California's Cheapest Big City to Do Biz? San Diego

San Diego was ranked the least expensive big city in the state in which to do business, it was announced Thursday.

The list was compiled in the Kosmont-Rose Institute "Cost of Doing Business Survey" for 2011, a study of 421 cities nationwide that evaluated business taxes and fees, economic incentives and other programs and assigned each a cost rating based on a proprietary formula.

Mayor Jerry Sanders said the study pointed out that San Diego had the best business climate among the state's largest urban centers.

"We're very proud of that. We've worked very hard over the past several years to create a business-friendly climate," he said.

Sanders said the city had worked to cut red tape, streamline the permit process and create city programs that helped small businesses get started.

"We've worked very hard to bring every resource we have to make San Diego a place people want to come to," Sanders said. The study by the Kosmont Companies and the Rose Institute of State and Local Government at Claremont McKenna College found Los Angeles County and the Bay area were some of  the most expensive areas in the state, while the San Diego County was one of the most affordable for business.

"The Rose Institute really verified what we had said, that San Diego's a great place to do business and that we're attracting a lot of people here," Sanders said.

He said business had increased in the clean-tech industry, which had grown from about 140 companies to more than 800 in the past few years.

San Diego also had more solar installations than any other city, which helped attract manufacturers, Sanders said. Three of the top five companies in the algae-to-fuel industry also operate in San Diego, he said.

The survey stated San Diego was such a low cost area because the taxes and fees were much lower across the board compared with those in the rest of the state. San Diego County's average business license tax rates were 60 percent lower than the state average, according to the survey.

San Diego historically had been one of the lowest cost counties surveyed and remained in the top spot for low cost, according to the survey.

-City News Service