Tuesday, September 21, 2010

Virginia's Gateway Region casts a global net


Renee Chapline and her staff logged more than 50,000 miles on "fishing trips" last year.

As a Southside Virginia "country girl" at heart, that's how Chapline likes to describe her work, which involves casting for business prospects all over the world.

"They're fishing trips for companies," said Chapline, who for five years has served as executive director of Virginia's Gateway Region, an economic development group that promotes a swath of the state along the Interstate 85 and 95 corridors south of Richmond.

The travel and competition for jobs is a labor of love for Chapline, who wasn't born in Virginia but grew up in the state and has worked in economic development for more than 10 years.

She goes about her work with a kind of zeal that is borne partly from having seen economic loss at its worst.

She can describe in detail "the day that 2,000 jobs went away at 5:05 on a Friday afternoon."

Chapline worked for the city of Martinsville in legislative and public affairs in 1999 when textile company Tultex Corp. filed for bankruptcy and announced it was closing its Martinsville operations, putting 2,000 people out of work

"You don't know bad times until you have seen a city of 15,411 people lose 2,000 jobs," she said. "We saw a lot of negative things happen."

"That was a turning point for me, when I realized that this is what I should be doing," she said. "I have to support job creation. If you give a family the ability to work, then you give them the ability to create the American dream."

Chapline "is somebody who never says die, never says give up and doesn't take no for an answer," said Dia Nichols, the chief executive officer of John Randolph Medical Center in Hopewell and president of the business council that advises the Gateway Region organization.

"That is what you have to be when you are in that role," he said. "She has got a unique background in terms of where she has come from that really helps her to be successful at getting it done."

Chapline, 44, was born in Oklahoma, the daughter of a military man.

Her family moved to Pittsylvania County, where her mother is from, when she was young.

After college at Averett University in Danville, she moved around for a while, including living in the Atlanta area for several years, but eventually she returned to Virginia. "I am a true Virginian," she said.

"Most of my career has been spent in the Southeast, but I have been all over the world many times," she said. "I believe the Southeastern United States offers the best opportunities for economic development than anywhere in the world right now."

Despite the recession, the economic future looks favorable for the Gateway Region, in large part because of some major ongoing projects such as the expansion of Fort Lee and Rolls-Royce PLC's construction of an aircraft engine components plant in Prince George County.

Together, those projects promise to create thousands of jobs and attract new suppliers and service companies to the area, and Chapline is spending a lot of her time focusing on attracting new companies that could benefit and want to be close to the developments.

Chapline has some tasty bait for the fish she seeks.

The 2,400-square-mile region, which includes the cities of Petersburg, Hopewell and Colonial Heights and the counties of Chesterfield, Dinwiddie, Prince George, Surry and Sussex, has a lot to offer prospective employers, she said.

"We are the gateway for a lot of things," she said, adding that the region has good access to transportation networks and Virginia's ports, a solid work force, and a lifestyle that encompasses rural and urban settings.

"Location, location, location is what companies are looking for," she said.

Still, the business of economic development has gotten tougher since the economic downturn, she said.

"I recently got back from a trip to Europe, and we are not in this ship alone," she said. "I was in Ireland and saw unfinished projects everywhere. It truly is a global recession."

"Things are slower here as well, but I think we have had some significant economic drivers that have helped keep the momentum in the Gateway Region stronger than in many parts of Virginia and the United States," she said. "Our region is very fortunate because of the community's hard work during the times when the economy was good."

When she's not on a fishing trip somewhere, Chapline might be seen driving business prospects around the area in the Gateway organization's "industry recruitment vehicle" - a seven-passenger Toyota Highlander hybrid.

"A lot of the companies that we work with are focused on energy savings, and it makes a good impression with the clients for us to be doing our part," she said.

That reflects one of the changes she has seen in economic development, toward an emphasis on green energy.

"For instance, 10 years ago, I was not looking at windmill blade manufacturers," she said. "I wasn't looking at organic food processors. But these are the kinds of things you see now."

The type of investments and jobs that are being created is changing as well, she said. Investments can be significant now, but a $100 million project 10 years ago that might have brought 400 to 500 jobs could bring no more than 50 jobs today.

"There are more advanced technologies and fewer employees needed to operate them," Chapline said.

That is one reason why she also emphasizes the role of homegrown, entrepreneurial businesses.

In the wake of the economic crisis, "I think we have got to focus on a lot of things differently," she said. "There is going to be a greater role for entrepreneurial development. Economic developers have always recognized that homegrown companies are good for the economy because they are usually very committed to the area they are established in. That's probably going to be a larger piece of the pie."

Among the projects Chapline likes to point out with particular pride is the work being done in Petersburg and Hopewell by developers such as Dave McCormack, whose Waukeshaw Development firm has renovated warehouse buildings into apartments and condominiums. Its recent projects include Mayton Transfer Lofts and Demolition Coffee in Petersburg.

Chapline "is able to attract businesses that otherwise might not be here and also to bring banking and financial interests here," McCormack said. "A lot of smaller municipalities don't have the economic development muscles on their own, and Renee and her team do a great job consolidating the effort."

"She has a lot of energy and enthusiasm," he said. "Especially here in Petersburg there is a lot of opportunity, but you need a cheerleader for that, and that is where Renee and her team fit a niche."

The Gateway Region organization is a public-private partnership, and during Chapline's time with the group, financial support has tripled, with about 125 private companies contributing more than $5 million to the organization. She oversees a staff of four.

"Our organization turns 50 years old at the beginning of 2011," Chapline said. "We are the oldest regional economic development organization in the commonwealth."

Chapline, who has a grown son, Bobby, lives in Prince George County, where she and her husband, Scott, adopt and raise pit bulls and other abandoned animals.

They have two pit bulls right now - Dozer and Dazy.

Chapline's love for pit bulls seems to parallel her enthusiasm for economic development. She sees the dogs as misunderstood and too-often mistreated, and simply needing to be to be nurtured to become gentle companions. "I guess I have a save-the-world mentality to a point," she said.

She remembers coming across some old economic development marketing materials that emphasized cities around Virginia as having "cheap labor."

"Why would you want to say that?" she said. "Why wouldn't you want to bring quality jobs that pay well for your citizens? You want to come in and work with communities and leave them better than you found them. You want to help them create good jobs for citizens."

Contact John Reid Blackwell at (804) 775-8123 or jblackwell@timesdispatch.com.

Wayne Co. fights fear of unions


When companies are scouting possible site locations for a new plant or call center in the U.S., Michigan and metro Detroit don't usually even make the short list of semifinalists.

Taxation rates can be an issue here; ditto for energy costs. But the biggest deterrent, by far, is labor climate.

It's fear of unionization. It's high labor costs, real or perceived, compared with other states and cities.

So imagine the surprise last week when a group of national site selection consultants from places such as Phoenix, Kansas City and Chicago came to Detroit to hear a pitch about why they should steer clients to Wayne County -- and found that their agenda included a meeting with leaders of organized labor.

That's right. Bob King, president of the UAW; Bill Black, executive director of Teamsters Joint Council No. 43, and officials of the Carpenters union and the Building and Construction Trades Council were part of the team selling Wayne County as a swell place to do business.

Paige Webster, of Foote Consulting Group in Phoenix, has been crisscrossing the country for a decade helping clients choose the best places for new plants or expansions.

Had he ever, in all his travels, met with labor union chiefs?

"No. Never," he told me.

