Posts by: Economic Development HQ.com

U.S. Bank Expansion in Earth City, MO to Create 260 New Jobs

Minneapolis, Minnesota-based U.S. Bank, a wholly owned subsidiary of U.S. Bancorp (NYSE: USB), is expanding its operations in Earth City, Missouri.

U.S. Bank in Missouri

U.S. Bank in Missouri (photo by pasa47/flickr)

U.S. Bank will be setting up a new center in Earth City that will house tech operations staff and mortgage customer service representatives.

The project is expected to create 260 new jobs with annual wages of around $55,000. U.S. Bank is already the largest bank in St. Louis, with more than 4,000 employees in the region, including 400 existing employees in Earth City.

This project was originally announced in Jan 2013, but was delayed because of site location complications. At that time, U.S. Bank had applied with the St. Louis County Economic Council for local incentives in the form of property tax breaks.

Denny Coleman, president and CEO of the St. Louis County Economic Council, said it had been an unbelievable year of job growth in St. Louis, and added that they were thrilled about U.S. Bank bringing new jobs to Earth City.

Steve Johnson, executive vice president of the St. Louis Regional Chamber, said they were pleased to work on this major recruitment project over the past year in partnership with the Missouri Department of Economic Development and the St. Louis County Economic Council.

Apart from the local incentives, U.S. Bank will also be eligible for state incentives in the form of around $4.3 million in tax credits under the Missouri Quality Jobs program.

Missouri Governor Jay Nixon said that it was always exciting when one of the state’s top employers increases their investment in Missouri. The Governor said the expansion was just the latest evidence that efforts to make the state an attractive place for growth in the financial services industry were paying off.

Missouri is the only state with two Federal Reserve Banks, which provides a unique advantage for the state’s financial services industry.

U.S. Bank is the fifth-largest bank in the U.S., with $353 billion in assets as of June 2013. It is also the fourth largest in terms of the number of branches, with 3,087 banking offices and 63,000 employees across 25 states.

Modesto, CA Plans Downtown Incentive Program

The City of Modesto in Stanislaus County, California is planning to offer a package of cash and tax break incentives to downtown businesses.

Modesto, CA

Modesto, CA (photo – modestogov.com)

The Modesto City Council’s Economic Development Committee will be meeting later today to decide on approval of the package.

Projections generated using IMPLAN show that the incentivized economic activity will lead to creation of 344 new jobs and $13,914,349 in new labor income.

Half the incentives would go to offices and the other half to restaurants and retail businesses. Around 197 of the new jobs created will be in offices used by professionals, with the rest divided between restaurants and retail outlets.

The average annual wage for downtown employees in Modesto is $45,000, which means a two-income family would have an income of $90,000. If the same holds true for the new jobs, the wages would be 10 percent higher than the average wage in the Modesto area.

The City Council had commissioned the Downtown Hospitality Program (DHP), a collaborative partnership between the City, Stanislaus Alliance and other interested stakeholders, to look into how the downtown could be made more hospitable and attractive.

DHP then set up its economic development committee to look into the matter. This committee submitted a report earlier this year which said that the downtown was a “sleeping economic giant” with lots of potential for boosting occupancy and intensification.

They said that at double the existing density, downtown could accommodate 10,000 more jobs, with plenty of room for further intensification.

The committee then set out to develop an incentive program to help realize this potential. They have recommended three types of incentives, including for occupancy, new developments and physical improvements.

The occupancy incentives include a City mill tax refund, sales tax refund, and cash for new businesses or those relocating to the downtown, based on the number of full-time equivalent jobs created. Businesses creating less than five jobs would get $1,000, while those who create between 5-10 jobs would get $2,000. Those adding more than 10 jobs would get $2,500.

Those making physical improvements will get up to $10,000 as a matching grant for façade improvements. Permit fee waivers will be provided for new developments and physical improvements.

The City expects to bear a cost of $100,000 for providing the incentives and the grants, not including the reduced revenues from the waived fees and tax reimbursements.

Illinois, Michigan Team Up to Share Cloud-Based Medicaid Technology

Illinois and Michigan announced an interstate alliance that will enable Illinois to access Michigan’s¬†Medicaid Management Information System (MMIS) as a shared cloud-based service.

Michigan MMIS CHAMPS

Michigan MMIS CHAMPS (photo – michigan.gov)

The cloud MMIS project is named IMPACT (Illinois Michigan Program Alliance for Core Technology).

