The Fremont City Council is expected to award a contract Tuesday to a consultant for the Community Branding and Marketing Initiative.
The council will meet at 7 p.m. on the second floor of the Municipal Building, preceded by a 6:45 p.m. study session.
The council will also meet as the Community Development Agency to authorize the issuance of bonds for the South Broad Street development project.
Council members will consider the Community Branding Committee's recommendation of Chandler Thinks as consultant for the project to research and develop a community marketing brand that can be used in promotions and economic development.
The Hendersonville, Tenn., firm was unanimously selected by the committee from 16 proposals submitted, Planning and Building Director Jeff Ray said.
The committee whittled the proposals down to six and interviewed the top four, Ray said.
Bids ranged from around $50,000 up to about $112,000, and Chandler Thinks came in on the low end, he said. The firm's bid was $45,000 plus travel, estimated in the $6,000 range.
Chandler Thinks is only six months old, Ray said, but the president of the company, Steve Chandler, is the former president of the firm that was the committee's second choice and recently branched out to start his own firm, Ray pointed out.
"He has a long history of dealing with community branding," Ray said.
The city pledged $25,000 a year for two years toward the project, which has a total of $122,000 in commitments from various community agencies.
Funding not used in the first phase, which includes research, will be rolled over into the second phase of implementation. The third phase is actually marketing the logos and tag lines.
Ray said other communities have been successful in hiring community branding consultants to market themselves
"They come in and they do a significant amount of research up front to determine what the flavor of the community is, what is your true strength, and determine what uniqueness you can capitalize on," Ray said.
Ultimately, the goal is to present a united front with matching logos and tag lines that tie together all economic development and promotion efforts, Ray explained.
"This is broader than the city, it's the whole region," he pointed out. "The city's taking a lead but it's a Fremont area project, we're not focusing on just inside the city limits."
City Administrator Bob Hartwig told the Developments and Improvements Committee last week the branding project has been an ongoing priority for three years, and was made a top priority earlier this year during a council retreat.
Tuesday, December 28, 2010
Nearby violence is El Paso's latest image problem
by Zahira Torres \ Austin Bureau
Posted: 12/26/2010 01:38:32 AM MST
El Paso Mayor John Cook has said that over the years, El Paso 's proximity to Juarez has brought positive trade relations and economic progress to both. But, Cook said, the violence in Juarez has hurt the image people have of El Paso. (Photo illustration by Mark Lambie / El Paso Times)El Paso has an image problem.
It is the safest big city in the country, yet its neighbor's reputation as the most dangerous place in Mexico is steering some tourists and businesses away from the border.
It is a city that boasts an authentic Mexican culture but is often overshadowed by Santa Fe and San Antonio, which market themselves with flair.
Though El Paso residents tout the scenic mountain vistas and good climate, some out-of-towners say they do not know where El Paso is, let alone what attractions it offers.
Changing El Paso's image has been a daunting task, said Richard Dayoub, the CEO of the Greater El Paso Chamber of Commerce.
"For years we've had a hard time getting national recognition, for people across the country to really figure out what is El Paso, where is it?" Dayoub said. "For all of our efforts, I think we have probably struggled as a community to find the right messages, and we are not consistent enough in getting those messages out."
The latest problems
Now, city leaders say, the difficulties have grown with political rhetoric centering around border security and a national spotlight that has focused on the violence in Juárez.
Juárez has exceeded 3,000 murders this year, compared with only seven homicides in greater El Paso -- five in the city and two in the county.
It is a striking disparity that on one hand has stimulated El Paso's economy through the migration of people and businesses from Mexico. But it has also created misconceptions that hurt El Paso as it looks to draw tourists and businesses from throughout the United States.
That leaves city leaders searching for ways to separate El Paso's image from that of its sister city after years of using the proximity to Mexico as a marketing tool to attract visitors.
"Part of El Paso's image was that it was a binational, international community. That has pluses and minuses, but we have struggled to define an image," City Manager Joyce Wilson said. "We've gone through branding and imaging and it's very hard to get consensus."
The latest numbers
El Paso spends about $680,000 a year from a $2.9 million Convention and Visitors Bureau budget on advertising intended to encourage regional tourism and secure conventions.
Santa Fe's Convention and Visitors Bureau spends about $800,000 of its $2.5 million budget on tourism advertising. The New Mexico city has about 74,000 people, according to census estimates.
Hotel occupancy in El Paso is up this year and is beating out other metro areas of Texas. The number of businesses that have expressed an interest in relocating to the El Paso region has grown from 79 three years ago to 192 this year, according to El Paso's Regional Economic Development Corp.
But, city leaders say, they are battling misconceptions about El Paso when recruiting businesses and marketing the city as a convention site. The subject has even bubbled up for college coaches trying to recruit athletes.
El Paso is not seeing large dips in hotel occupancy because it does not rely heavily on recreational tourism, said Bill Blaziek, the general manager of the El Paso Convention and Visitors Bureau.
Instead, he said, hotel occupancy has remained steady because of business travelers, overnight stays from Mexican shoppers and people driving through to other destinations.
But, Blaziek said, at least half a dozen state associations have postponed their conventions in El Paso because of concerns about the violence in Juárez. Those decisions have cost El Paso hundreds of thousands of dollars, he said.
Recruitment efforts
El Paso's Regional Economic Development Corp., which receives about $150,000 annually from the city to help recruit businesses, is also having to combat false impressions.
Bob Cook, the group's president, said his biggest challenge is tackling concerns over security. Cook said he is always prepared with crime statistics that show El Paso is safe. Still, he said, he worries that some businesses may have decided not to consider the city without giving leaders a chance to dispel myths.
Setbacks included a misstatement by Republican Gov. Rick Perry on national television during his bid for re-election this year. Perry incorrectly said bombs were exploding in El Paso. Though his staff later explained that the governor meant to say Juárez, El Paso leaders said his comment was harmful.
Dayoub said city leaders could not have predicted that the corruption and violence in Juárez would escalate to such a degree or that it would have "such a dramatic effect" on El Paso's image.
"I don't think anyone could have been so farseeing, so clairvoyant, as to have recognized that it would escalate to the level that it has," Dayoub said.
What's needed
Billy Vassiliadis, who runs the company responsible for Las Vegas' "What happens here, stays here" campaign, said dispelling misconceptions is important but not enough.
Vassiliadis, the CEO of R&R Partners, said El Paso should start focusing on what makes it different from other communities, and that requires investment.
He said the city must first spend money researching what makes it different, why people visit and whether the violence in Juárez truly had a large negative impact on tourism and business recruitment. That could cost between $200,000 and $300,000 the first year and about $150,000 annually, he said.
"El Paso's got to decide they want to own something," Vassiliadis said. "They want to represent something they can own and they can deliver on that's unique to them."
He said that was what Las Vegas did when it started feeling economic pressure because of the expansion of gambling to other states in the late 1990s. His city spends about $3 million a year on research to market itself.
"We looked for one thing to set us apart," he said. "The one differentiator for us was this notion of an adult freedom, an adult escape," he said.
New Orleans' story
El Paso may also be able to take a cue from New Orleans -- a city that understands the struggles of rebranding perhaps better than any other community in America.
Kelly Schulz, vice president of communications and public relations for the New Orleans Convention and Visitors Bureau, said the city has been the focus of national media attention since it was pummeled by Hurricane Katrina in 2005.
Schulz said that meant if there was a murder in New Orleans it was on the front page of the New York Times, or if there was another natural disaster it was compared to New Orleans. Then, as the city was rebounding, it faced misconceptions about the oil spill in the Gulf of Mexico, Schulz said.
"Here we are fighting this perception battle and trying to remind people there's not water in our streets and we do have restaurants open and you can come visit," she said. "In the meantime, they're turning on their television and reading the newspaper and all they're hearing about is all the things that are not working in New Orleans."
Schulz said New Orleans started an aggressive marketing campaign that sought to encourage tourists to return to the city and dispel myths through provocative advertising.
It received help from famous actors, chefs and musicians who offered to appear in commercials. They let the city use their names in letters and went on national television to promote New Orleans. And it didn't hurt that the New Orleans Saints won the Super Bowl last year, she said.
Native son
Aaron Sanchez, an El Pasoan who is a chef on the Food Network and owns a restaurant in New York City, said though he has not been asked, he would happily appear in commercials to promote his hometown.
Sanchez already has featured the city twice on Food Network's "The Best Thing I Ever Ate" program. He said he hopes to soon open his own restaurant on El Paso's West Side.
"I will never ever stop telling people where I'm from and to go there and visit," he said. "El Paso needs to establish itself as a tourist destination and let people know why they should go there."
City's efforts
Wilson said the city may soon take Sanchez up on his offer.
The city has put together "a counter crisis communications program" to be more proactive in dealing with media about the violence in Juárez and its impact on El Paso.
She said the program would also reinforce the growth, economic development and business and international investment in El Paso.
She said after the new year the city will look to develop a website that provides facts about Juárez and El Paso. City leaders will also set up special media briefings and create targeted advertisements that will run strategically across the country.
Blaziek said instead of initiating a national tourism campaign, the city will continue to focus on drawing tourists from markets within a 300-mile radius "rather than market in some areas that may misunderstand the dynamics of El Paso."
"We are comfortable in knowing who we are, and we can see that we are not a national destination for leisure travel," he said.
El Paso branding
Blaziek said El Paso has great weather and Mexican food but lacks the hotel resorts, commercial attractions and the direct flights that would make it a national destination.
But Ed O'Hara, a senior partner with SME Branding in New York, said during tough economic times all cities should be aggressively trying to tap into tourism and business dollars.
His company has helped cities with Olympic bids and has worked with brands like Adidas, the Kentucky Derby and NASCAR Media Group. It also created the sports logo for the University of Texas at El Paso.
"Every city, every state is cutting budgets and all we hear about are budget cuts and that services are going to go down," O'Hara said. "Why aren't they actively branding? It's pretty scary to me."
Hollywood thoughts
Hollywood actress Lupe Ontiveros, who has appeared in movies such as "Selena" and "Real Women Have Curves," said El Paso needs a marketing campaign. But, she said, the city should not lose its identity in the process.
"Find the beauty of what's in El Paso," she said. "The sunsets or the peace of going out into the desert."
Ontiveros, a native El Pasoan who lives in California, said El Paso has never been good at selling itself.
"The city of commerce or the business bureau has not been creative enough to find the catch, either they're afraid to or they don't want to spend the money," she said, adding that if she can see commercials to visit Israel in Los Angeles she should see such ads for El Paso.
El Paso must find its voice despite financial constraints, Dayoub said.
"I think we are getting to a point now where as a region we don't have any more options," Dayoub said. "We simply must stay focused and raise those dollars so we can do a national marketing effort to demonstrate what a wonderful community we have."
Zahira Torres may be reached at ztorres@elpasotimes.com; 512-479-6606.
Posted: 12/26/2010 01:38:32 AM MST
El Paso Mayor John Cook has said that over the years, El Paso 's proximity to Juarez has brought positive trade relations and economic progress to both. But, Cook said, the violence in Juarez has hurt the image people have of El Paso. (Photo illustration by Mark Lambie / El Paso Times)El Paso has an image problem.
It is the safest big city in the country, yet its neighbor's reputation as the most dangerous place in Mexico is steering some tourists and businesses away from the border.
It is a city that boasts an authentic Mexican culture but is often overshadowed by Santa Fe and San Antonio, which market themselves with flair.
Though El Paso residents tout the scenic mountain vistas and good climate, some out-of-towners say they do not know where El Paso is, let alone what attractions it offers.
Changing El Paso's image has been a daunting task, said Richard Dayoub, the CEO of the Greater El Paso Chamber of Commerce.
"For years we've had a hard time getting national recognition, for people across the country to really figure out what is El Paso, where is it?" Dayoub said. "For all of our efforts, I think we have probably struggled as a community to find the right messages, and we are not consistent enough in getting those messages out."
The latest problems
Now, city leaders say, the difficulties have grown with political rhetoric centering around border security and a national spotlight that has focused on the violence in Juárez.
Juárez has exceeded 3,000 murders this year, compared with only seven homicides in greater El Paso -- five in the city and two in the county.
It is a striking disparity that on one hand has stimulated El Paso's economy through the migration of people and businesses from Mexico. But it has also created misconceptions that hurt El Paso as it looks to draw tourists and businesses from throughout the United States.
That leaves city leaders searching for ways to separate El Paso's image from that of its sister city after years of using the proximity to Mexico as a marketing tool to attract visitors.
"Part of El Paso's image was that it was a binational, international community. That has pluses and minuses, but we have struggled to define an image," City Manager Joyce Wilson said. "We've gone through branding and imaging and it's very hard to get consensus."
The latest numbers
El Paso spends about $680,000 a year from a $2.9 million Convention and Visitors Bureau budget on advertising intended to encourage regional tourism and secure conventions.
Santa Fe's Convention and Visitors Bureau spends about $800,000 of its $2.5 million budget on tourism advertising. The New Mexico city has about 74,000 people, according to census estimates.
Hotel occupancy in El Paso is up this year and is beating out other metro areas of Texas. The number of businesses that have expressed an interest in relocating to the El Paso region has grown from 79 three years ago to 192 this year, according to El Paso's Regional Economic Development Corp.
But, city leaders say, they are battling misconceptions about El Paso when recruiting businesses and marketing the city as a convention site. The subject has even bubbled up for college coaches trying to recruit athletes.
El Paso is not seeing large dips in hotel occupancy because it does not rely heavily on recreational tourism, said Bill Blaziek, the general manager of the El Paso Convention and Visitors Bureau.
Instead, he said, hotel occupancy has remained steady because of business travelers, overnight stays from Mexican shoppers and people driving through to other destinations.
But, Blaziek said, at least half a dozen state associations have postponed their conventions in El Paso because of concerns about the violence in Juárez. Those decisions have cost El Paso hundreds of thousands of dollars, he said.
Recruitment efforts
El Paso's Regional Economic Development Corp., which receives about $150,000 annually from the city to help recruit businesses, is also having to combat false impressions.