"They kind of hit the beast head-on," said Ann Harts, CEO of the HartsGroup and a former economic development professional in Kansas.

"I was impressed with the business mind-set," she added. "We had very frank, healthy discussions with the labor group about perceptions and misperceptions. Bob King talked about adding value, how the union can help."

That was the point of including labor leaders along with corporate CEOs in the 2 1/2 -day visit, said Wayne County Executive Bob Ficano. "Instead of dealing with the devil-with-horns perception of labor," he said, the site selection consultants had personal give-and-take with the union officials.

"We really have to demonstrate that we are providing the best labor, that the UAW is committed to productivity and to quality, to flexibility," said King, who plans to accompany Ficano later this month on an investment mission to Italy, which will include visits to facilities of Chrysler's alliance partner Fiat.

Webster said he was impressed with the diversity of Wayne County's economy, after seeing the new General Electric tech center in Visteon Village, meeting with a life-science CEO and visiting a movie set. "We got a pretty unvarnished look," he said, noting that a film executive was very frank about the importance of film tax credits to keeping that activity in Michigan. "They follow the dollars."

Hats off to Ficano and his economic team for dealing head-on with Wayne County's historical baggage.

If Michigan and Detroit are perceived as having a negative labor climate, do something about it. Don't try to sweep it under the rug.

There's no political appetite now for a battle to make Michigan a right-to-work state. The reality is that unionization rates are much lower in the state than they used to be, and, in many sectors, wage rates are now lower than the national average.

More straight talk, and less posturing and political sniping, might produce more reactions like this one from Harts, the site consultant from Kansas City: "Everyone we saw around the table was working to create economic diversity and jobs for Wayne County."

And ideally, the clients of those site selectors might not be so quick to cross Michigan and metro Detroit off their short lists.

Contact TOM WALSH: 313-223-4430 or twalsh@freepress.com

Monday, September 20, 2010

New economic-development efforts in Southeast Volusia ready to shine

By MARK I. JOHNSON, Staff writer

When Pierre Lafleur decided to come out of retirement as a shopping cart manufacturer, he set his sights on Central Florida. Not because it is a hotbed of industrial activity, rather the opposite was true.

"It was quality of life," said the self-described "founder, janitor and president" of Cart Tech in Edgewater. The company rebuilds shopping carts for companies looking for an alternative to buying new.

Lafleur said his wife wanted to live on the ocean so he looked at a map and found New Smyrna Beach.

While his business partner tried to persuade him to look west, even enticing him with a building in Sanford, the idea of a daily commute coupled with an available location in Edgewater at the right price kept him in Southeast Volusia. And by the summer of 2009, the "green" company was ready to open its doors in the former Kister Kayat plant on U.S. 1.

"I started with one employee, me, and now I have 46," he said.

Offering a business what it is looking for is a key to the economic development of a region.

"You have to wear the right dress," said Volusia County's Economic Development Director Phil Ehlinger.

He said when a company expresses interest in the area, the agency puts together a package of resources available no matter where in the county it may be. That way a prospect can see if the assembled pieces of the puzzle will fit together.

Timing also plays a role. While there may have been hesitancy in Southeast Volusia in the past, New Smyrna Beach and Edgewater officials, working with both the public and private sectors, are now taking a proactive approach toward boosting the region's economic future.


Using citizen advisory boards, economic road maps, financial incentives and regional resources, city leaders and staff members are working, in some cases for the first time, to develop a coordinated framework on which to build new employment opportunities and diversify their tax bases.

"That signals a new direction for the city," said Tony Otte, New Smyrna Beach's interim economic development director.

Ehlinger said in the past difficulties such as a lack of available sites and advanced planning, coupled with reluctance from some residents and officials to encourage economic development, let some possibilities slip away.

Today, likely because residents hope to keep their quality of life, and want to shift the tax burden from the residential sector to a more diverse revenue source, attitudes have changed, he said.

Much of Southeast Volusia's economy has long been based on residential construction, tourism or commercial fishing and agriculture. There have been some industrial successes -- Edgewater's boat manufacturers -- although these remained in the minority.

"In the past, there was no vision to pass from council to council or from city manager to city manager," said Edgewater City Manager Tracey Barlow. However, with the recent adoption of his city's Comprehensive Economic Development Strategy, that is no longer the case.

The document, funded by a $10,000 grant from Volusia County's Department of Economic Development, spells out city strengths: location, industrial site availability, industrial labor force, a business friendly environment and a good quality of life.

It goes on to recommend officials build on existing creators -- boat building, recreational equipment, commercial and industrial products, in addition to "green technology" and entertainment, recreation and leisure services which take advantage of its waterfront location.

But there are negatives as well. The plan spells out that Edgewater needs to work on communications networks, a workforce lacking high-tech skills, community identity, urban services and amenities, along with a high property tax rate.

Not all of the proposals recommended are theory. The City Council on Monday formalized a variety of temporary impact fee deferments or reductions based on the number of new jobs a business might bring to the area.

One proposal is to offer $2,000 per job for nonresidential development, an incentive that would sunset after one year


New Smyrna Beach's economic push has been coordinated by Mayor Adam Barringer, who not only fulfilled a campaign promise to develop a roadmap similar to Edgewater's for his community, but also heads the economic development advisory board recommended as part of that document.

Barringer's plan sets numerous goals that include: assess and improve the image of the city; keep the public informed about various changes; review and possibly amend policies in place to provide business assistance; and expand performance measures for the city's largest economic engine -- tourism.

Currently, the city offers business improvement grants and beautification projects in core business areas through its Community Redevelopment Agency.

New Smyrna Beach's road map also encourages implementation of a hospitality training program and stimulating development of hotel and convention facilities, such as the proposed Hampton Inn project on Flagler Avenue.

Working with the developer, the city and the Community Redevelopment Agency smoothed the way for the project in terms of financial and land use change assistance to help the hotel become a reality.

Barringer believes New Smyrna Beach's greatest asset follows the real estate adage: location, location, location.

"We have the beach, the Intracoastal Waterway and New Smyrna Beach is a prime location for development," he said. "We are also in close proximity to Interstate 95 and Orlando."

Additionally, the city has been developing a list of shovel-ready or move-in commercial and industrial locations, which it will market to various prospects. That focus takes precedence over efforts to target specific types of companies.

"These sites are very important," Otte said. "We have to focus on the sites available and what is the best fit," whether light manufacturing, offices or showrooms.


In addition to the cities and Volusia County, a possible future player in Southeast Volusia is the recently established partnership known as Team Volusia.

The private-public effort is being developed through the Daytona Regional Chamber of Commerce to promote economic development countywide in collaboration with city and county governments.

"Volusia County is not even on the radar screen in terms of economic development," Team Volusia's interim president George Mirabal said. "What we get is by accident."

However, that could change if the region uses existing assets to attract new development -- composite manufacturing linked to the boat building industry, for example, Mirabal said.

The collaboration took a step forward Tuesday night when New Smyrna Beach officials decided to invest $25,000 to be part of Team Volusia's executive committee.

Another positive for the region pushed by both the cities and economic development programs is a quality work force, according to an executive at one of Southeast Volusia's largest employers -- Boston Whaler and its sister boat manufacturer Brunswick Commercial and Governmental Products.

"A work force is a critical asset," said Boston Whaler president John Ward. "Boat building is all about people."

While neither Ward nor Brunswick's Jennifer Butera were in their respective jobs when Whaler decided to relocate from Massachusetts to Central Florida, both indicated the current atmosphere makes it easy to stay.

