Posts by: Economic Development HQ.com

Iluka Resources Plans Mineral Sands Mining Development in VA

Perth, Australia-based mining company Iluka Resources (ASX: ILU) announced a proposed mineral sands mining development in Dinwiddie County, Virginia.

Iluka Resources mining operations in Virginia

Iluka Resources mining operations in Virginia (photo – iluka.com)

The company will initially be investing $67 million on machinery and equipment for the mining and concentration facilities.

To-date, the company has already invested $20 million on the project, and subsequent development costs are likely to push the total project cost up to $120 million.

Iluka’s project will create 86 new jobs with a total payroll impact of $34 million over the next 11 years. It will also create 490 construction jobs.

Iluka already has two mining operations in Virginia, located in Brink and Concord. The mined material is currently moved to a separation plant in Stony Creek which produces minerals such as zircon.

The proposed plant in Dinwiddie County includes mining and concentration facilities to produce zircon and titanium. Virginia zircon is apparently highly sought by high-end sanitary-ware and ceramic tile manufacturers.

Governor McDonnell said that Iluka had been a valuable employer for the last 16 years, and their new decision to add a new sands mine and invest in new equipment was a testament to the abundance of natural resources and infrastructure available.

Iluka also had mines in Florida and Georgia, but ceased those operations in 2005 and 2006 respectively. The company has since been evaluating new mineral sands deposits in Aurelian Springs, North Carolina and Dinwiddie County, Virginia for development.

Company officials indicated they were able to move ahead with the Dinwiddie County site first because of Virginia’s business-friendly environment.Matthew Blackwell, president and general manager, U.S. Operations, Iluka Resources, said that they appreciated the fast and thorough responses provided by officials and regulatory agencies while the company was considering the project.

The Virginia Economic Development Partnership (VEDP) worked with local officials in Dinwiddie County to secure the project. The company has been offered a $300,000 grant under the Virginia Investment Partnership program, along with another $525,000 from the Virginia Tobacco Commission.

The Virginia Department of Business Assistance will additionally provide Iluka with funding and support for recruitment and workforce training.

Elevate Chicago – $1.1B Infrastructure Redevelopment Plan

Chicago, Illinois Mayor Rahm Emanuel announced a $1.1 billion tourism and tradeshow infrastructure redevelopment plan called Elevate Chicago.

Rendering of Headquarters Hotel in McCormick Place entertainment district

Rendering of Headquarters Hotel in McCormick Place entertainment district (photo – .cityofchicago.org)

It combines previously announced investments worth $470 million with another $640 million for the redevelopment of Navy Pier and creation of an entertainment district at McCormick Place, which is Chicago’s convention center.

The project will create 3,700 permanent jobs and another 10,000 construction jobs, and is expected to fuel economic growth to the tune of hundreds of millions of dollars every year.

The plan calls for a new 10,000 seat events center, along with two hotels, shops and entertainment venues that are expected to fuel revitalization of Motor Row and other neighborhoods in the vicinity.

One of these hotels is the previously announced 1,200-room Headquarters Hotel and the other one will be a 500-room boutique hotel.

The City and local government agencies would be able to use the venue free of rent for events such as public school contests, graduations, etc.

The improvements and additional facilities will attract more tradeshows and conventions to Chicago, with a skybridge connecting McCormick Place West to the events center, which can be used as a general sessions hall for conventions.

The Navy Pier, already one of Chicago’s popular attractions, will be getting a comprehensive redesign of its public and commercial spaces just in time for its centennial. The $278 million redevelopment plan calls for urban landscaping, pocket parks, social areas and dramatic use of water features.

Marilynn Gardner, president and CEO of Navy Pier Inc, said they were taking what is good and making it great.

The events center arena and surrounding entertainment district is a public-private partnership, with the Metropolitan Pier and Exposition Authority (MPEA) and DePaul University sharing the $140 million cost of constructing the events center.

This will be matched with $400 in private investments to build the two hotels, restaurants and other venues included in the plan for the entertainment district.

Jim Reilly, CEO of McCormick Place, said they needed the events center and assembly hall in order to attract conventions and shows to Chicago and Illinois that were currently going to competing cities that already had such events centers.