Bob Cook, the group's president, said his biggest challenge is tackling concerns over security. Cook said he is always prepared with crime statistics that show El Paso is safe. Still, he said, he worries that some businesses may have decided not to consider the city without giving leaders a chance to dispel myths.
Setbacks included a misstatement by Republican Gov. Rick Perry on national television during his bid for re-election this year. Perry incorrectly said bombs were exploding in El Paso. Though his staff later explained that the governor meant to say Juárez, El Paso leaders said his comment was harmful.
Dayoub said city leaders could not have predicted that the corruption and violence in Juárez would escalate to such a degree or that it would have "such a dramatic effect" on El Paso's image.
"I don't think anyone could have been so farseeing, so clairvoyant, as to have recognized that it would escalate to the level that it has," Dayoub said.
What's needed
Billy Vassiliadis, who runs the company responsible for Las Vegas' "What happens here, stays here" campaign, said dispelling misconceptions is important but not enough.
Vassiliadis, the CEO of R&R Partners, said El Paso should start focusing on what makes it different from other communities, and that requires investment.
He said the city must first spend money researching what makes it different, why people visit and whether the violence in Juárez truly had a large negative impact on tourism and business recruitment. That could cost between $200,000 and $300,000 the first year and about $150,000 annually, he said.
"El Paso's got to decide they want to own something," Vassiliadis said. "They want to represent something they can own and they can deliver on that's unique to them."
He said that was what Las Vegas did when it started feeling economic pressure because of the expansion of gambling to other states in the late 1990s. His city spends about $3 million a year on research to market itself.
"We looked for one thing to set us apart," he said. "The one differentiator for us was this notion of an adult freedom, an adult escape," he said.
New Orleans' story
El Paso may also be able to take a cue from New Orleans -- a city that understands the struggles of rebranding perhaps better than any other community in America.
Kelly Schulz, vice president of communications and public relations for the New Orleans Convention and Visitors Bureau, said the city has been the focus of national media attention since it was pummeled by Hurricane Katrina in 2005.
Schulz said that meant if there was a murder in New Orleans it was on the front page of the New York Times, or if there was another natural disaster it was compared to New Orleans. Then, as the city was rebounding, it faced misconceptions about the oil spill in the Gulf of Mexico, Schulz said.
"Here we are fighting this perception battle and trying to remind people there's not water in our streets and we do have restaurants open and you can come visit," she said. "In the meantime, they're turning on their television and reading the newspaper and all they're hearing about is all the things that are not working in New Orleans."
Schulz said New Orleans started an aggressive marketing campaign that sought to encourage tourists to return to the city and dispel myths through provocative advertising.
It received help from famous actors, chefs and musicians who offered to appear in commercials. They let the city use their names in letters and went on national television to promote New Orleans. And it didn't hurt that the New Orleans Saints won the Super Bowl last year, she said.
Native son
Aaron Sanchez, an El Pasoan who is a chef on the Food Network and owns a restaurant in New York City, said though he has not been asked, he would happily appear in commercials to promote his hometown.
Sanchez already has featured the city twice on Food Network's "The Best Thing I Ever Ate" program. He said he hopes to soon open his own restaurant on El Paso's West Side.
"I will never ever stop telling people where I'm from and to go there and visit," he said. "El Paso needs to establish itself as a tourist destination and let people know why they should go there."
City's efforts
Wilson said the city may soon take Sanchez up on his offer.
The city has put together "a counter crisis communications program" to be more proactive in dealing with media about the violence in Juárez and its impact on El Paso.
She said the program would also reinforce the growth, economic development and business and international investment in El Paso.
She said after the new year the city will look to develop a website that provides facts about Juárez and El Paso. City leaders will also set up special media briefings and create targeted advertisements that will run strategically across the country.
Blaziek said instead of initiating a national tourism campaign, the city will continue to focus on drawing tourists from markets within a 300-mile radius "rather than market in some areas that may misunderstand the dynamics of El Paso."
"We are comfortable in knowing who we are, and we can see that we are not a national destination for leisure travel," he said.
El Paso branding
Blaziek said El Paso has great weather and Mexican food but lacks the hotel resorts, commercial attractions and the direct flights that would make it a national destination.
But Ed O'Hara, a senior partner with SME Branding in New York, said during tough economic times all cities should be aggressively trying to tap into tourism and business dollars.
His company has helped cities with Olympic bids and has worked with brands like Adidas, the Kentucky Derby and NASCAR Media Group. It also created the sports logo for the University of Texas at El Paso.
"Every city, every state is cutting budgets and all we hear about are budget cuts and that services are going to go down," O'Hara said. "Why aren't they actively branding? It's pretty scary to me."
Hollywood thoughts
Hollywood actress Lupe Ontiveros, who has appeared in movies such as "Selena" and "Real Women Have Curves," said El Paso needs a marketing campaign. But, she said, the city should not lose its identity in the process.
"Find the beauty of what's in El Paso," she said. "The sunsets or the peace of going out into the desert."
Ontiveros, a native El Pasoan who lives in California, said El Paso has never been good at selling itself.
"The city of commerce or the business bureau has not been creative enough to find the catch, either they're afraid to or they don't want to spend the money," she said, adding that if she can see commercials to visit Israel in Los Angeles she should see such ads for El Paso.
El Paso must find its voice despite financial constraints, Dayoub said.
"I think we are getting to a point now where as a region we don't have any more options," Dayoub said. "We simply must stay focused and raise those dollars so we can do a national marketing effort to demonstrate what a wonderful community we have."
Zahira Torres may be reached at ztorres@elpasotimes.com; 512-479-6606.
Monday, December 20, 2010
RCGA works to unify a divided region
BY DAVID NICKLAUS > dnicklaus@post-dispatch.com > 314-340-8213 | Posted: Sunday, December 19, 2010 12:00 am
When Dick Fleming arrived in 1994 to run St. Louis' economic development effort, he found a landscape that looked more tribal than regional.
Various city and suburban agencies made their own pitches to employers wanting to move or expand — in competition rather than cooperation. Some counties defined success by how many businesses they could lure from the city of St. Louis.
"It was really a free-for-all environment," recalls Fleming, who was hired as president of the Regional Chamber and Growth Association after holding a similar job in Denver. He's still here, and the RCGA recently announced the fourth five-year plan undertaken during Fleming's tenure.
Fifteen years after that first plan, St. Louis still lags the nation in job growth. The area also gets low marks for its inability to nurture entrepreneurial, fast-growing companies. During that time, though, we have at least learned to present ourselves as a region rather than a collection of warring clans.
In a global economy, where the decision on where to situate a new facility may be made in Europe or Asia, individual cities and counties don't have the clout to compete, says Ned Hill, dean of the Levin College of Urban Affairs at Cleveland State University. "You need the brand of the region," he says.
Even though our hundreds of local governments compete in many dysfunctional ways — such as using tax incentives to move big-box stores from one suburb to another — Hill says St. Louis, more often than not, presents a united front to the outside world. If a business from the East Coast wants to expand here, it can get impartial information about various sites from the RCGA's economic development staff.
In some metro areas, that same business would have to deal directly with competing cities and counties, with each of them bad-mouthing the others. Such an approach doesn't work, Hill says: "What is usually true with large amounts of fragmentation is you start getting jurisdictions looking out for their own, and they don't do a good job of sharing leads."
That could describe how St. Louis worked until the early 1990s. As part of the RCGA's first regional plan, which launched in 1995, Fleming made the various cities and counties agree to a no-raiding pledge.
They had to stop recruiting companies on one another's turf. They can't publicly disparage any part of the St. Louis area. If approached by a company from within the metro area, they must notify the company's current city or county to see if its needs can be met there.
The major counties in the region all signed on to the plan, as did the city of St. Louis. The rules are usually honored, though intra-regional tensions still arise.
During the decade and a half that the region's economic developers have strived to cooperate rather than compete, they've produced some successes. In the 1990s, when MasterCard outgrew its offices in St. Louis County, the region rallied around a site in O'Fallon, Mo., which won out in a competition with Dallas.
Regional officials concede, however, that the region still fails at times to present a unified front. A few St. Louis county companies have been recruited to nearby jurisdictions, despite the no-raiding pledge, said Denny Coleman, president of the county's Economic Council.
"That's the piece of economic development that's a full-contact sport," says Coleman, who instituted his own no-raiding policy when he joined the Economic Council in 1990. The biggest current tensions involve competing airports.
On the list of contributors to the RCGA's new economic development campaign, St. Clair County is notably absent. Board Chairman Mark Kern has criticized the RCGA's efforts to attract Chinese cargo airlines to Lambert-St. Louis International Airport. He says the cargo-hub idea originated at MidAmerica Airport, which is in St. Clair County, and was stolen by St. Louis officials eager to build traffic at Lambert.
Fleming says that the chamber would welcome Kern back any time and that the airport dispute hasn't impaired cooperation with St. Clair County on business recruitment projects.
Danny Ludeman, chief executive of Wells Fargo Advisors and chairman of the RCGA's economic development board, downplays the tension. "There are always going to be issues come up that people may not agree on, but I've been impressed with the spirit of collaboration here," he says.
Ludeman, who moved here in 2007 from Richmond, Va., says he has experienced "more discussion and talk on economic issues than I saw in Richmond or other cities I've been associated with."
Healthy communication, however, isn't an end in itself. No matter how much our regional leaders talk with one another, they have to figure out a way to generate jobs.
A new wrinkle in the latest economic plan aims to accomplish that. In key sectors such as health care and financial services, industry councils will advise the RCGA staff about which firms might be expanding and what needs they might have. In a sense, it brings more business leaders into the collaborative structure that's already set up for political leaders and their economic development aides.
The new plan also establishes an aggressive goal. Within a decade, the RCGA pledges that the region will be above average on various economic measures, including job growth.
It's certainly not a goal we can reach by competing among ourselves. To get there, the region's leaders will have to go beyond marketing and work together on a laundry list of tough issues, including infrasructure, education and the environment. And, of course, airports.
When Dick Fleming arrived in 1994 to run St. Louis' economic development effort, he found a landscape that looked more tribal than regional.
Various city and suburban agencies made their own pitches to employers wanting to move or expand — in competition rather than cooperation. Some counties defined success by how many businesses they could lure from the city of St. Louis.
"It was really a free-for-all environment," recalls Fleming, who was hired as president of the Regional Chamber and Growth Association after holding a similar job in Denver. He's still here, and the RCGA recently announced the fourth five-year plan undertaken during Fleming's tenure.
Fifteen years after that first plan, St. Louis still lags the nation in job growth. The area also gets low marks for its inability to nurture entrepreneurial, fast-growing companies. During that time, though, we have at least learned to present ourselves as a region rather than a collection of warring clans.
In a global economy, where the decision on where to situate a new facility may be made in Europe or Asia, individual cities and counties don't have the clout to compete, says Ned Hill, dean of the Levin College of Urban Affairs at Cleveland State University. "You need the brand of the region," he says.
Even though our hundreds of local governments compete in many dysfunctional ways — such as using tax incentives to move big-box stores from one suburb to another — Hill says St. Louis, more often than not, presents a united front to the outside world. If a business from the East Coast wants to expand here, it can get impartial information about various sites from the RCGA's economic development staff.
In some metro areas, that same business would have to deal directly with competing cities and counties, with each of them bad-mouthing the others. Such an approach doesn't work, Hill says: "What is usually true with large amounts of fragmentation is you start getting jurisdictions looking out for their own, and they don't do a good job of sharing leads."
That could describe how St. Louis worked until the early 1990s. As part of the RCGA's first regional plan, which launched in 1995, Fleming made the various cities and counties agree to a no-raiding pledge.
They had to stop recruiting companies on one another's turf. They can't publicly disparage any part of the St. Louis area. If approached by a company from within the metro area, they must notify the company's current city or county to see if its needs can be met there.
The major counties in the region all signed on to the plan, as did the city of St. Louis. The rules are usually honored, though intra-regional tensions still arise.
During the decade and a half that the region's economic developers have strived to cooperate rather than compete, they've produced some successes. In the 1990s, when MasterCard outgrew its offices in St. Louis County, the region rallied around a site in O'Fallon, Mo., which won out in a competition with Dallas.
Regional officials concede, however, that the region still fails at times to present a unified front. A few St. Louis county companies have been recruited to nearby jurisdictions, despite the no-raiding pledge, said Denny Coleman, president of the county's Economic Council.
"That's the piece of economic development that's a full-contact sport," says Coleman, who instituted his own no-raiding policy when he joined the Economic Council in 1990. The biggest current tensions involve competing airports.
On the list of contributors to the RCGA's new economic development campaign, St. Clair County is notably absent. Board Chairman Mark Kern has criticized the RCGA's efforts to attract Chinese cargo airlines to Lambert-St. Louis International Airport. He says the cargo-hub idea originated at MidAmerica Airport, which is in St. Clair County, and was stolen by St. Louis officials eager to build traffic at Lambert.
Fleming says that the chamber would welcome Kern back any time and that the airport dispute hasn't impaired cooperation with St. Clair County on business recruitment projects.
Danny Ludeman, chief executive of Wells Fargo Advisors and chairman of the RCGA's economic development board, downplays the tension. "There are always going to be issues come up that people may not agree on, but I've been impressed with the spirit of collaboration here," he says.
Ludeman, who moved here in 2007 from Richmond, Va., says he has experienced "more discussion and talk on economic issues than I saw in Richmond or other cities I've been associated with."
Healthy communication, however, isn't an end in itself. No matter how much our regional leaders talk with one another, they have to figure out a way to generate jobs.
A new wrinkle in the latest economic plan aims to accomplish that. In key sectors such as health care and financial services, industry councils will advise the RCGA staff about which firms might be expanding and what needs they might have. In a sense, it brings more business leaders into the collaborative structure that's already set up for political leaders and their economic development aides.
The new plan also establishes an aggressive goal. Within a decade, the RCGA pledges that the region will be above average on various economic measures, including job growth.
