Economic Development Blog

Economic Development

TVA Economic Development Programs Reel in $5.9B in Investments

Nov 15

The Tennessee Valley Authority claims that its economic development helped stimulate $5.9 billion in business investments in the TVA service area in fiscal year 2012.

TVA

John Bradley, TVA senior vice president of Economic Development, said TVA’s efforts helped recruit or expand more than 150 companies, resulting in the creation and retention of 48,000 jobs.

“Creating jobs, helping local communities, and improving quality of life in the Tennessee Valley is what TVA Economic Development is all about,” said Bradley. “We thank our many partners — local power companies, industry, state and local officials, and others — for helping make these programs so successful.”

Since 2005, TVA’s economic development programs are credited with helping create or retain 300,000 jobs and $32 billion in business investment.

The state-wise breakup in the TVA service area is as follows:-

- Alabama : 7,800 jobs and $1.2 billion;

- Kentucky: 4,800 jobs and $957 million;

- Middle Tennessee: 11,700 jobs and $1.2 billion;

- Mississippi: 5,100 jobs and $504 million;

- Northeast Tennessee and Virginia: 6,300 jobs and $506 million;

- Southeast Tennessee, Georgia and North Carolina: 4,450 jobs and $412 million; and

- West Tennessee: 8,400 jobs and $1.0 billion

The top business investments and expansions from companies participating in TVA Economic Development programs in 2012 include:-

- $53.7 million and 800 jobs by Magneti Marelli in Pulaski,TN;

- $500 million and 200 jobs by Carpenter Technology Corp. in Limestone County, AL;

- $8 million and 500 jobs by Agero in Clarksville, TN;

- $9.5 million and 207 jobs by Propulsys in Hopkinsville, KY;

- $130 million and 150 jobs by Roxul, Inc., in Byhalia, MS; and

- $15 million and 150 jobs by Mann Hummel in Dunlap, TN.

TVA was named for the seventh straight year to Site Selection magazine’s list of the top 10 utilities in North America for economic development. They also won a Gold Award for the Megasites Program from the International Economic Development Council (IEDC) for excellence in economic development.

The Tennessee Valley Authority is a corporation owned by the U.S. government, and provides electricity for business customers and distribution utilities that serve 9 million people in seven states. TVA is a non-profit entity and receives no taxpayer funds. TVA provides flood control and land management, and assists utilities and state and local governments with economic development. For more information, visit TVAed.com.

Indiana Venture Fund Launches Regional Entrepreneurship Action Plan

Nov 14

Elevate Ventures, a non-profit venture fund that manages the 21st Century Fund for the Indiana Economic Development Corporation (IEDC), has launched a Regional Entrepreneurship Action Plan (REAP).

Photo – Elevate Ventures

REAP is the next phase of Elevate Ventures’ Quick Start program, which has helped over 70 companies and offered over 5,000 hours of assistance in the last 12 months.

State and regional funders have already committed nearly $8 million for REAP, with the aim of raising and distributing a total of $18 million over the next three years.

“The $7.95 million already committed means we can begin implementing a significant portion of the REAP, and we look forward to raising an additional $9 million from national funders to match the State and regional investments,” said Elevate CEO Stephen Hourigan. “We have already seen tremendous progress with startups in this region, as compared to the state of the local economy just two years ago.”

The money will support innovation, entrepreneurial activity and associated economic growth opportunities in Northern Indiana. Of the $18 million, 87 percent will go directly towards services and investments in high potential startups and economic gardening companies. The remaining 13 percent is allocated for administration.

Once the $18 million has been raised and distributed, Elevate has a stated goal of bringing in more than $200 million in additional investment and sales growth, create or retain over 3,000 jobs over a three-year period, and service approximately 160 high potential startups in the Northern Indiana regions.

Elevate Ventures, Inc. is a registered 501 (c)(3) non-profit which manages the 21 Fund which helps startups with product demonstration and market penetration issues in order to accelerate company growth, milestone achievement, and job creation.