Upon completion of the project, the increase in the number of conventions and events, and the resultant increase in hotel demand, is expected to generate an additional $108 million annually for the City of Chicago.

Mayor Emanuel said that the Elevate Chicago plan was a vital step towards realizing the full potential of the City. He said these projects would serve as a major economic engine and would have a lasting impact on the city for generations.

Digital Marketing Firm ExactTarget to Expand Atlanta Operations

ExactTarget (NYSE: ET) will be expanding its operations in Atlanta, Georgia to add 225 jobs and relocate their regional headquarters with an investment of $1.25 million.

ExactTarget

ExactTarget (photo – exacttarget.com)

The announcement was made by Georgia Gov. Nathan Deal after months of speculation about the true identity of the project that was previously only known as “Project Orange.”

ExactTarget is a digital marketing firm offering SaaS (Software as a Service) solutions to customers that help them plan, automate and optimize data-driven marketing and improve the ROI on marketing campaigns.

This expansion has been in the works ever since the Indianapolis, Indiana-based ExactTarget acquired Atlanta-based B2B marketing automation company Pardot last year. They immediately started negotiating with state and local economic development agencies about a proposed expansion of their offices in Atlanta.

InvestAtlanta and the Georgia Department of Economic Development (GDEcD) teamed up to secure the project. The City of Atlanta has offered ExactTarget $200,000 in incentives through its Economic Opportunity Fund, and the company is eligible for tax credits from the state worth $2.9 million based on its job creation commitments.

ExactTarget will be moving its expanded operations and regional headquarters into the same Buckhead building as Pardot.

All this doesn’t mean it was a done deal right from the start. The company reportedly considered other sites in Indianapolis, Charlotte, Chicago and other locations.

Brian P. McGowan, President and CEO of Invest Atlanta, said that Atlanta’s success in recruiting these high-paying jobs despite competition from other cities is a testament to Atlanta’s position as a tech hub that continues attracting high-tech jobs.

GDEcD Commissioner Chris Cummiskey said they had a great team working on the project, and Georgia was the right place for companies that thrive on innovation for growth.

Atlanta Mayor Kasim Reed likewise said that the city was a great place for technology growth, and offered a culture of innovation and a diverse talent pool that ExactTarget will need while expanding its operations.

Gov. Deal said that Georgia’s talented workforce and low costs, together with its mature IT infrastructure, provided companies like ExactTarget a competitive edge in the marketplace.

ExactTarget has around 1,800 employees across the world, and posted a loss of almost $21 million last year, taking into account the fact that they spent $95.5 million on acquiring Pardot and another $21 million for iGoDigital.

Medidata to Invest $20M for Expansion in NYC

Medidata Solutions (NASDAQ: MDSO) announced a consolidation and expansion of their operations in New York. The company provides a cloud-based platform for clinical development solutions in the life sciences sector.

Medidata

Medidata (photo – mdsol.com)

Medidata will be spending $20 million to consolidate all their NYC operations into a single facility in West Soho, Manhattan that will also house their global headquarters.

The new lease covers three floors and offers 98,500 square feet of space. As part of the expansion, the company is adding 250 new jobs.

The expansion project secured by New York also saved 271 existing jobs that would otherwise have been relocated out of the state. Medidata has additional North American locations in Edison, New Jersey and Conshohocken, Pennsylvania.

In order to make sure the company stayed put in New York, Empire State Development (ESD) offered Medidata $2.75 million in performance-based tax credits.

ESD President and CEO Kenneth Adams said that life sciences and high-tech industries were critical for being competitive in a global economy, and Medidata’s choice to grow in New York further cemented the state’s reputation as a location where innovative companies are able to grow and thrive.

Medidata Solutions CEO Tarek Sherif said that the company had drawn on New York’s deep talent pool and resources to grow into an industry leader in clinical technology solutions for the life sciences sector. He added that they were committed to keeping New York as their global headquarters as the company continues growing.

Medidata’s cloud-based platform optimizes the entire process of clinical trials from conceptualization to conclusion, and helps reduce the overall cost of clinical development.