It will allow Illinois to quickly modernize its own outdated MMIS, while saving hundreds of millions of dollars at the federal level and for tax payers in both states.

Not to mention creating a model and a health care tech innovation that can be used by other states and by the Centers for Medicare and Medicaid Services (CMS), which has verified that the IMPACT project would be complaint with federal regulations and standards.

Michigan’s state-of-the-art MMIS called CHAMPS (Community Health Automated Medicaid Processing System) has already been certified by CMS.

As per conservative estimates, Illinois and the federal government would have needed to spend $190 million to upgrade the state’s 30-year old MMIS with a new stand-alone system. By comparison, the shared cloud system set up in partnership with Michigan is going to cost only $85 million.

The federal government, which will pick up 90 percent of the project cost, will save $76 million. The State of Illinois, which must pay for the remaining 10 percent cost of the new system, will save $10 million.

Michigan, for its part, will get to reduce the operational and maintenance costs of its system by 20 percent, as well as potentially $10 million over a period of five years.

The operational costs of the new cloud-based system for Illinois and the federal government will also be considerably lower in comparison to a new stand-alone system. Illinois will save $57 million over a five-year period, while the federal government gets to save $196 million in the same period.

Gaithersburg, Maryland-based CNSI, which built Michigan’s MMIS, will be building the technological components of IMPACT.

Nick Lyon, chief deputy director of the Michigan Department of Community Health (MDCH), said they anticipated an overall decrease in administrative costs for both states, which will enable better use of program dollars and help in ensuring quality services for residents in Michigan as well as Illinois.

State of Illinois CIO Sean Vinck said this venture was an advanced solution for Illinois, which they hoped would become a national model for systems modernization and interstate collaboration.

New Mexico Puts Veterans to Work on Film Productions

New Mexico Governor Susana Martinez announced the launch of a pilot program to put veterans to work on film and TV productions in the state.

New Mexico jobs for veterans

New Mexico jobs for veterans (photo – jobs.state.nm.us)

The program, named “Operation: Soundstage,” is a partnership initiative involving NM Workforce Solutions, NM Department of Veterans’ Services and the NM Film Office.

The Film Office already has an incentivized on-the-job training initiative called Film Crew Advancement Program (FCAP).

Under this program, production companies are reimbursed 50 percent of the wages for up to 1,040 hours put in by a qualified New Mexico crew member in a specialized craft position.

Operation: Soundstage will add one position in each production that will be filled by a veteran from New Mexico. The pilot program will also help veterans eligible for the G.I. Bill to take up a film-career development course at one of several colleges in the state.

Film and TV productions have all kinds of skilled worker positions to fill that are ideal for veterans. The available job openings will include positions such as electricians, carpenters, technicians, caterers, production assistants, drivers, editors, makeup artists, etc.

Apart from FCAP, the New Mexico Film Office also offers production companies in the state 25 percent refundable film production and post-production tax credits, project loans and other incentives.

Employers in New Mexico who hire unemployed veterans are additionally eligible for other state and federal incentives.

Employers get federal tax credits worth $2,400 for hiring a veteran who has been unemployed for a minimum of four weeks, and $5,600 for hiring veterans who have been unemployed for a minimum of six months.

Hiring a disabled vet who was injured in the line of duty makes the employer eligible for a $9,600 credit, while hiring a veteran on food stamps allows the employer to get a $2,400 credit.

As per a state law which came into effect in New Mexico last year, employers can get a $1,000 state tax credit for hiring veterans who have just returned after a tour of duty.

Gov. Martinez said that job opportunities in movie and TV productions were a great match for the skill sets veterans pick up during their military service. The Governor also noted that veterans are good at leading or taking orders as a result of their military training, and know the value of the teamwork which movie makers require.

Operation: Soundstage was preceded by another similar pilot program which hired and trained 40 veterans to be fire fighters and then dispatched them to fight wild-fires in New Mexico.

Las Vegas Global Economic Alliance Update – $450M Investments, 2640 Jobs Created

The Las Vegas Global Economic Alliance (LVGEA) released data about the activities and annual impact of the combined efforts of LVGEA and its partners in regional economic development.

Las Vegas Global Economic Alliance

photo – lvgea.org

A statewide strategy was implemented after the creation of Nevada Governor’s Office of Economic Development (GOED) to diversify the economy and coordinate economic development efforts between the state and regional groups.

