Sunday, November 29, 2009

Agenda 360 shares its plans for local job growth

By David Holthaus

The goal would be ambitious even in the best of economic times. In the worst of times, it appears virtually insurmountable: Create 200,000 jobs in little more than a decade.

Yet that's what local business and community leaders say they're committed to accomplishing. The goal isn't just aggressive, they say, it's essential to transforming the region into one of the nation's leading metropolitan areas.

The job-growth objective is a cornerstone of the Agenda 360 communitywide plan for growth. Unveiled in February, Agenda 360 was the product of two years of community meetings led by the Cincinnati USA Regional Chamber. From more than two dozen meetings involving 1,500 people, organizers identified goals to guide their efforts and those of other organizations around the region through 2020. To measure progress, three simple but lofty goals were laid out, the most audacious being the plan to create 200,000 jobs by 2020.

"We wanted to aspire to not just an incremental increase, but to a quantum increase," said Myrita Craig, executive director of Agenda 360. "Love it or hate it, that's what it is."

Achieving the goal would transform the workforce in Greater Cincinnati, Northern Kentucky and Southeastern Indiana. The addition of 200,000 net jobs in little more than a decade would require a rapid acceleration of the historical rate at which jobs have been created here. In the decade from 1998 to 2008, before the recession hit with full force, 64,000 jobs were added in the 15-county metropolitan area, according to government figures. More here.

Saturday, November 28, 2009

County's downturn could have upside in luring biotech firms

By Jeff Ostrowski Palm Beach Post Staff Writer

As Palm Beach County works to build a biotech hub, labs run by Scripps Florida and Max Planck Florida are the main attraction for CEOs looking for a place to call home.

But those two research institutes aren't the only draw. Palm Beach County also can boast of being a cheap place to do business, at least compared with other biotech hubs.

The Boyd Co., a location consulting firm in Princeton, N.J., calculated the costs of running a biotech business in 35 metro areas in the U.S. and Canada.

It found annual costs ranged from $18.8 million in New York to $12.6 million in Sioux Falls, S.D. Palm Beach County ranked 23rd, at $14.1 million, just behind Vancouver, B.C., and just ahead of Cincinnati. Boyd's estimates are based on the bill to operate a 60,000-square-foot facility with 150 workers, including scientists.

"In the corporate relocation field, costs are ruling the process," said Jon Boyd, head of The Boyd Co. "Palm Beach County shows very well."

Palm Beach County as a cheap place to operate a company?

That's a novel notion, especially after the costs of living and doing business in Palm Beach County inflated during the real estate boom.

But those costs have deflated during the bust. That means economic boosters once again can tout factors such as the lack of a state income tax and home prices that are cheaper than in the Northeast and California.

"I was pleasantly surprised," Mike Jones, president of the Economic Council of Palm Beach County, said of the study. "With the downturn in the economy, the reduction in housing prices, the reduction in rents across the board, we're looked upon more favorably."

But do costs really matter in the biotech world, where pricey areas such as San Francisco, Boston and San Diego are the bustling hubs that cheaper rivals hope to emulate? Maybe, maybe not.

When the leaders of Envoy Therapeutics decided to locate their start-up company in Jupiter, costs were a secondary concern, said Chief Executive Brad Margus. Envoy was drawn mainly by the brainpower already setting up shop at Scripps Florida and Max Planck Florida in Jupiter.

"By far the most important thing is the people," Margus said. "Can you find the junior-level scientists in the area that can work in your labs?"

He noted that San Francisco and Boston have remained biotech hubs despite their stratospheric costs. That's because those areas offer a wealth of scientists, lab space and investors, all of which are crucial to upstart science firms.

While it doesn't hurt that Palm Beach County is cheaper than competing biotech centers, it's far from the only concern for biotech CEOs.

"You can recruit somebody here and tell them there's no state income tax," Margus said. "But is that really the deciding factor in where you go? No."

But Boyd said his discussions with executives lead him to believe that costs are taking center stage.

"The trend is to smaller, more manageable, less costly markets," Boyd said.

If that trend holds, it could be good news for Palm Beach County.

The region's biotech market already has been buoyed by the arrival of Scripps Florida and Max Planck Florida in Jupiter and the Torrey Pines Institute for Molecular Studies in Port St. Lucie, Boyd said.

Those labs came because they were offered tax dollars that totaled hundreds of millions of dollars. Now, economic boosters aim to attract for-profit companies that won't demand public handouts.

"You're early on the curve, but you primed the pump," Boyd said. "In many of these other locations, it took a few decades to get where you've gotten in a few years. You seized the moment. These were trophy projects."

Friday, November 27, 2009

Branding Campaign Tries To Improve Image Of "Made In China"

Posted by Barry Silverstein, brandchannel

The Chinese government is finally acknowledging that the phrase "Made in China" has regained many of its one-time negative connotations. Many Chinese brands have earned their poor perception: Consumers in the US and elsewhere have heard alarming reports of Chinese-made products scandalized by poor quality and deadly oversights. These have included everyday products like pet food, toys, and milk. and the bad publicity has done nothing but damage to the country's image.

So China has launched a new television ad campaign. Seen first in Asia, the campaign is now airing in the US, and features products with the "Made in China" label -- with an international twist. Each "Made in China" example highlights Chinese manufacturers' collaboration with other countries. For example, MP3 players are shown with the phrase, "Made in China with software from Silicon Valley." Clothing carries the label "Made in China with French designers."

According to China Daily, the campaign is intended to demonstrate that "Chinese companies work with overseas firms to produce quality products." The campaign was developed by ad agency DDB's Chinese affiliate, under the direction of China's Ministry of Commerce.

With a lot of ground to make up, some critics are already saying the new campaign may be less than effective. "Wouldn't it have been better if they had touted the millions of things being devised and made in China?" asks one blogger. The Telegraph's Shanghai correspondent, Malcolm Moore, adds, "Does it make you feel better about Chinese quality? Not really." Or at least not yet.

Ironically, the campaign was ready to launch in 2008, but it was delayed due to the recent tainted milk scandal that caused the deaths of at least six children and sickened 300,000.

Thursday, November 26, 2009

Consultant: Wichita has 2 drawbacks

The Wichita Eagle

A consultant said Tuesday that Wichita has at least two major drawbacks in recruiting business: lack of a ready site, and a stigma stemming from recent aviation industry strikes.

Site Selection Group of Dallas was hired by the Greater Wichita Economic Development Coalition to write a study showing how Wichita can diversify its economy.

The $70,000 study will examine how well Wichita competes against similar cities, which industries it should target for recruitment, which gaps Wichita has, and how to better market the city.

The study will be released on Jan. 18.

The firm has completed the first phase of the study, looking at how six other communities have moved from shrinking industries to diversified collections of growing ones. They are Huntsville, Ala.; Boise, Idaho; Greensboro, N.C.; Omaha; Clarksville, Tenn.; and Tulsa.

The communities first recognized the threat to their main industry, said Site Selection Group senior vice president David Brandon.

Then they built a decades-long economic development effort supported by the community's top leadership. And they raised significant, mostly private, dollars to fund the diversification effort.

Brandon said the Wichita area has a great deal going for it and was close to landing a major solar-power manufacturing plant.

But the city suffers from not having a large industrial site ready for construction and from a stigma brought on by recent union strikes in the aircraft industry.

"You have to figure out how to bring unions into the tent and create a partnership," he said.

Wednesday, November 25, 2009

Greensburg Web site aims at developers, business prospects

By Bob Stiles
Monday, November 23, 2009

Steve Gifford used to send information by compact disc to prospective developers or business owners who were considering relocating in Greensburg.

That won't be the case anymore, at least not as a first step.

Gifford, Greensburg Community Development Corp. executive director, will refer them to a Web site that's being started as part of the new Think Greensburg campaign that was started this month by his group.

The Internet site,, will formally go online Wednesday.

"With the Web site, they can go immediately, share it with their (business) partners and access it when they want," Gifford said.

The Web site is being done in two phases. The first involves such information as housing, tourism and economic data. Suggestions about what businesses may succeed in the city will be included.

The second phase will involve more detailed information available for downloading — requests for proposals, site-development plans and potential business-opportunity sites.

In addition, the Web site will show residents what is going on in the city.

The creation of the Internet site and related advertising is being paid through a $36,000 grant from the state Department of Community and Economic Development, Gifford said. More here.

Tuesday, November 24, 2009

Energize-ECI made Dallas trip

E. Roy Budd, executive director of Energize-ECI Inc. announced the regional economic development partnership, along with ECI member area economic development officials, planned and participated in a business development sales trip to Dallas, Texas, Nov. 11-12.

Among those on the trip were Terry Murphy, vice president Muncie-Delaware County Economic Development Alliance; Bill Bradley, executive director Jay County Development Corporation; and Budd.

"The purpose of the Dallas trip was to familiarize a new group of site selection consultants about the many competitive advantages offered to new business investment, expansion and consolidation in East Central Indiana," Budd said. "We want to be top-of-mind when business investment projects are given the green light to active status. Right now, the economy has forced many business projects to be put on hold. I think we proved our case that East Central Indiana has much to offer for new business investment -- and is worthy of serious consideration."

Monday, November 23, 2009

Solar energy industry brings a ray of hope to the Rust Belt

Areas hard-hit by the U.S. automakers' slump are pitching themselves to green technology firms. Workers and machines that used to crank out cars are now making parts for solar and wind power plants.

By Todd Woody

At a recent solar energy conference in Anaheim, economic development officials from Ohio talked up a state that seemed far removed from the solar panels and high-tech devices that dominated the convention floor.

Ohio, long known for its smokestack auto plants and metal-bending factories, would be an ideal place for green technology companies to set up shop, they said.

