The Center for Strategic Economic Research (CSER) developed the Prosperity Index to provide business and community leaders in the Sacramento Region a valuable tool to measure economic prosperity and track its performance against competitor regions in order to evaluate the competition, identify opportunities for improvement, and impact change in the Region.  Along with the national average, ten competitor regions were chosen as benchmarks based on feedback from regional economic development organizations regarding metropolitan areas that often compete with the Region for business location and expansion projects.  CSER will update the Prosperity Index annually - which measures indicators in the three areas of Business, People and Place. The Business component will be updated quarterly in order to allow for more frequent evaluations of the local business climate. The Sacramento Region ranked eighth among its main competitors on the 2009 Prosperity Index, posting a score of 8.4 out of a possible 10. Sacramento received respectable scores on the People and Place components, but a fairly weak score on the Business component, placing the Region toward the bottom of the list. The misalignment in performance across the three components continues to plague Sacramento which has never pulled into the top quartile in all the years the Prosperity Index has been produced, including those during the Region’s economic peak. Among the five measured competitor regions in California, Sacramento placed third, falling behind the SF Bay Area and the San Diego region, but ahead of the Stockton region and the Inland Empire (Riverside/San Bernardino). Overall, relative to its main competitors for business location and expansion projects, the Sacramento Region presents economic prosperity that is about average, giving it a decent competitive position.   The Sacramento Region dropped two places on the first quarter 2010 BUSINESS component of the Prosperity Index, coming in eighth with a score of 6.3 out of a possible 10. Last quarter, the Region received a score of 6.6, which ranked it sixth, an above average grade and the highest place it had received over all quarters the component has been measured. This quarter, Sacramento fell below the national average, but remained ahead of three of the four other tracked California regions, San Diego, Stockton, and the Inland Empire (Riverside and San Bernardino County). Austin moved up four places from the last quarter to take the top spot with the SF Bay Area falling from first to fifth place, just ahead of the national average. There are still a handful of large markets in the Western United States (including one in California) that present stronger business climates than the rest of the nation. Phoenix remained in last place with a score of only 2.3. As its relative economic performance has fallen, the Sacramento Region is once again presenting a below average competitive position in terms of business climate. Sacramento’s scores on individual indicators were not as strong as they were in the past quarter (an average of 3.8 versus 4.6), leading to the lower overall ranking. The Region received decent scores on the Job Growth and Payroll Growth indicators with weak scores on all the rest, including Venture Capital Investment where it once again received the lowest score. Scores for two of the indicators improved, three experienced declines, and one remained the same since last quarter. Sacramento’s performance across the board indicates that it is basically in the middle of the road of all measured regions—all are still in the midst of economic turmoil from the recession which is affecting the business climate in about half more severely than Sacramento .