structure is more decentralized but has specific programs and a regulatory fairness board acting similarly to an advocate.
North Carolina	No standalone OSBA. Instead, uses EDPNC Small Business Advisors team as a one-stop (public-private partnership)nc.gov 68; also an SBC at each Community College. The state’s Ombudsman’s office in Commerce also assists businesses with regulatory issues.	Also: SBTDC and SBCN networks for counseling; One NC Small Business funding for startups. NC’s approach is through service delivery rather than a single advocate office – EDPNC’s toll-free line and team fulfill much of that role, guiding entrepreneurs through requirements.
Wisconsin	No single OSBA. WEDC incorporated small biz focus via an Office of Rural Prosperity (for rural small biz/community needs). Also, Wisconsin has a Small Business Regulatory Review Board (reviews impact of regulations on small biz).	Also: Wisconsin SBDC (14 centers via UW); WEDC’s statewide programs (Main Street, Bounceback grants) aimed at small biz; In utilities, WI does not have a Small Business Advocate, but the Citizens Utility Board represents residential and sometimes small commercial interests. The Office of Rural Prosperity created in 2020 elevates small rural business concerns within state government.wisconsinexaminer.com 69
Idaho	None. Idaho has no statutory Office of Small Business Advocate or equivalent. The Idaho Dept. of Commerce primarily focuses on business attraction/expansion (mostly large projects). Small business support falls mainly to the Idaho SBDC (based at Boise State University) and nonprofit initiatives.	Also: Idaho SBDC (6 region offices) provides counseling/training; Some tax incentives technically available to any size firm (e.g., Tax Reimbursement Incentive) but practical use skews to large firms due to job minimums. Idaho has no dedicated advocate or ombudsman for small businesses in state government – a notable gap.

As seen above, states like Pennsylvania, Tennessee, and California have formal offices advocating for small businesses in various ways – whether in utility hearings, for regulatory fairness, or as a cabinet-level voice. These offices help ensure that the interests of small enterprises (like reasonable utility costs, simplified paperwork, access to information) are represented when policies are made. Idaho has no such office, meaning small business issues may not get the same attention within government deliberations. For example, when Idaho Power negotiated special contracts for large new data center loads, Idaho had no OSBA to question how that might affect small commercial ratepayers[106][137]. In Pennsylvania or Tennessee, by contrast, an OSBA might scrutinize large-industrial rate deals to ensure smaller customers don’t subsidize thembusiness.pa.gov 70.

All states have SBDC networks thanks to federal SBA funding, but state support and integration vary. Idaho’s SBDC, hosted by Boise State University with outreach across the state, is the main technical assistance provider for small firms. It does good work in training and counseling (helping hundreds of new business starts yearly), but it operates on limited funding – Idaho contributes some state funds, but less so than many states relative to its business population. States like Wisconsin and North Carolina heavily fund and leverage their SBDC networks to implement bigger initiatives (e.g., in Wisconsin, SBDCs helped administer Main Street Bounceback info and ensure small biz knew to apply; in NC, SBDCs/SBCs were pivotal in helping businesses apply for COVID relief). Idaho could similarly mobilize its SBDC for more proactive programs if the state prioritized it, but so far the state’s efforts (like COVID small business grants in 2020) were run through the Dept. of Commerce with simpler distribution, possibly missing some who were not in the loop.

Another comparison point is executive-branch small business units or initiatives. Many states house small-business divisions within their economic development agencies:

·         In Colorado, OEDIT has a Business Support and Rural Prosperity division, and a Minority Business Office, focusing on small and emerging businesses.

·         In Missouri, the Department of Economic Development has a “Business and Community Solutions” team that works on downtown revitalization and small business grants.

·         North Carolina’s Commerce has a Business Helpline and an Entrepreneurial Development division which coordinate with EDPNC.

·         Wisconsin’s WEDC explicitly broadened to community and small biz, as reflected in program funding shifts we discussed.

Idaho’s Department of Commerce, by contrast, is organized mainly around traditional economic development functions: e.g., Business Attraction, Community Development (which does block grants, mostly infrastructure), Tourism, etc. There isn’t a specific “Small Business Division” or advocacy unit. Commerce’s Idaho Rural Partnership (IRP) existed to tackle rural economic issues, but that was more of a collaborative forum and not strictly small-business focused (and it lost state funding in the mid-2010s). In essence, Idaho’s small business support in government is relatively fragmented: the SBDC (educational institution-based), the Idaho Small Business Development Center Policy Board (advisory), and some programs like the Idaho Innovation Center in Idaho Falls (a local incubator) run by city partners. Without a unifying state small biz office or strategy, it’s likely that small businesses in Idaho rely on general economic climate and federal programs rather than targeted state help. This is corroborated by the fact that Idaho consistently touts low taxes and light regulation as its draw – which certainly benefits small businesses broadly – but doesn’t offer much in the way of tailored relief or programming for the little guys beyond what the federal SBA provides.

The lack of an Office of Small Business Advocacy in Idaho is especially glaring when one considers how active Idaho has been in catering to large businesses. For instance, Idaho created an Office of Energy Resources in the Governor’s office to help manage large energy projects and policies (very relevant for big data centers’ power needs), and it has the Idaho Commerce “Project Development Team” that works on big company recruitment behind closed doors (like the team that handled Project Peregrine for Meta under NDAs[96][97]). Yet there is no analogous team singularly focused on the needs of a 10-employee manufacturer or a chain of local grocery stores.

In summary, compared to peer states, Idaho stands out for what it doesn’t have: no small business advocacy office, no rural small business initiative at the state level (apart from general community block grants), no tax credit or grant programs geared to small enterprise development (Idaho’s incentives like the Tax Reimbursement Incentive and data center exemption all have high thresholds that effectively exclude small firms). The comparative structures show a correlation: states that intentionally set up offices or units for small business tend to also deploy more programs benefiting them, and vice versa. The next section will delve deeper into Idaho’s singular focus on large projects, illustrating the outcomes and trade-offs of that model.

Idaho’s Model: Big Corporations, NDAs, and Power-Heavy Projects vs. Small Business Development

Having detailed other states’ approaches, we turn to Idaho – to clearly show how Idaho is an outlier in its economic development strategy. Idaho’s recent marquee projects revolve around recruiting hyperscale data centers and other large enterprises, often through generous incentives and secretive negotiations. This section contrasts Idaho’s model with the small-business-focused strategies we’ve seen, focusing on several aspects:

·         The emphasis on mega-project recruitment (e.g., Meta/Facebook and Diode Ventures’ data centers in Kuna) at the expense of small-business promotion.