"People don't traditionally think of Ohio when they think of solar," said Lisa Patt-McDaniel, director of Ohio's economic development agency. But in fact, the Rust Belt goes well with the Green Belt, she said.

In years past, Sunbelt governors recruited Midwestern businesses to set up shop in their states, dangling tax breaks and the lure of a union-free workforce.

Now the tables have turned as solar start-ups, wind turbine companies and electric carmakers from California and the Southwest migrate to the nation's industrial heartland. They're looking to tap its manufacturing might and legions of skilled workers, hit hard by the near-collapse of the United States auto industry and eager for work.

For all of green tech's futuristic sheen, solar power plants and wind farms are made of much of the same stuff as automobiles: machine-stamped steel, glass and gearboxes.

That has renewable energy companies hitting the highway for Detroit and Northeastern industrial states, driven in part by the federal stimulus package's incentives and buy-American mandates.

Irvine's Fisker Automotive, for instance, will manufacture its next plug-in electric hybrid car at a defunct General Motors assembly plant in Wilmington, Del.

And Stirling Energy Systems, which is building two massive solar power plants in Southern California, has signed deals with two automotive companies to make components for its giant solar dishes.

Stirling's 40-by-38-foot SunCatcher resembles a mirrored satellite dish. The SunCatcher's mirrors focus the sun on a Stirling engine that sits on an arm that extends from the center of the dish. The heat causes hydrogen gas in the engine to expand, which drives pistons that generate electricity.

"The back of the mirror facet is a piece of stamped metal, and if you raise the hood of your car, what you see is a stamped metal frame," said Ian Simington, chief executive of the solar division of NTR, the Irish company that owns Stirling Energy Systems, based in Scottsdale, Ariz. "Nobody stamps metal better than automotive manufacturers. So in a sense the choice to go to high-volume suppliers in the greater Detroit area was an easy one for us."

Stirling signed an agreement with Tower Automotive to manufacture the dishes' structural components and assemble the mirror facets. The Livonia, Mich., company makes vehicle body parts and other components for the major carmakers but has seen auto orders slow with the downturn.

Jim Bernard, Tower's vice president of North American sales and program management, said the company had been looking to diversify its operations.

"The market that we thought would fit us was alternative energy," he said. "Utility-scale alternative energy projects have some of the exact same requirements that our automotive customers do."

That means Tower can use its existing machinery, with some modifications, and workforce to make SunCatcher components. In turn, Stirling avoids the capital costs of setting up its own factories and gets to tap Tower's manufacturing know-how to bring down its costs, which will be a key competitive advantage in the race to deploy new solar technologies.

"They have the practices beaten into them since Henry Ford, but more because of Japanese competition, to be able to do several things simultaneously -- improve the features of the product, take cost out and improve quality," Simington said.

He said his company has spent $30 million to $40 million in the Detroit area over the last year and hired 40 to 50 people from the automotive industry. Stirling has also outsourced the manufacturing of specialized tools to companies in Ohio, Illinois and Indiana.

About 25,000 SunCatchers will roll off the assembly line annually once production ramps up.

It's still something of a buyer's market these days, said Jeff Collins, Stirling's vice president of global supply chain and an auto industry veteran.

"I hate to say this, particularly as a guy who still owns a house in Detroit, but the downturn in the automotive market corresponded exactly with our requirements," he said. "We're not adding our own factories to scale up; we're just adding a second shift on the assembly line."

That available manufacturing muscle attracted Skyline Solar, a Silicon Valley solar power plant builder. In October, the start-up announced a deal with a Troy, Mich., subsidiary of automotive giant Magna International to make the long metal arrays that hold its photovoltaic panels.

"Renewable energy trends and forecast data suggest significant growth potential for this market. We expect to participate in this growth potential," Magna spokeswoman Tracy Fuerst said in an e-mail.

Back at Ohio's booth at the solar conference, Patt-McDaniel said Michigan was her biggest competitor for solar manufacturing projects.

Her state secured one of the biggest solar companies, First Solar of Tempe, Ariz., to produce photovoltaic modules in Ohio. Patt-McDaniel said wind turbines are already made in Ohio, and Rolls-Royce recently announced it would consolidate its fuel cell operations in the Buckeye State.

"We're open to anything and everything," she said.

Copyright © 2009, The Los Angeles Times

Plano to offer Pizza Hut $2.5 million deal to relocate from Addison


Plano is preparing to offer its largest economic package ever to lure Pizza Hut's corporate headquarters from Addison.

The package, drawn up during months of secret talks, includes grants and tax breaks totaling about $2.5 million. Plano's City Council will discuss the package Monday.

Officials say the multimillion-dollar deal is worth the cost for this city, which is struggling financially. Pizza Hut's impact, they say, could extend beyond the jobs it brings.

"It's not a done deal, but we're excited to be this close," Plano Mayor Phil Dyer said.

Should the company proceed, it would move at least 450 employees into a new $15 million office at Legacy Business Park in northwest Plano, according to the agreement. The yet-to-be-built structure would house nearly as much space as three football fields.

Pizza Hut officials could not be reached for comment. But a spokesman said earlier this week that the firm could come to Plano.

Addison Mayor Joe Chow said he was hopeful that the company, which moved to its current site along the Dallas North Tollway from Wichita, Kan., in 1995, would stay.

"It costs a lot to relocate," Chow said. "I don't believe that Plano is going to offer that much."

Pizza Hut would receive $2.1 million in cash as well as tax abatements through 2021, according to a copy of the incentives. More here.

Sunday, November 22, 2009

Area counties form marketing coalition to showcase economic development opportunities

Author: Mary Carr Mayle

With budget restrictions curtailing the state's ability to market economic development opportunities, four area counties have formed Savannah Gateway.

The coalition of Bryan, Chatham, Effingham and Liberty officials will tout the counties' attributes to site-selection firms and developers nationwide.

"The fact is, the state simply doesn't have the money to market like we used to," said state Rep. Ron Stephens, R-Savannah.

"The greater-Savannah area has so much to offer, it only makes sense to launch a collective marketing effort," said Stephens, chairman of the House Economic Development and Tourism Committee.

Lynn Pitts, senior vice president of Savannah Economic Development Authority, initially invited similar authorities in Effingham, Bryan and Liberty to join an informal conversation on how they could attract more attention to the area.

To that end, the group, with financial help from community sponsors, hosted a reception last month in Atlanta for commercial real estate brokers, developers and site-selection firms from throughout the Southeast to showcase all that coastal Georgia has to offer.

"It was a very successful meeting, one that produced a lot of bang for the buck," Stephens said.

Joan Herron, president of Herron Consulting in Atlanta, attended the reception with company director Bob Price.

"It was a great way to showcase what the area has to offer and allow a lot of people to make contact with the various communities," she said. "Taking a regional focus is definitely a step in the right direction. It allows you to make the most of your marketing budget while making it easier for companies to find you."

The group has a Web site and a brochure. The next step, Stephens said, will be to attend trade shows as a group and to market the area collectively on a global scale.

Economic development consultant Craig Lesser is working with SEDA to help with international marketing. To the extent that it fits with what SEDA has asked him to do, he plans to also market Savannah Gateway.

"Clearly, there will be some overlap," said Lesser, a former state economic development commissioner. "This is a very effective tool."

Lesser's successor, Georgia Economic Development Commissioner Ken Stewart, agreed.

"Savannah Gateway is really a brilliant move for that section of the state," he said. "Combining resources to present all that a region has to offer is definitely an idea whose time has come."

Saturday, November 21, 2009

Just how did Panama City woo Coast WET?

MATT DIXON / News Herald Writer

PANAMA CITY — With thousands of economic development groups vying for relatively few companies that seek to relocate each year, getting to first place in the business recruitment game is no easy feat.

The moment Panama City took the lead in the race to secure Coast WET was a fairly well defined one, said Janet Watermeier, executive director of the Bay County economic development alliance.

After some thought, she was able to pinpoint the moment she knew Panama City had pulled ahead in the race to secure the hundreds of jobs that might come if they were able to snag the water-efficient toilet parts manufacturer.

“We still have not won,” the economic development maven qualified. “But the moment I knew we were in first place was when we received approval for the governor’s closing fund package on Sept. 1.”

That package offered $500,000 of discretionary revenue to Coast, which used the money to defray a portion of the estimated $600,000 it would cost them to relocate from Southern California. More here.

Friday, November 20, 2009

Milken Institute: Best-Performing Cities 2009

Austin, TX; Killeen-Temple-Fort Hood, TX; Salt Lake City, UT; McAllen-Edinburg-Mission, TX; and, Houston, TX led the Milken Institute's list of this year's Best-Performing Cities. The Best Performing Cities Index includes both long-term (five years) and short-term (one year) measurements of employment and salary growth. More here

Thursday, November 19, 2009

In Detroit, Agencies Compete to Sell City as a Creative Haven


IT may not be the advertising version of “Mission: Impossible,” but it is certainly a challenging, if not daunting, task: produce a campaign to encourage young and creative people to consider Detroit as a place to live and work.

Cue the Lalo Schifrin theme music.

The effort, called Selling Detroit, is upfront about its intent. “America’s most struggling city needs to attract business and talent,” a description of the contest begins.

The initiative to help change what may be the most dire urban image in America is being sponsored by the Time Inc. unit of Time Warner as part of a yearlong project, Assignment Detroit, that involves reporters and editors from Essence, Fortune, Money, Sports Illustrated, Time and related Web sites.

Several advertising agencies with offices in the Detroit area were asked to develop campaigns; five agreed to take part. Their work is to appear in the Dec. 7 issue of Fortune, due Nov. 23, as well as on three Web sites:, and (The value of the ad pages that Time Inc. is devoting to the contest in Fortune is estimated at $400,000.)

Visitors to the Web sites will be able to vote, beginning on Monday, for their favorite among the five campaigns. The winner is to be announced on Dec. 2, during an annual awards ceremony in Detroit known as the D Show.

