Economic Development

South Dakota Economic Development Incentives Secure Consumers Supply Relocation

Consumers Supply Distributing, LLC, a wholesale distributor of agricultural and animal nutrition products, is relocating its corporate offices to the Flynn Business Park in North Sioux City, SD.

South Dakota incentives - Reinvestment Payment Program

South Dakota incentives – Reinvestment Payment Program

The company’s relocation was secured with the help of incentives approved by the South Dakota Economic Development Board earlier this month under the Reinvestment Payment Program.

Governor Dennis Daugaard said the Reinvestment Payment Program is ideal for companies looking to expand and add jobs. The Governor added that with the state’s low taxes and reasonable regulatory climate, Consumers Supply made the right choice to expand in South Dakota.

Consumers Supply is moving the corporate offices from Dakota Dunes, IA to the same location in North Sioux City where it is building a new state-of-the-art livestock feeds plant.

Half of it will be used for manufacturing bagged pelleted or texturized feeds, while the other half will produce vitamin premixes. The expansion project will create 20 new jobs.

Dan Patee, vice president of Consumers Supply Distributing, LLC, said the Reinvestment Payment Program played a key role in helping the company grow. Patee said it was nice to have support from the South Dakota Governor’s Office of Economic Development.

Consumers Supply is the sixth company to receive incentives under the Reinvestment Payment Program since it was approved by the South Dakota Legislature in 2013 as a bipartisan effort (SB 235) to enhance the state’s ability to compete for attracting new business and jobs.

The new incentives program allowed the Board of Economic Development to offer upfront reinvestment payments to assist companies that are relocating to the state, expanding existing operations or upgrading equipment.

Companies applying for incentives under this program need to show that the project in question would not be able to go ahead without state support in the form of a reinvestment payment.

Kory Menken, director of North Sioux City Economic Development, said they are extremely excited to welcome Consumers Supply to the Flynn Business Park and North Sioux City. Menken added that value-added agriculture is a significant component of the city’s economic base, and Consumers Supply will be a wonderful addition to their growing business community.

Oregon Governor and Regional Economic Development Group Sign Declaration of Cooperation

Oregon Governor John Kitzhaber has signed a Declaration of Cooperation with a regional economic development group focused on innovation-based startups and commercialization of university-based research in the South Willamette Valley.

Oregon Governor John Kitzhaber at RAIN Declaration of Cooperation signing in Eugene, OR

Oregon Governor John Kitzhaber at RAIN Declaration of Cooperation signing in Eugene, OR (photo – oregon.gov)

Members of the partnership, called RAIN (Regional Accelerator and Innovation Network), include the University of Oregon, Oregon State University, and the cities of Albany, Corvallis, Eugene and Springfield, in addition to businesses and agencies in the region.

At the signing ceremony in Eugene, Gov. Kitzhaber said they are sowing the seeds of innovation in the Willamette Valley so that forward-looking industries and economic prosperity can grow.

The Governor added that RAIN brings together critical players in the regional economy not only for helping scale up new companies, but also as a signal to the world that Oregon is creating jobs for the future.

RAIN, with a board of directors comprised of university researchers and business leaders, was established as a means for the Governor’s South Valley Regional Solutions Advisory Team to support the innovation economy in the state.

The initial $7.5 million investment in RAIN helped with facilities acquisition and improvement, staffing and program development. The Oregon Legislature has approved RAIN’s 2013-2015 funding, including $3.75 million for capital and operating expenses.

The partnership aims to build on the University of Oregon and Oregon State University’s 10-year track record of 45 spinouts. The plan is to mobilize and expand the region’s assets including UO and OSU’s combined $400 million of research activity linked to regional economic development programs, which has created a thriving ecosystem of tech companies and entrepreneurial talent.

RAIN’s engagement in the region is expected to triple these results over the next ten years.

In Phase I, RAIN is establishing venture accelerators in conjunction with UO and OSU. The OSU Advantage Accelerator for Corvallis-Albany is already operational with 15 participating startups. The UO RAIN Eugene-Springfield Accelerator is now accepting applications for its first batch.

Both these RAIN centers will assist early-stage technology efforts, providing them with mentoring and other resources to help them grow and spin off private initiatives that will create more jobs in Oregon.

Kentucky Economic Development Cabinet Throws Entrepreneurs Into Shark Tank

Governor Steve Beshear announced that Kentucky will be hosting eight regional pitch competitions similar to reality television show Shark Tank.

Kentucky entrepreneurs

Kentucky entrepreneurs (photo – thinkkentucky.com)

The competition is sponsored by the Kentucky Economic Development Cabinet’s Office of Entrepreneurship, the Kentucky Innovation Network and the Kentucky Angel Investors Network.