·         The use of NDAs, shell LLCs, and code names to conduct deals out of public view, leading to a lack of transparency and post-approval accountability.

·         Idaho’s absence of small business advocacy structures (no OSBA, etc.) and how that manifests in policy – for example, who speaks for small businesses when incentives or utility deals are crafted.

·         The reliance on large customers to fund power infrastructure expansions and how costs and risks might be shifted, given Idaho’s framework.

·         Quantitative outcomes: what is Idaho getting in jobs, tax base, etc., for its focus on large corporations, and how does that compare to if those resources were spread to small businesses?

Big-Corporation Focus: The Example of Meta and Gemstone Data Centers in Kuna

Idaho has aggressively pursued data center projects as a cornerstone of its development strategy in the last five years. The state passed the Idaho Information Technology Equipment Sales Tax Exemption in 2020 specifically to lure large data centers by exempting their massive equipment and construction purchases from the 6% sales tax[27][28]. This law requires at least a $250 million investment and 30 new jobs to qualify – thresholds obviously targeting only huge companies[28][138]. It was effectively a tailor-made incentive for companies like Facebook (Meta), which had been lobbying for such breaks since 2017[139][140]. Indeed, as soon as the law was in place, Meta selected Idaho for a new data center campus. In 2022, Meta announced an $800 million data center in Kuna, Idaho – the state’s first hyperscale data center, sprawling 960,000 sq ft on 620 acres[29][141]. Idaho’s Commerce Director credited the 2020 tax exemption as a decisive factor, highlighting how the state beat out others by essentially waiving tens of millions in taxes[29][142].

While this was hailed as a major win by state leaders – they pointed to the “grit” Idaho showed and the positive impact of its pro-business policies[143] – the actual public benefits are limited. Meta’s data center is expected to provide just “over a hundred” permanent jobs[144][145]. Local officials celebrated those 100 jobs and the construction activity, but these numbers pale in comparison to what, say, 100 small businesses could provide on the same land. Recall earlier: 1,100 acres in Kuna devoted to local businesses could yield 5,000+ jobs (roughly 5 jobs/acre at moderate density)[146][147], whereas the data centers will yield around 200 jobs combined on that land (Meta + Gemstone) – roughly 0.2 jobs per acre[148][149]. This is an extraordinarily low job density, meaning Idaho gave up a lot of potential employment to have these single-use facilities. State leaders counter that data centers are capital-intensive not labor-intensive, which is true, but that raises the question: are Idaho’s incentives buying capital investment for its own sake, or jobs and broad benefits? The data center exemption seems to buy capital investment (buildings, servers) – which does increase property tax base – but as we examine, Idaho structured things so that even the tax base benefit is muted.

Tax Revenue Trade-offs: Under current agreements, Idaho forfeits sales tax on hundreds of millions of purchases (Meta and Gemstone construction). The state likely lost on the order of $30–50 million in sales tax revenue for Meta’s build alone (6% of ~$800M, minus any non-taxable components)[98]. The rationale was to “unlock” the investment that wouldn’t happen otherwise[150]. Yet, if that $800M had been invested by a multitude of ordinary businesses (which do pay sales tax), Idaho would have collected that revenue. A 2022 report noted at least 10 states lose over $100 million per year to data center tax exemptions and urged rethinking these subsidies[151]. Idaho is now one of those states trending that way. On property taxes: data centers have high assessed values, so theoretically they boost the tax base. Northern Virginia famously saw local tax revenue jump from $6.5M to $166M a year in a decade due to data centers[152]. But Idaho’s approach allows much of that to be negated. Kuna put Meta’s site in an Urban Renewal District (URD) so that most property tax from the new facility is diverted to infrastructure for that site, not to the general fund[81][153]. In essence, Meta avoids sales tax and its property taxes largely go to benefit itself (roads, utilities for the site) via URD. State lawmakers cried foul at this “double dipping” and in 2023 moved to bar data centers from using URDs on top of state exemptions[154][155]. They succeeded, passing a measure disallowing future projects from that combo[156][157]. But Meta’s deal was grandfathered, so Idaho is locked into a situation where potentially tens of millions in tax revenue are negated over the project’s life[158][159]. The state sees little or no sales tax, and local governments can’t fully use the new property value to fund services due to both URD and an Idaho law that forbids counting big new construction toward increasing budgets beyond a cap[160][161]. Meanwhile, the profits from the data center (the value it generates for Meta’s business) flow to Meta’s headquarters in California. Economists would note this is effectively Idaho using local land and resources to host an “outpost” of an external corporation, with limited multiplier effect (since so few employees live and spend locally)[162]. Contrast this with a local small-business hub scenario where the profits stay in Idaho, employees spend locally, and the tax revenue per acre is higher – Idaho’s choice thus has an opportunity cost beyond the explicit taxes forgone[163][164].

NDAs, Shell LLCs, and Code Names – Transparency Issues: Idaho’s pursuit of these big projects has been marked by secrecy that is highly unusual compared to how states deal with small business programs. When a state gives a $10k grant to a bakery, it’s public and straightforward. When Idaho courted Meta and others, it shrouded the process in confidentiality. The City of Kuna and project developers signed Non-Disclosure Agreements (NDAs) pledging to keep critical details out of public view[3][165]. The Meta project was code-named “Project Peregrine” and even the annexation of land was approved under that alias, so the public didn’t know Meta was behind it until the announcement in 2022[96][97]. Meta used a shell company, “Brisbie, LLC,” to buy land and negotiate the power contract with Idaho Power, concealing Meta’s identity[166][72]. Diode Ventures likewise used “Gemstone Technology Park, LLC” as its front[167][168]. This SPE (special purpose entity) strategy kept the real parties “at arm’s length” in records[169][170]. While legal, it undermines public trust: if negotiations fell through, the public might never know a big company was considering the area, and if records were requested, the city could claim it knew nothing about “Facebook” – only dealing with Brisbie LLC[171][72]. Indeed, Kuna agendas had cryptic items like “Authorize Mayor to sign agreement with Gemstone Technology Park, LLC” which gave the public minimal insight[172][173].

This heavy secrecy is not normal for typical economic development in Idaho or elsewhere. The justification given is often competitive sensitivity or protecting trade secrets. But even after selection, Idaho officials and Idaho Power continued a degree of secrecy – for example, parts of Meta’s power contract filed with the PUC were redacted as “trade secrets” (like certain terms)[174][175]. The water usage of the data centers was also kept hidden initially; as an analog, in The Dalles, Oregon, Google’s water consumption was concealed by NDAs until forced into the open by legal challenge[176][125]. In Idaho’s case, Kuna never did a public disclosure of expected water draw or environmental impact for Meta’s project – there was no requirement for an EIS and they didn’t volunteer info at annexation hearings[177][178]. The community only learned such details much later, arguably too late to influence conditions.