“The whole idea of the contest is that we believe in the renewal of the city,” said Mark Ford, president for the news group at Time Inc. in New York. This is to be accomplished partly by people moving to Detroit with their businesses and creativity, and being there “for the long haul.”

To that end, the campaign will be “targeted more to the 18-to-34-year-old demographic,” he added.

Those involved in the contest acknowledge it is a small step toward determining “what is the road out” from Detroit’s difficulties, as Mr. Ford put it.

“I don’t pretend to have the answer to solve the problem,” Mr. Ford said. “You have to expect it’ll take many, many years to recover.” More here.

Wednesday, November 18, 2009

Economic development? Simply absurd

Lauren Ritchie


November 18, 2009

Second of two parts.

Sunday's column looked at a report by the Metro Orlando Economic Development Commission that claimed the agency had worked with Lake County's economic-development employees to bring 157 jobs to the community in the past year.

The real number, according to the companies themselves, is roughly a third of that when layoffs at the same companies cited by the EDC are tallied into the final total.

Today, we'll take a look at what the EDC says it did for those 10 firms for the nearly $300,000 in tax dollars that the county pays the group.

Recruiting companies and helping those already here to expand is a major part of the EDC's job but not the only part. The agency also is to help firms find buildings that work for them, help the county work toward meeting economic-development goals, represent Lake in trade missions, act as a conduit for grant money and help the county sell itself as a desirable place to live and work.

Nine of the 10 companies the EDC helped responded to requests to detail their relationship with the economic-development folks. The 10th, Niagara Bottling Co., did not answer inquiries asking for the exact number of people it employs now.

Two other companies were eliminated from the EDC's count. The agency claimed to have brought 42 jobs to Lake last year through Dunkin Donuts Distribution and six through QuietFlex, which makes flexible ductwork. Both of those firms, located in the Christopher C. Ford Commerce Park in Groveland, came to Lake in 2006 and did not add jobs in the past year.

Maureen Brockman, vice president for marketing and communications for the EDC, said the agency relied on figures from Lake County's economic-development folks for Dunkin and on a 2006 letter from QuietFlex to estimate the number of new jobs.

Calls to the companies show that none of the 10 was sought out and recruited by the EDC. Rather, it helped firms that already decided either to come to Lake or to expand operations here.

Only three companies said that the EDC or the county did anything other than provide information and paperwork about job grants. Two said the EDC didn't even do that much — the companies applied on their own for incentive money.

Here are the results:

Surgery Center of Mount Dora: A group of local doctors joined with Regent Surgery Health, an Illinois developer of surgical centers, to build a facility in Mount Dora. Regent chief of operations Joyce Deno described her company's relationship with the EDC as excellent. The agency, she said, didn't recruit her company, but "once we were grabbed, they were wonderful."

The EDC guided the surgery center through the process of getting incentive money for hiring workers making at least 115 percent of Lake's average annual wage, and the agency helped the center get through snags in the building-permit process. The EDC said the firm has 16 people, but Deno said that 22 are employed now, and she hopes to hire another eight in the next few months as the company opens and begins doing surgeries. The center expects to do about 300 surgeries a month. Deno said company made it a point to hire local janitorial, landscaping and extermination businesses.

Restor Telecom: President and Chief Operating Officer Lisa Somerville said her company came to Lake from Orlando in 2000 with the help of the EDC. Somerville said the EDC notified Restor last year that it may be eligible for job-incentive money. The EDC said Restor had hired 10 new employees, but Somerville said the number was 13, with the company getting grants for 10 of them.

G&T Conveyor: The company that designs, manufactures and installs large baggage-handling systems, mostly for airports, got grant money for 15 jobs but had to return the cash for four of them when it could not keep the positions for two years as the contract for the incentive money requires.

No one from the EDC or the county told G&T about the funds, HR director Chuck Matthews said. He said he was familiar with the program and he submitted the application without help from the agency.

At the time, he said, "G&T was experiencing good economic growth." Like many companies since then, the downturn hit G&T, which had to lay off 96 people.

Blue Earth Solutions: The EDC estimated that the recycler would hire up to 200 people, but the company is in a zoning pickle with Clermont and plans to expand are at a standstill.

The county's economic-development director is trying to help, but Blue Earth has "dropped" plans to increase the size of its Lake County location, Vice President of Business Development James Cohen Jr. said.

Instead, the startup company, which recycles durable foam and other products, is moving its headquarters to Winter Garden this week and looking to expand elsewhere.

Brockman said, "Our hope is that the full job creation potential originally anticipated in 2008 may one day happen."

It probably will — just somewhere else. After all, recycling is one of those business that is expected to grow under the Obama administration's push to expand "green" companies.

Cohen said he doesn't know where the EDC came up with the figure of 200 jobs. The agency, however, said it has a 2008 letter from the company president saying that Blue Earth hoped to employ that total.

Cohen said the company would hire 75 people at most if it were able to expand and operate around the clock. It has about 15 jobs now, which tallies with the EDC's claim.

Niagara Bottling Co.: The EDC didn't claim the jobs that the water bottler brought to Lake County this year, but it should. It is the EDC's biggest job creation of the year.

Brockman, however, said the EDC reports jobs from only those firms with which it has an official relationship, and Niagara is not one.

The EDC worked hard to get Niagara to come to Lake County. The firm doesn't have a "letter of establishment" with the agency because the county refused to give Niagara job-incentive money. Together, Lake and Groveland spent about $1.2 million trying to prevent the bottler from winning approval to take about 176 million gallons a year from wells into the underground water supply at a time when drinkable water is dwindling and residents can water their lawns only in dribbles.

A spokesman for Niagara said a month ago that about 50 people were working for Niagara and more were expected to be hired.

Lakeside Electrical: The electrical contractor, which was created in 2007, brought 14 jobs to Lake, according to the EDC. Owner Ron Hunt said the company currently employs 18 people. He said neither the EDC nor the county's economic-development department helped his firm get incentive money for high-paying jobs.

"Our office manager knew about the grant, and she pursued it and chased the paperwork," Hunt said. "Nobody informed us. We happened to hire a smart office manager."

Brockman said the agency provides a "seamless resource delivery system" that sometimes is invisible.

"Many companies don't realize that the EDC works closely with the county and the state to move incentive requests from application to approval," she said. "Again, that's OK because it is not about who gets the credit but that it happens."

Smart Fuels: The Boston-based biodiesel company that plans to produce fuel from waste vegetable oil at a plant in Fruitland Park already was building in Lake County when its owners contacted the EDC. That's how the company learned that incentive money for creating new jobs was available, said vice president Michael Carlton, who grew up in Lake and graduated from Eustis High in 1995.

The EDC said it is reviewing Smart Fuels for grant money, but Carlton said the firm employs 12 full-time people so far and plans to have 20 to 25 when production begins, perhaps by the beginning of 2010.

Buildtelligence Web Solutions: The Internet marketing and search-engine optimization firm in Mount Dora could be reimbursed up to $62,000 for hiring 31 employees over a period of three years as the company ramps up.

However, the firm has applied for reimbursement for only one position so far.

President and Chief Executive Officer Ken Knorr said he hasn't been able to find employees with experience in managing pay-per-click accounts and in search optimization. The latter is the ability to write copy that search engines latch onto so that a particular business appears at the top of any list that a search engine like Google returns to a user.

So, Knorr said, he's had to hire people at a lower wage and then train them.

However, he said, the company is growing fast. It is out of space in Mount Dora and is planning to move to the old Pringle Development building near the Leesburg International Airport. Knorr said he expects to double the size of the company quickly after the move.

He said the EDC not only walked him through the process of getting incentive grants but also helped him find a new location and pointed him toward other money available for training employees.

Brockman said, "This growing Mount Dora company has great potential; we are optimistic that the full job creation will occur."

So, there you have it.

The EDC is fudging its "success" numbers and needs to stop immediately.

Here are some numbers that are hard to tamper with, however: The EDC's IRS tax return for 2008 shows that it paid president and chief operating officer Ray Gilley $326,759. Gilley and the vice president combined took home $537,827, or 10 percent of the agency's revenue for the year. Talk about absurd.

If Lake County government paid its top two managers 10 percent of the budget, approximately $40 million would be walking away.

Here's an economic-development agency that doesn't have the first clue about economics. Somebody please tell me why Lake County deals with these people.

Lauren Ritchie can be reached at Lritchie@orlandosentinel

Tuesday, November 17, 2009

End incentives and increase jobs


CHAPEL HILL -- The headlines on two consecutive days said it all: Dell Computer closing shop and laying off over 900 workers and Cree Inc. adding almost 600 jobs. The difference: Dell - headquartered in Texas - was lured to North Carolina with the promise of over $300 million in incentives, while Cree - a homegrown business spun out of N.C. State University technology - requested no state incentives (although in fairness Cree did get an incentive a few years back to build an expansion plant).

When are we going to halt public expenditures on the "buffalo hunt" for footloose industry and instead focus our resources and efforts on the sector that produces by far most of the jobs - existing industry and homegrown business?

As a student of and participant in Southern economic development for almost 30 years, I have long been baffled and disappointed by the turn taken by this state in 1996 to enter into the incentives game. Until that time, North Carolina was seen as the leader in state economic development policies and investments - focusing on our great university system and infrastructure investments like the Research Triangle Park, the Board of Science and Technology, the Microelectronics Center, the N.C. Rural Economic Development Center, the community college system and the Biotechnology Center.

These investments built long-term capacity and supported the creation and maintenance of dynamic and growing businesses. Then, under pressure from the professional economic development community - including site selection consultants - the state enacted the William S. Lee Act, and we were off to the races in the escalating game of incentive-based recruitment.

