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SF should refocus area’s development effort on tech

By Dave Dannenberg

Bringing in technology companies – particularly software, bio tech, renewable energy and clean manufacturing – is important to the economic growth of northern New Mexico. Now, regional government is doing too little to promote this direction, with current activity and investment centered almost exclusively on growing tourism.

I’ve worked in tech for over 35 years, the first 20 of those for big companies in Phoenix and the more recent 18 years in a variety of ventures while living here in Santa Fe. I can say with certainty that it is possible to run a tech company here, but it’s not an easy or obvious place to do so.

Also, for me, doing tech in New Mexico has meant hiring remote, out-of-state employees, working long distance with investors and partners and typically billing out-of-state clients. Very little of my business has contributed directly back to the northern New Mexico economy in creating new jobs. This can change if local government and the handful of tech companies currently here work together to make it happen.

What is the motivation to shift local government away from a near-singular focus on tourism and onto growing tech? Foremost, tech companies pay high salaries and their demands on local resources and infrastructure are relatively low, particularly in comparison to tourism.

According to glassdoor.com, which surveys salaries nationwide, software engineers earn on average 103K per year. Adding tech companies and their high-paying jobs to the economic mix of the region means that more cash flows into the community, which means more tax revenues, and more business for the established construction, service and retail industries.

High-paying companies provide opportunities for salary growth in the community as local workers develop needed skills through workforce training or pursuing advanced degrees. As for infrastructure, a software company needs employees, an accessible office space, high-speed internet and not much else to produce a valuable product.

The region cannot sustain continued growth of tourism, which in contrast is a strain on resources. It requires steady investment in infrastructure, such as utilities, roads, policing and emergency services, to support growing peak tourist numbers. It does little to improve residents’ quality of life, bringing more crowds and higher prices. With low salaries in hospitality – 43K per year average, according to Glassdoor.com – there is little salary growth opportunity for those working in the industry.

What is the equation for bringing in tech? Northern New Mexico already has many of the pieces in place to attract tech. It is a great place to live. It has a beautiful and rich cultural heritage, and a great mix of city life and the outdoors. Its people value diversity and sustainability, which is in line with the belief systems of tech. LANL is already contributing by providing some technology spin outs and has the intellectual capacity to fuel more local innovation if other pieces are in place.

Tech companies thrive in a place that has other tech companies, universities and investors that create an innovation ecosystem. Although typically a research university is central to the ecosystem, Santa Fe Community College has shown that it can meet the challenge. It has already deployed complex initiatives in areas such as biofuels production, micro grids, solar energy and greenhouse operations, plus their partnerships with UNM and other research universities. I think that SFCC can be a cornerstone for developing a tech ecosystem here.

To make this happen, local tech, SFCC and UNM, with the solid support of government, need to come together and recognize the tasks needed to begin to grow an innovation ecosystem. Next, local government needs to provide real spending and resources in support of the initiatives developed. Finally, government should be ready to close deals using tools that are available, such as Local Economic Development Act (LEDA) grants, revenue bonds and tax breaks.

This is a long road that requires focus and intent to succeed. But I believe it promises a much better economic future for northern New Mexico than our current path.

Dave Dannenberg is founder of XFormGov (www.xformgov.org), a software company based in Santa Fe, and was previously a technology executive at Intel Corp. He is a candidate for SFCC Governing Board in the November election.

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