The 21 Fund and Elevate Ventures are together putting up $6 million for REAP. On an individual company basis, the 21 Fund has a limit of $1 million per company. The 21 Fund also provides SBIR/STTR matching awards on behalf of the state to companies that have received federal Small Business Innovative Research (SBIR) grants.

Elevate’s economic gardening assistance is provided at no charge to selected Indiana businesses statewide. This program is meant to help existing businesses with specific skills and tools in challenging areas that may lead to faster growth. This can be anything from help with social media to sorting databases for identifying qualified leads.

“We have seen significant traction in developing and attracting innovative talent to the region since we started engaging in the local areas… We’re already transforming the economic picture in northern Indiana, and it’s entirely possible that that transformation is not limited to within Indiana communities,” said Hourigan.

New York City launches NYC Restore – One Stop Restoration Centers

Nov 14

New York City Mayor Michael R. Bloomberg launched NYC Restore, an initiative under which seven one-stop restoration centers have been set up to help residents and businesses impacted by Hurricane Sandy with financial, health, environmental, nutritional and residential services, as well as Federal Emergency Management Administration (FEMA) reimbursement processing.

NYC Mayor Bloomberg in Staten Island Restoration Center (photo – NYC Mayor’s Office/Spencer T Tucker)

“We are taking our ongoing relief efforts an important step further by setting up one-stop city offices that make it simpler and more convenient for New Yorkers get the help they need,” said Mayor Bloomberg. “The Restoration Centers will be an invaluable resource for the New Yorkers most impacted by the storm – and for the communities hit hardest.”

NYC Restore is also partnering with non-profit community-based organizations to provide support services. The list of non-profits helping out includes the Metropolitan Council on Jewish Poverty, Catholic Charities of Brooklyn & Queens, Bronxworks, and Red Hook Initiative, among others.

Deputy Mayor for Health and Human Services Linda I. Gibbs and Human Resources Administrator (HRA) commissioner Robert Doar will oversee the Restoration Centers.

Staff from HRA will connect impacted New Yorkers with benefit information such as Medicaid, Supplemental Nutrition Assistance Program (SNAP), and temporary cash assistance. FEMA staff will be available onsite to perform benefits intake, as well as provide ongoing management and updates of applicants’ FEMA cases.

The Department of Small Business Services also will provide information and assistance on loans and reimbursements to small business owners. Other onsite New York City agencies include the New York City Department of Health, Administration for Children’s Services, Department of Consumer Affairs, the Department of Housing Preservation and Development and the Department for the Aging.

“The Restoration Centers will be in locations convenient to our communities – bringing government services to the community in co-located service centers where getting financial counseling, public assistance information, and home building repairs is as simple as moving from table to table,” said HRA Commissioner Doar.

Deputy Mayor Gibbs said that the Restoration Centers will bring social and emotional support services to care for the needs of those affected, with public agencies and community based non-profits side by side to address the long term effects of the storm.

“With the opening of the Restoration Centers our Administration is taking another significant step to accelerate the City’s recovery,” said New York City Deputy Mayor for Economic Development Robert K. Steel.

The seven Restoration Centers will be open from 8 a.m. to 8 p.m. The Restoration Centers in Far Rockaway, Coney Island, Gravesend and Staten Island have already opened. The Red Hook, Breezy Point and Throggs Neck-Pelham Bay centers will open later in the week.

Sandy’s $30B Silver Lining for New York

Nov 13

The fact that Hurricane Sandy caused damage to the tune of $50 billion is not in dispute. Even so, New York Governor Andrew Cuomo’s announcement that the state will be asking the federal government for $30 billion was a stunner.

Hurricane Sandy (photo – jaydensonbx/flickr)

The demands include:-

- $3.5 billion for the subway, tunnels and bridges;

- $1.65 billion to rebuild homes and residential units; and

- $1 billion for local government employee overtime;

They also want billions more in grants and loans for affected businesses in the state, which lost $13 billion because of damages, closures and employees unable to report for work.

Cuomo advisors apparently cooked up this list based on the fact that Katrina caused $145 billion worth of damages, with the federal government footing the bill for about $110 billion.