This NDA-driven opacity contrasts with states that have Offices of Small Business Advocacy or similar, where part of their role is fostering open communication between government and small firms. In Idaho, one can surmise that had there been an independent advocate or even more robust local process, the public might have been informed and involved earlier. Idaho’s Open Meeting Law was arguably stretched to its limit – agendas eventually listed code names, but a normal citizen wouldn’t know “Project Peregrine” equals Facebook, so meaningful public input was stifled[107][179]. The city may have followed the letter of the law (final decisions in open session), but not the spirit of full public engagement[180]. Lawmakers reacted: there were bills considered to curb such secrecy in the wake of the Meta deal, and at least to stop the double incentives as mentioned. Meanwhile, residents and watchdogs raised concerns that Idaho’s transparency laws were sidestepped, with NDAs essentially used to keep non-exempt information (like who is buying land) confidential beyond what state law normally allows[181][126].

An example of public pushback: in Kuna’s Gemstone hearings, once people realized it was a big unknown company with potential heavy water/power use, they were on the back foot, trying to get answers that perhaps should’ve been disclosed upfront[182][183]. One councilmember felt misled about the scope[184][185]. This is a direct consequence of the NDA/code name approach – it deprived local decision-makers and citizens of a clear picture until late. In small business development programs, by contrast, everything is in plain view (no one is hiding which businesses get a Main Street grant).

Ratepayer and Infrastructure Implications: One selling point Idaho officials used was that the big data centers would not burden other electricity customers. They required Special Contracts for any >20MW power user, so both Meta and Gemstone have such contracts ensuring they pay for the infrastructure and incremental generation needed[174][186]. Meta’s deal, as noted, includes them funding a new 200MW solar farm to supply their usage[187][188], and provisions to “hold other Idaho Power customers harmless”[130][131]. On paper, Meta is covering those costs – building substation, new lines, etc., plus buying the energy at rates that include paying toward the existing grid. Idaho Power representatives have said Meta is paying not only its share of existing system costs but also the new costs it triggers[189][190]. That sounds reassuring, and indeed initially it may be true. However, there are risks. Contracts can’t foresee all future scenarios. For example, if Meta’s data center doesn’t ramp up as much as expected or if it pauses (which it did in 2023 to retool), Idaho Power might have surplus power from that solar farm that has to be sold at a loss or charged to someone[191][192]. If Meta later expands beyond the contract terms, who pays for the next power plant? The special contract could be amended, but until then, there’s uncertainty. Some Idaho legislators were not content to trust the PUC on this; in 2025 a bipartisan bill (H.B. 395) was introduced to force any new >10MW customer to provide their own power upfront or self-generate[137]. This was basically a reaction to ensure, in law, that no big industry would ever make rates go up for others. The fact that such a bill was considered indicates not everyone is convinced the current approach fully protects ratepayers. It’s worth noting, Idaho’s PUC did not publish a detailed long-term rate impact study publicly for the Meta contract – we have assurances, but not a transparent model to examine[191][192].

Additionally, Idaho Power has projected extremely high load growth largely due to new large customers (data centers and maybe crypto miners). To meet this, they plan new generation and transmission investments. If one of these big customers leaves or underperforms, the utility and possibly other customers could be left holding costs for infrastructure built on those expectations. This is not a hypothetical – it’s what happened in other places (e.g., in Virginia some data centers curtailed expansion but transmission was already built; costs got socialized somewhat). Idaho is trying to avoid it contractually, but contracts have limits (e.g., Meta’s terms after year 7 are less clear, as initial contract was to be made finite by new legislation capping exemption to 7 years[193][194]). Compare this to investing in distributed small business growth: those businesses do use power, but incrementally – you don’t have to build a new power plant if 100 small businesses each add a few kW of demand; you generally do if one data center adds 100MW. The strain on resources (not just power, but also water) from one data center can be equivalent to that of a city of tens of thousands of people[125][195]. In Kuna, Meta’s site will eventually draw tens of millions of gallons of water annually for cooling – Idaho is letting a private entity use a chunk of aquifer capacity akin to a town’s usage, under a quiet water rights transfer process (no state-level environmental review required)[196][125]. If multiple data centers come, they could compete with farmers or cities for water in a dry year. Without an advocacy office or stronger public oversight, these issues might not get fully aired. Indeed, Idaho lacks a state-level environmental policy act (no NEPA-like process for private projects), so big developments are only checked via local permits and any federal triggers. In contrast, a state focusing on small-scale development usually doesn’t risk overwhelming local resources in one go – growth is gradual and diffuse.

Economic Resilience and Diversity: Idaho’s strategy of recruiting hyperscale projects carries risk in terms of diversification. If one company (Meta) is a large share of new investment, Idaho’s fortunes partly hitch to that company’s decisions. Meta already paused and altered its project in 2023 (shifting to AI infrastructure and halting construction for a time)[197]. If Meta decided in 5 years that cloud demand is down and closed the Kuna center, Idaho would have spent significant public resource (tax breaks, infrastructure accommodations) for a short-lived venture. Small businesses, by contrast, generally don’t all fail at once; they’re not all tied to the same corporate strategy. They’re also more rooted – a family business likely doesn’t pull up and leave to another state in a year, whereas big companies regularly shop around. For example, if another state offered an even better deal in the future for an expansion, Meta or others could channel new investment there instead of Idaho, leaving Idaho with a one-phase build instead of multi-phase. Meanwhile, had Idaho invested comparably in 50 small manufacturing firms, even if a few failed, most would still be there and collectively employ more people.