It's certainly not a goal we can reach by competing among ourselves. To get there, the region's leaders will have to go beyond marketing and work together on a laundry list of tough issues, including infrasructure, education and the environment. And, of course, airports.
Sunday, December 19, 2010
Home Economics: Homegrown talent key to economic development
Bobbie J. Clark
I recently got a chance to take a tour of what will become Blade Studios. When it's finished, it will be on par with any other music production facility in the world, according chief engineer Chris Bell.
Currently, the only music coming out of it is an ensemble of hammers, saws and construction chatter.
The project is the brainchild of Brady Blade Jr. and Scott Crompton. Both say the studio will be a perfect complement to the burgeoning movie industry in the Shreveport-Bossier City area.
No longer will movie producers and editors have to fly across the country for state-of-the-art sound effects and editing. Blade Studios fills a void that could attract more film business.
But that's only part of what they want to accomplish.
Music has deep roots in northwest Louisiana. Blade said he wants to capture the talent he knows is here.
Prior to forming Blade Studios, Blade was an economic development official for the City of Shreveport. He worked with the mayor and others to attract companies to the area.
Now instead of looking for economic development, he's growing it.
Former director of the Downtown Development Authority Don Shea once told me ventures like Blade Studios and CoHabitat, which Blade also had a role in, are examples of true economic development.
Shreveport-Bossier City needs to be a place that fosters this kind of creativity and ingenuity. We need more homegrown talent. Not only is it a boost the local economy, but it's also a way to lure development to the area.
Blade said Shreveport-Bossier City is on the cusp of something special. The renaissance of the area's musical tradition and the energy of the film industry have created a synergy that Blade said he hasn't felt before.
More and more younger Shreveporters have decided to come back to the area, he said.
While the area has its problems, like crime, housing and infrastructure, it also has a lot going for it too.
Projects like Blade Studios do nothing but raise the area's profile in the eyes of business prospects, potential investors and, maybe most important of all, local talent.
Bobbie J. Clark is the business writer for The Times.
I recently got a chance to take a tour of what will become Blade Studios. When it's finished, it will be on par with any other music production facility in the world, according chief engineer Chris Bell.
Currently, the only music coming out of it is an ensemble of hammers, saws and construction chatter.
The project is the brainchild of Brady Blade Jr. and Scott Crompton. Both say the studio will be a perfect complement to the burgeoning movie industry in the Shreveport-Bossier City area.
No longer will movie producers and editors have to fly across the country for state-of-the-art sound effects and editing. Blade Studios fills a void that could attract more film business.
But that's only part of what they want to accomplish.
Music has deep roots in northwest Louisiana. Blade said he wants to capture the talent he knows is here.
Prior to forming Blade Studios, Blade was an economic development official for the City of Shreveport. He worked with the mayor and others to attract companies to the area.
Now instead of looking for economic development, he's growing it.
Former director of the Downtown Development Authority Don Shea once told me ventures like Blade Studios and CoHabitat, which Blade also had a role in, are examples of true economic development.
Shreveport-Bossier City needs to be a place that fosters this kind of creativity and ingenuity. We need more homegrown talent. Not only is it a boost the local economy, but it's also a way to lure development to the area.
Blade said Shreveport-Bossier City is on the cusp of something special. The renaissance of the area's musical tradition and the energy of the film industry have created a synergy that Blade said he hasn't felt before.
More and more younger Shreveporters have decided to come back to the area, he said.
While the area has its problems, like crime, housing and infrastructure, it also has a lot going for it too.
Projects like Blade Studios do nothing but raise the area's profile in the eyes of business prospects, potential investors and, maybe most important of all, local talent.
Bobbie J. Clark is the business writer for The Times.
Saturday, December 18, 2010
Column: Cooperation vital to economic development
By STEVE RUTHERFORD Special to the Courier
It should be obvious to all that we have an employment problem in our region. We need jobs now.
According to Garner Economics LLC in its "Progress Report: Job Growth in U.S. Metros" published in September 2010, the Prescott metropolitan statistical area lost 7,700 jobs during the past five years. July 2010 employment was 55,500. The previous five-year July peak employment was 63,200. The numbers indicate a 13.9 percent decrease in regional employment.
Potential lost wages are $218,256,500 for each year those jobs don't exist. This estimate is determined by multiplying the 7,700 lost jobs by the median income for our region of $28,345 as determined by the Arizona Department of Commerce.
These numbers are startling.
Additional negative economic impact occurs as these dollars are not circulating through our local economy. This is a regional problem that requires a regional solution.
The quad-city area has several entities performing some function of economic development (ED). Currently, there is very little coordination of effort between communities in the region. Each community and their ED entities develop and perform their own marketing and recruiting efforts. There are varying degrees of sophistication and funding for ED efforts between entities and communities.
Central AZ Partnership (CAP) supports the concept of cooperative regional ED in an effort to create and attract base jobs. Base jobs are defined as manufacturing or value-added service jobs, which bring new dollars into the community from other areas.
Retailers are not included in this definition of base jobs as they, for the most part, spin dollars already existing in the community.
Recently, the Yavapai County Industrial Development Authority provided a grant to fund and promote regional marketing efforts. CAP supports taking this process a step further by forming a regional ED entity. The cooperative regional ED effort should include ED practitioners, private sector individuals, and representatives from the City of Prescott, Town of Prescott Valley, Town of Chino Valley, Town of Dewey-Humboldt, Yavapai County, Yavapai-Prescott Tribe, Yavapai College, Embry-Riddle, and other educational institutions. All of these entities and individuals should participate in funding the regional ED effort. Efficiencies will be gained through coordinated efforts to market the region rather than a fractured individual municipal approach.
Some might argue that by marketing the region, the unique character of each community is lost. The regional marketing goal should be to entice the potential site selector or business to physically visit the area. At that time, each community under consideration can showcase its specific amenities. The final decision on where to locate in the region can be determined, by the business, after site visits, incentive negotiations, and evaluation of other pertinent criteria.
A cooperative regional effort to market credible, current regional data will generate more interest in the area from potential businesses. Creating new base jobs and diversifying the regional economic base should be the ultimate goal. Let's get busy; we have 7,700 jobs to create just to get back to where we were. CAP supports regional action to achieve that goal.
Central AZ Partnership advocates responsible growth and promotes a balance between economic and ecological sustainability. CAP supports truthful examination and debate on matters of public importance relative to growth in the region. CAP was established by people who have a long-standing history and commitment to our area. CAP works to ensure a prosperous and sustainable future for all of us.
Steve Rutherford is a member of the CAP Board of Directors, a member of the Governor's Rural Business Advisory Council, and chairman of the Prescott Valley Economic Development Foundation.
It should be obvious to all that we have an employment problem in our region. We need jobs now.
According to Garner Economics LLC in its "Progress Report: Job Growth in U.S. Metros" published in September 2010, the Prescott metropolitan statistical area lost 7,700 jobs during the past five years. July 2010 employment was 55,500. The previous five-year July peak employment was 63,200. The numbers indicate a 13.9 percent decrease in regional employment.
Potential lost wages are $218,256,500 for each year those jobs don't exist. This estimate is determined by multiplying the 7,700 lost jobs by the median income for our region of $28,345 as determined by the Arizona Department of Commerce.
These numbers are startling.
Additional negative economic impact occurs as these dollars are not circulating through our local economy. This is a regional problem that requires a regional solution.
The quad-city area has several entities performing some function of economic development (ED). Currently, there is very little coordination of effort between communities in the region. Each community and their ED entities develop and perform their own marketing and recruiting efforts. There are varying degrees of sophistication and funding for ED efforts between entities and communities.
Central AZ Partnership (CAP) supports the concept of cooperative regional ED in an effort to create and attract base jobs. Base jobs are defined as manufacturing or value-added service jobs, which bring new dollars into the community from other areas.
Retailers are not included in this definition of base jobs as they, for the most part, spin dollars already existing in the community.
Recently, the Yavapai County Industrial Development Authority provided a grant to fund and promote regional marketing efforts. CAP supports taking this process a step further by forming a regional ED entity. The cooperative regional ED effort should include ED practitioners, private sector individuals, and representatives from the City of Prescott, Town of Prescott Valley, Town of Chino Valley, Town of Dewey-Humboldt, Yavapai County, Yavapai-Prescott Tribe, Yavapai College, Embry-Riddle, and other educational institutions. All of these entities and individuals should participate in funding the regional ED effort. Efficiencies will be gained through coordinated efforts to market the region rather than a fractured individual municipal approach.
Some might argue that by marketing the region, the unique character of each community is lost. The regional marketing goal should be to entice the potential site selector or business to physically visit the area. At that time, each community under consideration can showcase its specific amenities. The final decision on where to locate in the region can be determined, by the business, after site visits, incentive negotiations, and evaluation of other pertinent criteria.
A cooperative regional effort to market credible, current regional data will generate more interest in the area from potential businesses. Creating new base jobs and diversifying the regional economic base should be the ultimate goal. Let's get busy; we have 7,700 jobs to create just to get back to where we were. CAP supports regional action to achieve that goal.
Central AZ Partnership advocates responsible growth and promotes a balance between economic and ecological sustainability. CAP supports truthful examination and debate on matters of public importance relative to growth in the region. CAP was established by people who have a long-standing history and commitment to our area. CAP works to ensure a prosperous and sustainable future for all of us.
Steve Rutherford is a member of the CAP Board of Directors, a member of the Governor's Rural Business Advisory Council, and chairman of the Prescott Valley Economic Development Foundation.
Thursday, December 16, 2010
5 Ways Cities Are Using Social Media to Reverse Economic Downturn
Mashable, Aliza Sherman – Thu Dec 16, 10:15 am ET
The economic downturn has forced cities and states across the country to be more creative as they compete to attract companies and stimulate local economies. In just the past year, local economic development agencies have turned to social media tools and tactics to enhance their efforts nationally and locally.
According to a 2009 survey conducted by the International Economic Development Council (IEDC) and marketing agency Development Counsellors International (DCI), 57% of IEDC members surveyed said they were using social media tools. Of that, 63% had used them for less than a year. At the time, developers primarily focused their social media efforts on internal or regional uses, such as disseminating news and providing links to resources that support local businesses. LinkedIn was the social network of choice.
What a difference a year makes. Since the survey, economic developers have expanded their social media repertoire. Looking beyond localized efforts, they are using blogs, Twitter, Facebook and YouTube to attract and interact with site selectors and company decision makers nationally and globally.
Here are five ways cities and regions are using social media today.
--------------------------------------------------------------------------------
1. Strengthening or Rebranding a Region's Image
--------------------------------------------------------------------------------
When Orlando was wooing a New York City-based company, it heard a concern that it wasn't considered “edgy” enough and was too “theme-parkish.” To demonstrate an “edgier” image, the Metro Orlando Economic Development Commission created a microsite with a YouTube and Flickr presence. The city also sourced stories from their members as well as testimonials about why they love living and working in Orlando through Facebook, Twitter and its e-newsletter.
The result? Orlando was shortlisted and matched against the target company's home base of Manhattan. The company decided not to relocate, but the Metro Orlando Economic Development Commission credits social media as part of what helped rebrand their city and make a strong showing in its recruiting efforts.
--------------------------------------------------------------------------------
2. Showcasing Story Ideas for the Media
--------------------------------------------------------------------------------
The Maryland Department of Business and Economic Development (DBED) used social media to generate media interest. The DBED launched a new website –- ChooseMaryland -– along with branded social media channels including Twitter, Facebook, LinkedIn, YouTube and Flickr.
Since launching its social media channels, the DBED has seen its efforts turn into news stories and media opportunities, including a story in the Maryland Daily Record, an interview by tech correspondent Mario Armstrong on his Digital Café radio show as well as retweets and blog posts by reporters from the Washington Post and Baltimore Sun.
Further south, the Greater Richmond Partnership, Inc. posts videos on YouTube of CEOs who have successfully relocated their companies, businesses that are growing in the area, and community leaders extolling the benefits of their city -- all as promotional tools. They also created a series of videos titled Boundless Creativity specifically for a UK conference for businesses interested in expanding their presence to the U.S. to promote the creative class centered in greater Richmond.
--------------------------------------------------------------------------------
3. Attracting Former Residents Back to an Area
--------------------------------------------------------------------------------
In the Midwest, the Republic County Economic Development in Kansas uses LinkedIn and Facebook to locate and reach out to alumni and other former residents. The goal? To entice them back to their region to fill available jobs or to relocate their companies and create new jobs. The organization uses LinkedIn to identify professionals who might match the services that are needed in the county. The hope is that if someone already has a connection to their area, they may have more incentive to return. The agency rounds out its social media efforts with a YouTube channel to promote a positive image about its communities.
The county hired Jenny Russell, an external Internet and social media marketer to handle the launch of the social media channels and to manage the day-to-day. As the Republic County Economic Development co-coordinator, Russell estimates that she spends about seven hours per week on social media promotions and management.
--------------------------------------------------------------------------------
4. Linking Job Seekers to Jobs
--------------------------------------------------------------------------------
Workforce development is a major aspect of economic development, and social media has been a useful way for economic development groups to promote and get results. In addition to the Greater Richmond Partnership's (GRP) social media channels for outreach on LinkedIn, Facebook, Twitter and Flickr, the organization also launched social media channels for its workforce program, RichmondJobNet. Those job-specific channels include a Facebook Page and a Twitter presence. According to Jennifer Yeager, marketing communications consultant for the GRP, of the 21,500 tweets the organization has posted, 90% have been job listings.
--------------------------------------------------------------------------------
5. Promoting Local and Regional Businesses and Assets
--------------------------------------------------------------------------------
The Roanoke Regional Partnership catalogued the destinations and activities for its region in a comprehensive website in order to raise interest in outdoor assets like the Blue Ridge Mountains, Appalachian Trail and Blue Ridge Parkway. Then it began using Facebook and Twitter to create or promote events such as scavenger hunts, outdoor expos and a film festival. They also use social media to share new data about outdoor businesses in the region, solicit input from residents for outdoor activities and answer questions for people planning outings.
