1. 9/21/20151 Coachella Valley 2011 Competitiveness? John Husing, Ph.D. Economics & Politics, Inc.

2. After Losing 8.36 Million Jobs … U.S. Job Creation Is Crawling Back +23.1%

3. V Pattern of Likely Recovery U x x

4. Fear Causing Consumers Confidence To Dive Again

5. 9/21/20155 So. CA Job Change, 1991-2011e -488,700-794,400 -9.2% +4.2%

6. 9/21/20156 Inland Empire Job Change, 1984-2011e +20,600 -167,900 -13.0% -0.6%

7. 9/21/20157 Coachella Valley, Job Changes -1,879 -14,121 -13.0%

8. 9/21/20158 2 nd Worst National Unemployment Rate

9. 9/21/20159 What About the Future? … Look At Competitiveness

10. Labor Cost: 6 th Lowest of 9 Markets 9/21/201510

11. Labor Force Quality: 8 th Lowest of 9 Markets 9/21/201511

12. Office Space Cost: 5 th Lowest of 9 Markets 9/21/201512

13. Industrial Space Cost: Lowest of 9 Markets 9/21/201513

14. Natural Gas: 3 rd Lowest of 9 Markets 9/21/201514

15. Electrical Cost Highest of 9 Markets 9/21/201515

16. Home Prices 8 th Lowest of 9 Markets Indio 5 th Lowest of 9 Markets 9/21/201516

17. Water Surprisingly Inexpensive 9/21/201517

18. State Taxes 9/21/201518 State Business IncomeIndividual IncomeSales TaxGasolineProperty Tax Unemployment Tax (Avg) California8.84%9.55%8.25%46.1$1,3973.85% Oregon7.90%9.00%0.00%25$1,1673.60% Nevada0.00% 6.85%33.1$1,3442.83% Arizona6.97%4.24%6.60%19$1,1393.05% Texas0.00% 6.25%20$1,6004.66% Colorado4.63% 2.90%22$1,3222.70% Washington0.00% 6.50%37.5$1,2573.50% New Mexico6.40%4.90%5.13%18.8$5892.72% Utah5.00%0.00%5.95%24.5$8464.75% Highest 2nd Highest 2nd Highest

19. Policy Conflict: Environment vs. Jobs State Regulatory Environment

20. Public Health Asthma & Cancer Blue Collar Sectors Bring Rising Asthma & Cancer Risk From Airborne Toxics

21. Social Justice Blue Collar Sectors Hurt Modest Income Families Living Near Factories, Rail Yards, Ports, Freeways

22. California Solution Single Issue Regulatory Agencies CA Air Resources Board South Coast Air Quality Management District CA Environmental Protection Agency CA Water Resources Control Board & More

23. Two Results 1. Air Quality Is Improving

24. Blue Collar Blue Collar Work Is Much of Our Workforce’s Best Chance Middle Class To Reach The Middle Class 2. Downward Pressure On Blue Collar Jobs

25. Few Training Barriers Few Training Barriers To Beginning Employment Mining ($96,996)Blue Collar Manufacturing ($47,933)Blue Collar Logistics ($46,665)Blue Collar Wholesale Trade ($43,492) MedianBlue Collar Construction ($41,453)Blue Collar Retail Trade($28,840) Gaming($28,385) Hotel/Motel($24,019) Agriculture ($22,793) Eating & Drinking($15,132) $13,000 Gap

26. Results Of Job Suppression Unemployment Higher Than It Needs To Be Underemployment A Constant Difficulty Leading to the Middle ClassLack of Access to Jobs Leading to the Middle Class Health Issues of Poverty Divorce Spousal Abuse Drug & Alcohol Abuse Suicide Lack of Timely Medical Care Public Health Issues!

27. Over 60% Of These Populations Also Stopped Their Educations With High School or Less Schooling Social Justice Issue Suppressing Blue Collar Jobs Is Also A Social Justice Issue

28. Clean Air, Asthma & Cancer Are Health & Social Justice Justice Issues Health & Social Lack of Blue Collar Jobs & Poverty Are Health & Social Justice Justice Issues Public Policy Dilemma

29. Concentrating Solely On The Environment After Years Of Focus on Concentrating Solely On The Environment Forgotten Priority! Job Creation Is Our Forgotten Priority!

30. Competitiveness 9/21/201530 Coachella ValleyC CaliforniaF-

31. Gold Mine Theory Primary Tier Secondary Tier

32. Economic Base Grades 9/21/201532 Competitiveness D thanks to CA Construction Hotels & Conventions Tourism Tourist Shoppers Agriculture Clean Tech Creative Arts Distribution Retirees Health Care Manufacturing

33. 9/21/201533 Existing Homes Sales Remain Strong … Thanks To Short Sales/ Foreclosures

34. New Homes Sales Headed For A Record in 2011 … Thanks To Short Sales/ Foreclosures 9/21/201534

35. 9/21/201535 Existing Home Prices Stable Between 2002 & 2003 Level

36. 9/21/201536 New Home Price Back To 2004 Level … Well Above Existing Homes

37. Foreclosures Issue 1,086,305 Homes In Inland Empire 35.4% All Homes

38. Assessed Valuation UP … Next Move Is UP?

39. 9/21/201539 Demand Soaring CV Housing Affordability Sets A Record & Drives Demand 64% 14%