Quantified Outcome Summary: To crystallize Idaho’s model outcomes versus a small-business model:

• Jobs per Dollar: Idaho’s data center incentive (sales tax exemption) essentially gave up maybe $40 million to attract 100 jobs (Meta) – about $400,000 per job not including local property tax diversions[98]. If we include local URD benefits and the opportunity cost of not taxing equipment, that figure could be higher. Compare this to states like PA creating jobs via small biz at a few thousand per jobgoodjobsfirst.org 71 or Wisconsin’s $3k/job through Bounceback grants (approximation). Clearly, Idaho’s cost per job is extremely high in these deals (though proponents argue those aren’t direct “costs” since it was foregone revenue from something that wouldn’t happen otherwise – still, it’s a subsidy metric).
• Tax Base Impact: Kuna’s Meta project will eventually add perhaps $…100s of millions in property value to tax rolls. But thanks to the URD and state laws, local budgets won’t see an immediate windfall. Idaho even has that law capping how much new construction value can increase budgets, explicitly to prevent a data center from letting cities raise spending a lot[160][161]. They did that to protect taxpayers elsewhere, which is fine, but it also means the data center’s value primarily serves to slightly reduce tax rates for everyone (a diffuse benefit) rather than directly fund big community improvements. In small-biz growth scenarios, the tax base increases more evenly and cities can capture the incremental revenue in their annual allowed growth more organically.
• Urban/Rural Divide: Idaho’s big projects have been in more urbanized areas (the outskirts of Boise). Rural Idaho is not seeing Facebook plopping a data center in, say, Salmon or Sandpoint. Yet Idaho has no equally vigorous small business or downtown program to uplift those rural economies. Many rural Idaho towns struggle with declining Main Streets, out-migration of youth, etc., but Idaho offers them limited help (some federal grants, maybe some tourism promotion, but no state Main Street program, no Jump-Start tax credits like Colorado’s). So Idaho’s focus on big deals not only favors large corporations over small, it inherently favors the more metropolitan area (where infrastructure for big projects exists) over truly rural areas. States like North Carolina and Wisconsin have special efforts for rural small businesses (Rural Center, Office of Rural Prosperity) – Idaho does not. The Idaho Commission on Rural Development went defunct years ago. This means Idaho’s rural communities are arguably worse off relative to those in states that channel some ED dollars to small rural enterprise development.
• Post-Approval Transparency and Accountability: When a state gives a small business a grant or loan, it usually requires maybe a report on how funds were used or it’s a one-time thing. With big deals, states often make ongoing promises and then need to hold companies accountable for delivering jobs. Idaho’s data center exemption has minimal ongoing accountability (once qualified, the exemption is indefinite; a new bill might cap new ones at 7 years, but still). The Tax Reimbursement Incentive (another Idaho tool) does have performance agreements where companies must meet job/ wage targets to get rebates. But for Meta, since it didn’t use TRI, there’s no such requirement beyond the initial 30 jobs to qualify for the sales tax break[28][138] (which they easily meet). There is thus a lack of leverage if promised spin-offs don’t materialize. Contrast with, say, a state loan to a small business – if the business fails, at least the state might still have a claim or asset. Or if a small biz grant doesn’t produce the intended outcome, it’s a small loss and the state learns. With Idaho’s model, if the data center doesn’t produce community benefits, there’s no clawback of the tax break; the horse has left the barn.

In conclusion, Idaho’s singular emphasis on large corporations – particularly data centers – stands in sharp contrast to the multi-faceted small business strategies employed by many other states. Idaho’s approach has secured a few headline investments but at high public cost and with questionable local benefit. It also leaves Idaho vulnerable to the fortunes of external companies and does little for rural or small urban communities away from the project sites. The lack of a Small Business Advocacy office or equivalent in Idaho’s government structure underscores that small businesses are not a focused priority in policy – the state has no dedicated entity to streamline their dealings with government or champion their needs. Meanwhile, Idaho expends considerable effort to accommodate large firms (even to the point of adjusting its energy infrastructure planning and secrecy in governance to suit them).

The final portion of this report will quantify and compare outcomes more systematically, showing, for example, jobs-per-dollar invested and tax base impacts of Idaho’s large-business model versus a hypothetical or actual small-business investment model, and include breakdowns by region, industry, and business age where data allow.

Quantitative Outcomes: Small vs. Large Investment Models

To evaluate the efficacy of small-business-focused economic development versus large-corporation-focused development, we compare several metrics: jobs per dollar of public investment, capital investment efficiency, and tax base impacts, as well as consider how outcomes differ by urban/rural setting, industry, and the age of businesses supported.

Jobs per Dollar of Public Investment

One of the clearest ways to compare strategies is to calculate how many jobs are created or retained per unit of public spending (or forgone revenue). While not the only goal of economic development (quality of jobs and ancillary benefits matter too), this metric is a good indicator of bang-for-buck.

• Megadeals (Large Corp Recruitment): As noted earlier, large incentive deals often have very high cost per job. Good Jobs First’s database shows an average of $658,000 per job in megadeals (major company-specific subsidies) by 2016, and others updated it to around $456,000 per job by 2020goodjobsfirst.org 72 (some newer deals for EV and chip plants, which involve tens of billions in subsidies, may push averages even higher). In West Virginia’s 2022 Nucor steel deal, the package was equivalent to possibly $1.2 million+ per job for 800 jobs. In New York’s 2022 Micron deal, it was on the order of $700k per job. These figures dwarf typical small business program costs. For Idaho’s Meta data center: if we treat the sales tax exemption as an investment of roughly $40 million (estimate) for 100 jobs, that’s $400,000 per job. Add the URD effect (say another $50+ million in infrastructure financed by Meta’s own taxes, effectively a benefit to the project), and it could be $900k+ per job. Even if one argues those aren’t direct taxpayer outlays, they are public costs/foregone revenue for the sake of those jobs.
• Small Business Support Programs: In contrast, small business programs usually involve smaller grants or credits but to many firms. For example, Wisconsin’s Bounceback: $10k grants, presumably at least 1–2 jobs created or saved per grant (often more). If even 1 job per grant, it’s $10k/job; if 2, $5k/job. Colorado’s Rural Jump-Start: firms must create a minimum number of jobs (5 in most cases) and they get perhaps $20k plus tax breaks. If a firm creates 5 jobs for a $20k grant, that’s $4k/job (plus whatever value of tax relief – even if equal amount, still <$10k/job). Pennsylvania’s BFTP: As calculated, state investment returned jobs at ~$4k/jobbenfranklin.org 73, an incredibly efficient ratio due to leveraging and only modest amounts per company. North Carolina’s One NC Small Business (SBIR match): typically up to $100k match resulting maybe in a handful of jobs as the R&D leads to commercialization – likely under $20k per job for those that succeed. Missouri’s small business incubator credit: here the credit isn’t directly per job, but consider an incubator that receives $100k via donations for credits and incubates 10 startups that generate 20 jobs; effectively $5k per job assisted in that round (and those jobs hopefully grow).

To generalize, small business programs often create jobs at public costs in the four-figure to low five-figure range, say $1,000–$30,000 per job, whereas big deals range from mid-five-figures to six-figures (and sometimes seven) per jobgoodjobsfirst.org 74goodjobsfirst.org 75. This is a stark contrast. The difference arises because small biz programs are more about facilitating or catalyzing private initiative (the business owner still puts in most capital, hires out of necessity, etc.) whereas megadeals involve essentially purchasing jobs by offsetting costs that the corporation would otherwise bear.