The economic development agency, which represents three cities and four counties in southwest Virginia, has four Facebook accounts and four Twitter pages. According to Thomas Becher, president of public relations and advertising agency tba, within one year of adding social media to its communications mix, greenway use in the area was up 29% and state parks usage rose 12% - four times the average in Virginia.
--------------------------------------------------------------------------------
What Does the Future Hold?
--------------------------------------------------------------------------------
With social media adoption growing rapidly amongst economic developers in the past year, where else can they go to reach their audience and goals? Louisiana Economic Development has its sights set on mobile with the recent launch of EQ, its quarterly economic report publication for the iPad. The interactive app includes videos, photographs and content showcasing Louisiana's economic progress, business successes and Q&A's with industry leaders in the state.
“Economic development groups are increasingly turning to social media as a means of communicating both within their communities and externally with key audiences,” said Ryan Shell, director of digital and social media for DCI. “The medium has enormous potential for our profession.”
The economic downturn has forced cities and states across the country to be more creative as they compete to attract companies and stimulate local economies. In just the past year, local economic development agencies have turned to social media tools and tactics to enhance their efforts nationally and locally.
According to a 2009 survey conducted by the International Economic Development Council (IEDC) and marketing agency Development Counsellors International (DCI), 57% of IEDC members surveyed said they were using social media tools. Of that, 63% had used them for less than a year. At the time, developers primarily focused their social media efforts on internal or regional uses, such as disseminating news and providing links to resources that support local businesses. LinkedIn was the social network of choice.
What a difference a year makes. Since the survey, economic developers have expanded their social media repertoire. Looking beyond localized efforts, they are using blogs, Twitter, Facebook and YouTube to attract and interact with site selectors and company decision makers nationally and globally.
Here are five ways cities and regions are using social media today.
--------------------------------------------------------------------------------
1. Strengthening or Rebranding a Region's Image
--------------------------------------------------------------------------------
When Orlando was wooing a New York City-based company, it heard a concern that it wasn't considered “edgy” enough and was too “theme-parkish.” To demonstrate an “edgier” image, the Metro Orlando Economic Development Commission created a microsite with a YouTube and Flickr presence. The city also sourced stories from their members as well as testimonials about why they love living and working in Orlando through Facebook, Twitter and its e-newsletter.
The result? Orlando was shortlisted and matched against the target company's home base of Manhattan. The company decided not to relocate, but the Metro Orlando Economic Development Commission credits social media as part of what helped rebrand their city and make a strong showing in its recruiting efforts.
--------------------------------------------------------------------------------
2. Showcasing Story Ideas for the Media
--------------------------------------------------------------------------------
The Maryland Department of Business and Economic Development (DBED) used social media to generate media interest. The DBED launched a new website –- ChooseMaryland -– along with branded social media channels including Twitter, Facebook, LinkedIn, YouTube and Flickr.
Since launching its social media channels, the DBED has seen its efforts turn into news stories and media opportunities, including a story in the Maryland Daily Record, an interview by tech correspondent Mario Armstrong on his Digital Café radio show as well as retweets and blog posts by reporters from the Washington Post and Baltimore Sun.
Further south, the Greater Richmond Partnership, Inc. posts videos on YouTube of CEOs who have successfully relocated their companies, businesses that are growing in the area, and community leaders extolling the benefits of their city -- all as promotional tools. They also created a series of videos titled Boundless Creativity specifically for a UK conference for businesses interested in expanding their presence to the U.S. to promote the creative class centered in greater Richmond.
--------------------------------------------------------------------------------
3. Attracting Former Residents Back to an Area
--------------------------------------------------------------------------------
In the Midwest, the Republic County Economic Development in Kansas uses LinkedIn and Facebook to locate and reach out to alumni and other former residents. The goal? To entice them back to their region to fill available jobs or to relocate their companies and create new jobs. The organization uses LinkedIn to identify professionals who might match the services that are needed in the county. The hope is that if someone already has a connection to their area, they may have more incentive to return. The agency rounds out its social media efforts with a YouTube channel to promote a positive image about its communities.
The county hired Jenny Russell, an external Internet and social media marketer to handle the launch of the social media channels and to manage the day-to-day. As the Republic County Economic Development co-coordinator, Russell estimates that she spends about seven hours per week on social media promotions and management.
--------------------------------------------------------------------------------
4. Linking Job Seekers to Jobs
--------------------------------------------------------------------------------
Workforce development is a major aspect of economic development, and social media has been a useful way for economic development groups to promote and get results. In addition to the Greater Richmond Partnership's (GRP) social media channels for outreach on LinkedIn, Facebook, Twitter and Flickr, the organization also launched social media channels for its workforce program, RichmondJobNet. Those job-specific channels include a Facebook Page and a Twitter presence. According to Jennifer Yeager, marketing communications consultant for the GRP, of the 21,500 tweets the organization has posted, 90% have been job listings.
--------------------------------------------------------------------------------
5. Promoting Local and Regional Businesses and Assets
--------------------------------------------------------------------------------
The Roanoke Regional Partnership catalogued the destinations and activities for its region in a comprehensive website in order to raise interest in outdoor assets like the Blue Ridge Mountains, Appalachian Trail and Blue Ridge Parkway. Then it began using Facebook and Twitter to create or promote events such as scavenger hunts, outdoor expos and a film festival. They also use social media to share new data about outdoor businesses in the region, solicit input from residents for outdoor activities and answer questions for people planning outings.
The economic development agency, which represents three cities and four counties in southwest Virginia, has four Facebook accounts and four Twitter pages. According to Thomas Becher, president of public relations and advertising agency tba, within one year of adding social media to its communications mix, greenway use in the area was up 29% and state parks usage rose 12% - four times the average in Virginia.
--------------------------------------------------------------------------------
What Does the Future Hold?
--------------------------------------------------------------------------------
With social media adoption growing rapidly amongst economic developers in the past year, where else can they go to reach their audience and goals? Louisiana Economic Development has its sights set on mobile with the recent launch of EQ, its quarterly economic report publication for the iPad. The interactive app includes videos, photographs and content showcasing Louisiana's economic progress, business successes and Q&A's with industry leaders in the state.
“Economic development groups are increasingly turning to social media as a means of communicating both within their communities and externally with key audiences,” said Ryan Shell, director of digital and social media for DCI. “The medium has enormous potential for our profession.”
Changing old perceptions a big task in new economic-development push
By Kirk Ross
Staff Writer
This is the second in a series of articles on new economic-development initiatives in Orange County. The first article, on an effort to set up a new economic-development corporation is at carrborocitizen.com/main/2010/12/09/for-local-economic-development-%E2%80%98collaboration%E2%80%99-the-new-buzz-word
Call it the Southern Orange 80/20 rule, a kind of informal target for the mix of residential to commercial tax base.
Two decades ago, you would occasionally hear an elected official or policymaker talk about maintaining that 80/20 mix.
Now, not so much. With growing budget pressures, already-high property-tax rates and a lingering reputation of being anti-business, there is a general consensus that Orange County and its municipalities have to revise strategies.
In the past few years, Carrboro and Chapel Hill have expanded their economic-development efforts.
Chapel Hill set up an economic-development office and hired a full-time director in 2007. Carrboro maintains an office of economic and community development, which in addition to overseeing economic-development initiatives manages the town’s human-services grant program and affordable-housing efforts.
Now, with an effort to draw together local governments, the university and the business community in an economic-development collaboration, there comes the task of creating a structure and direction all parties can agree on. Then there’s the job of reversing a perception that has snowballed since Jesse Helms started railing against Hippie Hill.
Too much success
If there really was an 80/20 rule, you might say it was a roaring success, especially in Chapel Hill, which throughout the 1980s and ’90s tightened development ordinances and placed an emphasis on neighborhood protection. Stormwater runoff and traffic impacts were given greater scrutiny and the time developers could expect for review lengthened.
Chapel Hill Mayor Mark Kleinschmidt said that while the standards and safeguards put in place then were important, they fed into the perception the town was anti-business.
“Unfortunately, it created a momentum,” he said of the mythical 20 percent target. “We overshot that to our detriment.”
With the town’s commercial tax base now hovering at around 15 percent, he said, the town has to work hard to reverse the trend.
“We have to get businesses open more quickly,” Kleinschmidt said. The town also will have to continue to find ways to streamline the permitting process, he said, as well as be more open to new projects.
“We can’t say ‘no’ to everything,” he said.
Carrboro Mayor Mark Chilton, who served on the Chapel Hill Town Council in the mid-1990s, said that in both towns the mix of commercial to residential was driven by concerns about traffic and other impacts.
“Commercial development has been more controversial,” Chilton said. “That’s made it easier to grow residentially.”
That’s not likely to change soon, he said, noting the intense interest in projects like the proposed move of CVS in downtown Carrboro.
Brian Russell, a Carrboro business owner who serves on the Orange County Economic Development Commission, said despite efforts to be more open to commercial projects, the anti-business perception still haunts the county.
“As far as the reputation goes, its still alive and well,” Russell, who owns and runs Carrboro Creative Coworking, said. “We have a lot of public relations to do.”
Russell said any new economic-development entity will have to have a clear vision of what it wants to accomplish. He said he doesn’t think that means abandoning long-held principles.
“I think we can find a balance,” he said. “We need to find some harmony between the local business, anti-big box people and those who want them. We need to find some harmony with what environmentalists want and people being able to have a livelihood.”
Old concepts about economic development are colliding with the pressing need for more jobs, Russell said. “It’s not that simple anymore.”
Chilton agreed that the need for increasing the commercial tax base and the jobs that come with it is growing. That means making adjustments. The town recently worked with developers to add commercial properties to new housing developments and identified parcels north of town for commercial development.
“We’re in a far different environment than we were three, four or 10 years ago,” Chilton said.
Staff Writer
This is the second in a series of articles on new economic-development initiatives in Orange County. The first article, on an effort to set up a new economic-development corporation is at carrborocitizen.com/main/2010/12/09/for-local-economic-development-%E2%80%98collaboration%E2%80%99-the-new-buzz-word
Call it the Southern Orange 80/20 rule, a kind of informal target for the mix of residential to commercial tax base.
Two decades ago, you would occasionally hear an elected official or policymaker talk about maintaining that 80/20 mix.
Now, not so much. With growing budget pressures, already-high property-tax rates and a lingering reputation of being anti-business, there is a general consensus that Orange County and its municipalities have to revise strategies.
In the past few years, Carrboro and Chapel Hill have expanded their economic-development efforts.
Chapel Hill set up an economic-development office and hired a full-time director in 2007. Carrboro maintains an office of economic and community development, which in addition to overseeing economic-development initiatives manages the town’s human-services grant program and affordable-housing efforts.
Now, with an effort to draw together local governments, the university and the business community in an economic-development collaboration, there comes the task of creating a structure and direction all parties can agree on. Then there’s the job of reversing a perception that has snowballed since Jesse Helms started railing against Hippie Hill.
Too much success
If there really was an 80/20 rule, you might say it was a roaring success, especially in Chapel Hill, which throughout the 1980s and ’90s tightened development ordinances and placed an emphasis on neighborhood protection. Stormwater runoff and traffic impacts were given greater scrutiny and the time developers could expect for review lengthened.
Chapel Hill Mayor Mark Kleinschmidt said that while the standards and safeguards put in place then were important, they fed into the perception the town was anti-business.
“Unfortunately, it created a momentum,” he said of the mythical 20 percent target. “We overshot that to our detriment.”
With the town’s commercial tax base now hovering at around 15 percent, he said, the town has to work hard to reverse the trend.
“We have to get businesses open more quickly,” Kleinschmidt said. The town also will have to continue to find ways to streamline the permitting process, he said, as well as be more open to new projects.
“We can’t say ‘no’ to everything,” he said.
Carrboro Mayor Mark Chilton, who served on the Chapel Hill Town Council in the mid-1990s, said that in both towns the mix of commercial to residential was driven by concerns about traffic and other impacts.
“Commercial development has been more controversial,” Chilton said. “That’s made it easier to grow residentially.”
That’s not likely to change soon, he said, noting the intense interest in projects like the proposed move of CVS in downtown Carrboro.
Brian Russell, a Carrboro business owner who serves on the Orange County Economic Development Commission, said despite efforts to be more open to commercial projects, the anti-business perception still haunts the county.
“As far as the reputation goes, its still alive and well,” Russell, who owns and runs Carrboro Creative Coworking, said. “We have a lot of public relations to do.”
Russell said any new economic-development entity will have to have a clear vision of what it wants to accomplish. He said he doesn’t think that means abandoning long-held principles.
“I think we can find a balance,” he said. “We need to find some harmony between the local business, anti-big box people and those who want them. We need to find some harmony with what environmentalists want and people being able to have a livelihood.”
Old concepts about economic development are colliding with the pressing need for more jobs, Russell said. “It’s not that simple anymore.”
Chilton agreed that the need for increasing the commercial tax base and the jobs that come with it is growing. That means making adjustments. The town recently worked with developers to add commercial properties to new housing developments and identified parcels north of town for commercial development.
“We’re in a far different environment than we were three, four or 10 years ago,” Chilton said.
Tuesday, December 14, 2010
Montgomery Area Chamber of Commerce sees model in Texas city
By Mary Sell • December 14, 2010
The Montgomery Area Chamber of Commerce is
looking forward by looking 800 miles west.
Chamber leaders want to emulate in Montgomery
the recent economic turnaround in Austin, Texas,
that has created more than 100,000 new jobs and
greatly increased home values.
Gary Farmer, the immediate past chairman of the
Greater Austin Economic Development Corp. and a
small-business owner, was the keynote speaker of
the chamber's annual luncheon Monday. He spoke
about the strategy that brought 124,000 new jobs to
the Austin area in five years.
Farmer said Montgomery has a "treasure trove" of
resources.
"You guys have the assets; you just have to put it all
together," he told the crowd of about 800 chamber
members and business leaders at the Renaissance
Montgomery Hotel & Spa at the Convention Center in
downtown Montgomery.