While there have been some successes on a large scale, New Smyrna Beach's Barringer sees the region as an incubator of small business growth.

"We are essentially a beach town," Barringer said, although anything is possible.

"Maybe I will be surprised one day."

Whatever form it may take, Southeast Volusia is talking tough about creating a more diverse economy. Now it must turn those words and plans into deeds and results.

Sunday, September 19, 2010

Turtle Power: How San Antonio Beat The Recession

by Derek Thompson
National Journal Magazine

San Antonio -- The Riverwalk is the top tourist destination in Texas, but the narrow river barely looks like it's moving. There is no froth, except for the foam gurgled by Rio Taxis. The river winds through the city, traced by a crowded walkway flooded at night with families and young couples munching on burritos, sipping margaritas, and staring at the water rippling by.

To see the Riverwalk in the summertime is to understand San Antonio: patient, less than dynamic, but always moving. During the downturn, only one major metropolitan area outside famously recession-proof Washington has ranked in the top 10 for the fewest jobs lost and the highest economic growth. It's San Antonio, and -- except possibly for Washington -- it may count as the most recession-resistant city in the United States.

The story of the Alamo City offers a real-life version of the tortoise and the hare. For years, the hares -- in California, Florida, and Nevada, especially -- raced ahead on the tailwind of a real estate boom. The winds have shifted, and debt and defaults have held back the rabbits of the past decade.

But 2010 may be the year of the tortoise. The boom that brought the crash was all about proximity to capital, to exotic financial instruments spun on dizzying home prices. The post-recession era may depend on proximity to capitals, to state governments and federal spending on military, health care, education, and energy. The United States has 52 metro areas with a population of 1 million or more, and last year only three of them saw an increase in both net earnings and personal income. One was Washington. Another was Virginia Beach, a military hub. Then there was San Antonio. The steady city by the lazy river suddenly looks like it's moving.

Why San Antonio?

Call it the "eds and meds" effect. In the past decade, education and health care have been the most dependable -- perhaps the only dependable -- industries in the country. They combined to create 5.2 million jobs between 1999 and 2009, a lost decade when private-sector employment grew by only 1.1 million. San Antonio is home to a $16 billion health care and bioscience industry that employs one of every seven workers in the city. Its 31 colleges and universities enroll more than 100,000 students in a population of about 1.3 million.

San Antonio has a third line of defense against economic despair: the military. Bookended by the Randolph and Lackland bases, San Antonio anchors the country's Air Force training program. The city also won the lottery in the federal government's recent base-closure-and-realignment round, receiving $2.2 billion to build the largest new military medical complex near the city's center, at Fort Sam Houston. The secret to San Antonio's recent economic success, it turns out, is eds, meds, and enlisteds.

Also: hotel beds. Home to Texas's top two attractions (the Riverwalk and the Alamo), San Antonio has a thriving tourism industry that represents one-tenth of the local economy. Even the city's leisure business is somewhat recession-proof. Because San Antonio is primarily an in-state destination -- half of its tourists come from Houston and Dallas -- the city benefits from Texas's buoyant economy.

Cheap rooms, free attractions, and oversized margaritas add to the allure, with San Antonio serving as a backup destination for families on a budget. Once the recession struck, "people stopped taking the major trips overseas or to Disney and Vegas, and they came here," said Davis Phillips, the owner of Phillips Entertainment, which manages three shops that face the Alamo. "When folks stay closer to home, that's great business for us."

Nonmilitary-Industrial Complex

In the hare states, where the bubbles have burst, instability has spilled over into other sectors. When the housing market collapsed, construction companies went under, unemployment skyrocketed, and foreclosures rolled through neighborhoods like dominos. In San Antonio, it was stability that spilled over. "Health care, education, and the military underpin the resilience of our city," Mayor Julian Castro said in his City Hall office. "They've outperformed other sectors, but they also work well together."

San Antonio basks in a military-industrial complex. In this case, however, the industries are not defense-related but health care and education. Take the Health Science Center at the University of Texas (San Antonio). It is a medical research juggernaut, a cancer research center, and a consortium of five schools offering dozens of degrees to thousands of students.

William Henrich, the center's president, cited an estimate that up to 14,500 people here provide supplies or services to the organization. "From something as basic and mundane as food services," he said, "to scientific supplies, to construction for new laboratories, to the services required because of the patient population -- the effect of the health science center reaches into virtually every sector of commerce in the community."

Or take the San Antonio Military Medical Center. It will be "the largest training facility for medical specialties in the world," according to Richard Butler, an economist at Trinity University in San Antonio. In addition to serving the families of active and retired soldiers, the facility underwent a $2.2 billion expansion that accounted for approximately one-third of the city's nonresidential construction in 2009. "The boon from constructing and operating these facilities is going to be a source of jobs for years," said Suzanne Cuda, a physician who oversees the medical construction authorized by the base-closure law.

The ripple effect is wide. Ask Michael Cortez, who explained over the clatter of his 24-hour restaurant Mi Tierra that revenue is down only a few percentage points; his friends in Connecticut, meanwhile, complain about drops of 40 percent. Or ask Bill Holland of Hill County Interiors, who, despite having had to cut back inventory at his furniture store, hears from national reps every week about "how incredibly fortunate we are" compared with the rest of the country. As the economic tsunami swept across the United States, San Antonio's business owners felt the spray without getting soaked.

Tortoise Economics

San Antonio isn't a lonely oasis of stability. It stands near the center of a larger island of prosperity that is Texas. Six of the nation's 21 most resilient cities are in Texas, according to the Brookings Institution's Metro Monitor. No other state has more than two. (See sidebar, next page.)

The secret to Texas's success is well documented. The state experienced only a modest real estate bubble, mostly thanks to its vanilla lending practices after the savings and loan crisis in the mid-1980s. High energy prices through 2008 delayed the recession's onset in this oil-rich state. A diversified economy with low taxes, easygoing regulations, and cheap labor softened the downturn and has hastened the recovery.

The steady state of eds and meds -- and government -- has saved other cities as well. "Look at these cities in the middle of the country," said Alan Berube, the research director of the Brookings Institution's metropolitan policy program. "Des Moines. Omaha. Kansas City. Each has a ... mixture of government employment and universities, and a diversified service sector." Each depends on local businesses, such as in health care, that have thrived. And like Texas, they avoided the housing bubble.

The Lone Star State may be known for its don't-mess-with-Texas swagger, but San Antonio's boosters rather liked hearing their city described (even by a Yankee reporter) as a tortoise. The most common response to the analogy was a smile of recognition. Jealousy of Dallas and Houston for their faster growth either did not exist or was politely disguised. "Any time that you see somebody else with the highs, you take note of that," said Angela Shields, president of the San Antonio Board of Realtors. "But we're grateful that we don't see the lows."

Bill Lyons, the owner of Casa Rio, the first restaurant built on the Riverwalk, was downright enthusiastic. "We just haven't gotten into a hurry about things. There's sort of a siesta mentality to the city, and the benefits can take years to see."

A lazy river, however, won't lift many boats. San Antonio's wages recently ranked 62nd out of 77 metropolitan areas surveyed by the Labor Department -- behind Birmingham, Ala., and Oklahoma City. "The reality is, we are a poor city," said Sylvia Romo, a tax collector and assessor. "We don't have a big enough tax base to attract large companies with tremendous [tax incentives]."