New York Gov. Andrew M. Cuomo said that they had focused on promoting innovative industry clusters that create high-paying jobs, and he said he was happy Medidata was taking advantage of that and expanding their operations.

Medidata Solutions was founded in 1999, and has since grown to include 20 of the world’s top pharmaceutical companies among their customer base, in addition to government facilities, academic institutions, research organizations and others.

The company went public in June 2009, and generated revenues worth $218.3 million last year. They already have more than 900 employees located in facilities across the United States, Japan and the United Kingdom.

Five Indian Tribes to Build Largest Tribal Wind Farm in U.S.

After more than a decade of planning, the Cherokee Nation announced that the Tribal Council had approved a plan to develop the largest wind farm on tribal land in the U.S. in partnership with PNE Wind USA Inc.

Wind turbines

Wind turbines (photo – environment.ok.gov)

Development of the 6,000-acre and 90-turbine wind farm will begin immediately on 3,000 acres of Cherokee Nation tribal land in Chilocco, Kay County, Oklahoma.

Out of the total of 90 turbines, half will be based on these 3,000 acres while the other 45 turbines will be located on another 3,000 acres of tribal land belonging to four other tribes (Otoe-Missouria, Pawnee Nation, Ponca Nation and Kaw Nation).

The project is estimated to generate $16 million over the next twenty years, and will add 153 megawatts of wind power to the southwest grid.

Cherokee Nation Principal Chief Bill John Baker said they were already playing a significant role in the creation of green jobs, and expected to play a similar key role in Oklahoma’s wind energy sector.

Ellen Wesley, director of PNE Wind USA Inc, added that this project was significant because Cherokee Nation projects were usually privately owned, but had taken on PNE Wind USA as a partner for this project.

Chilocco was chosen for the wind farm not just because of favorable wind conditions, but also because environmental studies showed the wind farm would not impact migratory bird populations. The 1.7MW GE turbines will be more than 400 feet tall.

The Tribal Council’s Deputy Speaker Chuck Hoskin Jr. said that this was an opportunity for the Cherokee Nation to be a renewable energy leader among Indian nations. He said people talk a lot of saving the environment and conserving resources, and this project was a prime opportunity for putting words into action.

The four other tribes and PNE Wind USA broke ground on their 45-turbine project last month on Earth Day, and the construction phase is expected to be completed this summer, with the turbines operational by the first quarter of 2014.

The construction phase of the 45 turbines to be installed in the other four tribes’ 3,000 acre property will create almost 200 construction jobs. About a dozen or so permanent employees will be needed to operate the wind farm.

During the ground breaking, André De Rosa, managing director of PNE Wind USA, said that apart from generating clean energy, the wind farm would bring economic development to the area and would provide additional revenues for the tribes.

Chicago, Illinois-based PNE Wind USA is a part of Cuxhaven, Germany-based PNE Wind AG.

Bayer CropScience Announces Herbicide Facility in Mobile, AL

Monheim, Germany-based Bayer CropScience announced that it plans to build a glufosinate-ammonium herbicide production facility near Mobile, Alabama.

Bayer CropScience HQ in Monheim, Germany

Bayer CropScience HQ in Monheim, Germany (photo – cropscience.bayer.com)

The project is expected to require an investment of $396 million by Bayer CropScience, and will create 180 new and high-paying jobs with average annual wages of $75,000.

The company markets this glufosinate-ammonium as Liberty herbicide used for weed control.

They already produce Liberty herbicide at facilities in Muskegon, Michigan and Frankfurt, Germany. But demand for the product is expected to outpace their current combined production capacity.

Bayer CropScience CEO Liam Condon said they were setting up this facility in response to urgent calls by agronomists and farmers seeking weed control technology that can overcome the growing problem of weed resistance to common herbicides.

Mobile successfully competed for this herbicide production facility against one other U.S. city that was also in contention for the project up until the final stages.

In order to secure the project, the Mobile IDA has approved $32 million worth of tax abatements over a ten year period for Bayer CropScience.

The project was made easier to approve because Bayer CropScience plans to co-locate the herbicide facility on land that will be leased from specialty chemicals manufacturer Evonik, which has its largest North American site in Mobile.