Capital Investment Efficiency and Multipliers

Large projects do bring in a lot of capital investment – e.g., an $800M data center or a $10B factory. This can have construction employment benefits and some spillovers. However, capital-intensive projects tend to have lower local multipliers if they don’t integrate deeply into the local supply chain. A data center buys servers from out-of-state, and once operational, mostly spends on electricity (which in Idaho’s case goes to a utility company, partly local, partly investor-owned, and energy generation some local some purchased). There’s not a lot of ongoing procurement from local small businesses, except maybe some maintenance services, landscaping, etc. As one report quoted, data centers “do little to foster local tech culture or startups” – they are self-contained[202][203]. They don’t spin off suppliers or new firms the way a manufacturing plant might, or the way a cluster of small tech startups might cross-pollinate. So the multiplier (indirect and induced jobs per direct job) for data centers is low – estimates often around 1.5 total jobs per 1 direct job (including construction phase), whereas small local businesses often source locally and recirculate money. For example, a local retail shop’s profits go to the owner who spends locally, they advertise with a local newspaper, use local accountants, etc., so more of the money stays in the community.

If Idaho had taken the approach of investing in, say, 100 small businesses, each of which invested $1M (for $100M total, far less than Meta’s $800M) with perhaps $10M in combined state aid (similar tax value as what was given up for Meta), those 100 businesses might each employ 10 people = 1,000 jobs, and many would have local supply chains (local vendors, etc.). The multiplier on those could easily be 2.0 (because each of those employees spends money locally, etc.), yielding ~2,000 total jobs supported. In contrast, 100 data center jobs maybe yields 150 total jobs in the state (the data center employees plus maybe 50 in services). So in terms of economic impact per dollar, distributing capital among small firms likely yields more broad-based activity. It’s the classic question: is 10 $10M factories better than 1 $100M factory? Often, yes, because those 10 can be in different towns, create varied products, and if one fails, the others survive.

Tax Base and Revenue Impact

We discussed specifics: small business clusters can produce much higher property tax per acre than single-use mega facilities[48][49]. Also, a diversified base of businesses contributes to sales and income taxes more evenly. Let’s quantify:

• Property Tax: Using Idaho/Kuna example: 1,000 acres of data centers – Meta and Gemstone – value perhaps $1.5 billion combined (land + improvements). If fully taxed at Idaho’s rate (just hypothesize 1% effective rate), that’s $15M/year. But due to URD, much of that $15M is not going to general services but to site improvements. Now, 1,000 acres of mixed small business park: say 5 jobs/acre, 5,000 jobs, and improvements of smaller scale on each acre. It could arguably reach a similar total value (perhaps 1,000 acres × an average of $1 million improvements per acre = $1B, not far off). But importantly, those improvements would likely be taxed normally (no URD needed if growth is incremental), so local governments would see the revenue. And because small businesses often occupy existing buildings or gradually expand, they don’t usually trigger big tax break deals or URDs – they incrementally grow the base that governments can actually use. Also, as mentioned, denser development can yield many times the tax revenue per acre. In Boise, for instance, a study found that mixed-use downtown buildings produce far more tax per acre than peripheral big retail. Vermont’s stat: $1.2M/acre vs $8k/acre for downtown vs Walmart[204] – extreme but illustrative[48][49]. So from a land use efficiency standpoint, small-business oriented development can generate more revenue with less land. This matters as cities think of future growth: Kuna gave up a huge swath of land for something that won’t maximize tax generation.
• Sales/Income Tax: Data centers don’t generate sales taxes (they don’t sell goods publicly; Idaho actually exempted their purchases). Their employees do pay income tax on their salaries, but 100 workers is trivial in state revenue context. On the other hand, 100 small businesses might each be generating taxable sales (retail, etc.) – that’s a lot of sales tax. Or their employees collectively (if 5,000 employees total) pay a lot more income tax than 100 data center staff. Even manufacturing small businesses – they might sell mostly out of state (which is good, bringing money in) but their employees and owners spend money in state. Also, many small businesses do pay sales tax on equipment since they don’t hit the $250M exemption threshold – so when they build or expand, Idaho gets revenue. Idaho basically carved out a huge class of expenditures (data center construction) to exempt, whereas it taxes the exact same types of materials for any normal business. That’s a revenue opportunity cost and also arguably an inequity (small businesses feel “we have to pay tax on our tools, why doesn’t Facebook?”[205][206]).

Third-party evaluations often find that incentives to small/mid firms have higher fiscal ROI because those firms were often credit-constrained or growth-constrained, so the help makes a difference in growth that then quickly pays back in taxes. Meanwhile, big firms often might have done something similar without the full incentive, meaning the public money may have been unnecessary or excessive, lowering ROI. For instance, Virginia estimated a $1.09 return per $1 of data center tax exemption[207][208] – a slim margin – whereas Pennsylvania’s BFTP saw $4 return per $1benfranklin.org 76. That’s telling: invest in small tech companies, 4x return; give tax breaks to huge tech company, barely break even in revenue.

Urban vs. Rural Outcomes

As mentioned, big projects cluster in limited areas (Idaho’s all near Boise). Small biz programs can be designed to spread out. The rural outcomes of small biz focus are significant: e.g., in Colorado’s rural jump-start, 9 new businesses in rural zones in 2023 alonestartupcolorado.org 77; in Wisconsin, 3,000+ Bounceback grants went to businesses outside the major metro areasfox11online.com 78. This means jobs in towns that otherwise wouldn’t get a slice of the high-tech boom. Idaho’s rural counties have not seen an Amazon or Meta drop in – they likely won’t because of lack of infrastructure. So, without small biz development, rural Idaho could be left behind.

North Carolina explicitly channels building reuse grants to Tier 1 and 2 counties (rural), ensuring those communities get state investment in business development. Idaho could do similar (it has a Gem State Prospector site marketing tool for properties, but not much in way of rural-specific business incentives beyond generic property tax exemption authority which small companies rarely use).

Thus, rural small business strategies (like encouraging local food systems, outdoors recreation businesses, remote worker attraction, etc.) add on new jobs where big corporations wouldn’t naturally go. That improves statewide equity and keeps rural towns alive, which has societal benefits (reduced urban migration pressures, preservation of communities, etc.). States like Vermont and Maine show that focusing on unique local assets yields viable rural enterprises (cheese, maple, tourism, etc.). Idaho has many such opportunities (outdoor gear makers, specialty food, renewable energy tech in Idaho Falls, etc.), and some small businesses are doing it, but mostly on their own or with federal help (e.g., USDA grants), not state-coordinated efforts.