The argument is not against all recruitment - after all the Research Triangle Park was built on a recruitment strategy. Nor is the argument against all public investments in economic development - for example, water and sewer infrastructure, railroad spurs, access roads, industrial parks, etc. But what is indefensible is incentive-based recruitment in which public money goes into the corporations' bank accounts in what amounts to corporate welfare.

We can see how easily it can get out of hand in hard times, as in the recently reported case of North American Aerodynamics in Roxboro, for which provisions of site selection competition and even the prevailing wage standard were waived!

In fairness, it must be said that the General Assembly has been willing to examine and change the incentives structure. In the past two years, legislators appropriated money for a major study of this subject by our Carolina Center for Competitive Economies in the Kenan Institute for Private Enterprise. There have been efforts to target the incentives to the areas of greatest needs (Tier I counties) and to make them "earned" by the companies instead of all granted up front.

However, the evidence is that these incentives do not redound to the benefit of distressed rural areas as intended. Dell, for example, was located in Winston-Salem.

The scholarly literature on incentives shows that they are a very poor investment of public resources. And, of course, the business sector has become expert at playing off one state against another in something akin to corporate extortion; and who can blame them?

Imagine if the South in general and North Carolina in particular had put all of the money spent on industrial recruitment into education, training and small business support. We would be watching even more Quintiles, Cree, PPD, Southern Seasons, Performance Bicycle and other homegrown entrepreneurial success stories all across North Carolina. And, although there are no silver bullets in economic development, homegrown businesses are more likely to stay put, invest in the local community, provide stable civic leadership and keep the control and wealth local instead of away at some remote corporate headquarters.

This policy of incentive-based recruitment began in the 1930s in my home state of Mississippi, still the poorest state in the union. It spread throughout the South until the last holdout, North Carolina, signed up for this dismal strategy in 1996. Our state needs to abandon this policy and return to its investments in education, technical training and small business support.

Not only is this sound economic development policy, it removes the insult to ourselves that only "outsiders" can create the jobs and that we have to pay them to bring the jobs to our people. We can do better than that.

Jesse L. White Jr., Ph.D., is director of the Office of Economic and Business Development at UNC-Chapel Hill. He is a former federal co-chairman of the Appalachian Regional Commission and executive director of the Southern Growth Policies Board.

Working together to create jobs

Southwest Florida counties seek strength in Economic Development Partnership

Published: Tuesday, November 17, 2009 at 1:00 a.m.

One lesson from the long, deep recession is that communities, regions, states and nations are connected by the economy.

We are all in this together, to a great extent, so collaboration and cooperation can reap far greater rewards than division and dissension.

Competition among cities, counties, regions and nations was long the norm in economic development.

But a new initiative is bringing together job-creation efforts in an area including Sarasota, Charlotte, Lee, Collier and Glades counties. The goal of the Southwest Florida Economic Development Partnership is to market the region and explore ways to encourage businesses to expand in, or move to, the five-county area.

The new organization is based on the model that led to the creation of the Tampa Bay Partnership -- of which Sarasota County is also a member, along with Manatee, Hillsborough, Pinellas, Pasco, Polk and Hernando counties.

Sarasota-Manatee ties are vital

It is encouraging that Sarasota County will remain in a partnership that includes Manatee. The geographic, economic, cultural and political links between the two counties are strong -- and offer some of the best opportunities for cooperation in commerce and government. The counties share a commercial airport, a road-planning organization, the two-county State College of Florida and the University of South Florida's Sarasota-Manatee campus.

The study that preceded the formation of the Southwest Florida partnership specifically noted that Sarasota County has strong connections to both the north and the south. The study also recommended that USF's Sarasota-Manatee campus become the future site of an "incubator" project that would help start-up businesses succeed.

Kathy Baylis, director of the Sarasota County Economic Development Corp., told us yesterday that her organization has had "pretty serious conversations" with the Sarasota-Manatee campus about such a project.

The need to generate jobs on a broader platform than tourism and real-estate development has become clear since the decline of the housing industry. As a result, each Southwest Florida county's economic development group has committed funds and resources to the new partnership.

With unemployment rates in Southwest Florida running in the 12 percent range -- higher than state and national averages -- building a more resilient work force is a priority for economic development efforts.

Despite its involvement in the Tampa Bay Partnership and reputation for being more aggressive than Sarasota in economic development, Manatee County has not been spared from 12 percent unemployment -- a reminder that partnerships are no panacea.

Still, there is value in collaborating, marketing and sharing information with other governments, and between governments and the private sector. Employing the theme "Southwest Florida, a brighter place to do business," the new partnership has launched a Web site and a marketing campaign aimed at promoting and branding the region.

The partnership concept was presented at a recent breakfast meeting in North Port that was hosted by the Economic Development Corporation of Sarasota County. It was noted that Southwest Florida often appears to lag other regions in job-recruitment efforts. The partnership will seek to change that perception and the reality.

As both Sarasota County and the city of North Port consider seeking authority from voters to use tax abatements as incentives for business relocations or expansion, it is helpful to know that the economic development officials in the region are trying to speak with one voice. It was pointed out at the breakfast meeting that, even though the counties will sometimes compete with each other for a particular prospect, the benefits of economic development are widespread.

The partnership organizers have made it clear they would welcome other counties and cities to join them. They have also opened the door to working with the Tampa Bay Partnership. These are good signs.

Common challenges

The long-term direction of the Southwest Florida group has not been determined, and the partners in this new effort are at different places on the spectrum of economic development. The Sarasota County EDC is an established organization that recently completed an aggressive goal-setting effort, but now faces the daunting task of implementation. Charlotte County's program has made significant strides in the past two years, but is still in its infancy.

Despite these differences, however, most counties in Florida have the common challenges of recovering from recession and building better economies.

This story appeared in print on page A6
Copyright © 2009 — All rights reserved. Restricted use only.

Study: Marketing Oklahoma economically benefits state

The Oklahoma secretary of commerce told a House committee Nov. 17 that right now is the best time to market Oklahoma.

Secretary of Commerce and Tourism Natalie Shirley spoke to the House Economic Development and Financial Services Committee during an interim study on marketing the state.

State Rep. T.W. Shannon, who requested the study, said he thinks that the crucial role marketing plays in drawing jobs and industry to the state makes it an important investment even in a tight budget year.

“The state is doing an incredible job of marketing itself, but there is more that we could do,” Shannon, R-Lawton, “All three speakers who presented today showed that we are getting a return on our investment. Even in a tight budget year, it is crucial to continue to work to bring high-quality jobs for Oklahomans to the state.”

Shirley said that because of how well Oklahoma is faring the recession compared to its neighbors, now is the time to attract industry to the state. The Oklahoma Department of Commerce is planning to spend $3 million in a media campaign to reach C-level executives –- CEOs, CFOs, etc. -– with a 13-week schedule promoting the state that includes advertising on national TV networks.

The secretary also noted that Oklahoma City has recently made the top of lists 26 times recently – lists like best-recession proof city and best place to start a small business. One problem the state has is that many business executives do not have a mental image of Oklahoma, a problem she is hoping the 13-week media campaign will solve.

For every tourism dollar spent, the state saw a $54.46 return in 2009, according to Hardy Watkins, executive director of the state Tourism and Recreation Department.

“Clearly, if we are getting that kind of a return on our investment, it’s worth it,” Shannon said. “Though the secretary of commerce did not ask for a specific amount, she said it is important that lawmakers continue to keep marketing in mind when crafting the state budget next session. I, for one, believe it would be a good investment.”

Sunday, November 15, 2009

When going gets tough, TN towns buy advertising

Goodlettsville begins branding itself to lure more people to the small town

By Jennifer Brooks

In boom times, there were so many people relocating to Middle Tennessee, the biggest problem communities faced was building enough schools and roads to keep pace. It didn't really matter if a business or a family chose your town or the town next door, because there were always more moving vans rolling this way.

But then the recession hit. People couldn't relocate because they couldn't sell their homes, and by this time last year, American mobility was at its lowest point in 60 years, according to the U.S. Census Bureau.

Suddenly, attracting new residents and businesses to fill half-empty developments and prop up sagging tax bases became a priority. But how does a Goodlettsville set itself apart from a Gallatin or a Greenbrier?

For the city of Goodlettsville, it started with a modest advertising budget and a catchy slogan.

"Wow, that's good. … No, that's Goodlettsville," read the ads that began running in national specialty magazines this year.

Branding used to be something that only big cities had to worry about. Nashville has a $10 million budget for marketing and promotions. The new Smashville ad campaign, inviting people to Lower Broad to watch the Predators play, was a glitzy prime-time ad campaign.

But more and more small towns are stepping up with plans to brand themselves as memorable destinations. Thompson's Station formed a marketing and branding committee to help the town create an identity separate from its larger neighbor, Spring Hill.

Williamson County invited residents to create their own tourism promotion videos, featuring themes like "I Love My Franklin." White Bluff unveiled a new city logo and Web site designed to draw newcomers: "History, Family, Community: Tennesseans love to live, work and play in White Bluff."

The worse the economy gets, the more creative community marketing efforts have become, said Ben Stewart, director of economic and community development for the Greater Nashville Regional Council.

"It's an increasingly popular way for communities to market themselves," he said. "I think everyone's trying to think outside the box right now."

Putting city on the map

Goodlettsville increased its efforts at community branding this month with 30-second commercial spots that began airing on local Fox television stations. It's also grabbing a bit of name recognition with radio spots and by sponsoring weather and traffic reports: "The Tennessee morning weather report is brought to you by the city of Goodlettsville."

The community has spent $10,000 to $15,000 on self-promotion in the past year, said Tom Tucker, Goodlettsville's director of economic development.