Cuomo’s $30 billion demand is more than twice the $12 billion FEMA is currently authorized to spend – across all affected states – without requiring any further legislation or appropriation.

The thing is that Gov. Cuomo seems to be looking at New York’s $33 billion in damage and loss as an opportunity to upgrade infrastructure, such as replacing the existing power grid with a smart grid that alone would require $30 billion over the next decade.

“We have suffered what we estimate to be a $30 billion economic loss,” said Gov. Cuomo. “Just reimbursing the out-of-pocket expenses does not come close to making up to the economic damage that has been done to this state and this region.”

The Governor said that it was cataclysmic for New York, and would be a “wise investment for the federal government to help us build this economy back.”

Congress did push through $62.3 billion to help the Gulf Coast after Katrina by approving two supplemental appropriations. But Katrina was in a whole different league, with at least 1,833 people dead, a massive evacuation in progress, and the city of New Orleans drowned and deserted.

By comparison, the death toll for Sandy is 43, and New York is almost back to normalcy, except for the power problem in Long Island, some gas shortages, and some transportation issues. Besides, the media is no longer covering Sandy or its impact, and the elections are over so no one is going to pay that much attention now. It’s a good bet that this $30 billion demand is DOA in Washington.

Five Tech Companies Relocate to Lexington, KY

Nov 13

The Bluegrass Business Development Partnership (BBDP) announced that five new companies have relocated or will be expanding to set up new facilities in Lexington, Kentucky.

The five companies relocating are:-

Bluegrass Business Development Partnership (photo – thinkbluegrass.com)

- Biomedical Development Corporation (San Antonio, Texas);

- Innovative Energy Solutions (Chicago, Illinois);

- Invenio Therapeutics, Inc. (Cleveland, Ohio);

- Minerva Systems & Technology (Middleton, Rhode Island); and

- TeleHealth Holdings (San Antonio, Texas).

“The Commonwealth welcomes all five of these companies to Lexington,” said KY Gov. Steve Beshear. “This is a tremendous day for Kentucky; not only are we excited about 50 new, high-tech jobs and millions of dollars in investment, but we realize how attractive the Commonwealth is for innovative companies that require a vibrant workforce. These companies enhance our reputation and demonstrate the outstanding quality of our people.”

All five companies are technology based companies that have received a combined total of more than $2 million in federal Small Business Innovative Research (SBIR) grants. Kentucky’s SBIR/STTR matching funds program, managed by the Kentucky Cabinet for Economic Development, provided matching funds.

All five companies will also be getting rent subsidies of up to $10,000 under the state’s BBDP Rent Subsidy program. The program, designed to help emerging technological companies, is funded by the city through the BBDP, and is available to out-of-state companies who have received an SBIR matching grant from the state of Kentucky.

“Technology companies generally produce good jobs, and creating good jobs is my top priority,” said Lexington Mayor Jim Gray. “That’s why it’s important to encourage new technology companies by giving them the opportunity to grow.”

The BBDP, which is a collaborative partnership of the City of Lexington, Commerce Lexington Inc., and the University of Kentucky, worked with all five companies to facilitate and secure their relocation and expansion.

“Commerce Lexington Inc. has enjoyed working closely with each company alongside the BBDP,” says Bob Quick, president and CEO of Commerce Lexington Inc. “Our team coordinated meetings with realtors, faculty at UK, and tours of the community. We are excited about their location and hope to continue to cultivate deeper relationships with them as they grow here in Lexington.”

The five companies put together are involved in technology for everything from clean energy to satellites, leukemia treatments, wireless communication, and in-home monitors for patients.

Rhode Island Takes First Step Towards Integrated Economic Development

Nov 12

Rhode Island Governor Lincoln D. Chafee announced the state a plan to integrate the economic development efforts currently undertaken by multiple state agencies is now underway.

RIEDC (Photo – ri.gov)

The plan begins with an effort to collect and analyze economic data, and identify the state’s strengths and possible ways to improve the economic conditions of Rhode Island.