Austin and Montgomery have used the same
consultant company for their development plans.
Last month, a group of about 50 business and
political leaders from Montgomery visited Austin to
begin work on the chamber's next five-year plan.
The chamber's current five-year plan, Imagine a
Greater Montgomery, ends in 2011. Its five pillars
are improving education; strengthening the
economy; transforming Montgomery's image;
embracing diversity and enhancing leadership; and
strengthening the chamber.
Farmer is mentoring leaders in the River Region.
"Gary's leadership and vision really helps us set the
stage for our next phase of Imagine a Greater
Montgomery. His accomplishments have made
such a tremendous impact on Austin and his work
is a shining example for Montgomery to follow,"
said Nimrod T. Frazer Jr., the 2010 chairman of the
chamber's board of directors, in a written statement.
Farmer's tips ranged from improving the city's
image to seeking out new businesses. Austin had
144 corporate relocation announcements in the
first five years of its plan.
"Everyone I've talked to over the past couple of
months has shown a commitment to grow
Montgomery," Farmer said. "I think you're on the
right track."
He cautioned leaders to pay attention to existing
businesses while courting new companies.
"'Cause if you're not, I'm going to be over here
talking to them and trying to get them to come to
Texas," he said.
Monday's luncheon, the chamber's signature
annual event, also included a transition in
leadership. Larry Puckett, owner of Larry Puckett
Chevrolet, will be the chairman of the chamber's
board of directors for 2011. Puckett, of Prattville,
will replace Frazer on Jan. 1.
Puckett encouraged attendees of the meeting to
participate in Montgomery's revival.
"Stay involved and wake up every day and find
something for you to do to make Montgomery a
better place," he said.
The Montgomery Area Chamber of Commerce is
looking forward by looking 800 miles west.
Chamber leaders want to emulate in Montgomery
the recent economic turnaround in Austin, Texas,
that has created more than 100,000 new jobs and
greatly increased home values.
Gary Farmer, the immediate past chairman of the
Greater Austin Economic Development Corp. and a
small-business owner, was the keynote speaker of
the chamber's annual luncheon Monday. He spoke
about the strategy that brought 124,000 new jobs to
the Austin area in five years.
Farmer said Montgomery has a "treasure trove" of
resources.
"You guys have the assets; you just have to put it all
together," he told the crowd of about 800 chamber
members and business leaders at the Renaissance
Montgomery Hotel & Spa at the Convention Center in
downtown Montgomery.
Austin and Montgomery have used the same
consultant company for their development plans.
Last month, a group of about 50 business and
political leaders from Montgomery visited Austin to
begin work on the chamber's next five-year plan.
The chamber's current five-year plan, Imagine a
Greater Montgomery, ends in 2011. Its five pillars
are improving education; strengthening the
economy; transforming Montgomery's image;
embracing diversity and enhancing leadership; and
strengthening the chamber.
Farmer is mentoring leaders in the River Region.
"Gary's leadership and vision really helps us set the
stage for our next phase of Imagine a Greater
Montgomery. His accomplishments have made
such a tremendous impact on Austin and his work
is a shining example for Montgomery to follow,"
said Nimrod T. Frazer Jr., the 2010 chairman of the
chamber's board of directors, in a written statement.
Farmer's tips ranged from improving the city's
image to seeking out new businesses. Austin had
144 corporate relocation announcements in the
first five years of its plan.
"Everyone I've talked to over the past couple of
months has shown a commitment to grow
Montgomery," Farmer said. "I think you're on the
right track."
He cautioned leaders to pay attention to existing
businesses while courting new companies.
"'Cause if you're not, I'm going to be over here
talking to them and trying to get them to come to
Texas," he said.
Monday's luncheon, the chamber's signature
annual event, also included a transition in
leadership. Larry Puckett, owner of Larry Puckett
Chevrolet, will be the chairman of the chamber's
board of directors for 2011. Puckett, of Prattville,
will replace Frazer on Jan. 1.
Puckett encouraged attendees of the meeting to
participate in Montgomery's revival.
"Stay involved and wake up every day and find
something for you to do to make Montgomery a
better place," he said.
Friday, December 10, 2010
Study finds details lacking in economic development deals
By John Gramlich, Stateline Staff Writer
The national economic downturn has turned many governors into salesmen-in-chief, moving aggressively — and often in direct competition with one another — to lure more private-sector jobs to their states.
Consider Rick Perry. The Texas governor raised eyebrows earlier this year when he wrote letters to 90 business executives in Washington State, urging them to relocate to Texas because of a proposed new income tax in Washington. "If Washington doesn't want your business," Perry wrote to the heads of firms including Microsoft and Starbucks, "Texas does." (Washington's proposed income tax failed at the polls in November.)
While sales pitches such as Perry's have become increasingly common, a new 50-state report finds that the details of what job-hungry states offer companies are rarely disclosed to the public in an easy and accessible way. States, in other words, place a premium on economic development, but not necessarily on informing residents about the tax breaks, grants and other incentives that are at the center of such deals.
Four states — Illinois, North Carolina, Ohio and Wisconsin — lead the nation in disclosing information about their job-creation efforts, according to the report, released earlier this week by Good Jobs First, a Washington, D.C., group that promotes more accountability of such deals. But even those states have plenty of room for improvement, the study finds.
Ohio, for example, provides information about tax breaks and other deals it gives to each company, but it does not provide information about whether companies held up their end of the bargain: whether they created the jobs they promised or made the investments they said they would, as The Columbus Dispatch notes.
While most states are not providing many details about their job subsidies, the study does note that substantially more states — 37 — now disclose information than the 23 that did so just three years ago. Thirteen other states and the District of Columbia, however, still provide no information at all.
“Our findings tell two different stories,” says Greg LeRoy, executive director of Good Jobs First. “The first is one of the steady spread of transparency across the nation. The other is that some states still inexplicably keep taxpayers completely or partially in the dark. The accountability movement has made great advances but still has a long way to go before job subsidies are as transparent as other categories of state spending, such as procurement.”
"Today’s Take” provides a quick analysis of the day’s top news in state government.
—Contact John Gramlich at jgramlich@stateline.org
The national economic downturn has turned many governors into salesmen-in-chief, moving aggressively — and often in direct competition with one another — to lure more private-sector jobs to their states.
Consider Rick Perry. The Texas governor raised eyebrows earlier this year when he wrote letters to 90 business executives in Washington State, urging them to relocate to Texas because of a proposed new income tax in Washington. "If Washington doesn't want your business," Perry wrote to the heads of firms including Microsoft and Starbucks, "Texas does." (Washington's proposed income tax failed at the polls in November.)
While sales pitches such as Perry's have become increasingly common, a new 50-state report finds that the details of what job-hungry states offer companies are rarely disclosed to the public in an easy and accessible way. States, in other words, place a premium on economic development, but not necessarily on informing residents about the tax breaks, grants and other incentives that are at the center of such deals.
Four states — Illinois, North Carolina, Ohio and Wisconsin — lead the nation in disclosing information about their job-creation efforts, according to the report, released earlier this week by Good Jobs First, a Washington, D.C., group that promotes more accountability of such deals. But even those states have plenty of room for improvement, the study finds.
Ohio, for example, provides information about tax breaks and other deals it gives to each company, but it does not provide information about whether companies held up their end of the bargain: whether they created the jobs they promised or made the investments they said they would, as The Columbus Dispatch notes.
While most states are not providing many details about their job subsidies, the study does note that substantially more states — 37 — now disclose information than the 23 that did so just three years ago. Thirteen other states and the District of Columbia, however, still provide no information at all.
“Our findings tell two different stories,” says Greg LeRoy, executive director of Good Jobs First. “The first is one of the steady spread of transparency across the nation. The other is that some states still inexplicably keep taxpayers completely or partially in the dark. The accountability movement has made great advances but still has a long way to go before job subsidies are as transparent as other categories of state spending, such as procurement.”
"Today’s Take” provides a quick analysis of the day’s top news in state government.
—Contact John Gramlich at jgramlich@stateline.org
Sunday, December 05, 2010
Christiansburg's Microsoft miss brings pricey lessons
With spring approaching, recruiter Michael MacNeilly with the Virginia Economic Development Partnership could smell victory.
Microsoft Corp. was poised to announce plans to locate a nearly $500 million data center in Christiansburg, ending a three-year courtship to bring the high-tech, high-paying project to Montgomery County's prime industrial site.
"You could be pouring footers in less than a month," MacNeilly wrote to the company's head of data center development on Feb. 24.
A news release drafted March 23 under the headline, "GOVERNOR MCDONNELL ANNOUNCES MICROSOFT DATA CENTER IN MONTGOMERY COUNTY," called it the largest industrial investment in Southwest Virginia history.
Seven weeks later, Microsoft dropped Montgomery County from consideration.
The high-wattage electricity, premium broadband, utilities and government incentives Microsoft demanded were all there.
The deal-killer: a sinkhole about the size of a small backyard swimming pool that led to the discovery of underground voids that Microsoft feared could bring more.
The abruptness with which Microsoft changed course is characteristic of how big economic deals are made, with the company calling the shots.
"Everything has got to be absolutely perfect. They don't cut you any slack at all. Because the competition is so severe, they don't have to," said Glenn Barbour, chairman of the board of supervisors in Mecklenburg County, where Microsoft eventually decided to build the center.
The case was a nail-biter for officials who dealt with Microsoft in near-total secrecy.
It is noteworthy as a near-win of significant proportions that, aside from the geologic issues, places Montgomery County in a positive light. But it also raises the question of how much is too much when it comes to luring companies through economic incentives.
To attract Microsoft's interest, local leaders had dangled tens of millions of dollars in financial rewards through a commonly used tax-rebate mechanism.
Aric Bopp, who directs the New River Valley Economic Development Alliance, was quick to find a silver lining.
The region will not become a hub of Microsoft data operations. But neither is it on the hook for the steep price tag promised to the company.
"Maybe there will be a bigger and better use for the site in the future that employs more people and demands fewer incentives. I sure hope so," Bopp wrote to the Microsoft recruitment team.
But first, local officials have to grapple with the disclosure that Microsoft judged one of its prime sites geologically challenged, a potential obstacle for attracting the next "big one."
Incentive offers play out as a high-wire act
New River Valley economic development officials have declined repeated requests to talk about the Microsoft deal.
Yet 436 pages of e-mail correspondence and related documents -- released by the state after the Aug. 27 announcement that Mecklenburg County landed Microsoft -- tell the story of a three-year recruitment that unfolds in tense written exchanges and moments of intrigue.
Microsoft created the first personal computer software in widespread use and is a top player in the ongoing quest for the best search engine, best smart phone operating system and most trusted Web-hosting enterprise.
Hoping to expand quickly into cloud computing, or delivering computing power over the Web, Microsoft has begun work on a series of data centers around the globe.
Behind the veil of secrecy that officials fought hard to keep down during negotiations is evidence that Montgomery County and Christiansburg offered a small fortune to become a major contender for the new center.
To understand the magnitude of the story, one has to go back to January, when the business prospects were looking good for the Montgomery County site.
During confidential negotiations with local and state officials, Microsoft had gotten seriously interested in a graded lot measuring 46 acres. The facility was to house more than 100,000 computer servers to host ever-more data and computing power online.
Brian Hamilton, Montgomery County's economic development director, belonged to an inner circle of fully informed government employees who signed confidentiality agreements with Microsoft.
Scores of e-mail messages reflect his earnestness and hard work.
"We want this project," Hamilton told the Virginia Economic Development Partnership, a state-funded and controlled private, nonprofit corporation that oversaw the effort to attract the Microsoft facility to Virginia.
While the county grappled with finding money for basic services such as education, the localities offered to forgo $62 million to $117 million in taxes to attract the facility and its 50, $50,000-a-year jobs, according to e-mail correspondence. The incentive amount has not been publicly released, but a state official tasked with making dozens of redactions in the 436 pages of e-mails before their release failed to black out Montgomery County's offer completely. It could not be confirmed.
Bernard Weinstein, who was director of the Center for Economic Development and Research at the University of North Texas from 1989 to 2009, is one critic of localities offering huge economic inducements to get noticed by the likes of Microsoft and other large corporations that from time to time add major new facilities.
Typical support includes upfront cash, discounts on land and utility connections, and rebates that return a portion of tax payments shortly after they are made.
Weinstein said he's got a big problem with localities behaving like cash machines to attract jobs when corporations are more than able to pay their own way.
Microsoft, based in Redmond, Wash., earned $18.8 billion on revenue of $62.5 billion during the 12 months ended June 30.
When told of Montgomery County's offer for the Microsoft data center, he called the offer "absolutely insane."
"This competitive incentives game is worse today than it's ever been," he said. "That's partly because there's so much anxiety about job creation, and local politicians love to run on a platform of 'Thanks to me, such and such company located here, or expanded here.' "
In addition, incentives are called unfair to established businesses that do not have a deal and must pay taxes.
To make matters worse, local government agencies do not know the names of the communities in the same state or another state they are competing against, let alone how much they have already bid.
But some "will do anything to land a business and garner splashy headlines ... for businesses that may bring few jobs to an area or have little overall positive effect on the economy," John Accordino, who teaches urban and regional planning at Virginia Commonwealth University, wrote in an article in Virginia Issues & Answers, a Virginia Tech magazine.
For their part, private and government economic development officers describe incentives as the price communities must pay to attract new business investment in today's environment.
Without incentives on the table, a community will be passed over, they say.
"Our region would fare much better if economic incentives did not exist because our natural attributes and assets would far outweigh what other communities have, especially in places like North Carolina," Bopp said of the NRV alliance. But "they're a necessary evil these days."
Accordino argues that the setting and offering of incentives should at a minimum be opened to public review. In a public arena, officials would have to make the case for incentives to citizens.
"If economic development focuses on growing the economic base and generally enhancing the region's ability to compete, public officials have nothing to fear from full and frequent public disclosure," he wrote.
As it stands, deals are all but sealed in private.
Documentation, even the confidentiality agreements, are hidden from public knowledge. Even the amount of incentives offered is information local and state officials say the public should not know.