"We scripted our commercial so it's not coming across like we're better than anyone else," Tucker said. "But we kept hearing from people, 'I know about Goodlettsville, but I don't know how to get there.' "

Follow Interstate 65 north from downtown Nashville for about 15 minutes and you'll find Goodlettsville, straddling the Davidson-Sumner county line.

"We want to get Goodlettsville on the radar," Tucker said, ticking off his list of qualities he most wants to promote about this town of 16,000.

"We're a small town with a rich Southern tradition. … We have an abundance of eateries, shopping, churches to worship. … A lot of thought went into all of this."

The television spots feature a young couple and a toddler strolling past historic Mansker's Station and through the city sights — over an old bridge, past a church and into a restaurant for ice cream before finally reaching a shady subdivision.

"Wow, that's good. No, that's Goodlettsville," the ad begins. "It's the people that make this city a great place to raise a family and own a business. Goodlettsville is a community rich in Southern hospitality with many community groups, places to work and cultural activities."

NEO 77 a joint venture by business groups to coordinate and fund regional economic development efforts

By Tom Breckenridge, The Cleveland Plain De...
November 15, 2009, 9:55AM

Top corporate leaders in Akron and Cleveland are quietly discussing ways to better align and fund economic development efforts in the region.

The strategizing is called NEO 77, in recognition of the Interstate highway that links the region's largest cities.

The talks include ways to broaden the financial support for six specialty development organizations in the region, whose missions range from attracting new business to growing minority-owned companies.

The efforts of organizations like Team NEO and NorTech are paying off, business leaders believe.

But the "alphabet soup" of organizations confuses some corporate leaders, whose companies are fielding multiple requests for funding.

"Major corporations have a person from NorTech coming in one day, then a person from Team NEO the next day," said Thomas Strauss, chief executive at Summa Health System and board chairman for the Greater Akron Chamber of Commerce.

Strauss said talks started this summer with Henry Meyer, chief executive of KeyCorp and board chairman for the Greater Cleveland Partnership, Cleveland's chamber of commerce; and Christopher Connor, chief executive of Sherwin-Williams Co., vice chairman of the partnership and board chairman for Team NEO, the region's business-attraction organization.

Strauss emphasized that talks were in an early stage and would include Canton business leaders, too.

Meyer and Connor declined to be interviewed. Their spokesmen referred questions to Joe Roman, president of the Greater Cleveland Partnership.

Roman said the chambers are considering how to better link their "dollars and leadership" in support of the economic development organizations.

"We're looking at how we can sustain what has been a very potent system," said Roman, whose chamber funnels hundreds of thousands of dollars yearly to the specialty development groups.

In the past five years, the six organizations had an impact valued at hundreds of millions of dollars on the region, by attracting public investment and venture capital and expanding payrolls, officials said.

"It's clear the programs we're pursuing in collaboration with the business community are working," said Brad Whitehead, president of the Fund for Our Economic Future, a pool of philanthropic and nonprofit entities that has directed $38 million to the six organizations the past six years.

But the Fund is in a new money-raising cycle now. There's no assurance it can raise a similar amount of money, or that it will even exist after the next three years.

That's why anxious leaders of economic development efforts hope NEO 77 results in more dependable financial support in the long run.

"Fund raising in general . . . requires a different approach from what we're doing today," said Rick Batyko, head of the Cleveland Plus Marketing Alliance, which supports Team NEO's business-marketing efforts. "To my understanding, that's what NEO 77 is primarily about."

Batyko watched his budget drop to $1.8 million this year, from $2.2 million, due to a cut in state funding.

Rebecca Bagley, new president of NorTech, which promotes high-tech industries, projects that her $2.4 million budget will drop next year.

That means she'll be spending more time raising money, with direct appeals to chambers of commerce outside Cuyahoga County.

NEO 77 should be an opportunity to consider establishing a regional council of business leaders, Whitehead suggested.

The council could help set economic development priorities and direct money to them, Whitehead said. A council would allow the region to act more quickly on business-building opportunities, Whitehead said.

"We hope [NEO 77] will lead to greater regional coordination among the business leadership," Whitehead said.

Indiana officials seek economic development in California

MUNCIE -- Recent trips by local officials to Japan and China have made headlines, but an economic development junket to California has potential to boost one of Delaware County's newest companies and spark local employment.

Mayor Sharon McShurley and Terry Murphy, vice president for economic development for the Muncie-Delaware County Economic Development Alliance, accompanied Greg Winkler, director of project development for Brevini Wind, and Oliver Viehweider, owner of VAT, on the California trip in October.

"It was about a 40-hour trip," Winkler said. "It was very productive. What we're hoping is it results in an opportunity to build gearbox replacements for wind turbines already in the field, a whole other part of the business we're very excited about."

The California trip was prompted by contacts made during McShurley's September trip to Japan, Winkler said, referring to a two-week trip that also included stops in China.

During the trip to California, local officials met with one company -- which Winkler declined to name -- but when Winkler returns next week he'll meet with two companies.

If Brevini lands contracts with the companies, Winkler said, that not only means more work for Brevini's employees -- projected at 450 workers needed after production begins in 2010 at the company's western Delaware County facility -- but also for suppliers.

Winkler said having McShurley and Murphy along on the trip demonstrated to potential business partners the support of the Delaware County community.

"We very much appreciate the help, the relationship-building, that the mayor and Terry bring to the table," Winkler said.

"Terry was there to tell them how we as a community have supported Brevini and VAT," McShurley said. "I went out as mayor representing the city of Muncie. We became aware of the opportunity in Japan; we came back and connected those dots."

Saturday, November 14, 2009

Smaller communities search for ways to stand out in economic development

Larger cities throughout the Northern Great Plains like Sioux Falls, Fargo and Bismarck continue to grab headlines for their relative economic strength in the midst of a recession. But recent research has indicated that a growing number of employers and workers are considering leaving congested major population centers in search of a simpler life in smaller communities with less crime and shorter commute times. More.

Factory losses strike deepest in rural Iowa

Kirk McCullough knows rural towns, heavily dependent on manufacturing, are in danger.

"It feels like the jobs are moving to big cities, metropolitan areas. But I'm not ready to say we're going to turn into a ghost town. We'll turn it around," McCullough said. He owns Seneca Foundry, a 100-year-old company in Webster City, the latest Iowa town to learn its largest employer will close its plant.

While few Iowa communities have escaped layoffs in the past year, the current recession has hit factory jobs harder in rural towns than in metro areas, new data from Iowa State University show.

Boone, Mount Pleasant, Ottumwa and other places with fewer than 30,000 residents have lost nearly 20,000 factory jobs since 2007, when the current recession began nationally. That's twice as many production positions than Iowa has lost in metro areas such as Des Moines, Cedar Rapids and Davenport, data from ISU economist Liesl Eathington show.

The loss of factory floor jobs may seem a remote concern for city office workers, but the fate of small-town manufacturing — usually high-paying jobs with good benefits — is crucial to Iowa's economy.

Production of grain bins, car crushers and cereal makes up the largest chunk of Iowa's economy at 21 percent, about $28.2 billion of the state's $135.7 billion gross domestic product, 2008 federal data show. Manufacturing contributes more to Iowa's economy than insurance and finance, construction, and agriculture combined. Iowa's economic dependence on manufacturing ranks second in the nation only after Indiana.

With the odds stacked against them, economic development leaders in Webster City and elsewhere are looking to renewable energy, entrepreneurs and existing companies to replace lost manufacturing jobs. One key will be worker willingness to retrain, experts say. More.

Economic development must move beyond taxes, freeways, railroads and land, to talent, education, innovation, and entrepreneurs

Every twenty years, South Carolina lands a major buffalo like BMW or Boeing. Attracting Boeing is terrific in itself, but it likely will reinforce the bad habits of the economic development community to focus almost all their efforts on industrial recruitment in order to land the next buffalo.

Need proof? In a recent meeting, the Anderson Independent reports that economic development leaders reemphasized the traditional industrial recruitment strategy as the path to prosperity for Anderson. “The tax structure here, the freeway, the railroads, this is a logical place for companies. But you have got to have a location for them to land on.” The economic development leadership “challenged Anderson County today to offer aggressive tax benefits and build inventory of available sites to try to land large industries.”

Is this view of economic development wrong? Well no, if the objective of your economic development strategy is to recruit the next branch manufacturer. But is this to best economic development strategy for the future of Anderson Country, or for the rest of the state for that matter? No. Not in the 21st century global economy.

Anderson needs to move away from trying get branch manufacturers to locate there because they have cheap land, cheap labor and incentives. As the singular focus of economic development, that strategy is obsolete.

The largest private employer in Anderson in AmMed. How does Anderson grow AnMed? And how does Anderson grow an ecosystem of small and medium companies and education institutions that make AnMed as the health care anchor of Anderson more innovative and productive? How does Anderson identify and support the high impact entrepreneurial company that starts-up to meet an AnMed need, and then can grow into a major company serving other hospitals across the country or even globally? Focusing on growing health care, and making it more innovative and productive, can grow thousands of well paying, stable jobs in Anderson.

There are eighteen high-impact companies forming the “Clemson cluster,” that have grown up in recent years around the university. How Does Anderson make sure that some of these seeds are planted in Anderson to grow into the next major company headquartered there?

Anderson has major production facilities, like Michelin, Bosch and others. How can Anderson grow an ecosystem of small and medium companies and education institutional around these anchors that makes them more innovative and productive? Recruiting BMW manufacturing was great, but that was followed by leveraging that relationship using Clemson as a magnet to attract the BMW Information Technology Research Center as a foundation of CU-ICAR. How can Anderson leverage their relationships with global companies to attract other, more innovative parts of those companies, especially around the Clemson Advanced Materials Lab which is located in Anderson?

Speaking of start-ups and small and medium sized enterprises, there are very talented and experienced people associated with Tri-country Technical College and Anderson University. How does Anderson incubate business opportunities spinning out of those institutions, as well as Clemson?