40. Competitive Housing Prices 9/21/201540

41. Economic Base Grades 9/21/201541 CompetitivenessD thanks to CA ConstructionD- Hotels & Conventions Tourism Tourist Shoppers Agriculture Clean Tech Creative Arts Distribution Retirees Health Care Manufacturing

42. Wheeler’s Desert Letter Hotel Rates, Coming Back! 9/21/201542 Corporate Meetings & Conventions Coming Back 2 nd quarter 2011 Coachella Valley hotel occupancy up 14.8% Average room rate up 5.4% Palm Springs Desert Community Convention Bureau Labor Day hotel occupancy is 25% higher than 2010

43. Airport Volume Flat 9/21/201543 Need More Flights To Compete With Phoenix-Scottsdale

44. Increased Tourist Options: Thermal Motor Sports Park 9/21/201544

45. Retail Sales … Stronger This Year! 9/21/201545

46. Economic Base Grades 9/21/201546 CompetitivenessD thanks to CA ConstructionD- Hotels & ConventionsC+ TourismC+ Tourist ShoppersC Agriculture Clean Tech Creative Arts Distribution Retirees Health Care Manufacturing

47. High Value Crops 9/21/201547

48. Agricultural Production: A Record 9/21/201548

49. Economic Base Grades 9/21/201549 CompetitivenessD thanks to CA ConstructionD- Hotels & ConventionsC+ TourismC+ Tourist ShoppersC AgricultureA Clean Tech Creative Arts Distribution Health Care Retirees Manufacturing

50. Clean Energy Initiatives 9/21/201550 Demand Property Assessed Clean Energy Financing (PACE) Palm Desert Municipal Program AB 811 Net Metering Development Skill Training To Work In the Industry Electric Vehicle Production

51. Economic Base Grades 9/21/201551 CompetitivenessD thanks to CA ConstructionD- Hotels & ConventionsC+ TourismC+ Tourist ShoppersC AgricultureA Clean TechC- Creative Arts Distribution Health Care Retirees Manufacturing

52. Creative Arts 9/21/201552

53. Major Films & Important Commercials Are Already Shot in the Coachella Valley 9/21/201553 Value of Filming Activity Coachella Valley Coachella ValleyRiverside Co.Share 2006$11,892,591$24,225,50049.1% 2007$10,174,750$15,336,75066.3% 2008$11,705,000$13,551,00086.4% 2009$4,732,000$9,639,20049.1% 2010$11,019,500$16,479,75066.9% Assumes Coachella Valley equal to lowest share of 2007-2009 Source: Inland Empire Film Commission

54. Economic Base Grades 9/21/201554 CompetitivenessD thanks to CA ConstructionD- Hotels & ConventionsC+ TourismC+ Tourist ShoppersC AgricultureA Clean TechC- Creative ArtsB- Distribution Health Care Retirees Manufacturing

55. Logistics Links 9/21/201555

56. Key Transportation Links 9/21/201556 To East To Mexico To East & Mexico

57. Distribution: Back to 2001 9/21/201557

58. Economic Base Grades 9/21/201558 CompetitivenessD thanks to CA ConstructionD- Hotels & ConventionsC+ TourismC+ Tourist ShoppersC AgricultureA Clean TechC- Creative ArtsB- DistributionD Health Care Retirees Manufacturing

59. Facilities & Medical Staff 9/21/201559

60. Health Care Employment: Continued Growth 9/21/201560 OSHPD

61. Age Distribution: Young & Old 9/21/201561 19.3 vs. 10.4% 27.6%

62. Economic Base Grades 9/21/201562 CompetitivenessD thanks to CA ConstructionD- Hotels & ConventionsC+ TourismC+ Tourist ShoppersC AgricultureA Clean TechC- Creative ArtsB- DistributionD Health CareA- Retirees Manufacturing

63. Is the Past … the Future? 9/21/201563

64. No Longer Just This Active Baby Boomer Retirees 9/21/201564 Now This

65. Economic Base Grades 9/21/201565 CompetitivenessD thanks to CA ConstructionD- Hotels & ConventionsC+ TourismC+ Tourist ShoppersC AgricultureA Clean TechC- Creative ArtsB- DistributionD Health CareA- RetireesA Manufacturing

66. Manufacturing Jobs, 2011 Back To 1997 Level 9/21/201566

67. Setting Conditions For The Future 9/21/201567 CompetitivenessD thanks to CA ConstructionD- Hotels & ConventionsC+ TourismC+ Tourist ShoppersC AgricultureA Clean TechC- Creative ArtsB- DistributionD Health CareA- RetireesA ManufacturingD Over All Grade C- to C

68. Other Key Current Facts … 9/21/201568

69. 9/21/201569 Population Growth Has Slowed

70. 9/21/201570 Academic Performance

71. 9/21/201571 What Jobs Grew?

72. 9/21/201572 Crime Per 1,000 Residents

73. 9/21/201573 2010, 2011 When Will “Normal” Start To Return? x 2012 If Mortgages Fixed! x 2015-2016 Not x

74. 9/21/201574 www.johnhusing.com