Since 2012, LVGEA (formerly Nevada Development Authority) has therefore been working in cooperation with Clark County, GOED and the economic development agencies of Las Vegas, Boulder, Henderson, North Las Vegas and Mesquite.

The data they released shows these groups provided expansion, relocation and startup assistance for 62 businesses. These projects account for $450 million in new capital investments and the creation of 2,640 new jobs. Put together, the economic impact of these projects on the Southern Nevada economy exceeds $1.5 billion.

LVGEA COO Jonas Peterson said the robust numbers show the importance of the region working together for realizing shared economic prosperity. He said collaboration makes them stronger, and increasing efforts to grow and diversify the region’s economy would lead to more success next year.

LVGEA highlighted some of their major successes in FY 2012-13, including the SolarCity project. San Mateo, California-based SolarCity Corp. (NASDAQ: SCTY) had been scouting for a place to locate its back office and sales staff.

They looked at locations in Arizona, Colorado, Idaho and Oregon before settling on Las Vegas. SolarCity now plans to create hundreds of jobs at the Vegas office. It also opens up the possibility of Nevada getting the company’s solar equipment manufacturing and distribution centers.

The project was secured by a collaborative effort undertaken by LVGEA with GOED, Clark County, The inNEVation Center, and the Las Vegas Metro Chamber of Commerce. SolarCity is getting $1.2 million as state incentives under the Catalyst Fund for relocation assistance.

Another highlighted project was a testing studio relocated by Take-Two Interactive Software, Inc. (NASDAQ: TTWO), which develops, publishes and distributes hit video games such as the Grand Theft Auto (GTA) series.

Take-Two relocated a testing studio with 150 jobs from Northridge, California to Las Vegas. The project was facilitated by the City of Las Vegas and LVGEA working together with GOED to get the company approved for Catalyst Fund incentives.

Las Vegas Deputy City Manager Scott Adams said the City was pleased that it was able to play a significant role in the restructuring of the region’s development organization into the LVGEA, which has led to an alliance that is more effective and showing great progress.

LVGEA was formerly known as the Nevada Development Authority until Feb 2013, at which time the organization changed its name to the Las Vegas Global Economic Alliance, and moved into an expanded space in The InNEVation Center.

Benson Hill Biosystems gets $175K from Missouri Technology Corporation

The Missouri Technology Corporation (MTC) announced that it was investing $175,000 in agricultural biotechnology startup Benson Hill Biosystems.

Benson Hill Biosystems

Photo – brdg-park.com

The company aims to develop technology that can boost intrinsic crop yields by advancing biotech-based traits.

Benson Hill Biosystems was founded in 2012 based on technology developed by researchers at the Donald Danforth Plant Science Center in St. Louis, MO.

However, the startup began with its U.S. headquarters located in the Research Triangle Park, North Carolina. In Feb 2013, they returned back home as a tenant in the Bio-Research & Development Growth Park (BRDG Park) adjacent to the Danforth Center.

Technically, it was an expansion into Missouri since they didn’t relocate from North Carolina. Benson Hill now states itself as being co-located in both Research Triangle Park and St. Louis.

At the same time, the company also announced that it had received $300,000 in seed funding. Benson Hill Biosystems CEO Matt Crisp said that St. Louis offers the company benefits beyond just funding.

Crisp specifically named the science community in St. Louis, and the relationship between BRDG Park and the Danforth Center, as key ingredients to the company’s success.

The $175,000 investment now announced by MTC is being provided through Missouri IDEA (Innovation, Development and Entrepreneurship Advancement) Funds. IDEA funding is meant to support startups and expansions that are transferring science and technology into job creation.

MTC Acting Executive Director Bill Anderson said they were excited to announce Benson Hill Biosystems as their newest partner. He said Missouri’s world class talent and extensive plant sciences resources offers the infrastructure hi-tech companies need to grow and succeed.

Aside from the MTC’s $175,000 investment, Benson Hill has also received funding from other St. Louis-based biotech startup funding organizations such as BioGenerator and the Helix Fund.

BioGenerator is an early-stage capital fund, while the Helix Fund administered by the St. Louis County Economic Council is an early-stage life sciences and plant investment fund.

Dan Broderick, vice president of Investments at BioGenerator, said Benson Hill’s research and industry partnerships have positioned it well for growth.

Broderick said the company’s expansion in St. Louis will help them take advantage of the unique agricultural bioscience assets in the region such as research facilities, talent, networks to agtech investors and other startup support.