The company expects to complete construction and have the new facility operational sometime during the fourth quarter in 2015, so that the 2016 growing season can be their first year of production. Bayer CropScience expects this plant to be a key component in helping them reach a target of doubling production capacity for the Liberty herbicide.

Bayer CropScience has its regional North American headquarters located in the Research Triangle Park near Durham in North Carolina.

Apart from the Research Triangle headquarters, a nearby innovation center in Morrisville, and the Muskegon facility in Michigan, Bayer CropScience has additional facilities in the U.S. in Davis, California; Lubbock and Pasadena in Texas; Kansas City, Missouri; and one more near Charleston, West Virginia.

Bayer CropScience employs 20,800 workers worldwide, and has a presence in 120 countries. The company is a subsidiary of Bayer AG.

NY Kicks Off $760M Third Funding Round for Regional Councils

New York today officially launched the 2013 round of competitive economic development funding for the state’s ten Regional Economic Development Councils (REDCs).

NY Regional Councils

NY Regional Councils (photo – regionalcouncils.ny.gov)

This is the third round of funding for the REDCs under the Consolidated Funding Application (CFA) process.

The first two rounds over the last two years have committed $1.5 billion for more than 1,400 projects, which has helped create and retain around 75,000 jobs.

This time, the REDCs will be getting a total of $760 million in funding and tax incentives. Out of this, $220 million will be competitive funding, including $150 million in grants and $70 million in the form of tax incentives.

Five of the REDCs billed as “top performers” will get $25 million each out the $150 million, while the other five REDCs will be competing for the balance of $25 million. Each REDC will also be eligible to get a maximum of $10 million in tax credits.

The remaining $540 million out of the total of $760 million will be allocated through the CFA process to projects submitted by each of the Regional Councils.

NY Lieutenant Governor Robert J. Duffy, who is also the REDC Chair, said that the past two rounds of the competitive funding process have shown what a difference can be made to local economies by listening to regional community and business leaders.

Along with this announcement, New York also unveiled another competition for the REDCs. This competition, called Innovations Hot Spots, requires each Regional Council to come up with a plan for a business incubator to support startups and promote commercialization of academic research.

The incubator must be connected to a higher educational institution with a proven ability to transition projects from labs to the marketplace. Applicants must maintain and run the incubator for three years, and be capable of generating a 2:1 funding match based on the amount of state grants they get.

Five incubators will be approved this year, and another five in 2014. The ultimate aim of setting up these incubators is to attract more venture capital and research spending by private industries in New York.

Buncombe County, NC Approves $18M Incentives for Project X

The Board of Commissioners of Buncombe County, North Carolina yesterday approved an $18.38 million package of incentives for an economic development project codenamed “Project X” without revealing the identity of the company involved.

Project X

Project X (photo – wikimedia)

As per the agreement, Project X would invest $126 million for setting up a new manufacturing facility, including purchase of new equipment and machinery.

The company will create 52 new full-time jobs with average annual wages of $40,000, and will retain hundreds of existing full-time jobs. This is higher than the median wage in the County, and the new investment will additionally create more indirect jobs.

The existing full-time jobs in the area currently pay average annual wages of $57,000. The total annual labor income impact of the company’s existing and new jobs is pegged at $34 million.

In order to secure the expansion and retain the company’s existing jobs, Buncombe County is offering them a $2.68 million cash grant, to be paid out over a decade from 2015 through 2024. The company will in turn commit to creating 52 new jobs, and they would have to retain existing jobs for ten years.

Project X has also been offered a land swap deal that will cost the county $15.7 million, including constructing a 20,000-square-foot-building on one property and then swapping it for another one to be used for constructing a 125,000-square-foot facility.

The site preparation and construction costs for this second building would be $10.6 million, and it would then be leased for 15 years to Project X for locating a facility for manufacturing components.

Buncombe County expects additional tax revenues worth around $5.616 million over the next ten years, generated by increased property taxes over the site improvements and sales tax from equipment and material purchase.

Buncombe County’s largest manufacturers that have between 500-1000 employees are Eaton Corporation, Borgwarner Turbo Systems and Kendro Laboratory Products LP.

