CHARLESTON, W.Va. -- States must put their "own house in order" to spark job growth and set the stage for economic development, West Virginia Commerce Secretary Keith Burdette said Monday.

West Virginia's political leaders have balanced the state's budget, reduced pension debts, cut taxes and privatized the workers' compensation system -- key factors designed to lure businesses to the state, Burdette said.

"Economic development starts with getting your own house in order," said Burdette, speaking at the Southern Legislative Conference in Charleston. "We've tried to broaden people's vision about us around the country."

Twenty years ago, West Virginia lawmakers "set a course of action" to shore up the state's finances, he said.

The state has had a balanced budget each of the past seven years, and West Virginia hasn't raised general taxes in 17 years, the commerce secretary said.

The state's food tax and business franchise tax will be eliminated within two years.

West Virginia has the third-most-stable budget in the nation, according to a recent ranking cited by Burdette on Monday.

"It wasn't just about cutting taxes," he said. "It was about balancing the budget so you can cut taxes strategically."

Workers' compensation reforms also have improved West Virginia's business climate, Burdette said. The state's workers' compensation rates have fallen 52 percent in recent years.

"It's gone from some of the highest rates in the country to some of the lowest in the country," Burdette said.

The changes, he said, have helped persuade companies such as Macy's, which recently opened a distribution center in Martinsburg, and Gestamp International, a Spanish automotive company that plans to create 700 jobs in South Charleston, to locate in West Virginia.

West Virginia's credit rating -- now AAA -- has improved, and state exports have increased significantly -- up 39 percent last year over the previous year, Burdette said.

Coal exports -- $5.3 billion last year compared to $2.8 billion in 2010 -- accounted for much of the growth. But plastics and other product exports also set records.

"Yes, coal is part of the equation, but other products are as well," Burdette said.

He also discussed West Virginia's ongoing efforts to land a "world-class" ethane cracker plant.

Burdette predicted that chemical companies might build up to four of the massive petrochemical facilities in the Appalachian region, creating thousands of jobs. The plants would convert ethane from the Marcellus Shale into more profitable chemicals such as ethylene, which is used to create plastics.

"The opportunities are real," Burdette said.

West Virginia's future economic success also hinges on proper workforce training, he said.

Burdette visited a sawmill in West Virginia two weeks ago.

"I saw more computers than saw blades," he said. "We have to convince [workers and students] it's not my father's manufacturing plant," Burdette said. "It's a much different plant."

On July 16, West Virginia started drug-testing people who seek job training through federally funded programs, Burdette said. West Virginia was the second state to ask the federal government to require training program enrollees to take drug tests.

"Before you can get training for a job that requires a drug test, you have to be drug tested on the front end," he said. "It sends a message, and that message is ... if you're not clean, you may be from Harvard [University], but you won't get a job."

Burdette said it's important for states to "plan in advance" for tough economic times.

"Are we perfect? No," Burdette said. "But I like to think we're headed in the right direction."

Legislators from West Virginia and 14 other states are attending the Southern Legislative Conference at the Charleston Marriott this week.

Reach Eric Eyre at erice...@wvgazette.com or 304-348-4869.