Industry Type Differences

Small businesses span industries – retail, services, manufacturing, construction, creative industries. Large deals tend to concentrate in a few industries that states chase: tech, auto, aerospace, logistics. By supporting only large deals, a state may overweight its economy in certain sectors. Idaho, by chasing data centers and possibly semiconductor fabs (they tried for one in 2022, offering huge incentives to Micron which ultimately is building memory fabs elsewhere), is concentrating on high-capital, high-resource tech. If that sector suffers (say advances reduce need for so many data centers or an energy crunch limits growth), Idaho would be exposed. A broad small business base means a mix: restaurants, healthcare clinics, software startups, light manufacturers, all growing moderately – more resilient to any one shock. The pandemic illustrated that: states with diverse small business scenes could pivot (distilleries making sanitizer, etc.), whereas places dependent on one big industry were more at a loss if that industry halted.

So, from an industry diversification perspective, small business promotion wins.

Business Age: Supporting startups (business age 0-5 years) is crucial since they generate many new jobs. States like PA (with BFTP, KIZ credits) and NC (SBIR match, etc.) directly target young firms to accelerate their growth. Idaho largely does not (though the Idaho Global Entrepreneurial Mission, IGEM, is a small grant program for university tech commercialization, and an Idaho Technology Council exists – but state funding is modest). If Idaho continues focusing on established big companies, it might miss out on nurturing the next Micron or WinCo (which themselves started small in Idaho long ago).

A state’s entrepreneurial ecosystem health is measured by new firm births. Idaho actually has a decent startup rate (owing to its population growth and culture), but those startups likely succeed despite state policy rather than because of it. The ones that do well (e.g., Truckstop.com in Twin Falls, TSheets in Eagle acquired by Intuit, etc.) did not need big tax breaks, but they benefit from a generally low-tax environment. However, they might have benefitted from more state support in workforce training or expansion capital. Other states might poach them eventually with incentives – something Idaho doesn’t really counter except by overall climate.

Summarizing Small vs. Large Model Impacts

To encapsulate, let’s bullet some comparative stats (using hypothetical but reasonable figures drawn from our analysis):

• Cost per Job (State Investment): Small business model: typically $5k–$50k per job (e.g., WI Bounceback ~$10k/job, PA BFTP ~$4k/job, training programs $1–$5k/jobgoodjobsfirst.org 79). Large corp model: $100k–$1M+ per job (e.g., Foxconn initially $231k/job promised; Idaho Meta ~$400k/job; average megadeal $456k/jobgoodjobsfirst.org 80).
• Jobs per Acre: Small biz dense development: 5–20 jobs/acre (even an average of 5 is plausible as earlier anchorage study showed ~9.5 jobs/acre, more in flex space[209]). Large corp facility: 0.1–1 job/acre (Meta ~0.16 jobs/acre; a large factory might be 1–2 jobs/acre including parking lots etc., but many big complexes are mostly land-intensive).
• Tax Revenue per Acre: Small biz cluster: from tens of thousands up to millions $/acre if multi-story (VT example $80k/acre or more[48]). Large project: often a few thousand $/acre if single-story with lots of land (Walmart example $8.3k/acre[210]; data center depends on equipment taxation – in Virginia case, with equipment taxed, it was lucrative, but Idaho chooses not to tax that equipment fully). In Kuna’s case, because of URD, initial net revenue per acre from Meta to general funds is close to $0 for a period, ironically.
• Multiplier (Total jobs per direct job): Small local businesses typically have local supplier networks and owners spend locally, giving multipliers in the range 1.5–1.8 for many sectors, up to >2 for some (construction trades especially). Big capital-heavy projects often have multipliers <1.3 (once construction phase is done) because of little local supply chain (especially true for something like a data center – after construction, the operations buy very little locally except utilities).
• Regional Spread: Small business support can be allocated to 100% of counties (e.g., WI grants in all 72 countiesfox11online.com 81). Big deals: typically end up in a few urban or strategic locations, leaving many counties with 0 direct impact. Idaho example: Ada County gets Meta; many rural counties have nothing comparable.
• Resilience: Small biz model has built-in redundancy – lose one business, others continue. Large model has single points of failure – e.g., if Meta closed, 100 jobs gone, big empty shell not easily reused (data center shells are quite specialized), and infrastructure built for it underused. If one small business closes on Main Street, another can rent the space, especially if the overall environment is healthy.

These quantitative and qualitative factors strongly favor a strategy that at least balances toward small businesses. That doesn’t mean states should never recruit a big fish, but as CAP’s 2018 report suggested, the pendulum swung too far to “moonshots” in many placesamericanprogress.org 82. The evidence and examples here show that redirecting even a portion of resources to small-scale development yields more distributed jobs and potentially higher returns on public dollars.

Idaho’s challenge (and opportunity) would be to learn from these comparisons. For instance, if Idaho took the ~$50 million essentially given to Meta in tax breaks and instead capitalized a small business fund, it could provide $50k each to 1,000 small firms (that’s 20 per county on average!) – imagine the statewide impact of that vs. 1 data center. Even if only half those businesses succeeded long-term, the job creation would very likely exceed 100 by far, and they’d be spread across Idaho, building local economies.

Rural Small Business Strategies: Focus and Additional Insights

While we’ve interwoven rural considerations above, this dedicated section addresses rural small business development in more depth – as an “addition” to the overall narrative, recognizing unique challenges and innovations outside metropolitan areas. Rural economies often face higher barriers: sparse capital, workforce drain, limited broadband, fewer customers. Yet, states have crafted creative solutions to spark rural entrepreneurship and sustain Main Streets in small towns. We highlight successful rural-focused initiatives, many of which have already been touched on but warrant a consolidated look, and contrast them with Idaho’s rural situation.

Colorado’s Rural Initiatives: As discussed, the Rural Jump-Start Zone program is a marquee rural strategystartupcolorado.org 83. Key features making it work for rural areas: It requires partnership with local entities (county and a sponsoring institution like a college) to designate a zone, ensuring buy-in. It then gives a “tax holiday” and grants for businesses that likely wouldn’t come to a rural county otherwise. For example, a tech startup from Denver is incentivized to open an office in Montrose or Grand Junction under RJS; or a new local startup is encouraged to launch in-zone rather than elsewhere. The Just Transition Communities (tier 1) get even larger benefits (matching grants up to $40k, new hire grants $5k/employee), aimed at areas losing coal jobs. This targeted approach recognizes rural communities need a jump-start to overcome disinvestment. The 2023 data – 9 new businesses, $8.2M in payroll exempted – shows that even small scale, it’s doing something.