Gov. Beshear said the next great idea can come from anyone, and the state needs to support these visionaries and provide them with the tools to turn their vision into reality, including the financial means to get started.

The Governor added that he is looking forward to seeing more small businesses and new jobs come to life as a result of these competitions.

This won’t be reality television, but the format for the pitch competitions will be the same. Entrepreneurs will present their business ideas to a group of local angel investors and individuals who can provide capital for startups.

The Kentucky Cabinet for Economic Development’s Acting Commissioner of Business Development Mandy Lambert said small businesses are job creators and the backbone of the state’s economy. Lambert added that this is a great opportunity for entrepreneurs to network with potential investors and get their business off the ground.

Dean Harvey, executive director of the Von Allmen Center for Entrepreneurship, Gatton College of Business and Economics, University of Kentucky, said these regional events help form the foundation for a statewide network of investors and entrepreneurs working together for creating new businesses and jobs across Kentucky.

The competitions will take place in Ashland, Pikeville, Murray, Elizabethtown, Richmond, Louisville, Covington and Lexington starting June 3 in Ashland and wrapping up in Lexington on Sept 24.

The winners will get cash prizes, and the opportunity to make their pitch to the entire membership of the Kentucky Angels in Frankfort.

The Kentucky Angels Investor Network was launched last year in November by the Cabinet for Economic Development, and brings accredited investors together with new ventures via monthly online meetings. Investors within Kentucky and those outside who are interested in investing in Kentucky companies are provided access to form partnerships and deals with entrepreneurs from all over the state.

The Kentucky Innovation Network has a network of 12 offices across the state staffed by experienced and educated business leaders from the local community. The network is managed by the Kentucky Science and Technology Corp and the Cabinet for Economic Development, along with local partners.

U.S. Announces First 12 Designated Manufacturing Communities under IMCP Initiative

U.S. Secretary of Commerce Penny Pritzker has released the names of the first 12 communities to be designated as “Manufacturing Communities” under the Investing in Manufacturing Communities Partnership (IMCP) initiative.

IMCP

IMCP

The 12 designated IMCP Manufacturing Communities are as follows:

- The New York Finger Lakes Region, led by the City of Rochester

- Southern California, led by the University of Southern California Center for Economic Development

- The Chicago metro region, led by the Cook County Bureau of Economic Development

- Southeastern Michigan, led by the Wayne County Economic Development Growth Engine

- The Washington Puget Sound region, led by the Puget Sound Regional Council

- Southwest Alabama, led by the University of South Alabama

- Northwest Georgia, led by the Northwest Georgia Regional Commission

- South Kansas, led by Wichita State University

- Greater Portland region in Maine, led by the Great Portland Council of Governments

- Southwestern Ohio Aerospace Region, led by the City of Cincinnati

- The Tennessee Valley, led by the University of Tennessee

- The Milwaukee 7 region, led by the Redevelopment Authority of the City of Milwaukee

The IMCP designation is going to provide a huge boost to these 12 communities, because they will now receive preference and targeted support for strengthening regional manufacturing from 11 federal agencies with $1.3 billion in economic development funds at their disposal.

As a designated Manufacturing Community, each of these 12 communities will also get their own federal liaison, along with branding and promotion on federal resources to help attract private investment and partnerships.

IMCP was first launched in April 2013. The U.S. Economic Development Administration and other agencies awarded $7 million in IMCP implementation strategy grants in Sept 2013 to 44 communities. These grants helped the communities develop long-term economic development plans, which in turn helped them compete for this designation as a Manufacturing Community.

A total of 70 communities applied for the designation, out of which these 12 were selected by an interagency panel based on the strengths of their economic development plans, depths of public-private partnerships available to carry out the plans, and the impact of the plans on the community.

Later this year, a second IMCP competition will be launched that will result in more communities being designated.

This entire process has also thrown up new ways of developing and implementing economic development plans that match the changing global economy and increasing focus on advanced manufacturing. The federal government therefore plans to convene all 70 communities who applied to share the best practices in economic development planning.

Quotes from federal, state and regional leaders and economic development officials on the IMCP Manufacturing Community designations:-

U.S. Secretary of Commerce Penny Pritzker Р“The 12 Manufacturing Communities announced today represent a diverse group of communities with the most comprehensive economic development plans to attract business investment that will increase their competitiveness.”

Rochester Mayor Lovely A. Warren Р“I am thrilled that Rochester’s value as a global manufacturing hub with unlimited potential is being recognized by the Department of Commerce and the Obama Administration.”