Borgwarner makes turbochargers for vehicle engines, while Kendro makes lab equipment. Eaton Corporation (NYSE: ETN) is a global power management company that produces electrical components and systems, and has facilities located in Arden, North Carolina.

Financial Restructuring Board Proposed for Distressed NY Local Governments

New York Governor Andrew M. Cuomo outlined a proposal for creating a Financial Restructuring Board to assist distressed local governments in managing their finances.

Gov. Cuomo proposes Financial Restructuring Board

Gov. Cuomo proposes Financial Restructuring Board (photo – NY Governor’s Office)

In his presentation, the Governor said that more money was not the solution.

He said the state’s AIM (Aid and Incentives for Municipalities) program neither reflects performance nor the needs of local governments, even though it accounts for a huge share of the big city budgets (excluding NYC).

For example, Buffalo’s $161.285 million in AIM funds makes up 33.21 percent of their $485.621 million FY 2013 budget. The percentages for Yonkers (24.46), Syracuse (24.07) and Rochester (18.06) are similarly high.

Gov. Cuomo said that it was time to stop talking about it, and start doing something. He added that Albany was different from Syracuse, which was different from Buffalo and Jamestown and so on.

The Governor said there was no one size fits all solution, and they needed to bring each one in and work with them to come up with an individual restructuring plan for each locality.

Jamestown Mayor Samuel Teresi noted that this was the first attempt ever at understanding the structural economic problems that cities and local governments in the Upstate region have faced for generations.

The plan involves the creation of a Financial Restructuring Board comprised of one restructuring professional from the private sector, accompanied by state officials including the Sec. of State, Budget Director, AG and Comptroller.

Their first task would be to come up with the standards for defining fiscally distressed local governments in New York. The eligible candidates could then request assistance from the board and work together to develop a restructuring plan.

The board would have $80 million to work with, allocated in the FY 2013-14 Budget for reorganization plans. If a local government accepts funding, the recommendations made by the board would be binding on the recipient.

Apart from drawing up detailed financial plans for several years, other measures the board is expected to push for include use of shared services, functional consolidation and mergers, and reduction in the number of public officials.

FedEx Ground Breaks Ground on Distribution Center in Sauget, IL

Illinois Gov. Pat Quinn was on hand for the groundbreaking of the new FedEx Ground distribution center in Sauget, IL.

FedEx Ground groundbreaking in Sauget, IL

FedEx Ground groundbreaking in Sauget, IL (photo – FedEx/Zach Bowman)

Construction of the 181,000-square-foot distribution center in Sauget Industrial Parkway will require FedEx to invest $23.5 million, and will create 25 full time and 150 part-time jobs.

Scott Burns, regional vice president of Fedex Ground, said they were thrilled to be a part of the Sauget community, and added that the site was selected primarily because of its location, which provides easy access to major highways and is close to the distribution centers of their customers.

That, and the fact that the Illinois Department of Commerce and Economic Opportunity (DCEO) has offered FedEx performance-based tax credits worth $459,000. The company will get these tax credits over a 10-year period, and only if it meets committed job creation and investment targets.

The company will also be getting workforce training grants to help the company hire trained employees that will boost its workforce quality. Once fully operational, the facility will be capable of processing 10,000 packages per hour. FedEx plans to have the distribution facility operational by Aug 2014.

Gov. Quinn said that companies like FedEx were growing in the state, and their expansion would help the Illinois economy recover from the worst recession the state had faced since the Great Depression.

FedEx Ground already has 16 facilities in Illinois, and the new center is part of the company’s strategic expansion plan for its nationwide network. FedEx Ground has added 11 major hubs across the country since 2005, along with expansions or relocations of 500 facilities.

The 175 new jobs being created in Sauget will add to approximately 50,000 existing FedEx Ground employees and 9,000 independent businesses which together pick up and drop off a total of more than 5.6 million packages every day in the U.S. and Canada.

Last year, the Moon Township, Pennsylvania-based FedEx Ground generated $9.5 billion in revenues. FedEx Ground is a subsidiary of the Memphis, Tennessee-based FedEx Corporation (NYSE: FDX).

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