Colorado also leverages higher ed in rural areas via Small Business Development Centers and local economic development orgs. For instance, Western Colorado University in Gunnison hosts an ICELab (incubator) partly supported by state funds, drawing outdoor recreation startups to rural mountains.

North Carolina’s Rural Center and SBCN: North Carolina established the NC Rural Economic Development Center in the late 1980s as a nonprofit but funded by the legislature. It pioneered rural entrepreneurship programs. One was the Institute for Rural Entrepreneurship, which in early 2000s helped set up local angel networks and training for rural entrepreneurs. The Microenterprise Loan Program (as noted) provided capital where banks wouldn’t. Another Rural Center program was STEP (Small Town Economic Prosperity), a technical assistance grant to help small towns (pop under 5k) develop an economic strategy, often tourism or small niche manufacturing, and seed fund a couple of small projects (say, a farmer’s market start-up cost or fixing a building to lease to a business). Evaluations of STEP found improved civic engagement and some new businesses in those towns that participated.

NC also integrated rural needs into mainstream programs: e.g., building reuse grants have lower job creation thresholds in rural counties as mentioned, making it easier for a 10-job project to get funded in a small town whereas in Raleigh you’d need 50 jobs to compete.

Wisconsin’s Office of Rural Prosperity and Main Street: The Office of Rural Prosperity (ORP) created under WEDC is a model of giving rural stakeholders a direct line to state policywisconsinexaminer.com 84. In its first year, ORP held listening sessions that highlighted issues like lack of rural broadband, need for housing to attract workers, and difficulties for rural small businesses in accessing state programs (sometimes simply lack of grant-writing capacity). As a result, WEDC altered some program outreach to simplify applications and actively encourage rural applicants. For example, the Main Street Bounceback was publicized through rural county economic development organizations and chambers to ensure upstate and northern businesses applied, leading to thousands of grants in those areas. Additionally, Wisconsin launched a pilot We’re All In grant during COVID that had a portion reserved for smallest businesses statewide including rural; they gave out $2,500 emergency grants to tens of thousands of one-person or very small firms, many in rural towns. WEDC found that many of those firms had never interacted with the state before – now they were on the radar, and could be connected to SBDCs for further help.

Vermont’s Rural Innovation: Vermont is almost entirely rural or small-town, so most of its programs inherently serve rural needs. The Working Lands Enterprise Initiative, as mentioned, directly invests in rural farm/forest businesses – helping them diversify (e.g., a dairy farm adding a cheese-making operation for direct sale, or a logger purchasing a mill to produce value-added wood products). These create jobs that are tied to rural land and heritage, meaning they won’t relocate out of state easily because they’re based on Vermont’s natural resources. Vermont also has a Village Center designation program (like a junior version of Downtown designation) that gets small villages access to tax credits and grants for improvements. This keeps very small commercial centers viable – e.g., a general store or café in a village might get a tax credit for fixing its facade or code improvements. The cumulative effect is preventing rural blight and strengthening community hubs that attract tourism or retirees, etc.

One innovative rural strategy is supporting telework and remote business. After COVID, many states realized rural areas could attract remote workers (who often start home-based businesses or bring purchasing power). Some states like Vermont and Oklahoma offered remote worker incentives (cash to people moving in with remote jobs). Tennessee did something interesting: created “Entrepreneurial Communities” program to train rural leaders on how to build local entrepreneurial ecosystems (via its University of TN Institute for Public Service).

Cooperatives and Rural Small Business: In rural areas, co-op models can help achieve scale or provide services. Several states encourage co-ops: e.g., Nebraska has a program helping communities form grocery co-ops to replace closed grocery stores. Maine and Vermont assist conversion of mobile home parks to resident-owned co-ops (to preserve affordable housing – indirectly helping the many small businesses whose workers rely on that housing). These might seem tangential but are crucial to rural quality of life and indirectly to small business success (employees have housing, communities have grocery stores, etc.). Idaho’s rural communities could benefit from similar—like fostering co-op ownership of businesses that owners retire from (instead of them closing for lack of buyer).

Idaho’s rural economic development tends to revolve around natural resource industries (timber, mining, agriculture) and tourism. The state hasn’t done a lot specifically for small businesses in those domains beyond facilitating regulatory processes. An exception is some collaboration with USDA on value-added ag grants. Also, Idaho has a Travel Council that gives grants to localities for tourism promotion – which helps rural outfitters, lodges, etc. That is one positive program for small tourism businesses (though it’s not direct to the business, it markets regions).

If Idaho wanted to emulate others: it could designate, say, “Opportunity Zones” not just for tax deferral (the federal OZ program exists, but Idaho could layer state incentives on zones in rural towns encouraging small business there, akin to Jump-Start). Or re-fund the defunct Idaho Rural Partnership to coordinate rural entrepreneurship training.

Broadband and Infrastructure: A recurring theme in rural development is infrastructure – broadband is key for modern small businesses (to sell online, reach markets). States have poured money into rural broadband (WI’s PSC has a broadband grant program, NC funded rural broadband through its GREAT grants). Idaho has allocated some federal funds to broadband projects recently, but historically lagged. Without broadband, rural small businesses (like an online craft business or a telehealth practice) can’t function. Thus, small biz strategies and infrastructure go hand-in-hand. States like Michigan and Minnesota combine small biz support with initiatives to reuse vacant rural industrial buildings (giving modern facilities and fiber connectivity).

Community Colleges and Workforce in Rural: Many rural small businesses rely on local community colleges for skilled labor (nurses for clinics, mechanics for auto shops). States that strengthen rural community college programs (with targeted funding, maybe mobile training labs that go to far-flung towns) help those businesses. For example, North Carolina’s community college system has specialized “live training” trucks that go to rural counties to train in welding or IT. That means a small manufacturing shop in a rural NC town can get local talent trained without employees having to travel hours. Idaho’s community colleges (CSI, CWI, NIC, etc.) can play that role if empowered with economic development programs.

In sum, rural small business success often hinges on tailored support: capital, training, infrastructure, and community development. States that invest in those see rural entrepreneurs creating jobs that large companies will not. The case studies show multiple approaches: - Fiscal incentives (tax credits, grants) to reduce rural cost disadvantages (CO, VT). - Capacity-building (Rural centers, ORP, training programs) to level the playing field in accessing resources (NC, WI, TN). - Leveraging local assets (Working Lands, tourism, cultural heritage). - Encouraging new models (co-ops, remote work hubs) to solve rural-specific problems.