A more radical proposal would be to ban government incentives at the local level, leaving the financial enticement of businesses to the states.
Tim Sutton, an elected official in Alamance County, N.C., who supports this vision, said if a company does not wish to expand or move in without a local financial reward, let it go elsewhere.
"If you've got something to sell in your county besides cash giveaways, you ought to be able to sell that," Sutton said.
As it builds in Mecklenburg County, Microsoft Corp. is in line for the following incentives
-$2.1 million from the Virginia Governor’s Opportunity Development Fund.
-$4.8 million through the Virginia Tobacco Indemnification and Community Revitalization Commission.
-More than $20 million in savings through a state sales-tax exemption for computer purchases.
-$50,000 in state-paid employee hiring and training benefits.
-Free grant of county real estate worth $2 million.
-$3.95 million of benefits related to local water and sewer connections.
-20-year, 90 percent local personal property tax rebate worth $12 million during the first three years alone.
Source: Incentives agreements signed by Mecklenburg County, Virginia Economic Development Partnership and Microsoft Corp.
Microsoft lands valuable incentive package
Mecklenburg County is unable to estimate its tax gains, break-even point or even the total value of the local incentives package for Microsoft, because it does not know precisely what the company will spend or when, County Administrator Wayne Carter said.
At its new home in Southside, Microsoft is in line for upfront payments of $2.1 million from the state and $4.8 million through the Virginia Tobacco Indemnification and Community Revitalization Commission; state sales tax exemptions of unknown value; $50,000 in state-paid employee hiring and training benefits; a $2 million piece of county real estate free; $3.95 million of benefits related to local "water and sewer connections;" and a 20-year, 90 percent local personal property tax rebate worth $12 million during the first three years alone, according to agreements signed by the company and government officials.
For its part, Microsoft promised the state it would spend $44 million on a new building subject to the local real estate tax and $255 million on equipment including computer servers subject to the local personal property tax by the end of 2014 and, in later years, spend an additional $200 million, for a grand total of $499 million, the agreements said. The company is preparing its building site, which sits beside U.S. 58 just outside Boydton.
The company has said hiring will begin by early summer. It is looking for about 50 people who will receive an average salary of $49,700, which is 75 percent higher than Mecklenburg County's average annual salary of $28,423.
The state expects to break even by 2021, according to its agreement.
Had the same deal been made in Montgomery County, it's unknown how much tax Montgomery County and Christiansburg would have kept.
Officials have said Montgomery County's offer was comparable to Mecklenburg's but would not detail it.
The new jobs would have expanded a budding tech job market in Montgomery County.
Microsoft Corp. was poised to announce plans to locate a nearly $500 million data center in Christiansburg, ending a three-year courtship to bring the high-tech, high-paying project to Montgomery County's prime industrial site.
"You could be pouring footers in less than a month," MacNeilly wrote to the company's head of data center development on Feb. 24.
A news release drafted March 23 under the headline, "GOVERNOR MCDONNELL ANNOUNCES MICROSOFT DATA CENTER IN MONTGOMERY COUNTY," called it the largest industrial investment in Southwest Virginia history.
Seven weeks later, Microsoft dropped Montgomery County from consideration.
The high-wattage electricity, premium broadband, utilities and government incentives Microsoft demanded were all there.
The deal-killer: a sinkhole about the size of a small backyard swimming pool that led to the discovery of underground voids that Microsoft feared could bring more.
The abruptness with which Microsoft changed course is characteristic of how big economic deals are made, with the company calling the shots.
"Everything has got to be absolutely perfect. They don't cut you any slack at all. Because the competition is so severe, they don't have to," said Glenn Barbour, chairman of the board of supervisors in Mecklenburg County, where Microsoft eventually decided to build the center.
The case was a nail-biter for officials who dealt with Microsoft in near-total secrecy.
It is noteworthy as a near-win of significant proportions that, aside from the geologic issues, places Montgomery County in a positive light. But it also raises the question of how much is too much when it comes to luring companies through economic incentives.
To attract Microsoft's interest, local leaders had dangled tens of millions of dollars in financial rewards through a commonly used tax-rebate mechanism.
Aric Bopp, who directs the New River Valley Economic Development Alliance, was quick to find a silver lining.
The region will not become a hub of Microsoft data operations. But neither is it on the hook for the steep price tag promised to the company.
"Maybe there will be a bigger and better use for the site in the future that employs more people and demands fewer incentives. I sure hope so," Bopp wrote to the Microsoft recruitment team.
But first, local officials have to grapple with the disclosure that Microsoft judged one of its prime sites geologically challenged, a potential obstacle for attracting the next "big one."
Incentive offers play out as a high-wire act
New River Valley economic development officials have declined repeated requests to talk about the Microsoft deal.
Yet 436 pages of e-mail correspondence and related documents -- released by the state after the Aug. 27 announcement that Mecklenburg County landed Microsoft -- tell the story of a three-year recruitment that unfolds in tense written exchanges and moments of intrigue.
Microsoft created the first personal computer software in widespread use and is a top player in the ongoing quest for the best search engine, best smart phone operating system and most trusted Web-hosting enterprise.
Hoping to expand quickly into cloud computing, or delivering computing power over the Web, Microsoft has begun work on a series of data centers around the globe.
Behind the veil of secrecy that officials fought hard to keep down during negotiations is evidence that Montgomery County and Christiansburg offered a small fortune to become a major contender for the new center.
To understand the magnitude of the story, one has to go back to January, when the business prospects were looking good for the Montgomery County site.
During confidential negotiations with local and state officials, Microsoft had gotten seriously interested in a graded lot measuring 46 acres. The facility was to house more than 100,000 computer servers to host ever-more data and computing power online.
Brian Hamilton, Montgomery County's economic development director, belonged to an inner circle of fully informed government employees who signed confidentiality agreements with Microsoft.
Scores of e-mail messages reflect his earnestness and hard work.
"We want this project," Hamilton told the Virginia Economic Development Partnership, a state-funded and controlled private, nonprofit corporation that oversaw the effort to attract the Microsoft facility to Virginia.
While the county grappled with finding money for basic services such as education, the localities offered to forgo $62 million to $117 million in taxes to attract the facility and its 50, $50,000-a-year jobs, according to e-mail correspondence. The incentive amount has not been publicly released, but a state official tasked with making dozens of redactions in the 436 pages of e-mails before their release failed to black out Montgomery County's offer completely. It could not be confirmed.
Bernard Weinstein, who was director of the Center for Economic Development and Research at the University of North Texas from 1989 to 2009, is one critic of localities offering huge economic inducements to get noticed by the likes of Microsoft and other large corporations that from time to time add major new facilities.
Typical support includes upfront cash, discounts on land and utility connections, and rebates that return a portion of tax payments shortly after they are made.
Weinstein said he's got a big problem with localities behaving like cash machines to attract jobs when corporations are more than able to pay their own way.
Microsoft, based in Redmond, Wash., earned $18.8 billion on revenue of $62.5 billion during the 12 months ended June 30.
When told of Montgomery County's offer for the Microsoft data center, he called the offer "absolutely insane."
"This competitive incentives game is worse today than it's ever been," he said. "That's partly because there's so much anxiety about job creation, and local politicians love to run on a platform of 'Thanks to me, such and such company located here, or expanded here.' "
In addition, incentives are called unfair to established businesses that do not have a deal and must pay taxes.
To make matters worse, local government agencies do not know the names of the communities in the same state or another state they are competing against, let alone how much they have already bid.
But some "will do anything to land a business and garner splashy headlines ... for businesses that may bring few jobs to an area or have little overall positive effect on the economy," John Accordino, who teaches urban and regional planning at Virginia Commonwealth University, wrote in an article in Virginia Issues & Answers, a Virginia Tech magazine.
For their part, private and government economic development officers describe incentives as the price communities must pay to attract new business investment in today's environment.
Without incentives on the table, a community will be passed over, they say.
"Our region would fare much better if economic incentives did not exist because our natural attributes and assets would far outweigh what other communities have, especially in places like North Carolina," Bopp said of the NRV alliance. But "they're a necessary evil these days."
Accordino argues that the setting and offering of incentives should at a minimum be opened to public review. In a public arena, officials would have to make the case for incentives to citizens.
"If economic development focuses on growing the economic base and generally enhancing the region's ability to compete, public officials have nothing to fear from full and frequent public disclosure," he wrote.
As it stands, deals are all but sealed in private.
Documentation, even the confidentiality agreements, are hidden from public knowledge. Even the amount of incentives offered is information local and state officials say the public should not know.
A more radical proposal would be to ban government incentives at the local level, leaving the financial enticement of businesses to the states.
Tim Sutton, an elected official in Alamance County, N.C., who supports this vision, said if a company does not wish to expand or move in without a local financial reward, let it go elsewhere.
"If you've got something to sell in your county besides cash giveaways, you ought to be able to sell that," Sutton said.
As it builds in Mecklenburg County, Microsoft Corp. is in line for the following incentives
-$2.1 million from the Virginia Governor’s Opportunity Development Fund.
-$4.8 million through the Virginia Tobacco Indemnification and Community Revitalization Commission.
-More than $20 million in savings through a state sales-tax exemption for computer purchases.
-$50,000 in state-paid employee hiring and training benefits.
-Free grant of county real estate worth $2 million.
-$3.95 million of benefits related to local water and sewer connections.
-20-year, 90 percent local personal property tax rebate worth $12 million during the first three years alone.
Source: Incentives agreements signed by Mecklenburg County, Virginia Economic Development Partnership and Microsoft Corp.
Microsoft lands valuable incentive package
Mecklenburg County is unable to estimate its tax gains, break-even point or even the total value of the local incentives package for Microsoft, because it does not know precisely what the company will spend or when, County Administrator Wayne Carter said.
At its new home in Southside, Microsoft is in line for upfront payments of $2.1 million from the state and $4.8 million through the Virginia Tobacco Indemnification and Community Revitalization Commission; state sales tax exemptions of unknown value; $50,000 in state-paid employee hiring and training benefits; a $2 million piece of county real estate free; $3.95 million of benefits related to local "water and sewer connections;" and a 20-year, 90 percent local personal property tax rebate worth $12 million during the first three years alone, according to agreements signed by the company and government officials.
For its part, Microsoft promised the state it would spend $44 million on a new building subject to the local real estate tax and $255 million on equipment including computer servers subject to the local personal property tax by the end of 2014 and, in later years, spend an additional $200 million, for a grand total of $499 million, the agreements said. The company is preparing its building site, which sits beside U.S. 58 just outside Boydton.
The company has said hiring will begin by early summer. It is looking for about 50 people who will receive an average salary of $49,700, which is 75 percent higher than Mecklenburg County's average annual salary of $28,423.
The state expects to break even by 2021, according to its agreement.
Had the same deal been made in Montgomery County, it's unknown how much tax Montgomery County and Christiansburg would have kept.
Officials have said Montgomery County's offer was comparable to Mecklenburg's but would not detail it.
The new jobs would have expanded a budding tech job market in Montgomery County.
Local nonprofits tasked with economic development use different methods
By Eric Pfahler
Amidst double-digit unemployment, Treasure Coast county governments have continued to put money toward efforts to increase jobs while other programs and services have been cut.
Martin, St. Lucie and Indian River counties all turn to nonprofit economic development agencies for help drawing high-wage jobs to the region. All three counties have unemployment rates higher than 11.8 percent, according to the latest figures from the Agency for Workforce Innovation.
"They have been effective in recruiting companies and industries here at the county," St. Lucie County Administrator Faye Outlaw said. "I think the county has gotten a good return on its investment."
In 2010, Martin County doubled its contract with the Business Development Board of Martin County to $625,000. St. Lucie County has a $225,000 contract with the Economic Development Council of St. Lucie County. Indian River County has a $119,000 contract with the Indian River County Chamber of Commerce for economic development.
Each county has a different public-private partnership.
"It's not a cookie-cutter approach to doing economic development by having all organizations look alike and act alike," said Stuart Doyle, the spokesman for Enterprise Florida, the state agency for economic development. "They really represent the clientele that they serve."
In an e-mail to Scripps Treasure Coast Newspapers, Economic Development Council of St. Lucie County Director Larry Pelton said there are advantages to such partnerships between the private and public sector. Local officials credit the council and Pelton with helping draw entities such as Digital Domain Holdings and Torrey Pines Institute for Molecular Studies to the county and putting together incentive packages featuring state and local tax dollars for the employers.
The nonprofit has created 1,755 new jobs since June 2006 and has helped local businesses expand by 1,503 full-time jobs in that time period with more projects in the pipeline, Pelton said. The county's $225,000 contribution comes from the general fund.
"The advantage of being a private organization in the recruitment of private sector jobs include: the ability to raise private funding from business investors; a great deal of credibility with private companies that we understand their business planning and needs; the ability to sign corporate confidentiality agreements that are common in the business world; the ability to organize private leadership teams to address business needs; the ability to deal with companies' sensitive proprietary information," Pelton wrote.
Area officials consider Pelton a star hire. He was hired in 2006 after he was key to recruiting Scripps Research Institute to northern Palm Beach County.
The council raised $344,000 from the private sector and paid out $362,000 in salaries, compensation and employee benefits, including $195,000 to Pelton, according to a 2008-09 tax return. According to the tax return, Pelton made $173,000 in base compensation and $22,000 in bonus and incentive compensation.
In the e-mail, Pelton wrote that none of the public funds pay the full compensation of any employees, and his compensation could be maintained without public funds.
After a national search, the Business Development Board Martin County hired Ron Bunch from Danville, Va. to be the board's director.
Bunch now makes $141,000, according to the board's 2008-09 tax return. Ten companies are slated to create 1,182 jobs during the next three years with the board's help, according to the board.
In 2010, the county doubled its contract with the board. Each year, the county gives the board money received from occupational licenses, which are taxes businesses pay to operate. The total typically is about $300,000. The rest of the $625,000 comes from the general fund.
