CHARLESTON – For the second consecutive year, Forbes magazine has ranked West Virginia as the worst state in the nation for business.
In its annual "Best States for Business" special report, Forbes and author Kurt Badenhausen list the Mountain State at the bottom of their list. Neighboring Virginia, for the third consecutive year, tops the list. To see the report, go to http://www.forbes.com/business/2008/07/30/virginia-georgia-utah-biz-cz_kb_0731beststates.html.
In its six major categories, Forbes ranks West Virginia last in Regulatory Environment and Growth Prospects, 49th in Labor, 45th in Quality of Life, 38th in Economic Climate and 14th in Business Costs.
"Business costs are weighted the most, but low costs were not enough to keep Louisiana and West Virginia from being the bottom two in our ranking," Badenhausen wrote. "We look at a total of 32 data points to compile rankings."
West Virginia Citizens Against Lawsuit Abuse says the state's legal climate is a key part of the low ranking.
This should "sound the alarm for reform of our broken lawsuit system," WV CALA Executive Director Steve Cohen said. "This is the second straight year West Virginia has been ranked 50th by the magazine. In 2006, only Louisiana was lower because of Hurricanes Katrina and Rita.
"How fitting that West Virginia retreated from its 'open for business' slogan. 'Open for lawsuits' is more fitting."
Cohen also noted that a survey published in the National Law Journal showed that three of the seven largest verdicts in the U.S. over the past year were delivered in West Virginia courtrooms.
"Cross the border and with the bat of an eye you can go from worst to first," Cohen said. "Fixing our broken lawsuit system in West Virginia will close this striking disparity."
Cohen said a recent study prepared for Directorship magazine by American Justice Partnership, a coalition of 70 groups which tracks civil justice issues, placed West Virginia last in the nation for jobs because of the state's reputation for litigiousness. He said that is consistent with similar rankings:
* This spring the Washington, D.C.-based Institute for Legal Reform ranked, for the third straight year, West Virginia last in the U.S. for its legal system;
* The American Tort Reform Foundation, also based in Washington, has tagged West Virginia a "judicial hellhole" every year since it launched its annual analysis in 2002;
* The Pacific Research Institute annual survey rated West Virginia's legal climate 43rd
for its litigation climate;
* The Ewing Marion Kauffmann Foundation's New Economy Index placed West Virginia dead last in its latest report;
Cohen said a recent survey of West Virginia business leaders found that legal reform is the issue they are most concerned with to improve the state's attractiveness for jobs. Reform of the tax code and health care system followed closely behind as top concerns.
"Let's hope the Forbes ranking sounds the alarm for reform," Cohen said. "It will make a genuine difference in making West Virginia truly hospitable to jobs. Our leaders need to develop some political backbone to cut through the politics and start to help our state's working families."