For Idaho, boosting rural small businesses could mean the difference between a one-company town fading vs. a diversified local economy. Many Idaho rural towns have rich potential – think Salmon (outdoor recreation companies?), or small ag towns creating food products. A strategic plan focusing on small businesses in rural Idaho could address persistent issues like youth flight and low wages in those areas.

It’s important to highlight that focusing on rural doesn’t mean neglecting urban – it’s complementary. States that excel tend to have distinct programs for each context (urban main street vs. rural jumpstart, etc.), recognizing one size doesn’t fit all.

By adding this rural perspective, we reinforce the argument that a small-business-centric approach yields statewide benefits, not just city-centric growth. Big corporate projects rarely choose truly rural locations (unless resource-based, like a mine or plant near raw materials). Therefore, only a small biz strategy can organically spread prosperity to those corners.

Idaho’s heavy tilt to big projects inherently leaves rural Idaho to fend largely for itself. That might widen regional inequalities over time. If, for example, Boise-area booms with tech data centers (though job-light, they bring construction booms and tax base), while rural Idaho sees mines automate and farms consolidate (reducing jobs), you get a state with a booming metro and struggling periphery. Other states face that too, but they try to mitigate it with rural-targeted economic gardening (like Kansas had a “Rural Opportunity Zones” program forgiving student loans for people who move to rural counties – a talent attraction tactic). Idaho could consider similar ideas (e.g., incentivize young entrepreneurs to move to or stay in rural hometowns via startup grants or loan forgiveness).

The evidence suggests rural strategies pay off modestly but meaningfully: e.g., the Colorado report of 31 rural jump-start businesses with $8M in new payroll – that might be small in state GDP terms, but for each of those 31 communities, that could be 5-20 families able to work locally, schools staying open, etc., which has long-term positive externalities.

Conclusion (if needed): Tying it all together, it’s evident that states focusing on small businesses – through structured programs, advocacy, and targeted incentives – create more jobs per dollar, enhance their tax base in a sustained way, and foster resilient communities. Idaho’s model of wooing large corporations with confidential mega-deals stands in sharp contrast. As of 2025, the results of Idaho’s approach (few permanent jobs, forgone revenues, and potential vulnerabilities) suggest that incorporating some of the small-business-centric practices of other states could greatly benefit Idaho. Establishing an Office of Small Business Advocacy, retooling incentives to include smaller projects (for instance, creating a tier in the Tax Reimbursement Incentive for 5-50 job expansions), and dedicating some portion of development funds to rural entrepreneurship could align Idaho with the proven successes seen in places like Colorado, Vermont, Pennsylvania, North Carolina, Wisconsin, and beyond.

The analysis and comparative data in this report underscore a fundamental point: economic development is not just about landing the next big thing – it’s about cultivating the garden of thousands of small things that collectively yield a rich harvest for the state. Idaho’s experience and the experiences of its peers make a compelling case for recalibrating priorities toward that garden of small businesses on Main Streets across America.

At WEDC, focus expands to communities and small businesses — not just big ones • Wisconsin Examiner

goodjobsfirst.org 85 Smart Skills versus Mindless Megadeals: Cost-Effective Workforce Development versus Costly "Buffalo Hunting," with Proven Policy Solutions - Good Jobs First

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americanprogress.org 86 The Realities of Economic Development Subsidies - Center for American Progress

sbecouncil.org 87 Facts & Data on Small Business and Entrepreneurship

border.bank 88 Small Businesses: The Cornerstone of our Communities - Border Bank

economicgardening.org 89 [PDF] By Louise Anderson It wasn't very long ago that programs to foster ...

esri.com 90 Economic Gardening: A Grassroots Alternative to Wooing Amazon

iedconline.org 91 ED Now Feature: What You Should Know About Economic Gardening

energizingentrepreneurs.org 92 [PDF] Economic Gardening - e2 Entrepreneurial Ecosystems

benfranklin.org 93 5 Year Impact Report - Ben Franklin Technology Partners

goodjobsfirst.org 94 Giant Job Subsidy Packages Grow More Common and Costly

goodjobsfirst.org 95 2022: A Mega-Year for Megadeals! - Good Jobs First

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choosecolorado.com 96   Economic Incentives | Colorado Grants | OEDIT

startupcolorado.org 97 Explained: How Colorado's Rural Jump-Start Program Supports Founders - Startup Colorado

oedit.colorado.gov 98 Enterprise Zone Program | Colorado Office of Economic ...

iasourcelink.com 99 Economic Gardening... What is it? - IASourceLink

advocacy.sba.gov 100 [PDF] Colorado 2024 - SBA Office of Advocacy

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claconnect.com 101 Missouri Works: Tax Benefits for Small and Large Companies: CLA

every.io 102 Tax Credits For Startups In Missouri

efactory.missouristate.edu 103 Missouri SBDC at MSU - efactory

foxbusiness.com 104 $2.7M in Vermont tax credits going to downtown projects

vermontbiz.com 105 Read the Working Lands Enterprise Initiative Impact Report

vermontbiz.com 106 Working Lands Enterprise Initiative celebrates 12 years

vtsbdc.org 107 Are you considering a business transition?

pa.gov 108 Office of Small Business Advocate - Commonwealth of Pennsylvania

legis.state.pa.us 109 1988 Act 181 - PA General Assembly

business.pa.gov 110 Office of Small Business Advocate - PA Business One-Stop Shop

edpnc.com 111 One North Carolina Fund Small Business Program | EDPNC

researchfunding.duke.edu 112 One North Carolina Small Business Program | Research Funding

tradeandindustrydev.com 113 NC: 90 Small Businesses Receive North Carolina State Grants to ...

nc.gov 114 All Business Resources | nc.gov

advocacy.sba.gov 115 Small Businesses Generate 44 Percent of U.S. Economic Activity

wedc.org 116 Gov. Evers, WEDC Announce More Than 6600 Small Businesses ...

fox11online.com 117 Small business grants bolster growth in Northeast Wisconsin communities

content.govdelivery.com 118 Gov. Evers Announces More Than 5200 Businesses Have Received ...

wisconsinexaminer.com 119 Wisconsin Economic Development Corp. Archives • Wisconsin Examiner

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comptroller.tn.gov 120 Small Business Advocate - Tennessee Comptroller of the Treasury

calmatters.digitaldemocracy.org 121 AB 2687: Office of Small Business. | Digital Democracy

senate.mo.gov 122 Bill Summary | Missouri Senate