Chicago Microlending Institute Helps Create and Save 350 Jobs

The Department of Business Affairs and Consumer Protection (BACP) in Chicago, Illinois provided an update on the Chicago Microlending Institute (CMI) that was established last year to train and fund microlenders to support small business financing in the City.

Chicago microloans

Chicago microloan recipient (photo – cnigroup.org)

As per the BACP update, more than 80 small businesses in Chicago have received microloans totaling $650,000 under the CMI initiative, helping create and retain 350 jobs.

Chicago Mayor Rahm Emanuel announced the CMI project in Dec 2011 as a first-in-the-nation microlending training center that would train lenders on how to provide targeted financing for the City’s smallest businesses.

CMI was formally established in May 2012 with $1 million in funding from the City, to be used under the Small Business Loan Fund as a loan pool for funding lenders who would be trained by CMI.

The training, which requires $245,000 to administer, would be handled by ACCION Chicago and CitiBank. ACCION would train the lenders, with Citi and the Chicago Community Trust funding the training process.

Two new microlenders would be trained by the institute every year. Once trained, the lenders would join ACCION in making microloans of up to $25,000, using funds from the loan pool administered by CMI.

The first two organizations chosen for CMI training were the Women’s Business Development Center (WEDC) and Chicago Neighborhood Initiatives (CNI).

Out of the microloans made so far by ACCION, WEDC and CNI, minorities accounted for 72 percent of the borrowers. A full 58 percent were women-owned businesses, while 62 percent were under the low-to-moderate income category.

Half of the loans were below $5,000, and 79 percent were below $10,000.

Tim Coonan, owner of Big Shoulders Coffee Works, was one of the recipients of a loan from CMI. He said getting the microloan was the tipping point in their financing efforts, and helped bring other investors on board and provide working capital to keep the business on track.

After Mae Whiteside’s efforts to secure a loan for Cheri K. Lewis Engineers failed, she contacted CNI, which provided her with $15,600 as a loan to help the company undertake roadway improvement projects.

Whiteside used the loan to purchase software and plotters needed to produce plans for the work, and one of the projects is currently underway, with the other two slated to begin shortly. Whiteside says the microloan was crucial to saving three civil engineering jobs.

CMI anticipates that the remaining $350,000 in their loan fund will be distributed to more recipients by December. There is still an estimated $28 million annual demand for microloans in Chicago that is currently unfulfilled.

Michigan EDC Awards Incentives to DDC, Teleperformance and GKN

The Michigan Economic Development Corporation (MEDC) announced approval of incentives for three projects that will together generate investments of nearly $86 million and create 600 new jobs.

Michigan Economic Development Corporation

MEDC (photo – michiganadvantage.org)

One is a $77.2 million expansion by Detroit Diesel Corporation, whose parent is Daimler Trucks North America.

The Detroit-based DDC, which makes diesel engines for trucks, plans to expand its facility in Redford Township to include a new automated manual truck transmission assembly and production capacity for an asymmetric turbocharger.

Last year in December, DDC had announced an investment of $120 million and creation of 115 new jobs at the Redford Township plant for this same expansion.

The transmissions the company plans to start assembling in Redford are currently made at a plant in Gaggenau, Germany. The turbocharger production is being relocated from China to Redford, MI.

DDC chose to source both the turbocharger and transmission from Detroit because of worries over foreign currency rates, in addition to workforce availability and local and state incentives offered by Redford Township and the State of Michigan. Another DDC plant in Mexico was also in contention for the expansion.

MEDC has approved $250,000 in incentives from the Michigan Strategic Fund for DDC, under the Michigan Business Development Program. Local incentives worth $6.6 million are being offered by Redford Township in the form of a property tax abatement for 12 years.

Another project that was approved for incentives is a customer care center being set up in Cascade Charter Township, MI by Utah-based Teleperformance USA. The inbound call center will provide customer support for a major telecom company, and requires the creation of 500 new jobs with an investment of $3.8 million.

Teleperformance USA is getting $600,000 in incentives in the form of a performance-based grant. MEDC and The Right Place, a non-profit economic development organization for West Michigan, helped secure the project against competing sites in Utah and five other states.

The third project approved for incentives is an expansion by GKN Driveline North America in the City of Auburn Hills. GKN is a subsidiary of British automotive supplier GKN plc. GKN Driveline is investing $5.1 million for the expansion of its engineering and testing facility, and will create 50 new jobs.