Chicago Mayor Rahm Emanuel – “This designation by the U.S. Department of Commerce through its Investing in Manufacturing Communities Partnership program ensures Chicago’s place as a leader in advanced manufacturing. I applaud the efforts of our partners at the Cook County Bureau of Economic Development to attain this designation, World Business Chicago and my economic development team in their ongoing work to expand manufacturing and increase exports across the region.”

Los Angeles Mayor Eric Garcetti – “We‚Äôve been aggressive‚Äîtoday‚Äôs announcement is the result of us being loud and clear in Washington that we‚Äôre serious about investing in jobs here in California.”

GO-Biz (California Governor’s Office of Business and Economic Development) Director Kish Rajan – ‚ÄúSouthern California‚Äôs designation as a national manufacturing community further underscores California‚Äôs place as the U.S. leader in manufacturing companies, jobs and output.‚Äù

Los Angeles County Economic Development Corp – “The LAEDC wishes to thank the co-leaders on the application, USC and City of Los Angeles, with special acknowledgement to the leadership of City of LA Mayor Garcetti.”

You can see a detailed summary of economic development strategies developed by each of the 12 communities on the eda.gov website.

Vermont Governor Signs Economic Development Bills To Promote Downtown Growth

Vermont Governor Peter Shumlin signed into law three economic development bills that address issues critical for downtown growth and revitalization.

Vermont economic development bills to promote downtown growth

Vermont economic development bills to promote downtown growth

The Governor was joined at the signing, held at the recently rehabilitated St. Albans House, by St. Albans Mayor Liz Gamache and other state and local officials and members of the business community.

Gov. Shumlin told the group of attendees, which included both homebuilders and environmental groups, that the bills and an additional $500,000 in tax credits will ensure that historic buildings like St. Albans House are rehabilitated, more jobs and businesses are located in Vermont’s downtowns, and new homes get built within walking distance to public transit, schools, stores and restaurants.

Mayor Gamache noted that their initial $3 million investment to make the town’s downtown more pedestrian friendly turned out to be a magnet for economic development and jobs.

The three bills signed into law to assist such downtown growth are as follows:-

H. 809 – Helps communities plan for growth and development by improving the process of obtaining Growth Center and New Town Center designations;

H. 823 – Provides development incentives within designated growth centers to address housing shortage while promoting walkable communities. This bill also bars large-scale commercial developments outside designated centers from contributing to extension of strip development;

H. 740 – Establishes Transportation Improvement Districts, in the process reducing costs for developers by changing how they need to pay for improvements to transportation infrastructure. Developers will now be required to pay for the traffic their development creates, and not the entire cost of the whole improvement.

This package of Vermont economic development legislation is the result of an inclusive effort that brought together all stakeholders to figure out how cities and towns should develop and grow, and to direct more jobs, housing and business to community centers.

The Governor added that directing development to community centers also supports the state’s agricultural renaissance and assures that productive farms and forests remain a vital part of the Vermont landscape.

Apart from the Vermont Legislature and the Shumlin Administration, other partners who worked on the legislation include the Vermont League of Cities and Towns, Vermont Mayors Coalition, Vermont Realtors Association, Vermont Natural Resources Council and many other such groups.

Burlington Mayor Miro Weinberger, who was present at the bill signing, said the Vermont Mayors Coalition prioritized and advocated for these changes during this legislative session because these bills will create jobs and housing opportunities in the state’s treasured downtowns.

California Governor’s Office of Economic Development Team Will Tour Sriracha Factory

A team from the California Governor’s Office of Economic Development (Go-Biz) is scheduled to visit the Sriracha factory in Irwindale, CA for a factory tour they hope will bring about a resolution to the dispute between Sriracha maker Huy Fong Foods and the City of Irwindale.

Delegation from Denton, TX tours Sriracha factory

Delegation from Denton, TX tours Sriracha factory (photo – Huy Fong Foods)

On Tuesday, a team from Go-Biz will accompany Irwindale Mayor Mark A. Breceda and other city officials on a tour of the Sriracha facility.

Brook Taylor, Deputy Director, Communications and Policy, California Governor’s Office of Economic Development, is quoted by the Pasadena Star-News as saying that they hope to reach a compromise which keeps the Sriracha factory and its jobs in California.

The dispute began last year when complaints were filed by Irwindale residents about an alleged harmful chili odors emanating from the factory which they said was causing health problems. The city filed a lawsuit against Huy Fong Foods in Oct 2013, leading to the plant being told to rectify the issue.