Mayor Castro suggested he wouldn't mind seeing the city's economy get a little more frothy. Rapid development in high technology "might leave San Antonio more vulnerable to the ups and downs of the economy," he said, "but the rise in income levels is worth that trade-off."

Castro's vision for San Antonio during the decade to come looks like Rackspace, a blossoming information-technology company that recently set up offices in an abandoned shopping mall on the city's outskirts. Rackspace bought the 1.2-million-square-foot building, gutted it, filled it with inexpensive desks, and turned it into the headquarters of a 3,000-employee server-management company.

"We want to do for San Antonio what Dell did for Austin," said Randy Smith, the company's director of real estate. Even as Rackspace's business grows by 30 percent a year, the company is emphatically a creature of San Antonio. Rackspace frames its mission with the same service-first attitude that underpins the city's twin pillars, the military and medical training. "We're not a technology company," Smith said. "We're a service company. Service is what we're all about."

That's an attitude that has bolstered this city through the lingering recession and may well protect it during the recessions to come.

The author is a staff editor for TheAtlantic.com.

Pure Michigan ad campaign is in jeopardy

Louis Aguilar / The Detroit News

The state's harsh financial climate has killed the Pure Michigan advertising campaign for the fall and makes prospects bleak for whether the successful tourist promotion will return.

The office behind the Pure Michigan commercials, including the popular summer ad featuring the voice of Michiganian actor Tim Allen, was cut to $17 million this year from $28 million in 2009, forcing it to freeze the fall promotion despite a robust summer tourism season.

Travel Michigan, a business unit of the Michigan Economic Development Corp., had spent as much as $2.1 million on out-of-state fall ad buys in markets like Chicago in 2008 before the budget was cut to $1.7 million in 2009 and then erased for this year, as The News reported earlier this month.

"Canceling the fall campaign was not something we wanted to do, but there was no other choice," said George Zimmermann, vice president of Travel Michigan.

It could get worse. State legislators are grappling with a projected budget deficit of more than $400 million for fiscal year 2011, which starts Oct. 1. Legislative proposals would slash Travel Michigan's budget by two-thirds to $5.4 million.

"As proposals stand now, we likely won't have the money to continue any advertising campaign," Zimmermann said.

The ad campaign began in 2006, and 90 percent of its focus was to attract more out-of-state visitors because state tourism officials realized they could no longer rely solely on Michiganians, who account for 70 percent of the state's travel volume.

The state has lost almost 900,000 jobs since 2000, which has led to an exodus that has resulted in four consecutive years of population loss, said Dan McCole, an assistant professor of commercial recreation and tourism at Michigan State University in East Lansing.

"And yet the state's tourism industry is expected to improve by 3 to 4 percent this year," said McCole, who closely follows the state's tourism industry and attributes some of this year's tourism boost to the out-of-state ad campaign.

"The Pure Michigan campaign is very effective and timely," he said.

When the Pure Michigan budget was cut this year, tourism officials decided to focus its efforts and cash on the larger summer tourism season. And tourism-related activity in Michigan was up about 5 percent from last year for the period prior to the Labor Day weekend.

"It has done wonders for us," said Michael Norton, spokesman for the Traverse City Visitors and Convention Bureau. He noted most tourism-related businesses reported 30 to 40 percent increases from last summer, which was marred by bad weather.

"Those beautiful ads broke trail for us in markets we were not previously reaching," he said. "This summer, we noticed traffic from Kentucky, Maryland and Minnesota."

Since 2006, the state has spent a total of $31.7 million out of state on Pure Michigan ads. It lured an estimated 5 million out-of-state visitors who spent $1.3 billion, which generated $93.2 million in state taxes, according to Longwoods International, which tracks tourism spending.

That amounts to $2.94 of state tax revenue for every ad dollar spent by Travel Michigan on the campaign.

The Pure Michigan promotions have received many accolades. Forbes magazine ranked it sixth in its list of Top 10 best ever tourism campaigns. The U.S. Travel Association, the national group representing U.S. travel industry officials, honored it as the best state tourism ad campaign for four consecutive years.

The promotional blitz helped make Travel Michigan's website -- www.michigan.org -- the most visited state tourism website for three consecutive years. In 2009, the site attracted 12.7 million unique hits.

The legislative fight over Pure Michigan's future is far from over, said Steve Yencich, president and CEO of the Michigan Lodging and Tourism Association.

"Next week, we intend to personally meet with our policy makers and remind them of the importance of tourism," said Yencich, who added that the group supports a $30 million budget for Travel Michigan and a plan that would dedicate a portion of the state's sales tax revenue to continue the Pure Michigan campaign.

"It is one of the industries that will play a pivotal role in a better future for Michigan."

laguilar@detnews.com (313) 222-2760

Internet could be key to economic development in WNC

Written by Bibeka Shrestha
Smoky Mountain News

Western Carolina might never be the next Silicon Valley, but experts say improving Internet access could help kick-start the region’s economy.

David Hubbs, CEO of BalsamWest FiberNET, said with the manufacturing sector mostly on its way out in WNC, it’s time to look to a new kind of model for economic development.

“The days of hoping for a factory to come to town, that’s probably not going to happen in the foreseeable future,” said Hubbs. Nurturing a tech-friendly environment would level the competitive playing field and allow students to stay in the area after they graduate, however.

“We’re helping to create an opportunity for people who grow up here,” Hubbs said.

Robin Kevlin, co-owner of Metrostat Communications, a Sylva-based telecom company, provides services to certain companies that would not have stuck around WNC without access to quality Internet service. The Internet can be an important tool in recruiting new businesses and promoting economic development, Kevlin said.

“Because of the way the land is around here, you’re not going to bring in a Dell Computer,” said Kevlin. “But you can bring in the smaller companies.”

For many companies, the Internet is not a luxury but a real need.

“Internet connectivity is as basic as water, sewage and infrastructure,” said Pam Lewis, senior vice president of entrepreneurial development at AdvantageWest, a regional economic development arm.

Preparing for 2013
Earlier this year, the Nantahala Gorge was named as the site for the 2013 Freestyle World Championships in kayaking.

The Nantahala Outdoor Center is equipped with high-speed Internet from BalsamWest FiberNET, but only at its headquarters. Fiber is not an option at branch offices, where Internet is both expensive and unreliable, according to Kevin Sisson, Chief Information Officer at the Nantahala Outdoor Center.

“If it rains, it’ll go down, or if it’s foggy, it’ll go down,” said Sisson. “It really hampers the ability of these branch offices to connect to our reservation system.”

Sisson and others in the rafting community are worried about the Gorge’s preparedness for the kayaking championships. Lack of widespread Internet access might make it difficult or impossible to upload event photos or videos.

“We’re going to have an international community arrive here,” said Juliet Kastorff, owner of Endless River Adventures. “Journalists, competitors, families that get here and have no high-speed wireless.”

The Internet is a necessity even during the regular tourist season. Kastorff says that about 10 percent of tourists anticipate working during their vacation. They sometimes rule out a travel destination if Internet connections are spotty.

Varied uses
The web is not just useful for browsing endlessly on YouTube or Googling for directions.

With the Internet increasingly being used to educate, children in WNC will need better Internet access at home as well as school.

John Howell, owner of Telecommunications Consulting Associates in Waynesville, said students in other regions are receiving laptops as early as the ninth grade. They complete assignments requiring Internet connections and interact with teachers via email.

“If a kid’s got dial-up, he or she can’t compete with kids from more populous areas of the state,” said Howell.

