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77. Spokane, Wa.
Population: 202,618
Pros: Great community involvement, outdoorsy environment
Cons: Business occupation tax, gray skies

Though it's considered a mid-sized city, Spokane's approach to business has a very small-town feel. Top politicians make the time to attend opening ceremonies for new businesses. The state's first distillery opened in Spokane last year, and has received so much local support that it's begun expanding two years earlier than planned. The Home-Based Business Connection support group ensures that even entrepreneurs working out of their basements and garages receive mentoring. Washington's lack of corporate or personal income taxes helps ease the burden of paying a business occupation tax. Spokane is the only city in the state that does not charge an additional local business occupation tax.

The rapid growth of Spokane's tech sectors is largely supported by the state-funded Spokane Intercollegiate Research & Technology Institute (Sirti), which operates a mixed-use business campus featuring state-of-the-art labs, light manufacturing space and conventional office spaces. Entrepreneurs can source capital from local angel networks and early-stage venture-capital investment firms.

The outdoorsy type can find much to do in and around Spokane, which has a river running though the middle of the city that tumbles over into a series of waterfalls right in the downtown area. Hiking and biking along the river and in the nearby mountains are popular activities, as is an annual 12K race that attracts athletes to Spokane each spring. If the gray winter skies are getting you down, try heading up to one of the area's seven ski resorts. -Brandi Stewart

Interactive map: Spokane, Wash.
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Last updated July 02 2008: 11:16 AM ET
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