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assistant: Three weeks ago I spoke to Utah Gov. Gary Herbert as part of our annual look at the Best States for Business. Utah topped the ranks this year for the first time and Herbert was proud of the state’s pro-business climate. He also made a pitch to California companies looking to expand or relocate. “We are lowering taxes and making the state business friendly while California is doing the opposite with higher taxes and regulations that are nonsensical,” says Herbert.

Companies are getting the message. Over the past two years California companies like Adobe Systems, eBay, Electronic Arts, Oracle and Twitter have expanded in Utah. The Tax Foundation weighed in last week on the business tax climates of each state. Utah ranked 9th best, while California was 49th (only New York fared worse). Utah lowered its corporate income tax rate in 2008 from 7% to 5% which is one of the lowest in the country. If you want to gauge the regulatory climate by the numbers, consider the Pacific Research Institute which publishes its Economic Freedom Index. When it comes to regulatory environment it ranks Utah 2nd and California 49th

Adobe announced plans in August to build a new campus in Utah that will create 1,000 new jobs there, building on its $1.8 billion purchase of Orem-based Web analytic firm Omniture last year. Oracle, Twitter and eBay are building massive data centers around the Salt Lake City area. Gaming firm Electronic Arts opened a state-of-the-art facility in July. EA credited Utah’s education infrastructure, a welcoming government and high quality of life for its interest in expanding in Utah.

Wall Street gets the message as Moody’s gives Utah’s general obligation bonds its top Aaa rating, while California and Illinois have the worst ratings of any state at A1. Goldman Sachs has dramatically expanded its presence in Utah. Goldman’s Salt Lake City office is now its second biggest in North America.

Utah’s success paved the way for Herbert to be chosen this summer as the Chair of the Economic Development and Commerce Committee for the National Governors Association. It was an usual move because Herbert was not even part of the committee before being selected for the lead role. It speaks to Utah’s position as a leader in economic development.

Hebert wants other states and Washington D.C. to get their act together. “I wish that Washington D.C. understood how to be fiscally prudent and not promote an entitlement society that is not sustainable,” he says. “We can not continue down this road. States need to get their own fiscal houses in order and demand that Washington follows.”

Hebert is running in a special election tomorrow after taking over the job in August 2009, when then Gov. Jon Huntsman was appointed U.S. ambassador to China. He is expected to cruise over his Democratic opponent Peter Corroon with polls putting Hebert’s lead at 30 percentage points. As for California’s race between Jerry Brown and Meg Whitman, Herbert is pulling for an upset by his fellow Republican in Whitman. “Meg Whitman is the only hope they have got in California,” Herbert says.

Follow me on Twitter: @kbadenhausen