Data-intensive entities, like hospitals and Internet-based companies, also need the Internet to simply operate. The hospital group, MedWest, processes millions of transactions every month. On top of billing and registration data, hospitals need high-speed capacity for sending X-rays, MRIs and detailed medical records to doctors.

Since the creation of MedWest in January, administrators have also discovered a need for video conferencing to avoid excessive travel.

Kevlin said that the Internet is immensely useful for cutting down on pollution.

“If we’re going to be a greener society, more people are going to be working from home,” said Kevlin. “They need the tools necessary to do that, and broadband Internet is part of that.”

Maury Alliance hopes to attract 2K jobs


Local economic development officials are set to unveil an ambitious plan — funded by both public and private sectors — designed to bring more than 2,000 jobs and $140 million in capital investment to the county over the next four years.

The Maury Alliance’s four-pronged strategy will significantly ramp up efforts to both recruit new businesses and help existing companies expand. It also strives to strengthen the local workforce and attract new residents to the county.

To execute the plan, the Alliance has asked for a $2.75 million commitment from the community — $1.65 million of which would come from the private sector.

Alliance President Brandom Gengelbach said he views the promised jobs and capital investment not as goals but as benchmarks that must be met.

“We need to do it, and we’re going to be held accountable as an organization. This isn’t ‘let’s give us our best shot,’” Gengelbach said. “There will be consequences with us not achieving those goals. Certainly from the private sector, they’re not doing this because it’s a sweet thing to do. They’re doing this because they want to see the community grow and they know the bottom line will help them.”

Randy Wilmore, chairman of the Alliance’s board of directors, said that until now the Alliance’s economic development efforts were funded almost solely by city and county governments.

The organization receives $175,000 annually from the county, $100,000 each year from Columbia, while Mt. Pleasant now chips in $4,000 a year and Spring Hill contributes $2,500. The county has long lagged behind other communities in getting investments from the private sector, he said.

The Alliance has already secured $1 million from private entities and $1.1 million from the public sectors to help finance the four-year effort that’s being called the Economic Development Partnership.

“At this point I think we’re on the right trajectory to get to our goal and fund our plan completely,” Wilmore said.

The plan calls for Alliance officials to meet with 80 of the county’s largest employers each year to assess opportunities for growth and also conduct “relationship building” visits with companies that have out-of-town headquarters to encourage additional investment here. The Alliance will also produce an annual report citing obstacles to business growth and look for ways to boost local business-to-business merchandising.

Other objectives in the plan are to identify, purchase and develop land near Interstate 65 for new business and commercial parks as well as selecting sites for new retail locations.

The strategy also calls for a renewed effort to attract industries to the Cherry Glen Industrial Park in Mt. Pleasant. Alliance officials would work with the Tennessee Valley Authority and the state to revisit the Cherry Glen master plan, expand the list of potential industries for the business park, and develop a marketing plan to target those companies.

Efforts to market Maury County to companies in foreign countries are also included in the plan.

“We’ve used the terms international or global marketing and strategies, but we’ve never had a way or a plan to do that,” said Charlotte Battles, co-chair of the Alliance’s Economic Development Partnership. “Lip service is good, but sometimes you go out and have to really make things happen if you want them to happen.”

Gengelbach said the recent announcement that Japanese-owned auto parts maker IB-Tech will start manufacturing seat adjusters in a 144,000-square-foot building in Mt. Pleasant by 2012 can only help the effort to reach out to foreign markets.

“You’re going to be a whole lot more effective walking into a Japanese corporation with IB-Tech on your arm talking about their investment in Mt. Pleasant than you are just by yourself, saying “Hey, have you heard about our community.’”

Maury Regional Medical Center is among local companies stepping up its investment in the Alliance. Maury Regional Chief Executive Officer Robert Otwell, who is also a co-chair of the Alliance’s partnership, said that the hospital is chipping in $100,000 over the next four years.

“If we were able to help reduce our unemployment from the 15 percent level, certainly to something below 10 percent, by this investment that we’ve made it would be the greatest return we could get by getting more people working that have good jobs with insurance that can pay for their health care,” Otwell said.

Otwell believes the economic partnership will help unify the county, and he said some individuals are stepping forward to help fund the plan.

Wilmore said he’s confident the Alliance will be able to meet the targets for jobs and capital investment set forth in the plan.

“I really think we’ll outdo that,” Wilmore said. “I’m optimistic that’s going to happen.”

Alpharetta sets its sites on the future

Unlike some North Fulton communities, Alpharetta saw the writing on the wall two years ago and braced itself for the difficult economic times on the horizon. And though production, employment, and savings squalls kept the sun away, Alpharetta fared rather well. And now, as the storms continue to swell; this city builds its shelter for the arduous times ahead.

With untapped city and emergency reserves, a balanced budget, and a $1,000 bonus awarded to all city employees this year (due to their patience in the no-raises conformity during the abovementioned two years); Alpharetta enlisted the guidance of Market Street Services -- together with their retail specialty subcontractor, The Buxton Group -- this July.

At Tuesday's city council meeting, Christopher Jones, Economic Development Coordinator presented the following information: Market Street Services responsibilities for the 2020 Economic Development Plan would be the following: Programs that address business retention, entrepreneurship development, industry sector analysis, competitive analysis, incentives, economic development partner alignment, marketing and PR. They will also aide in the needed policies, regulations, and procedures to put said programs in place.

The 2020 plan will also include an implementation schedule, and identify goals and strategies for same.

A series of individual interviews and group meetings are the first step. These will be conducted in late September and involve the mayor, city council, the development authority, business leaders, Home Owners Associations, and Civic/Education leaders.

After explaining each stage of the process in detail, Jones summed up the pertinent points by stating, "Our competition is also going to be addressed in this. Because we're not looking at competition that most people think might be Roswell or Norcross. Our competition is in Charlotte, Texas, the suburbs of Houston and Dallas. That's where we have to remain competitive."

Watching Alpharetta's Mayor and City Council on Sept. 7, one understands why "There is no 'i' in team." All were united in this significant endeavor as in the numerous others positive decisions and actions made by the city in the last few years. Not only in the confines of city hall, but down every street, and many neighborhood. Perhaps, this is why their healthy bottom line exists.

Councilmember Douglas DeRito said it best, however, with these words "We have done an outstanding job in building this city out. And the key to the next economic development for the next ten years is sustaining that advance posture of staying ahead of the curve and creating an environment that attracts people here...We have to keep our eye on the ball."

Nevada economic agencies compete for commerce

RENO, Nev. — They may tout the same mission, but some business analysts suggest northern Nevada's economic development agencies need to work together more, and perhaps consolidate, to lure industries and revitalize the state's ailing economy.

The Northern Nevada Development Authority represents Carson City, Douglas, Lyon and Storey counties. The Economic Development Authority of Western Nevada covers the Reno, Sparks and Lake Tahoe region.

Six years ago, the agencies announced a joint operating agreement to pool resources. But it was never approved by EDAWN and NNDA boards, said Chuck Alvey, CEO of EDAWN since 1998.

"They wanted their unique identities," Alvey told the Reno Gazette-Journal. "We all got busy with other things."

Pessimism in the recently released Sierra Region Economic Outlook Mid-Year Business Survey has renewed calls for greater unity to "turn this economic beast around," as Northern Nevada Development Authority Executive Director Rob Hooper put it.