The Irwindale City Council then decided to consider a resolution declaring Huy Fong Foods as a “public nuisance,” which would give them the authority to take action. This resolution has not been approved so far, and has already been tabled twice for future consideration.

In the meantime, Huy Fong Foods owner David Tran has managed to whip up international publicity by opening up the factory for tours, in part to show that even people inside the facility don’t find the odors to be irksome or harmful. He has been contacted by officials from dozens of locations in several states who want the factory to relocate.

The tiff has already attracted multiple teams of delegations from Texas visiting the factory, trying to get the company to relocate or expand. Meanwhile, Go-Biz and the Los Angeles Economic Development Corp have been working with both sides to find an amicable resolution to the dispute in order to keep the factory and the jobs within the county and state.

With city officials and representatives from the California Governor’s Office of Economic Development now touring the plant, it looks like a final resolution to this whole issue may finally be possible and close at hand.

Virginia Governor Vetoes Bill Citing Economic Development Project Confidentiality

Virginia Governor Terry McAuliffe has vetoed legislation that would have imposed a $50 limit on gifts and donations being made to him by anyone seeking state economic development incentives through the Governor’s Development Opportunity Fund.

HB 1212 veto

HB 1212 veto

The bill (HB 1212), if it had become law, would have prohibited the “Governor, his campaign committee, and any political action committee established on his behalf” from knowingly soliciting or accepting contributions, gifts or any item valued at more than $50 from entities and persons who are seeking loans or grants from the Governor’s Development Opportunity Fund.

Any violation would have resulted in a penalty of $500 or twice the amount of the gift or contribution, whichever was higher.

The Governor has the authority to award incentives at his discretion from the Governor’s Opportunity Fund (GOF) in order to secure business expansion or relocation projects for Virginia.

The legislation to amend the Code of Virginia related to this Fund was approved unanimously with bipartisan support by the Virginia Legislature. The House of Delegates passed HB 1212 on Feb 11, 2014 and the Senate approved the companion bill on March 3.

The bill, as passed by both the House and Senate, was then sent to the Governor for his signature. But Gov. McAuliffe sent it back to the House on April 7 with recommendations.

The changes required would have imposed the $50 limit not just on the Governor, but also on legislators. Another recommendation was that the bill be re-enacted by the 2015 Session of the General Assembly.

In his statement announcing the veto, Gov. McAuliffe said that the recommendations he had asked for “would avoid unintended consequences and protect confidentiality for ongoing economic development projects.”

In the fiscal impact statement for HB 1212, it is mentioned that the bill will have no fiscal impact on the Virginia Economic Development Partnership, the lead state organization providing business expansion and site selection services in Virginia.

However, neither the bill nor the impact statement makes any mention of how the legislation would affect economic development projects that are already in the works.

The House rejected the recommendations on April 23, 2014, and the bill was sent back to the Governor as is. Gov. McAuliffe announced his veto of the bill on May 23, 2014.

Study – Economic and Fiscal Impact of Facebook Data Center in Prineville, Oregon

When it comes to data center projects, people tend to be disappointed by the relatively low number of jobs created, in contrast to the high capital investments for facility construction and equipment purchase.

Facebook Prineville, OR Data Center

Facebook Prineville, OR Data Center (photo – facebook.com/PrinevilleDataCenter)

But Facebook now wants to dispel this notion, and commissioned an economic and fiscal impact study of their Prineville, Oregon data center on a regional and statewide level.

The study, prepared by economic consulting firm ECONorthwest, provides detailed information about the jobs created, capital spending and economic output generated in Central Oregon and across the state during the five-year construction period as well as for ongoing non-construction data center operations thereafter.

A few highlights from the report:-

Five-year Construction Period Impact – According to the study, the construction of the Facebook Prineville Data Center project is credited with creating a total of 3,592 jobs in Oregon, including 651 jobs in Central Oregon.

The project generated $573 million in capital spending statewide, and enough personal income from construction activities in the 2009-2013 period to result in the State getting additional income taxes to the tune of more than $6.5 million.

Data Center Operations Impact – The operation of the Facebook data center in Prineville in 2013 alone is linked to 207 jobs and $45 million in output in Central Oregon. The impact on the entire state increases to 266 jobs and $64.7 million in output.

The data center’s 2013 operations have resulted in property tax revenue worth nearly $500,000, and more than $750,000 in state income taxes.

Facebook released a statement in which it says – “We’re pleased to continue to have a positive impact on the economies of Prineville, Crook County, and Central Oregon… Our Prineville data center is part of the fabric that powers Facebook, and we are grateful to be a part of this community for the long term.”