To this end, the Rhode Island Economic Development Corporation (RIEDC), in collaboration with Statewide Planning, issued a request for proposal (RFP).

The funding for this project comes from a $1.9 million federal grant by the U.S. Department of Housing and Urban Development (HUD) Sustainable Communities program.

In addition to RIEDC and Statewide Planning, the Rhode Island Departments of Environmental Management, Labor and Training, and Transportation are all part of this project.

“Because of this federal grant through HUD, we have an opportunity to develop a whole new approach that integrates efforts across state agencies and involves community partners to mobilize our assets to create a better place for all of Rhode Island,” said Statewide Planning director Kevin Flynn. “This partnership with the RIEDC is the first step in a larger plan to combine business growth with strategic land use, transportation, housing, environmental protection and social equity issues.”

As per the RFP, the analysis will focus on six key areas – business climate; targeted cluster analysis and validation; state regulatory environment; financial resource assessment; marketing analysis; and economic development assessment.

The aforementioned sixth and last key area involves assembling all the data analysis and assessment into a single, written report that describes and analyzes Rhode Island’s existing economic development assets and challenges. It must be suitable for use as the basis for the development of both short-term economic development strategies and a separate but related long-term economic development plan.

“This data and information collection will enable us to better execute economic development strategies that bring Rhode Island the best chance of success,” said Paul McGreevy, director of the Department of Business Regulation and special advisor to the Governor. “We want to understand the areas where Rhode Island excels and should focus additional resources in the short term and long term.”

This data analysis project looks to be the first step towards implementation of the REPEC study asked for by the Governor. The study had called for a “Council of Economic Advisors” to provide economic analysis and serve as a repository of economic related data.

The completion deadline for the economic data collection and analysis project is Feb 8, 2012.

“In 90 days we will have data analysis that we will use to inform decisions to use our assets wisely, prioritize our ideas and focus our resources in specific areas where we can make a real difference,” says Gov. Chafee.

How to Build an Aerospace Supply Chain in America

Nov 10

When one of the world’s two largest aircraft manufacturers lands in your backyard, the economic impact is going to be explosive. Airbus Americas had announced back in July 2012 that they had selected Mobile, Alabama for their first $600 million U.S.-based aircraft assembly line operations.

Airbus in Mobile, Alabama (Photo – Airbus.com)

Airbus Americas chairman Allan McArtor has now provided more details about their plans. McArtor said Airbus is taking the long view, looking at Mobile as their industrial home and planning for growth over the next 10-30 years.

He described the halo effect of the plant on the economy not just in Mobile or Alabama or the Gulf Coast, but in 45 states where Airbus suppliers supported some 250,000 jobs fueled by $12 billion in purchase contracts with Airbus last year.

Airbus currently has a global backlog of more than 4,400 aircraft, with a bullish forecast for growing future demand. They plan to double their annual $12 billion spending with U.S. manufacturers in the coming years.

McArtor said in a chat with al.com editorial board that the Mobile plant’s supply chain is likely to be spread from the Florida Panhandle and all the way north to Tennessee, with workers coming in from as far as Ohio.

He stressed on building up the aerospace supply chain rather than just contracting with existing suppliers. Airbus, said McArtor, wants to qualify, train and assist suppliers with certification to become aerospace suppliers.

The site location in Alabama with its massive automotive manufacturing base is ideal for getting automotive suppliers involved in the aerospace sector, since both industries have a lot of similarities.

Airbus is also planning on holding a series of supplier conferences along the Gulf Coast, similar to events that are already being held in Ohio and Southern California. Last month on Oct 19, 2012, more than 100 local manufacturers attended an educational summit at the Los Angeles Area Chamber of Commerce.

Airbus presented suppliers with an overview of its plans for growth, including sales projections, manufacturing needs, procurement strategy and details about what it takes to join the Airbus supply chain. Current suppliers shared their experiences on working with Airbus.

“By seeking new partnerships with businesses here, Airbus can help us grow the aerospace industry and ensure that it remains the strong economic engine that it is today,” said Los Angeles Mayor Antonio Villaraigosa.

