Douglas, Arizona

Source: Bureau of Economic Analysis, 1995.

Foreign Trade Zone: Foreign Trade Zone #139 located in Sierra Vista, Arizona, consists of 5.37 acres on two parcels of land.

Business costs: Real estate costs are not currently available. The following two tables display tax rates and electric utility costs for Douglas.

Douglas Selected Tax Summary
Type of Tax	Rate
Corporate income tax	8.0%
Franchise tax	N/A
Property tax	Average tax rate of 13.78/$100 of assessed value
Sales/use tax	8.0% (state = 5.0% and local = 3.0%)

Source: Data compiled by Arizona Department of Commerce.

Electric Utility Rates and Revenues: Douglas, AZ
Utility	Typical Commercial Billing 30 kW 300 kW 6,000 kWh 90,000 kWh		1996 Commercial Avg. Revenue (cents/kWh)	Typical Industrial Billing 150 kW 5,000 kW 30,000 kWh 1,500,000 kWh		1996 Industrial Avg. Revenue (cents/kWh)
Arizona Public Service Co.	702	8,210	8.23	3,211	110,123	5.32

Source: Typical Residential, Commercial, and Industrial Bills, Edison Electric Institute, Winter 1997.

Transportation Infrastructure

Air: The Douglas International Airport has two lighted runways, a paved one measuring 6,400 feet and an unpaved one measuring 4,800 feet. Customs services are available for international flights. The Bisbee/Douglas airport, located nine miles north, has two lighted and paved runways each 7,500 feet in length (see table). There are six airports in the larger Douglas region.

Statistics for Bisbee-Douglas International Airport
Functional class:	Business service
Elevation:	4,151´
Use:	Public
Navigational aids:	T-VOR
Runway:	08/26; 7,001´ by 75´
Surface:	Asphalt
Runway:	17/35; 7,292´ by 150´
Surface:	Asphalt

Source: Department of Transportation, Arizona Airports Land Use Compatibility Study

Highway: Interstate 10 and U.S. Highway 191 link Douglas with markets to the north and northeast. Several state highways (80, 82, 90, 92, 181, and 182) provide access to the region. Mexico National Highway 2 connects Douglas to points as far south as Mexico City and Guadalajara.

Border Port of Entry: The Douglas port of entry consists of eight lanes for vehicle crossing.

Rail: Union Pacific Railroad and San Pedro/Southwestern Railway serve the Douglas region. A rail line that crosses the border into Mexico has not been active since the latter part of 1980.

Education (1990)

§ 16.1 percent of adults have completed a bachelor’s degree.

§ 75.7 percent of adults have completed high school, compared to 75 percent nationally.

Enrollment in Institutions of Higher Learning in the Douglas Region
Institution	Enrollment	Institution	Enrollment
Cochise College (Douglas Campus)	4580	Northern Arizona University	43
Western International University	187	The University of Arizona–Douglas Office	42
Total full- and part-time enrollment: 4,852

Sources: Admissions Office, Cochise College; Student Services, Western International University; Statewide Programs, Northern Arizona University; The University of Arizona–Douglas Campus coordinator; Institutional Research, Pima College.

The Douglas Region

The Douglas region is marketed as the Premier Southwestern Border Community. Economic development professionals emphasize the lack of congestion and unburdened infrastructure as key selling points of the Douglas area. With a handful of manufacturing operations located on the U.S. side and approximately 33 in the city of Agua Prieta, Sonora, Douglas offers an unsaturated market, short waits for border crossing (in minutes), and available and competitively priced facilities.

Labor

Labor relations, specifically the minimal degree of unionization among Mexican workers in Agua Prieta relative to locations in Texas, allows greater cost savings to plant managers.

Location

Located on the U.S.-Mexico border, Douglas is strategically positioned at the beginning of the Janos Highway, described in marketing material as the shortest paved route to Mexico City and Guadalajara from the western United States.

Market

The following tables show the top ten imports and exports through the Port of Douglas.

Top 10 Exports through Port of Douglas, 1997
SITC	Description	Export Value
77220	Printed circuits	$51,938,651
78432	Other parts and accessories of motor vehicle bodies of headings 8701 to 8705 (including cabs)	39,374,205
69969	Articles of iron or steel, n.e.s.*	27,352,979
28782	Molybdenum ores and concentrates, other than roasted	24,730,949
77249	Electrical apparatus for switching or protecting electrical circuits, or making connections to or in electrical circuits n.e.s.,* exceeding 1,000 volts	23,040,604
89399	Articles of plastics, n.e.s.*	19,190,040
58224	Plates, sheets, film, foil, and strip of vinyl chloride polymers, not self-adhesive and not reinforced, laminated, etc.	15,263,764
77129	Parts of electric power machinery (other than rotating electric power generating machinery and equipment), and parts thereof	12,236,814
65613	Narrow woven fabrics, n.e.s.*	10,607,166
77878	Electrical machines and apparatus, having individual functions, n.e.s.* (other than particle accelerators)	9,090,784

Source: Border Trade Institute, Texas A&M International University (April 1998). * Not elsewhere specified

Top 10 Imports through Port of Douglas, 1997
SITC	Description	Import Value
78432	Other parts and accessories of motor vehicle bodies of headings 8701 to 8705 (including cabs)	$168,335,406
75997	Parts of automatic data-processing machines and units thereof, magnetic or optical readers, and machines for transcribing and processing data n.e.s.*	87,278,216
28781	Molybdenum ores and concentrates, roasted	37,388,376
77129	Parts of electric power machinery (other than rotating electric-power-generating machinery and equipment), and parts thereof	37,264,855
93100	Special transactions and commodities not classified according to kind	33,534,930
77121	Static converters (e.g., rectifiers)	14,520,805
77254	Relays for electrical apparatus used with electrical circuits not exceeding 1,000 volts	9,983,783
00119	Bovine animals, other than purebred breeding animals, live	8,994,270
65893	Life jackets and life belts and other made-up articles, n.e.s.,* of textile materials	7,722,194
77125	Electrical inductors, n.e.s.*	6,095,662

Source: Border Trade Institute, Texas A&M International University (April 1998). * Not elsewhere specified

Transportation

Air: Customs and immigration services have been added at the Douglas International Airport to offer greater flexibility for commercial development and just-in-time deliveries.