According to 2008-09 tax returns, the business board received $82,000 from the private sector. Crystal Stiles, the board's marketing manager, said the group explored raising more private money, but the board was advised not to try while the economy struggled.
Indian River County is unique compared to others in the Treasure Coast.
The economic development division of the Indian River County Chamber of Commerce helped the county retain Piper Aircraft Inc. and attract a CVS Pharmacy regional distribution center. The two totalled 1,125 jobs. According to the chamber, the division has facilitated six job grants within the last 12 to 18 months that will add about 250 new jobs over the next several years. Another 100 construction jobs are expected from the INEOS New Planet BioEnergy LLC facility.
Private money coming into the chamber helps subsidize the government's efforts to draw business, chamber president Penny Chandler wrote in an e-mail to Scripps Treasure Coast Newspapers.
The chamber houses the economic development division, and so the chamber pays for rent to help keep the public costs down. Other chambers of commerce in the Treasure Coast are separate entities from the local economic development agency.
The chamber does not get paid up front by the county, but rather gets paid back after spending for economic development. The economic development division budget also is approved by the Economic Development Council, which is made up of industry leaders and elected officials throughout Indian River County.
For the 2010 budget year, $40,254 of the $119,000 from the county went to salary and benefits, according to the chamber's request for funding for the 2011 budget year. One position is partially paid for by county funds. The rest of the division's staff is paid from private money collected by the chamber, which reported seven-figure revenues each year from 2006-07 to 2008-09 according to tax returns.
Doyle said many local entities are struggling to raise private money. But Doyle said private sector involvement in attracting business remains key.
"It's still important to have the private sector or the business community involved in economic development because in a major way, they are experts," Doyle said.
ECONOMIC DEVELOPMENT SPENDING
Here's a look at how much local economic development agencies take in from the public and private sector and how they use the money based on information available to the public:
Business Development Board of Martin County*
Public sector contributions: $312,000
Public sector source: Occupational license fees charged to businesses
Private sector contributions: $82,000
Total revenues: $394,000
Amount paid toward salaries, other compensation and employee benefits: $249,000
Marketing and advertising: $25,000
Economic Development Council of St. Lucie ^
Public sector contribution: $268,000
Public sector source: County general fund accounts for $250,000
Private sector contributions: $327,000
Total revenues: $611,000
Amount paid toward salaries, other compensation and employee benefits: $362,000
Marketing and advertising: $13,000
Economic Development Division of the Indian River Chamber of Commerce@
Public sector contribution: $119,000
Public sector source: County general fund
Private sector contributions: Contributions sorted in separate accounts for purposes not limited to economic development. Private sector covers some salary expenses and space for economic development.
Total revenues: $119,000
Amount paid toward salaries, other compensation and employee benefits: $40,000
Marketing and advertising: $0
* Information according to 2008-09 tax return. Martin County since increased its total contribution to $625,000 through general fund contributions.
^ Information according to 2008-09 tax return. St. Lucie County since decreased its total contribution to $225,000.
@ Information according to 2010 request for funding. No money is listed specifically for advertising or marketing, but $1,350 for printing and publications. Indian River Chamber of Commerce pays for space and subsidizes economic development division through private funds.
LOCAL UNEMPLOYMENT RATES
Here's a look at the latest figures from the state's Agency for Workforce Innovation for local unemployment.
Martin County: 11.8 percent
St. Lucie County: 14.7 percent
Indian River County: 14.2 percent
© 2010 TCPalm. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Amidst double-digit unemployment, Treasure Coast county governments have continued to put money toward efforts to increase jobs while other programs and services have been cut.
Martin, St. Lucie and Indian River counties all turn to nonprofit economic development agencies for help drawing high-wage jobs to the region. All three counties have unemployment rates higher than 11.8 percent, according to the latest figures from the Agency for Workforce Innovation.
"They have been effective in recruiting companies and industries here at the county," St. Lucie County Administrator Faye Outlaw said. "I think the county has gotten a good return on its investment."
In 2010, Martin County doubled its contract with the Business Development Board of Martin County to $625,000. St. Lucie County has a $225,000 contract with the Economic Development Council of St. Lucie County. Indian River County has a $119,000 contract with the Indian River County Chamber of Commerce for economic development.
Each county has a different public-private partnership.
"It's not a cookie-cutter approach to doing economic development by having all organizations look alike and act alike," said Stuart Doyle, the spokesman for Enterprise Florida, the state agency for economic development. "They really represent the clientele that they serve."
In an e-mail to Scripps Treasure Coast Newspapers, Economic Development Council of St. Lucie County Director Larry Pelton said there are advantages to such partnerships between the private and public sector. Local officials credit the council and Pelton with helping draw entities such as Digital Domain Holdings and Torrey Pines Institute for Molecular Studies to the county and putting together incentive packages featuring state and local tax dollars for the employers.
The nonprofit has created 1,755 new jobs since June 2006 and has helped local businesses expand by 1,503 full-time jobs in that time period with more projects in the pipeline, Pelton said. The county's $225,000 contribution comes from the general fund.
"The advantage of being a private organization in the recruitment of private sector jobs include: the ability to raise private funding from business investors; a great deal of credibility with private companies that we understand their business planning and needs; the ability to sign corporate confidentiality agreements that are common in the business world; the ability to organize private leadership teams to address business needs; the ability to deal with companies' sensitive proprietary information," Pelton wrote.
Area officials consider Pelton a star hire. He was hired in 2006 after he was key to recruiting Scripps Research Institute to northern Palm Beach County.
The council raised $344,000 from the private sector and paid out $362,000 in salaries, compensation and employee benefits, including $195,000 to Pelton, according to a 2008-09 tax return. According to the tax return, Pelton made $173,000 in base compensation and $22,000 in bonus and incentive compensation.
In the e-mail, Pelton wrote that none of the public funds pay the full compensation of any employees, and his compensation could be maintained without public funds.
After a national search, the Business Development Board Martin County hired Ron Bunch from Danville, Va. to be the board's director.
Bunch now makes $141,000, according to the board's 2008-09 tax return. Ten companies are slated to create 1,182 jobs during the next three years with the board's help, according to the board.
In 2010, the county doubled its contract with the board. Each year, the county gives the board money received from occupational licenses, which are taxes businesses pay to operate. The total typically is about $300,000. The rest of the $625,000 comes from the general fund.
According to 2008-09 tax returns, the business board received $82,000 from the private sector. Crystal Stiles, the board's marketing manager, said the group explored raising more private money, but the board was advised not to try while the economy struggled.
Indian River County is unique compared to others in the Treasure Coast.
The economic development division of the Indian River County Chamber of Commerce helped the county retain Piper Aircraft Inc. and attract a CVS Pharmacy regional distribution center. The two totalled 1,125 jobs. According to the chamber, the division has facilitated six job grants within the last 12 to 18 months that will add about 250 new jobs over the next several years. Another 100 construction jobs are expected from the INEOS New Planet BioEnergy LLC facility.
Private money coming into the chamber helps subsidize the government's efforts to draw business, chamber president Penny Chandler wrote in an e-mail to Scripps Treasure Coast Newspapers.
The chamber houses the economic development division, and so the chamber pays for rent to help keep the public costs down. Other chambers of commerce in the Treasure Coast are separate entities from the local economic development agency.
The chamber does not get paid up front by the county, but rather gets paid back after spending for economic development. The economic development division budget also is approved by the Economic Development Council, which is made up of industry leaders and elected officials throughout Indian River County.
For the 2010 budget year, $40,254 of the $119,000 from the county went to salary and benefits, according to the chamber's request for funding for the 2011 budget year. One position is partially paid for by county funds. The rest of the division's staff is paid from private money collected by the chamber, which reported seven-figure revenues each year from 2006-07 to 2008-09 according to tax returns.
Doyle said many local entities are struggling to raise private money. But Doyle said private sector involvement in attracting business remains key.
"It's still important to have the private sector or the business community involved in economic development because in a major way, they are experts," Doyle said.
ECONOMIC DEVELOPMENT SPENDING
Here's a look at how much local economic development agencies take in from the public and private sector and how they use the money based on information available to the public:
Business Development Board of Martin County*
Public sector contributions: $312,000
Public sector source: Occupational license fees charged to businesses
Private sector contributions: $82,000
Total revenues: $394,000
Amount paid toward salaries, other compensation and employee benefits: $249,000
Marketing and advertising: $25,000
Economic Development Council of St. Lucie ^
Public sector contribution: $268,000
Public sector source: County general fund accounts for $250,000
Private sector contributions: $327,000
Total revenues: $611,000
Amount paid toward salaries, other compensation and employee benefits: $362,000
Marketing and advertising: $13,000
Economic Development Division of the Indian River Chamber of Commerce@
Public sector contribution: $119,000
Public sector source: County general fund
Private sector contributions: Contributions sorted in separate accounts for purposes not limited to economic development. Private sector covers some salary expenses and space for economic development.
Total revenues: $119,000
Amount paid toward salaries, other compensation and employee benefits: $40,000
Marketing and advertising: $0
* Information according to 2008-09 tax return. Martin County since increased its total contribution to $625,000 through general fund contributions.
^ Information according to 2008-09 tax return. St. Lucie County since decreased its total contribution to $225,000.
@ Information according to 2010 request for funding. No money is listed specifically for advertising or marketing, but $1,350 for printing and publications. Indian River Chamber of Commerce pays for space and subsidizes economic development division through private funds.
LOCAL UNEMPLOYMENT RATES
Here's a look at the latest figures from the state's Agency for Workforce Innovation for local unemployment.
Martin County: 11.8 percent
St. Lucie County: 14.7 percent
Indian River County: 14.2 percent
© 2010 TCPalm. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Saturday, December 04, 2010
Consultant: Marion lacks offerings other communities have
By Bill Thompson
Staff writer
Ocala-Marion County has a host of assets that new employers would find attractive, but it is also lacking some significant things that other communities offer, a new study says.
The report suggests that catching up to those competitors in order to avoid losing new job opportunities in the future will require a major and urgent remake of the physical landscape along parts of the Interstate 75 corridor, as well as an overhaul in the thinking and strategies of local policy-makers.
Such were the findings of a consultant hired in May by the Ocala-Marion County Economic Development Corp., or EDC, to evaluate the state of business-park development in the county. The analysis does contain remedies, but it remains to be seen if the policy-makers will accept and act on the recommendations when they are formally presented in the coming weeks.
Marketing strategy
Besides sizing up the progress and plans for local business parks, John Rhodes, senior principal of the Lakewood Ranch-based firm Moran, Stahl & Boyer, was also tasked with developing a marketing strategy for these sites once they come to fruition.
His 51-page report, released Wednesday, emerges as economic development and job creation have achieved front-burner status for local policy-makers confronted with an unemployment rate that persistently hovers around 14 percent.
Rhodes' advice to move the community forward will likely test the resilience of the partnership of the three main local players in economic development — the city, county and EDC.
The relationship between those three has been strained since the County Commission voted last month to hire its own consultants to locate new employment opportunities.
Rhodes considered an unspecified number of counties for his analysis, although he ultimately chose Alachua and Polk counties to compare to Marion.
His summation of the Ocala area's assets was in many ways similar to past studies commissioned by the EDC and local governments over the past decade.
I-75 and rail lines have the community “well positioned” to reach markets within the state and the Southeast, as well as port cities with shipping traffic accessing foreign markets, he wrote.
Being located in a “right-to-work” state makes Ocala appealing to firms seeking to avoid union entanglements.
The community's work force has a variety of skills and comes at a modest price in terms of wages.
And the College of Central Florida is key for its support for local business expansion and training.
Demographics
There were also “challenges” identified by Rhodes.
Marion County's population has a “high average age” — seven years older than the national average — that is driven up by the size of its 65-and-older demographic.
That large, and growing, older population also shrinks the size of the local work force and may send a “red flag” to companies about how many workers are actually available.
Moreover, Rhodes added, the county has a “very low” number of college graduates with four-year degrees, which reflects its agricultural and industrial economic base.
That creates the impression that the community is “lacking technical talent.”
Finally, Marion County has a paucity of industrial or warehouse buildings ready for new companies.
Specifically, Rhodes noted the shortage of facilities that are less than 20 years old, situated within five miles of I-75 and have ceiling heights reaching 20 feet or more.
“There are essentially no existing major sites that are at a high level of readiness with utilities and roads in place,” Rhodes observed.
“This is important because any delay in road or utility installation beyond the building construction period will cause an unsatisfactory situation as perceived by a prospective company.”
“Unless there is a very well-defined plan with hard commitment dates for installation, most prospective companies will view the ability to deliver both road and utilities as over optimism,” he added.
In contrast, Alachua and Polk both have buildings and sites available at a “relatively high level of readiness and would be considered attractive alternatives to Marion County. Competition going forward is going to be very intense and anything that can be done to minimize the gap and real estate availability is critical,” Rhodes wrote.
Cost
Rhodes offered several prescriptions for closing the readiness gap, ideas that he said should be implemented quickly.
Although he didn't put a specific price tag on them, they collectively could cost tens of millions of dollars, testing the will of policy-makers dealing with declining revenues and public demands for curbs on government spending.
Among his major points, the consultant suggested that the Ocala City Council finish its development of the business park at Ocala International Airport and declare it “shovel ready” within nine months.
He also recommended that the city, County Commission and the “team” involved in the development of the 677-acre Magna property at I-75 at U.S. 27 push ahead to create an “inland port,” complete with railroad access and a truck depot.
Making Magna and the airport sites more suitable for truck traffic would also require constructing at least one “wing” of a cloverleaf on the west side of the I-75 interchanges at U.S. 27 and the east side of State Road 40, respectively, as well as reconfiguring their exit ramps, Rhodes indicated.
“Selected” sites at Magna should be “on the market” within nine months, Rhodes wrote.
Rhodes added that local officials must also design a “virtual building” capable of housing manufacturing and warehousing firms that is at least 50,000 square feet to show to prospective companies.
In addition, local officials should also cut a deal with Merillat Corp. to put its now-defunct manufacturing building in Ocala up for sale, in return for the company building in another local business park, if the facility is sold.