“This effort by Airbus to increase partnerships with local manufacturers is a win for local manufacturers, a win for job seekers and a win for the aerospace industry,” said Gary L. Toebben, Los Angeles Chamber of Commerce President and CEO.

Back in Mobile, Airbus is in the initial stages of its hiring process for the $600 million plant, which is looking at 3,600 construction jobs and 1,000 permanent jobs afterwards for the assembly line, which should be operational by 2015 and churning out single-aisle planes in the A320 aircraft family by 2016. By 2018, they should be able to produce 40-50 planes per year.

“The time is right for Airbus to expand in America,” said Fabrice Brégier, Airbus president and CEO. “The U.S. is the largest single-aisle aircraft market in the world – with a projected need for 4,600 aircraft over the next 20 years – and this assembly line brings us closer to our customers.”

The Mobile, Alabama assembly line joins other successful and growing Airbus final aircraft assembly lines in Hamburg, Germany; Toulouse, France; and Tianjin, China.

Toulouse, France-based Airbus SAS, an EADS company, has sold more than 11,500 aircraft to more than 470 customers and operators worldwide. The company generated revenues last year of $42.07 billion for a net income of $2.03 billion. Airbus has 63,000 employees across 16 sites in Europe and four subsidiaries in the U.S., China, India and Japan.

Canadian Convoy Rides in to Restore Long Island Power

Nov 09

Long Island, New York may never recover from the shame of having Canada ride to their rescue, but the hundreds of thousands still without power will no doubt appreciate the convoy of more than 175 vehicles carrying 400 electricity distribution workers from 25 different Ontario utilities that rode in to help restore power.

Downed trees knocked out power lines in Long Island, NY (USDA photo by Dave Kosling)

The Long Island Power Authority and National Grid are the utilities under fire for not being able to get back up to normal in the aftermath of Hurricane Sandy which knocked out power to 10 million customers after making landfall at Atlantic City, New Jersey on Oct 29, 2012.

As of Nov 8, 2012, there were 108,000 customers without power in Nassau County, another 79,000 in Suffolk County, 35,000 in Westchester and 23,000 in Queens. All told, 1.8 million utility customers across North America remain without power 10 days after the hurricane.

In a press conference yesterday, NY Gov. Andrew Cuomo didn’t mince words and said the utilities had failed, and derided them for having run out of poles. He said that what utility companies come down to is wires, poles, crews and trucks, and wondered how a utility runs out of poles.

Long Island will have to come up with its own poles, but the Electricity Distributors Association (EDA) of Ontario is doing their bit about the need for crews.

The Ontario crews had just finished restoring power to their own customers after Sandy barreled through Ontario on October 29. It soon became clear that utilities south of the border were experiencing a much greater crisis.

“We connected with our sister associations the American Public Power Association and the Edison Electric Institute in the United States to coordinate assistance. They confirmed that there was an urgent need for help,” said Charlie Macaluso, EDA president and CEO, adding that some Ontario utilities had already been contacted by their counterparts in the U.S. “We put out the call to see if anyone could spare emergency crews and our members responded quickly with offers to assist.”

Utilities from across Ontario sent crews to Long island and other affected areas in the Northeast. Some Ontario utilities which are not directly involved in the effort have offered to help with back-up in Ontario to utilities that have sent crews to the U.S.

“In the wake of the storm in the Northeastern United States, we’re reminded of electricity’s central role in our lives. I’m extremely proud of the men and women who work in Ontario’s electricity industry for answering the call to help our neighbors,” said EDA chair Max Cananzi.

A total of 80 utilities are involved in the power restoration effort, and the Ontario crew expects to be needed and present in Long Island, the rest of New York and other Northeastern states for at least two weeks.

AT&T Announces $14B Broadband Network Investment

Nov 08

AT&T announced plans to invest $14 billion over the next three years to expand and enhance its wireless and wireline IP broadband networks. The investment plan, dubbed Project Velocity IP (VIP), expands AT&T’s high-potential growth platforms.