Border Port of Entry: Improvements totaling $10 million have increased the vehicle crossing capacity of the port by four lanes. Cargo-storage facilities have also been expanded.

Communications

Several upgrades to the telecommunications system in the Douglas area have been completed, although strategies to address the domestic and international telecommunication needs of the community continue to be explored. Private telecommunication facilities serve the maquiladora industry and surrounding areas.

Services

The Douglas Economic Development Council has been assisting in the extension of a natural gas line to industrial sites in Agua Prieta.

Quality of Life

The construction of a new library and nine additional holes at the golf course are features that improve the amenities in the area.

Education/Research

The local school systems, Cochise College, and the Cochise Private Industry Council (PIC) are seeking ways to upgrade the local labor pool. Efforts consist of GED instruction and on-the-job and post-employment training. The Douglas Educational Advisory Committee, under the aegis of Cochise College, is working with local businesses to determine labor and curriculum-development needs.

Due to local demand, The University of Arizona has established an instructional office in the Douglas region. Consisting of two classrooms, a computer lab, and five faculty offices, the Douglas Office offers bachelor of arts degrees in Latin American studies and elementary education with a bilingual endorsement; an international retail certificate; and a master of arts in language, reading, and culture. In addition, outreach activities with the maquiladora facilities south of Douglas in Agua Prieta, Sonora, have targeted the development of specialized workforce training programs and cross-border educational partnerships.

Economic Development Activities

§ The Strategic Economic Development Plan for the Douglas area recognizes the growing importance of the border region and the potential benefits of increased transboundary trade.

§ Recruitment efforts focus upon attracting suppliers to provide services and products for the growing maquiladora industry. Local developers indicate that a small percentage of the materials sourced by twin plants in the region originates from Arizona, mostly from the greater Phoenix area. The recent expansion into the area by Unique Molded Products, a Brownsville, Texas–based company, is considered an important step toward enticing other manufacturers to the community.

§ Economic development professionals in the Agua Prieta–Douglas region recognize a need to collaborate on marketing the region to prospective firms. Economic developers in Douglas report that a cross-border coalition of professionals is emerging to facilitate recruitment efforts.

§ The South Eastern Arizona Governments Organization (SEAGO) received a Ford Foundation Grant to provide technical assistance and market research for small to medium-sized businesses in Cochise, Santa Cruz, Graham, and Greenlee Counties of southern Arizona. SEAGO also serves as a platform for dialogue between local officials in Mexico and Arizona. A new development at the organization, the South Eastern Arizona International Trade Center, is helping smaller companies, often overlooked in trade opportunities, to access markets in Mexico. The center offers an assortment of services including export counseling, contact and trade financing assistance, international market research, customs assistance, and translation/ interpretation at no cost.

§ The Border Region Business Incubator, a creative effort to support private-sector growth in the Douglas region, provides organizational partnering opportunities, office equipment, and technical support to firms. The incubator targets firms that “preserve the unique character of the region” and are involved in areas with the greatest potential for growth and job creation in the region, such as information services, international trade, and nature/ecotourism.¹

§ A new initiative in the region seeks to enhance competitiveness in agricultural development. The South Eastern Arizona Center for Agribusiness Development grew out of a marketing profile that identified a need to diversify the local economy and explore crossover opportunities. According to the organization’s resource manual, “The primary objective of the Center will be to equip local producers and potential relocations/start-ups with timely data to assure state-of-the-art technology transfer, information access, and expertise.”2

Economic Development Challenges

Labor

Local business representatives report a shortage of qualified and skilled personnel. Efforts to attract a talented workforce are hindered by the community’s isolation and limited amenities.

Transportation

Interviewees cited poor highway and rail access as regional limitations. Some disagreement exists regarding the limitation posed by highway access. For instance, a local firm that manufactures vehicle safety restraints, the few hours needed to connect to I-10 from Douglas are insignificant to overall operating costs, since the markets it serves are in the northwestern United States.

The small level of manufacturing in the region does not produce sufficient demand to justify lengthening the hours of operation at the border port of entry.

Communications

The lack of ISDN capabilities prevents efficient transmission of data across the border.

Services

The quality of water in the region has been described by some business people as inadequate.

Quality of Life

Although the Douglas region, which includes Agua Prieta, Sonora, provides outdoor and recreational activities, the quantity of particular amenities, such as restaurants, theaters, and museums, is minimal. Several interviewees indicated that they commute daily from Sierra Vista, (68 miles to the northwest) in order to enjoy a wider array of options.

Education

Test scores for Douglas students are well below county, state, and national levels.

Competitive Advantages

The following comparative advantages exist within the Douglas region:

§ Short border-crossing times and lack of congestion

§ Direct access to Guadalajara via the Janos Highway

§ Available and relatively inexpensive land for development

Notes

1. Border Region Business Incubator (BRBI) brochure.

2. Willcox Chamber of Commerce and Agriculture and The University of Arizona Cooperative Extension, The Agricultural Development Resource Manual and Marketing Strategy for Southeastern Arizona (June 1997).

Douglas, Arizona

Douglas Selected Tax Summary

Statistics for Bisbee-Douglas International Airport

Notes