GKN chose to expand in Auburn Hills over another site in North Carolina. MEDC helped secure the project by offering the company a $1 million performance-based grant. Auburn Hills is offering the company local incentives in the form of a property tax abatement.

NY Offers Incentives to Raise $3.2B Investment for Reconstruction

The New York Department of Financial Services (DFS) has notified financial institutions that loans made for reconstruction projects in storm-damaged communities will be eligible for credit under the federal Community Reinvestment Act (CRA).

NY Rising Community Reconstruction

NY Rising Community Reconstruction (photo – nysandyhelp.ny.gov)

The incentives are expected to spur private investments worth $3.2 billion in New York communities.

CRA compliance calls for banks to serve low and moderate income communities by providing everything from community development funding to small business loans and housing finance.

Failure to do so results in an unsatisfactory CRA rating, which can hold up federal approval for bank expansions, mergers and acquisitions.

One of the duties of the NY DFS is to review the CRA performance of banks in the state, and DFS has been directed to give priority CRA credit to banks that are investing in projects under the New York Rising Community Reconstruction program.

This program was established with $25 million in planning funds to help communities impacted by Tropical Storm Lee and Hurricanes Sandy and Irene. Earlier this month, Gov. Cuomo designated 102 communities under this program as being eligible for $750 million in federal funding for reconstruction, including $500 million in Community Development Block Grant funding.

Apart from such direct funding, the State will now be able to facilitate funding for individual projects by connecting New York Rising Community projects looking for financing to banks that are looking to invest in CRA-eligible projects.

DFS plans to host meetings that both the project planning committees and banks will be invited to attend. DFS will also help publicize the planning process for New York Rising Communities projects.

Other state agencies have also been directed to provide priority assistance for these projects. Empire State Development (ESD) will by prioritizing grant funding for Community Development Financial Institutions (CDFIs) involved in storm reconstruction projects.

The NY Department of State will provide assistance to New York Rising Communities projects that are facing brownfield contamination issues by supporting these projects under the Brownfield Opportunity Areas Program.

The NYS Department of Transportation will likewise expedite highway permits for these projects, while the Department of Environmental Conservation will expedite environmental permits.

The Energy Research and Development Authority (NYSERDA) and New York Power Authority (NYPA) will give preference to New York Rising Communities for sustainability and energy efficiency projects including solar panel installations, public building retrofits, and selection of locations to install public electric vehicle charging stations.

Aviation LED Maker Aveo to Create 300 Jobs in Flagler County, FL

Aveo Engineering announced that it will be setting up a design and manufacturing facility in Flagler County, Florida for making LED lighting products for the aviation industry.

Aveo Engineering

Aveo Engineering (photo – aveoengineering.com)

The company broke ground yesterday on the project to build the facility in a new hangar at Flagler County Airport in Palm Coast, FL.

The project requires a capital investment of $7.5 million by the company for construction and equipment.

Aveo will create 300 new jobs over the next three years with average annual wages of $43,379. The company will start by hiring 50 new employees in the first year.

Last month, the Flagler County Board of County Commissioners approved $150,000 in workforce training incentives for Aveo, linked to the company’s job-creation efforts. Every job created by the company will be awarded $500, to be paid out in installments every year.

Local officials in Flagler County have been working to secure this project for quite some time, identified until now only under the code name of “Green Dream.”

Aveo Engineering is one of many “green” Aveo Group companies that provide LED lighting and solutions, including Startek, Strojkov, GreenAir, AveoGo, AveoShark and EmergiStrobe.

These group companies have facilities all over the world, including in the United Kingdom, Czech Republic, Malaysia, Slovakia and India. The company works with several aviation and aerospace companies including Sikorsky, Boeing, Gulfstream, Lockheed Martin, General Atomics, Raytheon and Hughes MD Helicopters.

FL Gov. Rick Scott said the company considered other locations including Texas and Malaysia, but they liked what Florida was offering.

Aveo decided they needed the facility in the U.S., where they could be closer to their customers. They’re already operating from a temporary space in Palm Coast,

Aveo President Christian Nielsen said they had worked closely with the county and conducted a workforce analysis. He said Flagler County and the region offered an amazing talent pool which the company could draw upon.

Flagler County Commissioner Barbara Revels said this was one of the target industries they have been working to attract, and called it a game changing success for the county.

Flagler County got assistance for this project from Enterprise Florida and the Florida Department of Economic Opportunity, but details about state incentives for Aveo have not been disclosed.

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