All of this requires top flight talent, which Anderson won’t have unless it reforms public education. Anderson has one of the better public school superintendents in Becky Bagley in Anderson District 5. How does Anderson support her and make sure the other public schools districts in Anderson are high quality? A national leader in Montessori education, Paul Epstein, is the head of the Montessori School of Anderson. How does Anderson makes sure more students benefit from this wonderful asset? Anderson has an incredible champion focused on early childhood education for children in poverty, Roy Jeffcoat. How does Anderson makes sure Roy’s program get the support it deserves?

Anderson needs to make sure that it hangs onto, and attracts more of, its best and brightest talent. I recently was in a meeting in Anderson, where an educated young woman said she had recently moved to Anderson after considering several other places in the Upstate, like Greenville. She intentionally chose Anderson because she thought it was a wonderful, walkable, green community. Anderson needs to grab hold of young people like her to understand and build on what they find great about Anderson so they attract and retain more of the best and brightest.

Am I being too harsh on the economic development community? I don’t think so. I hope they take this as a sobering call to action. Instead of focusing myopically on taxes, freeways, railroads and land, economic development professionals also should focus on talent, education, innovation, and entrepreneurs. The SC Department of Commerce, the Upstate Alliance, and the Anderson County Office of Economic Development need to develop and execute a comprehensive economic development strategy of which industrial recruitment is a part, but where cheap land, cheap labor and incentives are no longer treated as sufficient for Anderson to become the prosperous community its citizens aspire for it to be.

By John Warner, Courtesy of Swamp Fox

Economic development from Kelo case fails

By Steve Stanek

One of the worst decisions in U.S. Supreme Court history is now linked with one of the worst economic development failures in history. We should not be surprised, as “economic development” failures cover the country.

Pharmaceuticals company Pfizer has announced plans to pull out of New London, Conn., where local officials spent $75 million to destroy a middle-income neighborhood of homes and small businesses. Jobs and higher tax revenues that had been promised have not appeared, and the homes and businesses have been flattened, leaving the 90 acres looking like a desert.

Instances of such government abuse scar the country. The New London case makes news because of the scale of the abuse and the infamy it produced:

the Supreme Court’s 2005 decision in Kelo v. City of New London, in which five so-called justices spat on the Constitution they had sworn to uphold.

They ruled no one has a right to their own property if someone else wants to use it in ways that might - might! - generate more tax revenue or jobs. The ruling prompted most states to rework their eminent domain laws to protect property owners from the impact of the court’s decision.

“Economic development projects like these have a horrible track record, yet city officials fall for them time and again,” said Scott Bullock, an attorney with the Institute for Justice who represented plaintiffs in the Kelo case. “The city remediated the property, spending huge sums to do that, and gave the property to Pfizer for a dollar. And it gave massive tax abatements that are expiring in 2011. Pfizer will be out one year before the tax abatements are shut off and they have to pay the full bill.”

What grand economic development plans they had! The city would seize the Fort Trumbull neighborhood’s nearly 100 homes and small businesses and turn the property over to Pfizer to build condos, corporate offices, and a conference hotel next to the company’s research facility. Those developments would in turn generate jobs and tax revenue for New London.

None of the development has occurred or will occur, and the adjacent Pfizer research facility - opened just eight years ago - will be cleared out as well, taking 1,400 existing jobs elsewhere.

One homeowner who meant nothing to city officials was Susette Kelo, who led her neighbors in a fight to defend their homes, their freedoms, and the Constitution. That document says government may take property only for “public use” after paying “just compensation.” For most of the nation’s history, public use was understood to mean things such as public roads or utilities.

The majority of justices in the Kelo decision perversely declared private, profit-making shopping centers, industrial parks, hotels, sports stadiums, upscale housing developments and similar projects also warrant to property seizures by government. Their ruling states a “public purpose” - not a “public use” - is enough to justify government seizing private property.

Justice John Paul Stevens wrote in the majority opinion, “promoting economic development is a traditional and long accepted function of government.” Under his ruling, property does not have to be abandoned or blighted to be seized. The government could seize a $1 million house from its owner to give it to someone who wants to build a $3 million house.

Then-Justice Sandra Day O’Connor rightly noted in her dissent, “The beneficiaries are likely to be those citizens with disproportionate influence and power in the political process, including large corporations and development firms. As for the victims, the government now has license to transfer property from those with fewer resources to those with more. The founders cannot have intended this perverse result.”

Can anyone doubt the truth behind O’Connor’s words?

Upstate group hopes to triple visits from economic development prospects

By Mike Ellis
Friday, November 13, 2009

ANDERSON — Hal Johnson III thinks that by 2015 his marketing organization can triple the number of economic development prospects that visit the 10-county Upstate region each year.

“Actually I’ll be extremely disappointed if we only have 120 prospects coming in per year,” said Johnson, the president and chief executive of Upstate Alliance.

The reason he is expecting such a dramatic increase is today’s roll-out of a targeted industry study that identifies the most likely types of companies that would locate in the area. About 150 business and community leaders came to Tri-County Technical College to hear about the proposal.

“This is the most targeted marketing strategy in the world for marketing agencies,” Johnson said.

Advanced materials, automotive, biosciences and the energy sector are the four target industries that Johnson’s organization has identified as a result of the study.

South Carolina Commerce Department Secretary Joe Taylor was in Anderson on Monday at a meeting with county economic development and real estate officials. He said target market studies were a waste of resources and he would advise economic developers to pursue “anyone who is breathing and has a driver’s license.”

When asked about that, Johnson said his group’s study narrowed down a small number of industries so that targeted Web sites and individualized messages could be made. But Johnson said the core message of the study is to build awareness of the region.

Burriss Nelson, Anderson County’s interim economic development director, said the study would help him identify specific companies to go after.

“There’s some stuff already on the radar screen, things we may have some contacts with already,” Nelson said.

He also said Anderson County has 11,000 unemployed people so his staff is doing everything it can to bring in any type of company.

Sunday, November 08, 2009

Shuttered factories pose big challenges for communities

By Josh Brown
The Virginian-Pilot
© November 8, 2009

After the wood chippers go still and the boilers cool, the International Paper mill outside of Franklin will join a growing list of closed local factories.

Nearly 4 million square feet of factory space across the region is dormant or scheduled to close, not including International Paper's plant, which will add hundreds of thousands of square feet to the market when it closes next spring.

In Norfolk, Ford Motor Co.'s 2.6 million-

square-foot assembly plant has sat vacant for more than two years. Chesapeake Hardwood Products Inc. closed last year, and its 452,000-square-foot plywood plant is up for sale. And Smithfield Foods Inc. plans to close a 413,000-square-foot meatpacking facility in its hometown early next year.

Shuttered factories pose big challenges for communities in lost jobs, tax income and often blight, yet they also offer opportunities for redevelopment.

But the latter is a difficult proposition.

Unlike cookie-cutter warehouses, factories are designed and built for the purpose of producing a specific product. Everything from the layout to land use has a purpose and may not lend itself to modification. The same goes for machinery, which is often highly specialized and expensive to remove or alter.

Add to that the recession and credit crunch that have reined in

developers who redevelop factory land for other uses such as office and shopping space or even residences, and it becomes even more difficult to for cities to get unused factories back to work.

After a company has decided to close a factory, it sometimes takes months or years to decide whether to sell, demolish or hold onto the plant - much to the chagrin of economic development officials eager to find a way to use it to create new jobs.

"Here's the rub: The highest and best use most of the time is the same use, whether it be paper production or food production," said Worth Remick, a vice president with the Norfolk office of real estate firm CB Richard Ellis. "And so the buyer would most likely be a competitor of International Paper or Smithfield. Are these sellers essentially creating more competition or assisting competition, or are they just getting rid of buildings that aren't contributing to the bottom line?" More.

New Bedford emerging as cleantech leader

November 08, 2009 12:00 AM

NEW BEDFORD — Efforts by city officials to position the city as a "cleantech" hub have started to pay off, and many industry experts say the city could see a burst of economic activity over the next several years.

"Is there going to be a 1,500-person, thin-film manufacturing facility in New Bedford tomorrow? No," said John DeVillars, a partner at Blue Wave Strategies, an advisory company to renewable energy projects.

"Can New Bedford, over the course of several years, develop a cleantech economy that employs several thousand of its citizens?" he asked. "I believe it can."

The city first zeroed in on the economic potential of the cleantech industry several years ago, said Matthew Morrissey, executive director of the New Bedford Economic Development Council.

Cleantech is a broad term that covers a range of emerging industries and technologies related to alternative or renewable energy and energy efficiency.

"We know that our traditional manufacturing base will continue to decline," Morrissey said. "We are acting right now to stem those losses we know are coming."

Cleantech was one of several industries city officials identified that matched up well with New Bedford's assets, including its geographic location and its existing work force, and that had considerable support from private investors and the government, according to Morrissey. More here.

Water as a Economic Advantage

Water can make this region attractive for further economic development. Local officials should make use of those advantages.

Posted: Nov. 5, 2009

Milwaukee Mayor Tom Barrett is touting an idea that could help economic development in the region by being smarter about attracting businesses. Use the area's best natural asset - a plentiful supply of clean water - to appeal to firms in other parts of the country or globe where water may be scarce or more polluted or expensive.

The idea would be to create so-called Wave districts, for "water attracting valued employers," where new businesses could be offered low-cost or free water in return for job-creating investment. The proposal - credited to Rich Meeusen, chief executive of Badger Meter Inc., a Brown Deer-based maker of water meters - came up at a recent conference at Marquette University on the economics of water.

It's an idea that deserves strong follow-up.

"This is our comparative advantage," Barrett said at the conference. "We have to sell on our comparative advantage. We cannot sell our winter weather." Well, we could, but how many businesses cater to penguins, polar bears and other snow lovers?