"It's a matter of getting everyone on the same page," said Greg Mosier, dean of the University of Nevada, Reno College of Business, one of the survey's sponsors.

"In some ways, they've tried to do that, but it's never been everyone in the room at the same time," Mosier said. "I don't think there's been a team effort so far. It's going to be a train wreck going forward. We've got to say, 'What are we going to do?'"

In summer 2008, the economic development arena was further splintered when Kris Holt, a former head of NNDA, launched Nevada Business Connections, a private Carson City-based group. Holt said it has grown to more than 200 members regionwide.

"I was approached by a dozen local business people who said nothing was going on with economic development," Holt said.

He said he considers his group a complement to NNDA and EDAWN.

"They can go after Fortune 500 companies. That's fine," Holt said. "We're all trying to do the same thing, create jobs. But we're not bound by geographical boundaries."

But Holt also acknowledged there might be too many economic development entities for the region.

"At times, we do cross over. Maybe there needs to be one big group. Really, it makes sense," he said. "There's only so much of the pie out there."

Mike Skaggs, executive director of the Nevada Commission on Economic Development, said consolidation has been discussed in the past, and he thinks the issue it could emerge during the 2011 Legislature.

He said doesn't see a need for consolidation, but would like better communication between agencies.

"We need all hands on deck in this economic environment," he said. "A 'we're in this together' attitude needs to be fostered."

Information from: Reno Gazette-Journal, http://www.rgj.com

Copyright © 2010 The Associated Press. All rights reserved.

Marketing Win: ‘Project Fly’ lands in NC

Posted By David Boraks

Switzerland-based ABB Inc. plans to invest $90 million to build a manufacturing plant for electric power cables in Huntersville’s Commerce Station business park, which is jointly owned by the towns of Huntersville, Cornelius and Davidson. An announcement by state, local and company officials at the park Thursday said the new plant would create 100 jobs over the next two years.

The announcement caps a secretive year-long recruitment effort, dubbed Project Fly, by state and local officials. In the end, state and local grants helped lure ABB to pick Huntersville over another site in a neighboring state.

Jerry Broadway, director of the Lake Norman Regional Economic Development Corp., [1] said it was a long-awaited win for local recruiters, and for the towns. “As far as the business park is concerned, this takes the remaining available site off the market. We had actually been holding it off the market for them for a couple of months,” he said.


In a press release, Mike Griffin, chairman of the Lake Norman Regional EDC, said, “This win points out the importance of regional development efforts. The Lake Norman Regional EDC and the Charlotte Chamber worked in partnership with the North Carolina Department of Commerce to land this project.”

Besides creating jobs, the announcement is something of a payoff for the towns, which have invested millions of dollars to assemble the property and improve roads and other infrastructure in hopes of luring a major facility like ABB’s.

State and local officials first learned of the opportunity in August 2009, when a site selection consultant approached them in search of a plant site.

The park is owned 60 percent by Huntersville, 25 percent by Cornelius and 15 percent by Davidson, and they share proportionally in expenses and any eventual revenues it generates, according to Mr. Broadway.

It wasn’t clear Thursday when or if the towns might generate revenue from the deal. Davidson Town Manager Leamon Brice said it’s possible the towns could share in revenue from the sale of the land, though he wasn’t sure of the purchase price. Mr. Broadway said the park’s management and the towns also could decide to reinvest proceeds in building additional infrastructure to open up more parcels in the park for future development.

The towns own about 126 acres at the park, off N.C. 115 in Huntersville, about 2 miles north of I-485. Along with additional privately owned parcels, the park eventually could total 350 acres, Mr. Broadway said.

The park’s only other tenant at the moment is Prairie Packaging, which Mr. Broadway said now has about 300 to 350 employees in the park.

Huntersville Mayor Jill Swain said in a press release that the town had revised its zoning code and taken other steps to help seal the deal. “The town board has worked diligently with the Lake Norman EDC to remove obstacles and address issues to make the Commerce Station site ready for ABB,” Mayor Swain said.

Officials said Thursday that the company’s decision came in part because of incentives, from the state’s Job Development Investment Grant program and One North Carolina Fund, as well as local Business Investment Partnership grants from Mecklenburg County and the Town of Huntersville.

Mayor Swain said the Huntersville Town Board would take action at a meeting soon on those incentives. “This is the largest economic development project we have ever been involved in and we didn’t want to take any chances on losing it,” she said.


ABB is the world’s largest provider of transmission and distribution equipment and technology for electric power grids. In The new Huntersville plant will make high-voltage land cables for power transmission. The company said that while wages will vary by job functions, the average wage for the new jobs in Huntersville would be $64,008. That’s above the county average full-time wage of $48,776, according to a press release Thursday.

ABB’s North American Power Systems and Power Products divisions are headquartered in Raleigh, and it has 771 employees in the state. In picking a Huntersville location, it adds yet another facility in N.C. and becomes the latest in a series of companies in the energy industry to focus on Charlotte.

“The Charlotte region is becoming a hub for companies in that industry sector. There’s already a critical mass of power related companies located here,” Mr. Broadway said.

In a press release, Enrique Santacana, region manager for ABB in North America, said, “We have a very good and long-standing relationship with the state of North Carolina. The combination of proximity to transportation, top-notch engineering talent and an attractive living environment made Huntersville an excellent choice for this new cable facility.”

ABB said it expects to begin hiring for the new jobs in the second half of 2011.


Article printed from DavidsonNews.net: http://davidsonnews.net

Is Denver metro area attractive to outside business?

By Tom Clark

Every day, metro Denver is under some company's microscope, being examined from every direction as a potential site for a new business expansion.

Recently, nine site selection executives who make their living performing those analyses and making recommendations to clients were guests of the Metro Denver Economic Development Corporation for our annual Metro Denver Site Selection Conference. They came to learn about metro Denver's economy and to tell us about how effectively we compete with other regions around the globe.

They were the "professors," we the eager students.

We were told that our incentives for corporate relocations and expansions are modest. But we already knew that. What we didn't know was that many companies perceive our lack of incentives as a signal that Colorado is not pro-business. This surprised us.

In the last four years, Colorado has significantly improved the type and quality of incentives for corporate expansions and relocations. Today we are on par with our competitor states, except, of course, Texas. (No one has more money than Texas.) We have been hesitant to extol our new incentive programs during these difficult times because we worry that the next collection of state legislators will abandon these new programs.

Our guests admired metro Denver's ability to get big things done. As one said, "We go to many places where they talk about doing great things. You just do them." They pointed to projects such as Fitzsimons, DIA, FasTracks, the professional sports stadiums, the convention center, etc. We affirmed our national reputation as a center of regional cooperation among business and governments when our visitors learned that most of our civic accomplishments in the past years came through collaboration among cities, counties and state government, in partnership with the private sector.

Two of the site consultants said that prior to attending the conference, they saw Colorado as a place where "people work only hard enough to pay for their outdoorsy, recreational lifestyle." A panel of local companies that expanded or relocated to the region dispelled that impression, however. Joe Potter, vice president and CFO of United Launch Alliance, and Hugh Westermeyer, senior vice president of Charles Schwab Investor Services, extolled the hard-working nature of their employees and the depth of talent available here.

Four hundred area businesspeople attended a sold-out panel discussion with our guests at the end of their visit. One of the site selection consultants was impressed at the level of involvement in economic development by private-sector leaders, while another conference attendee, after seeing DIA Manager Kim Day's presentation on the airport's proposed expansion, reminded us that non-stop, direct flights to other parts of the globe are a crucial, even essential element in the competition for new jobs.