AT&T Broadband (Photo – AT&T)

“This is a major commitment to invest in 21st century communications infrastructure for the United States and bring high-speed Internet connectivity — 4G LTE mobile and wireline IP broadband — to millions more Americans,” said AT&T chairman and CEO Randall Stephenson.

AT&T plans to expand and enhance its wireline IP network to 57 million customer locations (consumer and small business) or 75 percent of all customer locations in its wireline service area by year-end 2015.

In the 25 percent of locations where it’s currently not economically feasible to build a competitive IP wireline network, the company said it will utilize its 4G LTE wireless network — as it becomes available — to offer voice and high-speed IP Internet services. The 4G LTE network will expand to include 300 million people.

AT&T expects capital spending to be approximately $22 billion for each of the next three years, then return to pre-Project VIP levels.

“AT&T’s announcement is exactly the kind of infrastructure investment story that policymakers have been urging to create jobs in the United States. AT&T is stepping up to meet that challenge,” said AT&T’s senior vice president-Federal Regulatory and chief privacy officer Bob Quinn.

Federal Communications Commission (FCC) chairman Julius Genachowski said in a statement that, “AT&T’s announcement of billions of dollars in new investment in wired and wireless broadband networks is proof positive that the climate for investment and innovation in the U.S. communications sector is healthy. As our National Broadband Plan said, extending wired and wireless broadband across America is the ‘great infrastructure challenge of the 21st century’. America’s 21st century economy and our global leadership depend on meeting this challenge.”

U.S. Senator John Kerry (D-MA), a member of the Senate Commerce Committee, said in a statement that, “AT&T’s announcement of a concentrated $14 billion investment in broadband bodes well for jobs and innovation. Smart technology and telecommunications policy is a critical component of economic renewal that’s enabling the growth of a booming app and Internet marketplace as well as making it profitable for infrastructure owners like AT&T to make investments in the information superhighways that make innovation possible. AT&T is making a great bet on America and we should all applaud it.”

Fitchburg State Univ. EDI Forum on Broadband Availability and Usage

Nov 07

The Regional Economic Development Institute (REDI) at Fitchburg State University held a public research forum in Fitchburg, Massachusetts on Monday where researchers presented their findings in a study on broadband usage and availability.

Broadband for small business (photo – house.gov)

The report was completed by REDI faculty researchers Jane Zhang and Beverly Hollingsworth and includes a survey of broadband access across 20 cities and towns in North Central Massachusetts.

REDI completed the research project with the help of the Massachusetts Broadband Institute (MBI), which is currently working on a $40 million statewide project to improve broadband service to its cities and towns.

MBI has a stated goal of providing broadband access to 98 percent of statewide businesses and residents in Massachusetts. It seems they have a long road ahead, because the REDI study found that only 46 percent of businesses in the survey region were using high-speed broadband internet.

The survey team collected 380 responses via telephone surveys, with 90 percent of the respondents being private businesses. Seven percent were government organizations and agencies, and the remaining three percent were non-profits.

A full 11 percent said they do not use internet at all. Another 18 percent of the respondents said they used slower DSL connections, while 25 percent responded with “other.” Residential users were not included in the survey, and wireless was also not factored in.

What’s disheartening is that apart from the 46 percent who already use broadband for business purposes, the rest don’t seem to even want it. A full 41 percent said they had no interest in cable internet, while another eight percent said it “depends.” Only five percent said they would like to be able to use broadband.

Even so, the REDI report’s conclusion was optimistic – “The desire for high speed internet clearly points to the fact that demand for cable will likely rise as broadband users realize its effectiveness in business. As small and medium size businesses grow, the demand for broadband will potentially move in a direct relationship with business growth.”

“This REDI study shows that the availability of broadband to the targeted areas of North Central Massachusetts is significant to the region’s economic sectors, especially for potentially aiding employment, improving business growth, and advancing economic development,” said Joshua Spero, REDI director and a member of the university’s Economics, History and Political Science faculty.

Read the full REDI report – Download (pdf, 13.7 mb)

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