That big body of water off of Lincoln Memorial Drive is the region's greatest natural asset and offers tremendous untapped potential as an economic development tool.

Work is proceeding on developing Milwaukee as a hub for the water technology industry. The University of Wisconsin-Milwaukee wants to create a freshwater science school that could tie into that industry as well as develop research on what's been called the 21st century's most critical resource.

And the region can use the promise of cheap and plentiful water to lure businesses and family-supporting jobs, especially in Milwaukee, where the water utility is running under capacity.

Although the concept of using water as an economic development tool is in its early stages, Barrett said it could be in place as soon as a year from now. The Milwaukee Water Council, a trade group that aims to coax growth out of the region's cluster of water-technology companies, discussed the idea two weeks ago with the state Public Service Commission, the agency that approves water rates.

Some existing businesses may complain that newcomers will get an unfair advantage on water rates, but Meeusen has the right answer: "If we can attract additional businesses, it benefits everybody."

It's time to move on this issue. We've been told by a federal official that the Milwaukee area appears to be better organized and ahead of the curve on water issues compared with most other Great Lakes metro regions. Using water as an economic development tool can keep us there. Let's start creating those Wave districts.

A look at Fairfax County's globetrotting chief marketer

Economic Development Authority's Gordon travels
the world in search of business

by Gregg MacDonald | Staff Writer

In his capacity as Fairfax County's head promoter, Gerald Gordon lives an exotic life.

As president of the 45-member Fairfax County Economic Development Authority, Gordon, 58, frequently travels both the country and the globe, singing the county's praises and promoting it as a place for domestic, foreign and multinational businesses to set up shop.

"I once lived in a tree for a week in Yap, Micronesia," he told Northern Virginia business leaders at a Tower Club Tysons Corner breakfast last month. "I also spent two weeks in Vieques, Puerto Rico, where the U.S. Navy tests its bombs by dropping them from airplanes. That was cool. It was the only time I ever was assigned bodyguards."

When he's back home, Gordon is generally known for two things: his offbeat sense of humor and his razor-sharp business development acumen.

"If Gerry wasn't the director of FCEDA, he could be one of the original Marx Brothers," said Larry Rosenstrauch, director of the Loudoun County Department of Economic Development.

On a more serious note, Rosenstrauch says he should pay Gordon for marketing the entire region to interested businesses. "When they come to Fairfax County, they are inclined to poke around and see the neighbors," he said, referring to Loudoun. "We tend to think of Gerry and the FCEDA in terms of regional cooperation and not direct competition."

"Gerry Gordon has stood the test of time as one of the longest-serving economic development directors in the Commonwealth," added Jeff Anderson, Executive Director of the Virginia Economic Development Partnership, the state's economic development marketing office. "He is an accomplished professional who is highly regarded in the economic development community, nationally and internationally."

Gordon, a Citadel graduate with a doctorate in International Economics from Catholic University, has been representing the FCEDA for 26 years and serves at the request of its seven-member board.

Board members are appointed by the Fairfax County Board of Supervisors and serve four-year terms. The Authority receives an annual $6.7 million budget, which so far has not been impacted by county budgetary issues.

Part of the reason Gerry is such a good fit for the position is his skill at making Fairfax County accessible to outsiders, said Fairfax County Board of Supervisors Chairman Sharon Bulova.

"Gerry is a great communicator and a master at telling the Fairfax County story in a way that attracts business," Bulova added.

For Gordon, working on the ever-changing economy is "pretty simple" — and under his leadership, Volkswagen America, Hilton Hotels Inc., and Science Applications International Corporation have all moved their corporate headquarters in the past few years to Fairfax County, bringing thousands of jobs to the area.

When asked about the effects of bringing more people into a county with already infamous transportation issues, Gordon jokes: "The board of supervisors is product development; I'm marketing."

On a serious note, however, Gordon says the county once offered only two employment options: either "work for the federal government or leave town."

"Since then we have become the place where ‘the next great thing' is done," he added.

Today, Gordon says that translates into a handful of cutting-edge technology industries, such as nano-technology, bio-science and personalized medicine, and bio-technology. "Fairfax County's labor force is well-educated and ready for the next great thing," he said. "The average resident has at least a college education."

According to Gordon, the county's future economic success will also include the development of minority, women-owned and internationally owned businesses. There are already 360 foreign-owned businesses in the county, currently employing 20,000 people, "but we can always use more," he said.

The one thing he says he worries about is a reported trend that federal agencies are cutting back on outsourcing dollars and opting to insource in an effort to keep spending down. "That could hurt Fairfax County," he said.

But overall, the economic future of the county looks bright, according to Gordon. In his best Groucho Marx imitation, he remarks: "The best thing we ever did was to locate ourselves next to Washington, D.C."

Leaders look to develop 'brand’ for Greenwood

Wednesday, November 4, 2009 9:09 AM EST
What is Greenwood’s calling card?

Is it the people? The schools? Sports? Industry? The medical community? The churches? Wildlife and natural resources? All of the above and more?

These are questions that are being considered this week by numerous local leaders and representatives of town planning, economic development and community branding consulting firm Arnett Muldrow and Associates.

Arnett Muldrow is meeting this week with different clusters of community leaders to develop a singular “brand” for the Greenwood area. This brand would ultimately be conveyed in the signage throughout Greenwood and on literature and marketing material that is used to help market the county to prospective industry and retail establishments that might look to set up shop here.

Partnership Alliance director of communications Julie Miner said Greenwood’s brand would reflect to outsiders what the area is about.

“We have put together a task force, a core marketing task force,” Miner said. “That task force met with (Arnett Muldrow representatives on Monday) and they are going to meet with them again (today) to see the preliminary look and to see if we think it is on track with what we are looking for. That task force is made up of professionals from Piedmont Tech, Lander, Self Regional, Park Seed, Partnership

Alliance, the Greenwood Chamber, the (Greenwood Regional Tourism and Visitors Bureau), Countybank, Fujifilm, Wesley Commons and others. There’s a good representation there. Those are people who are on the front line that have to sell Greenwood.”

On Monday, consultants met with numerous governmental leaders at the Federal Building, including Greenwood city manager Charlie Barrineau, Greenwood County manager Vic Carpenter, assistant county manager Thessa Smith, members of Greenwood City Council, state Sen. Billy O’Dell, Piedmont Tech president Ray Brooks, District 50 superintendent Darrell Johnson and others.

“Companies and private enterprises have been doing branding for a long time,” Arnett Muldrow’s Tripp Muldrow said. “When you see the apple on the back of a computer or see Mickey Mouse’s ears, that promotes a whole set of feelings and thoughts about a company you might engage in business with. A community brand is very much that same thing, except, unlike a company where a CEO said, ‘This the brand, this is it,’ a community almost has to be a ‘bottom up’ process.

Muldrow said his company’s task is to look at an image for Greenwood. “We are not looking at the city or downtown necessarily. It is really an overall community brand.”

The consultants asked those present to share their ideas about what makes Greenwood unique. Brooks said Greenwood’s location and natural resources are a key selling point.

“One thing that is interesting to me is that people will ask, ‘How long does it take to get to Columbia from Greenwood?’ About an hour,” Brooks said. “They ask, ‘How long to get to Greenville?’ About an hour. ‘How long does it take to get to Augusta?’ About an hour. Really, I have been amazed that there a lot of things that are within a short distance. You’ve got access to health care. I think two things that attract a lot of the retirees here are the golf courses and the fact that they like the water and recreational opportunities, whether it be fishing or boating.”

Smith said she thinks people from outside the community connect Greenwood with the Festival of Flowers.

“Basically, a lot of times when I talk about Greenwood, people want to relate Greenwood to the Festival of Flowers or Park Seed,” Smith said. “That’s their point of reference. Also, from an innovative standpoint, our bio park, people relate us to that. We’ve also got the best lake in the state.”

Carpenter said that Greenwood is a county that likes to enjoy itself.

“This is a town that knows how to have fun,” the county manager said. “Our festivals are world class festivals. And we’ve got numbers of them, not just one per year. They range from the Festival of Flowers to the Festival of Discovery to the music festivals, Click 646, the Catfish Feastival and Ninety Six with its Fourth of July festival. Friday night football, it’s as American as it gets, in that respect. This town knows how to have fun and it does it very well.”

Johnson said he thinks Greenwood’s new brand should celebrate the resources available here.

“Whatever you want, we have right here,” the superintendent said. “It is possible (in Greenwood) to get a first class education, from 2 years old all the way through a Master’s degree, along with all the recreation, along with everything in the medical field. The hospital, the Genetic Center — we have it all right here. Sometimes, I think we take for granted the positives we have here.”

Tuesday, November 03, 2009

No-Win Situation: Region Could Not Keep SAIC

No-Win Situation: Region Could Not Keep SAIC
By MIKE ALLEN - 11/2/2009
San Diego Business Journal Staff

When SAIC Inc. said it was leaving San Diego for a suburb of Washington, D.C., most of the region’s business leaders barely blinked.

For the past several years, it was common knowledge among top insiders that the $10 billion engineering and research firm, one of the area’s largest employers, was going to relocate its headquarters east to be closer to its primary customers, the federal government and the Department of Defense.

But despite this knowledge, the San Diego Regional Economic Development Corp., a publicly and privately funded agency focused on retaining and attracting companies to the area, did not make a formal proposal to persuade the company, also known as Science Applications International Corp., to maintain its headquarters in the University City area.

Julie Meier Wright, chief executive at the EDC, said she had several discussions with SAIC officials over the years, but there was never a formal package of incentives presented. She said the discussions, some that included Mayor Jerry Sanders, made it clear that SAIC intended to move to the Washington, D.C., area to be closer to its customers, and there wasn’t anything that could change that decision.