What we were reluctant to talk about are three initiatives looming on the November ballot. Proposition 101 and Amendments 60 and 61 are stalking Colorado's economy, aiming to deliver a punishing blow to the efforts of the past 25 years to diversify the economy and create more jobs. Instead of fostering a recovery, these initiatives would cost Colorado another 70,000-113,000 new jobs. That's almost as many jobs as we've lost in the recent, deep recession. Except this recession won't be brought on by Wall Street scoundrels; this will be a "voter-approved" recession, approved by the likes of you and me.

If these initiatives pass, we'll spend all our time trying to explain to the national and international business community why Colorado, known globally as a center of innovation and high personal incomes, voluntarily committed economic suicide.

Listening to our guests, who have their fingers on the pulse of where new jobs are coming from, I'll be voting "no" on these initiatives. It's just too risky. The potential of hurting our economic comeback is not something I want to be a part of. And judging from our guests, this would no longer be a state where they would feel comfortable bringing new jobs.

Tom Clark is executive vice president of the Metro Denver Economic Development Corporation.

Friday, September 17, 2010

Twin Cities to get in game of selling image

To the relief of many, a regional economic development agency is taking shape to help brand the metro area as open for business.


The Twin Cities is about to get a head marketer.

Saying the metro area needs to brand itself and court new business in a unified way, the Itasca Project has been quietly creating a new regional economic development agency it wants up and running by the new year. At a time when money is tight, it's out raising an initial $2.8 million for the effort and has just launched a national search for a director.

"We are the largest metro area in the nation without a regional entity," said Kathy Schmidlkofer, a General Mills financial executive heading up the effort to create the as-yet-unnamed agency. "We've maybe rested on our laurels a little bit."

St. Paul Mayor Chris Coleman has pledged $125,000, subject to the council's approval, and noted "we were in first."

"We're getting beat on a regular basis in a game that we're not even playing," Coleman said. "Every site selector that we talk to says we're not even on the list of potential cities."

Schmidlkofer has been working on the project full time for the past year for Itasca, an alliance of influential CEOs and public officials from around the area including Ken Powell, General Mills' CEO. The group largely works out of the Minneapolis offices of consulting firm McKinsey & Co. and is perhaps best known for a report it released a few years ago on achievement gaps in Minnesota's schools.

Last April the Itasca Project released another report saying the area's business rankings were dropping, its economic development efforts were too fragmented and a regional game plan is needed to jump-start the state's ailing jobs machine. The Twin Cities just isn't on the radar of site selectors around the country that companies hire to find new locations for them, it said.

The new entity is a work in progress, Schmidlkofer emphasized. But it hopes to have a director in place by Jan. 1, with an operating budget for 2011 of $2.8 million and a staff of perhaps 12 people. The goal is to increase the annual budget to $4 million and the staff to about 20 after a few years, she said. Finding an office is on the to-do list.

It has hired Chicago-based DHR International Inc. to lead the executive search. Michael Langley, the former head of Pittsburgh's regional economic development agency, has been working with the Itasca Group as a consultant on the project.

Schmidlkofer wouldn't say how much of the $2.8 million she's raised so far, but said most of the money will come from corporations, with roughly one-third coming from cities, counties and other public bodies. No state money is going to it.

The effort appears to be gaining broad support despite both public and private belt-tightening.

Burnsville, for instance, earlier this year made a permanent $3.5 million budget cut. But it has $25,000 in its annual budget for the new economic development group. The City Council won't vote on the budget until December. As Burnsville Mayor Elizabeth Kautz sees it, her city had just one economic development person on staff and couldn't create its own marketing campaign for $25,000. She said she's not concerned that any new jobs the group might create wouldn't necessarily wind up in her city.

"We need to continue to market our city so we attract new businesses," Kautz said. "We can't do this alone."

Minneapolis Mayor R.T. Rybak has committed $150,000 in his budget for the project, although the amount still needs City Council approval.

Chief of staff Jeremy Hanson Willis said the city's contribution would come from the budget for its Economic Development Department. "I can't imagine creating a regional economic development entity without Minneapolis being part of it," he said.

Hennepin County has been asked for a contribution of around $150,000 but nothing has been committed, said Patrick Connoy, the county's economic development manager. Ramsey County would only say it hasn't committed anything.

Even tiny Rosemount, a city of 22,000, has given a preliminary pledge of $10,000 to the entity.

"There's benefit to the public tax base," said Rosemount city administrator Dwight Johnson. "This gives the metro area a regional entity to market the area national and globally."

A similar public-private economic development group called Advantage Minnesota operated in the 1990s to market Minnesota, but with relatively limited results, a person familiar with that group said.

Separately, Rebecca Driscoll, formerly Yanisch, Jesse Ventura's commissioner of Trade and Economic Development, said that it's tough to measure results of such collaborative economic development groups.

Dane Smith, president of the policy group Growth and Justice in St. Paul, also gave the effort a thumbs-up.

"I do think that something beyond 'no new taxes' as an economic development strategy makes some sense," he said. "The Itasca Group has a reputation for being thoughtful and not ideological."

"I like this idea of branding," Smith added. "Our brand is progressive. Economic fairness is our brand."

jennifer.bjorhus@startribune.com • 612-673-4683

dave.phelps@startribune.com • 612-673-7269

Economic development shouldn’t be about branding Michigan

George Erickcek

Twenty five years ago, my former supervisor told me that there was very little economics in economic development.

As a young economist, of course, I disagreed.

Since the goal of business is to maximize profits by producing goods and services the market wants at the lowest costs, it only made sense that economic developers would focus their efforts on ensuring that their region provided a competitive environment for their firms. However, once again, experience trumps theory; my supervisor was right.

Economic development efforts to “brand” a region and identify target industries are less associated with economics than with marketing, and, I believe, they also are misguided.

In consumer markets, branding makes sense. Harley Davidson doesn’t sell motorcycles; it sells the idea that a nerdy economist can become a reckless, young Marlon Brando on the weekends. Nike doesn’t sell shoes; it sells the dream to a middle-age guy that he can run faster and jump higher than he did when he was younger.

Target marketing also makes sense when it comes to consumer goods. If your product is aimed at tech-savvy youngsters, you don’t hawk it on the network evening news. On the other hand, if you are selling anti-depressants …

For economic development, I question the worth of both activities. It is highly unlikely that if you brand it, companies will come. Regional brands are describers of what is already there, not what could be there. Companies located in southern San Francisco Bay were producing computer components before the region was branded Silicon Valley.

Detroit was branded the Motor City because it was the center of the domestic auto industry. Kalamazoo once was branded the Celery City and then the Paper City. Pittsburgh was, of course, known as the Steel City.

We now know how those brands played out.

I believe that businesses care little about such notions as the Green Belt, Michigan: the Alternative Energy Capital of the World, Automation Alley (Southeast Michigan), or the Other West Coast (West Michigan). They want to know if the area’s work force will meet their needs and if the necessary transportation infrastructure is in place. They should already know if the region is a good market location for their goods or services.

As for targeting industries, I just don’t believe anyone is that good at forecasting. I agree that the market for health care products and services will only grow due to the aging population in almost all developed countries. I am also willing to go along with the need to explore alternative energy sources.

