Thoughts from Kansas

Inc. magazine is Rating the Governors, and only four governors got 4 stars, among them our own:

Kathleen Sebelius

During her 2004 State of the State address, Sebelius said, "State government can't create jobs, but it must create a climate in which businesses can flourish." Ask business owners in Kansas and they'll say she has done just that. Riding a wave of popularity that stems from 22 straight months of job growth, Sebelius will probably waltz to a second term.

By all accounts, she's an expert manager. After inheriting a $1.1 billion deficit, Sebelius balanced subsequent budgets without raising taxes. Most famously, she analyzed the pool of government cars and sold 700 deemed extraneous.

She followed that up in 2004 by putting together legislation that outlined strategies to pump new life into the economy. In practice, this has meant creating statewide entrepreneurship centers, establishing a $500 million, 10-year initiative to foster technology transfer at state universities, instituting an angel investment tax credit, and promoting ethanol and bioscience initiatives.

More recently, Sebelius worked with the legislature to eliminate property taxes on machinery and equipment purchased after July 1, 2006, and to raise the exemption for "low-cost" items from $400 to $1,500. "This law was a direct result of the governor reaching out to small businesses for guidance and asking them what is most important to them," says Hal Hudson, state director of the Kansas chapter of the NFIB.

"Kansas is a very entrepreneurial state, but our governors have traditionally not been all that pro-business; it has managed to do well in spite of itself," says Tom Devlin, founder of the Rent-A-Center (NASDAQ:RCII) retail chain and now the principal at a venture capital firm, Devlin Enterprises. "Sebelius is the first one who realizes the value of entrepreneurs."