“There was really nothing, with the tools we have in California, that we could have done,” Wright said of the move, announced Sept. 24.

At the announcement of the relocation, Virginia Gov. Timothy Kaine said the state offered $7 million in incentives, plus $1.5 million for road improvements, to accommodate SAIC’s expansion of existing offices in McLean, Va., where about 17,000 employees already work.

The move will initially result in about 20 corporate positions moving to Virginia. SAIC has about 4,300 employees in San Diego, including about 900 corporate staff members.

SAIC spokeswoman Laura Luke said the company relocated its headquarters so it could be closer to its federal government customers, and to have its corporate executives in the same place.

“SAIC’s decision was unrelated to the business climate in California, and in particular to San Diego, where we have always had excellent support from local business and political leaders and organizations, and expect this to continue,” Luke said.

Several local business leaders said California and the region should be trying harder to keep major corporations from moving elsewhere.

“I think it’s important that San Diego and the state of California do whatever it can to retain a company as much as it does to attract companies to come here,” said Ted Owen, president and CEO of the Carlsbad Chamber of Commerce.

Yet most interviewed for this story said SAIC’s decision to relocate was made years ago, and nothing could have dissuaded it from moving its top executives east.

In June, SAIC hired Walter Havenstein to succeed retiring Ken Dahlberg as chief executive and president of the 40-year-old firm started by J. Robert Beyster.

Havenstein is a former chief operating officer of BAE Systems, which is based in Rockville, Md., also a suburb of Washington.

Ruben Barrales, president of the San Diego Regional Chamber of Commerce, said SAIC’s formal announcement to relocate its headquarters wasn’t surprising.

Barrales said the decision makes good business sense since SAIC’s main customers are in Washington.

He said the decision to move the headquarters had nothing to do with the state’s high taxes or excessive regulatory burdens.

“It was an internal business decision on how they can better relate to the decision makers who are so critical to the growth of their business,” he said.

Duane Roth, CEO of Connect, a nonprofit technology trade group, and a member of the EDC’s board of directors, said SAIC’s relocation couldn’t have been prevented by any sort of package of incentives, even though no such package had been offered.

“This had nothing to do with incentives,” Roth said. “There wasn’t anything to work with. Sometimes decisions are made and they are what they are.”

Wright said while it was disappointing to lose a Fortune 500 corporation, SAIC’s top executives have assured her that the company’s commitment in terms of community involvement and philanthropic activity in San Diego won’t change.

Wright reiterated that the EDC had ongoing discussions with SAIC executives about the relocation, and that the gist of its message was that the relocation was not a matter of if it would happen, only about when it would occur.

“We stayed in constant dialogue with them and had candid conversations with their executives. But at the end of the day, we were told there was nothing we could do to influence this decision,” she said.

5 counties promote data center corridor

By John Dayberry | Hickory Daily Record

Published: October 28, 2009

Maiden - Scott Millar said establishing an information technology corridor stretching northwest from Charlotte could transform the region's economy.

"Partnering with Caldwell, Burke, Alexander and Iredell counties to market this to the world may give all the counties new business opportunities," said Millar, president of the Catawba County Economic Development Corp.

On Tuesday and Wednesday, Millar and other economic development officials from the five counties outlined plans for a North Carolina data center corridor during a marketing event that attracted nearly 40 U.S. site selection consultants specializing in data center locations.

Each of the participating counties has available sites suitable for data center development.

On Wednesday, participants in the third Data Center Information Exchange gathered at the future site of Apple's $1 billion data center in Maiden.

Construction is under way on the project, the first phase of which is expected to be up and running by late 2010.

Site Selection Magazine, a nationally recognized publication, recently acknowledged a region anchored by financial data centers in Charlotte, Apple in Catawba County, Google in Caldwell County and the state's data center in Rutherford County as an emerging data center cluster that is attracting attention within the industry.

Data Center Knowledge, a Web site that specializes in information for the industry, recently ran an article on the clustering of data centers and referred to the "Apple-Google Data Center Corridor."

North Carolina is also the top state in which to build a data center, according to a report by Tishman Technologies Corp., a New York-based construction management firm.

Tishman rated the state highly for low energy cost, favorable labor conditions and fiber optics infrastructure.

The five-county corridor builds on those advantages with a lack of extreme weather conditions, easy access to major airports and a high quality of life, Millar said.

"This new clustering, along with the well-established communications companies in the corridor — CommScope, Corning Cable Systems and Draka — provides us with a huge marketing opportunity," Millar said.

Harry Whalen, director of the Economic Development Commission of Caldwell County, agreed.

Whalen said the region has the potential to be "the next Quincy," referring to Grant County, Washington, and the success that region has had recruiting data centers.

Whalen said that like fast-food restaurants, data centers tend to cluster.

"When you see a McDonald's, you'll often see a Burger King," he said.

A data center is a facility used to house computer systems and associated components, including telecommunications and storage systems.

California-based Google opened a $600 million data center in Caldwell County in 2008.

When Apple announced plans for its $1 billion Maiden data center in July, economic development officials saw magnified potential for a data center corridor in the region.

Apple's arrival in the region also heightened interest on the part of site selection consultants from New York, Chicago, Atlanta, Washington, D.C., and other cities, Millar said.

Attendance at the Data Center Information Exchange blossomed.

"Eight (consultants) came the first year, 18 came last year and 38 came this year," Millar said.

"We're getting attention."

Monday, November 02, 2009

Sun Belt loses some glow for graduates

Many are turning to tech-based cities, census data show

By Associated Press
Wednesday, October 28, 2009

Many college graduates are passing up the Sun Belt and industrial centers, which have been hit hard by the recession, in favor of life in urban, high-tech meccas. Such moves are fueling a resurgence in parts of California, North Carolina and Texas.

Census data released Tuesday offer the first detailed look at U.S. migration information, broken down by education and income, since the recession began in late 2007.

The data covering 2006 to 2008 show that Austin; Portland, Ore.; Charlotte; Raleigh, N.C.; and Seattle had large jumps in residents with at least a college degree. San Francisco, with its burgeoning biotech industry, and Houston, home to NASA and several medical centers, had significant increases in residents with advanced-level graduate degrees.

In contrast, metropolitan areas with high rates of foreclosures, fewer tech-based economies or increasing unemployment had declines or slower rates of growth in residents with a college degree or higher. They included Los Angeles, Atlanta, Orlando, New Orleans, Detroit and Cleveland.

"During this economic downturn, young, educated professionals are heading for the high-tech 'cool' metros rather than the fast-growing upstarts of the mid-decade," said William H. Frey, a demographer at the Brookings Institution who analyzed the American Community Survey data. "The investment in knowledge industries and young professional amenities in places like Austin, Raleigh and Seattle is now paying off."

According to the data, cities with higher levels of education did not always have the highest incomes.

Austin, Seattle and Charlotte had large gains in the number of residents who made $65,000 a year or more. But they were outpaced by places such as Bakersfield, Calif., and Sun Belt communities such as Phoenix and Las Vegas, which had larger jumps in richer residents.

Frey attributed the differences to younger college graduates in the high-tech areas who are moving up the career ladder and have not reached their peak levels of income.

The information was collected over three years, from every U.S. community with at least 20,000 residents.

Sunday, November 01, 2009

Local leaders say Boeing plant will spur economic development across the state

By Patricia Burkett | WBTW Anchor/ Reporter

Boeing’s decision to land a new aircraft assembly plant in South Carolina should mean thousands of jobs beyond the plant’s walls.

On Friday, Gov. Mark Sanford signed an incentive package that includes $170 million in low-interest loans used to lure Boeing to the Palmetto State.

State Senate President Pro Tempore Glenn McConnell said he expects two to three spinoff jobs for each of the 3,800 Boeing hopes to create in seven years.

Construction begins in November and it will take about 2,000 workers to build the new plant in North Charleston, near Charleston International Airport.

State Sen. Hugh Leatherman of Florence said he had been in talks with Boeing officials for the past six to seven weeks. He said he even continued speaking with Boeing officials during his recent overseas economic development trip to Asia.

Leatherman said he and McConnell spoke with a Boeing executive about what South Carolina had to offer, and assured the company official the Palmetto State would be the appropriate spot for its new facility.

“The two of us met, talked about what Boeing had to offer, what South Carolina could offer and sort of put together a tentative package,” Leatherman said.

Leatherman said he then found out that Boeing officials decided to take South Carolina up on its offer and locate the plant in North Charleston.

The announcement will permanently alter the course of economic development in the state, Leatherman said.

“We can’t imagine, we just can’t imagine ... it will change the economic landscape in this state forever. I don’t think any of us at this point in time can really imagine or evaluate the economic impact this will have on our state,” he said.

In terms of economic impact, the plant will not only provide thousands of jobs in the Charleston area, but some economic development leaders say it could help them entice future companies.

“Having such a large win that you can tout, I think it raises the eyebrows of other companies,” North Eastern Strategic Alliance Executive Director Jeff McKay said.

McKay said those prospective companies will be saying, “If Boeing did this, what is there that made them make that decision and should we be looking there as well?”

Though McKay said he doesn’t know yet how the plant will directly impact the Pee Dee and the Grand Strand, he does know it will only have positive effects on economic development across the state.

“I think it’s a tremendous win for the state and it’s definitely something that we as an economic development community will tout as the reason why companies should consider the state of South Carolina for their business expansion or opportunity,” he said.

Leatherman said the plant will create more jobs across the state in offshoot companies, just as other major plants have done in the past.

“We know up in Greer where BMW located, they have about 5,000 jobs but it created about 20,000 spin-off jobs for suppliers, vendors and things of that nature,” Leatherman said.

Economic leaders and lawmakers say they worked hard to recruit Boeing, and now Boeing will turn to South Carolina’s workforce to help make the company a success.