However, I question if anyone knows what technology or product is going to come out on top in either industry. If the French are successful in their efforts to commercialize fusion energy, it will have a sudden and severe impact on wind, solar and battery technologies. A new battery design could be announced next week in Germany or Japan that could leap frog over current designs being produced.

In short, targeting not only requires you to pick the right race; it requires you to pick the right horse.

High-growth firms exist in nearly all industries. Maybe we should target them and not their industries.

With my last economic development dollar, I would rather spend it helping our existing firms achieve their potential. Moreover, I am not opposed to giving them a little push in developing new products and services or encouraging their better employees to start up their own enterprise.

I would spend that last economic development dollar on customized training programs, a business retention call or a business leadership or innovation program, long before I would consider spending it on a branding campaign targeted at a specific industry.

In short, let’s put economics back into economic development and leave branding and targeting to the hawkers of consumer goods.

George Erickcek is senior regional analyst at the W.E. Upjohn Institute for Employment Research in Kalamazoo.

Monday, September 06, 2010

North Carolina’s Southeast Unveils Economic Development Strategic Marketing Plan

The Bladen Journal

ELIZABETHTOWN —North Carolina’s Southeast, one of the seven regional economic development partnerships in North Carolina, has unveiled its strategic marketing plan for 2010-2011.

NCSE’s mission is to provide strong economic development leadership in southeastern North Carolina through innovative marketing and collaborative regional initiatives that will create new jobs, generate capital investment, and secure new business locations. Within this mission is a long-term goal to help the southeast region become as globally competitive as possible in the area of quality job growth.

NCSE is cognizant of the slow economic recovery and is designing innovative economic development approaches to help the region. Since 1996, NCSE has generated or assisted in the location of 103 companies, more than 8,000 jobs, and more than $900 million in private investment to the southeast region. NCSE serves the following counties: Bladen, Brunswick, Columbus, Cumberland, Hoke, New Hanover, Pender, Richmond, Robeson, Sampson, and Scotland.

In addition to its on-going economic development marketing of targeted industry sectors and clusters within the region, NCSE will be launching several new initiatives in the region, including:

— Regional Workforce Analysis: This study will analyze the region’s strengths and weaknesses within existing and targeted industry sectors, such as biotechnology, food processing, distribution, energy, and other sectors. It will also explore the current standing of the manufacturing base in the region for the purpose of indentifying job growth areas. Manufacturing pays the highest wages of any sector in the region, and 11 percent of the workforce is engaged in manufacturing.

The study will also provide a basis to strengthen NCSE’s marketing for quality job creation and provide guidance to other organizations that conduct training and education, including the area workforce boards, the community colleges, the Career Technical Education programs for K-12 schools, and the three public universities in the region.

— Targeting aerospace and aviation companies: NCSE has just started an analysis of the region’s potential to attract aerospace and aviation companies. Transportation proximity to the new Boeing Aircraft assembly plant in South Carolina provides an opportunity to market the region to supplier companies that will service that facility with parts and components.

Additionally, over the last several years, North Carolina has achieved major accomplishments in becoming a location for companies in this industry sector.

— Recruiting and assisting renewable energy companies: NCSE is already seeing strong interest from renewable energy companies that are eying the region for potential facilities. These companies are exploring several areas of development of renewable energy, including biomass, bio-fuels, wood pellets, solar panels, and wind turbine components.

This is a young industry sector, but one with job growth potential in the region.

NCSE’s marketing plan was developed by the NCSE board of directors and its Technical Advisory Group, which includes local economic development organizations in the region, the community college system, the three public universities in the region, private sector allies, and other organizations, a total of more than 30 organizations.

“North Carolina’s Southeast provides a unified and innovative approach to marketing the southeast region to several industry sectors, and this is very helpful to the region’s counties in creating new jobs and developing opportunities to talk to companies about possible locations here,” says John Swope, executive director of the Sampson County Economic Development Commission and also chairman of the Technical Advisory Group.

Since its creation by the North Carolina General Assembly in 1993, North Carolina’s Southeast has served as the region’s lead economic development organization, filling gaps that exist between the state and local development entities and complementing government resources with private dollars and expertise.

For information on North Carolina’s Southeast, visit www.ncse.org.

Read more: The Bladen Journal - North Carolina’s Southeast Unveils Economic Development Strategic Marketing Plan

Wednesday, September 01, 2010

Group looking to attract aviation jobs

by Philip D. Brown

North Carolina’s Southeast economic development partnership plans to bolster the region’s economy by bringing the aerospace and aviation industry here, as well as helping renewable energy companies thrive, as well as studying its workers.

“NCSE is cognizant of the slow economic recovery and is designing innovative economic development approaches to help the region,” a press release reads.

The partnership plans to complete a regional workforce analysis, in addition to emphasizing these two industries, as part of its strategic marketing plan for 2010-11.

“The NCSE’s efforts have helped Richmond County for many years and their new initiatives will certainly continue to enhance our economic development efforts,” said Richmond County Economic Development Director and Manager Rick Sago.

NCSE Director Steve Yost said there is potential in Richmond County to locate both aviation and renewable energy businesses, which he said are both high growth sectors and are expected to be for the next decade.

In the case of renewable energy businesses, at least, Yost said there is plenty of room to grow.

“That’s really a young sector, and we’re starting to see companies finally establish themselves, but a lot of these companies are in the infancy stages and don’t have the capital to work the processes they have in place,” Yost said. “But we are beginning to see some of those companies that are capitalized and ready to go.”

He said there are “seven or eight” active projects to locate companies that would turn bio-mass into energy, and cited the recent announcement DuPont will invest $55 million in Bladen County to manufacture components for solar panels.

“With our location, and being in a high growth state, I think Richmond County’s in a pretty good position to capitalize on some of these projects,” Yost said, pointing to the county’s proximity to Charlotte, Wilmington, the Triad and the Triangle.

He also said the aerospace and aviation industry is experiencing growth, with the Honda jet expansion in Greensboro and Boeing’s announcement they will build a new facility in Charleston, S.C.

“What we’re trying to tap into there is some of the growth that the state as a whole is experiencing,” he explained. “... We would like to have suppliers to service these manufacturers locate in our region. This is a high growth sector, and we certainly need to be pursuing high growth sectors, especially in the southeast region where we’ve been hit so hard by this recession.”

Finally, Yost explained the regional workforce analysis study will cost about $150,000 to $200,000, and grants have been applied for, and is set to get underway in September or October.

“Our region has never done a truly in-depth analysis of where our workforce is,” Yost said. “We know we’ve got some deficiencies, and we know we’ve got some strengths, but we really want to drill in and come up with some strategies, especially to address some of our deficiencies.”

He said the study will consist mostly of conversations and surveys with existing businesses in the region, the community colleges, the Career Technical Education departments of the region’s K-12 schools and at least three public universities.

North Carolina’s Southeast was created in 1993 as a way for its 11 member counties to pool their resources in job creation and industry recruitment.

“North Carolina’s Southeast provides a unified and innovative approach to marketing the southeast region to several industry sectors, and this is very helpful to the region’s counties in creating new jobs and developing opportunities to talk to companies about possible locations here,” NCSE Technical Advisory Group Chairman John Swope said.

Since 1996, the NCSE has generated or assisted in the location of 103 companies, more than 8,000 jobs and more than $900 million in private investment to the southeast region.

Staff Writer Philip D. Brown can be reached at (910) 997-3111 ext. 32, or by e-mail at pbrown@yourdailyjournal.com

Read more: Richmond County Daily Journal - Group looking to attract aviation jobs