Horse sense about incentives: when it comes to perks, Colorado lags behind neighboring states.

• Author: Peterson, Eric

Pat Parelli, a former California rodeo star, first fell for the classic Rocky Mountain scenery surrounding Pagosa Springs when his truck broke down there in the 1980s. That's why Parelli, now a horse-training guru, bought 700 acres of ranchland near Pagosa Springs in the late 1990s and made it home base for his company, Parelli Natural Horse-Man-Ship Inc.

The business, founded by Parelli and his wife Linda, doesn't train horses; rather, it trains horse-owners and instructors in the use of Pat's "natural" training methods. Since the '90s, Parelli operations have boomed, serving more than a quarter-million customers around the globe, and becoming the fifth-largest employer in 12,000-resident Archuleta County.

Parelli Horse-Man-Ship is a business Colorado doesn't want to lose. And yet it almost did.

In 2003, Marion County, Fla., which is nicknamed "The Horse Capital of the World" because it has the largest equine population in the U.S., made Parelli President Mark Weiler an offer he thought he couldn't refuse.

Florida wanted the Parellis to move their headquarters permanently south. As a lure, the county was willing to ante up a package of incentives that included $1.75 million in cash and a free office building. In Colorado, said Weiler, "There was nothing happening" in terms of comparable incentives. He decided to tell Pagosa-area officials the bad news: "I said, 'We're going to have to move .... It's compelling from a financial perspective.'"

Of course, no local official wanted to see the Parellis' operations move out. The Parelli Study Center is a fully accredited university with an administrative staff of 43, and the ranch employed an additional 26 workers. So Archuleta County moved quickly to come up with some economic-development incentives of its own--uncharted territory for rural areas of Colorado.

The Region 9 Economic Development District of Southwest Colorado collaborated with the Town of Pagosa Springs and the county to put together a competing proposal that included one-time $2,500 payments for each new job created by Parelli; the town and county also promised to match each of the job grants with waived taxes; and, in conjunction with the state, the local governments came up with $500,000 in federal grants for infrastructure. Gov. Bill Owens even paid a visit to convince the company to stay.

The Colorado package was not as large as Florida's, Weiler said, and it was largely performance-based. "If it was just based on money, the package in Florida was bigger than what we got here," he said. But it was good enough. Instead of leaving, the company remained and started designing a new headquarters--looking toward more growth.

EXCEPTION TO THE RULE

The Parelli case, many economic-development experts say, is an exception to the rule in Colorado, which is simple: Colorado offers very few incentives to companies that want to move or expand here. One critic of that policy--which may be changing, but not by action of the state legislature--is Bill Meade, CEO of Denver-based StarTek Inc., which operates call centers and handles other outsourced business processes.

"I've been CEO of a Colorado-headquartered, publicly held company that's added over 4,000 jobs in the last three years, and we have not had many people in Colorado knocking on our door," said Meade. "That's just an indication to me that something's...