That would provide the community with a 200,000-square-foot site that could be immediately marketed, Rhodes noted.
Energy use
Not all of Rhodes' ideas occur on the ground, however.
He called for the city to reduce its electrical rates, which are among the highest in the South and more than 20 percent higher than the national average.
Rhodes maintained the county would be “well served” by pursuing a waste-to-energy plant capable of consuming 100,000 tons of manure, bedding and wood waste a year — a “true win-win situation” that eliminates the intractable problem of ridding the community of horse-farm waste and creating low-cost green energy.
Rhodes said the city's participation in that would invite investors and open up a spigot of federal grant money.
Recruiting certain types of companies — solar energy, medical manufacturing, food science, pharmaceutical — will require a liaison who could help research conducted by the state's major universities evolve into actual economic development initiatives, Rhodes argued.
And the “serious negative,” as far as potential employers are concerned, presented by the community's large senior population might be a “hidden asset,” Rhodes wrote.
“Within all those older folks are years of experience and insights that could be tapped,” Rhodes wrote.
“This means the Ocala area has one of the most experienced and talented work forces.
“In order to tap this talent, there needs to be several actions taken and attitudes changed.”
Making that conversion would require creating policies that provide older workers or retirees flexible schedules that allow them to work past retirement age or that permit them to be mentors to younger workers.
Finally, Rhodes maintained that local officials must draft a better wooing strategy — although he did not detail what the crux of that plan would be.
“There is typically some point of differentiation that is news worthy and catches someone's attention. A marketing effort that focuses on ‘look at me, I'm just like everyone else' is not an effective approach,” the consultant wrote.
Yet it also came back to having something concrete to offer.
“One adage that site selectors learn is: ‘Communities with the basic resources may stay in the game, but it is those that have something unique that allows them to win.' Regardless of the amount or quality of marketing efforts, a community must ultimately be able to provide the specific resources at the required level of readiness for the prospective company's situation.”
Implementation
Overall, as Rhodes summed it up, “The implementation of [the study's] recommendations are critical to the competitiveness of the Ocala/Marion County area.”
“Recent trends have indicated that when companies make a decision to locate their business they want to minimize the facility start-up time. That requires communities to have buildings available and/or provide sites that are at a high level of readiness.”
And in almost every case, he indicates his proposals should be implemented within two years.
The timing aside, what's left out of Rhodes' evaluation — which he is expected to present to the County Commission within a few weeks — is what it might cost to put it all into action.
Pete Tesch, the EDC's president and CEO, couldn't offer an exact figure, but acknowledged it would be expensive.
How expensive?
Some examples might shed some light, if the community's elected leaders pursue even some of what Rhodes advocates.
In February 2009, for instance, the county was in the opening round of discussions with the city about partnering on the development of the Magna site.
Then-County Administrator Pat Howard told the board the county would need to pony up $17 million just for its share of the project's infrastructure.
In 2008, the Florida Thoroughbred Breeders' and Owners' Association teamed up with a Texas-based company to develop a waste-to-energy system to dispose of 100,000 tons of horse manure, bedding and wood waste.
In February 2009, FTBOA announced that it had received a $2.5 million grant to explore the technology more fully.
The plant itself was estimated at about $30 million.
A Florida Department of Transportation report from October 2009 estimated the cost of a partial cloverleaf interchange at more than $40 million.
Tesch urged people to not “freak out” about the potential costs in the short term.
Tesch said what is critical — and fresh, relative to past studies — is Rhodes' narrowing the community discussion of business parks to the airport and Magna sites; his compilation of the existing inventory of buildings, or lack thereof; and his outlining of the resources, collaboration and salesmanship needed to make Ocala-Marion County competitive with places like Alachua and Polk.
“People should understand how exciting this is. We're finally having the conversation about what we need to do to attract businesses,” Tesch said.
Rhodes' study, he added, is about “what economic development looks like in 2011 and going forward, and puts into a clearer perspective what needs to be done — and what challenges we have.”
Contact Bill Thompson at 867-4117.
Staff writer
Ocala-Marion County has a host of assets that new employers would find attractive, but it is also lacking some significant things that other communities offer, a new study says.
The report suggests that catching up to those competitors in order to avoid losing new job opportunities in the future will require a major and urgent remake of the physical landscape along parts of the Interstate 75 corridor, as well as an overhaul in the thinking and strategies of local policy-makers.
Such were the findings of a consultant hired in May by the Ocala-Marion County Economic Development Corp., or EDC, to evaluate the state of business-park development in the county. The analysis does contain remedies, but it remains to be seen if the policy-makers will accept and act on the recommendations when they are formally presented in the coming weeks.
Marketing strategy
Besides sizing up the progress and plans for local business parks, John Rhodes, senior principal of the Lakewood Ranch-based firm Moran, Stahl & Boyer, was also tasked with developing a marketing strategy for these sites once they come to fruition.
His 51-page report, released Wednesday, emerges as economic development and job creation have achieved front-burner status for local policy-makers confronted with an unemployment rate that persistently hovers around 14 percent.
Rhodes' advice to move the community forward will likely test the resilience of the partnership of the three main local players in economic development — the city, county and EDC.
The relationship between those three has been strained since the County Commission voted last month to hire its own consultants to locate new employment opportunities.
Rhodes considered an unspecified number of counties for his analysis, although he ultimately chose Alachua and Polk counties to compare to Marion.
His summation of the Ocala area's assets was in many ways similar to past studies commissioned by the EDC and local governments over the past decade.
I-75 and rail lines have the community “well positioned” to reach markets within the state and the Southeast, as well as port cities with shipping traffic accessing foreign markets, he wrote.
Being located in a “right-to-work” state makes Ocala appealing to firms seeking to avoid union entanglements.
The community's work force has a variety of skills and comes at a modest price in terms of wages.
And the College of Central Florida is key for its support for local business expansion and training.
Demographics
There were also “challenges” identified by Rhodes.
Marion County's population has a “high average age” — seven years older than the national average — that is driven up by the size of its 65-and-older demographic.
That large, and growing, older population also shrinks the size of the local work force and may send a “red flag” to companies about how many workers are actually available.
Moreover, Rhodes added, the county has a “very low” number of college graduates with four-year degrees, which reflects its agricultural and industrial economic base.
That creates the impression that the community is “lacking technical talent.”
Finally, Marion County has a paucity of industrial or warehouse buildings ready for new companies.
Specifically, Rhodes noted the shortage of facilities that are less than 20 years old, situated within five miles of I-75 and have ceiling heights reaching 20 feet or more.
“There are essentially no existing major sites that are at a high level of readiness with utilities and roads in place,” Rhodes observed.
“This is important because any delay in road or utility installation beyond the building construction period will cause an unsatisfactory situation as perceived by a prospective company.”
“Unless there is a very well-defined plan with hard commitment dates for installation, most prospective companies will view the ability to deliver both road and utilities as over optimism,” he added.
In contrast, Alachua and Polk both have buildings and sites available at a “relatively high level of readiness and would be considered attractive alternatives to Marion County. Competition going forward is going to be very intense and anything that can be done to minimize the gap and real estate availability is critical,” Rhodes wrote.
Cost
Rhodes offered several prescriptions for closing the readiness gap, ideas that he said should be implemented quickly.
Although he didn't put a specific price tag on them, they collectively could cost tens of millions of dollars, testing the will of policy-makers dealing with declining revenues and public demands for curbs on government spending.
Among his major points, the consultant suggested that the Ocala City Council finish its development of the business park at Ocala International Airport and declare it “shovel ready” within nine months.
He also recommended that the city, County Commission and the “team” involved in the development of the 677-acre Magna property at I-75 at U.S. 27 push ahead to create an “inland port,” complete with railroad access and a truck depot.
Making Magna and the airport sites more suitable for truck traffic would also require constructing at least one “wing” of a cloverleaf on the west side of the I-75 interchanges at U.S. 27 and the east side of State Road 40, respectively, as well as reconfiguring their exit ramps, Rhodes indicated.
“Selected” sites at Magna should be “on the market” within nine months, Rhodes wrote.
Rhodes added that local officials must also design a “virtual building” capable of housing manufacturing and warehousing firms that is at least 50,000 square feet to show to prospective companies.
In addition, local officials should also cut a deal with Merillat Corp. to put its now-defunct manufacturing building in Ocala up for sale, in return for the company building in another local business park, if the facility is sold.
That would provide the community with a 200,000-square-foot site that could be immediately marketed, Rhodes noted.
Energy use
Not all of Rhodes' ideas occur on the ground, however.
He called for the city to reduce its electrical rates, which are among the highest in the South and more than 20 percent higher than the national average.
Rhodes maintained the county would be “well served” by pursuing a waste-to-energy plant capable of consuming 100,000 tons of manure, bedding and wood waste a year — a “true win-win situation” that eliminates the intractable problem of ridding the community of horse-farm waste and creating low-cost green energy.
Rhodes said the city's participation in that would invite investors and open up a spigot of federal grant money.
Recruiting certain types of companies — solar energy, medical manufacturing, food science, pharmaceutical — will require a liaison who could help research conducted by the state's major universities evolve into actual economic development initiatives, Rhodes argued.
And the “serious negative,” as far as potential employers are concerned, presented by the community's large senior population might be a “hidden asset,” Rhodes wrote.
“Within all those older folks are years of experience and insights that could be tapped,” Rhodes wrote.
“This means the Ocala area has one of the most experienced and talented work forces.
“In order to tap this talent, there needs to be several actions taken and attitudes changed.”
Making that conversion would require creating policies that provide older workers or retirees flexible schedules that allow them to work past retirement age or that permit them to be mentors to younger workers.
Finally, Rhodes maintained that local officials must draft a better wooing strategy — although he did not detail what the crux of that plan would be.
“There is typically some point of differentiation that is news worthy and catches someone's attention. A marketing effort that focuses on ‘look at me, I'm just like everyone else' is not an effective approach,” the consultant wrote.
Yet it also came back to having something concrete to offer.
“One adage that site selectors learn is: ‘Communities with the basic resources may stay in the game, but it is those that have something unique that allows them to win.' Regardless of the amount or quality of marketing efforts, a community must ultimately be able to provide the specific resources at the required level of readiness for the prospective company's situation.”
Implementation
Overall, as Rhodes summed it up, “The implementation of [the study's] recommendations are critical to the competitiveness of the Ocala/Marion County area.”
“Recent trends have indicated that when companies make a decision to locate their business they want to minimize the facility start-up time. That requires communities to have buildings available and/or provide sites that are at a high level of readiness.”
And in almost every case, he indicates his proposals should be implemented within two years.
The timing aside, what's left out of Rhodes' evaluation — which he is expected to present to the County Commission within a few weeks — is what it might cost to put it all into action.
Pete Tesch, the EDC's president and CEO, couldn't offer an exact figure, but acknowledged it would be expensive.
How expensive?
Some examples might shed some light, if the community's elected leaders pursue even some of what Rhodes advocates.
In February 2009, for instance, the county was in the opening round of discussions with the city about partnering on the development of the Magna site.
Then-County Administrator Pat Howard told the board the county would need to pony up $17 million just for its share of the project's infrastructure.
In 2008, the Florida Thoroughbred Breeders' and Owners' Association teamed up with a Texas-based company to develop a waste-to-energy system to dispose of 100,000 tons of horse manure, bedding and wood waste.
In February 2009, FTBOA announced that it had received a $2.5 million grant to explore the technology more fully.
The plant itself was estimated at about $30 million.
A Florida Department of Transportation report from October 2009 estimated the cost of a partial cloverleaf interchange at more than $40 million.
Tesch urged people to not “freak out” about the potential costs in the short term.
Tesch said what is critical — and fresh, relative to past studies — is Rhodes' narrowing the community discussion of business parks to the airport and Magna sites; his compilation of the existing inventory of buildings, or lack thereof; and his outlining of the resources, collaboration and salesmanship needed to make Ocala-Marion County competitive with places like Alachua and Polk.
“People should understand how exciting this is. We're finally having the conversation about what we need to do to attract businesses,” Tesch said.
Rhodes' study, he added, is about “what economic development looks like in 2011 and going forward, and puts into a clearer perspective what needs to be done — and what challenges we have.”
Contact Bill Thompson at 867-4117.
Thursday, December 02, 2010
Saginaw County Chamber president highlights Great Lakes Bay Region re-branding
SAGINAW TWP. — Though the name has been met with some criticism, Saginaw County Chamber of Commerce on Thursday reiterated the importance and the success of re-branding Saginaw, Bay and Midland counties as the Great Lakes Bay Region.
He said the name has been embraced by many local entities, including Great Lakes Bay Michigan Works and many others.
The brand of the Great Lakes Bay Region, Van Deventer said, allows Saginaw, Bay and Midland counties to be prepared for the future from a regional standpoint and bring good jobs for economic development.
"And if we could communicate that with one voice we thought it would benefit the region," he said.
Another new regional development is the Great Lakes Bay Regional Arts and Culture Council. The council is just beginning to form, and Van Deventer said it will serve as a collective voice for the arts and culture groups in the area in order to coordinate fund raising and promotional efforts.
The Great Lakes Bay Regional Convention and Visitors Bureau is also gaining momentum, he said, and will further be able to promote the region as a whole rather than as individual and separate counties.
He said the name has been embraced by many local entities, including Great Lakes Bay Michigan Works and many others.
The brand of the Great Lakes Bay Region, Van Deventer said, allows Saginaw, Bay and Midland counties to be prepared for the future from a regional standpoint and bring good jobs for economic development.
"And if we could communicate that with one voice we thought it would benefit the region," he said.
Another new regional development is the Great Lakes Bay Regional Arts and Culture Council. The council is just beginning to form, and Van Deventer said it will serve as a collective voice for the arts and culture groups in the area in order to coordinate fund raising and promotional efforts.
The Great Lakes Bay Regional Convention and Visitors Bureau is also gaining momentum, he said, and will further be able to promote the region as a whole rather than as individual and separate counties.
Subscribe to:
Posts (Atom)