Apart from the economic and fiscal impact of the data center construction and operations, Facebook has also had a significant impact in other areas such as STEM education and community development in Prineville, Crook County and the rest of Central Oregon.

Through their community action grants program and other local donations, Facebook has awarded $965,000 so far to Crook County schools and qualified non-profits in the region.

Read the full Facebook Prineville, OR Data Center Impact Study – Download (pdf)

 

Vermont Economic Development Authority Gets $4.4M in SSBCI Funding

The Vermont Economic Development Authority has received another $4.4 million from the U.S. Treasury Department to help the state enhance lending to small businesses in Vermont.

SSBCI

SSBCI (photo – treasury.gov)

The $4.4 million in federal funding was provided to VEDA by the Treasury under the State Small Business Credit Initiative (SSBCI).

This is the third and final installment of SSBCI funding being awarded to Vermont, which had been allocated a total of $13.2 million under the program in May 2011.

Vermont Governor Peter Shumlin said this is great news for the state’s small business owners and their employees. Gov. Shumlin said VEDA is receiving the third installment after having successfully lent the prior $8.7 million it has previously received in SSBCI funding.

The Governor noted that to-date, this federal funding under SSBCCI has allowed Vermont businesses to generate an additional $116.7 million in private sector financing.

The State Small Business Credit Initiative was created the Small Business Jobs Act of 2010, funded with funded with $1.5 billion that would be allocated to state economic development agencies in support of state lending programs to small businesses and small manufacturers.

Participating states are expected to use the federal funding for enhancing programs that leverage private lending for small businesses and manufacturers who want to expand and create jobs, but are not able to get the loans and investment they need from traditional funding sources.

VEDA CEO Jo Bradley said the allocation increases the availability of low-interest financing for small businesses in Vermont.

Bradley added that the Vermont Economic Development Authority is pleased to be able to continue the program, and added that with the help of the state’s financial institutions, they should be able to leverage private capital and continue moving Vermont’s economy forward.

The SSBCI funding helps leverage $10 in private capital for every federal dollar allocated, and is expected to spur a total of up to $15 billion in lending to small businesses by the program’s end.

According to the latest quarterly report, the U.S. Treasury has already allocated more than $1 billion out of the total $1.5 billion in SSBCI funding, and participating states have in turn expended, obligated, transferred, or recycled $750 million.

 

Detroit Economic Development Gets $100M Boost From JP Morgan Chase

JP Morgan Chase is expanding their commitment to Detroit with a new $100 million investment over the next five years to help speed up the economic recovery and community revitalization that is already underway.

JP Morgan Chase investment in Detroit

JP Morgan Chase investment in Detroit

The announcement is scheduled to be made jointly by JP Morgan Chase CEO Jamie Dimon, Detroit Mayor Mike Duggan and Michigan Governor Rick Snyder.

The $100 million will be invested in highly specific areas that will aid existing and planned Detroit economic development efforts and programs.

Here’s the breakup:-

Community Development ($50 million) – JP Morgan Chase will provide $50 million in the form of grants and long-term investments to two Community Development Financial Institutions. With the help of these two CDFIs, JP Morgan Chase will create two new funds that will in turn provide financing for critical projects that lack access to traditional funding sources.

Blight ($25 million) – JP Morgan Chase will team up with organizations such as the Detroit Blight Removal Task Force and the Detroit Land Bank Authority, helping them expand their reach and accelerate efforts to end blight, and stabilize and revitalize neighborhoods across the city.

Workforce Readiness ($12.5 million) РThis new $12.5 million investment will support workforce rediness efforts in Detroit under JP Morgan Chase’s $250 million global five-year New Skills at Work initiative.

Growing Small Businesses ($7 million) – This $7 million will be used to support innovative programs and organizations such as Detroit Eastern Market and startup accelerator Bizdom that are helping small business owners and entrepreneurs in Detroit launch and grow their business.

Seeding Future Economic Growth ($5.5 million) – A part of this investment will go to the M-1 Rail streetcar project which holds potential for economic development and urban renewal in downtown Detroit. Apart from a $1.5 million philanthropic grant to the non-profit M-1 RAIL, JP Morgan Chase is also providing another $1 million to Midtown Detroit Inc. to assist with a program to mitigate the temporary impact of the M-1 Rail construction on local businesses.

They will also bring the Global Cities Initiative (GCI) to Detroit. This is a joint initiative established by JP Morgan Chase and the Brookings Institution, which helps bring together policymakers with business leaders and other interested stakeholders in participating cities to collaborate on strategies for improving the city’s global competitiveness.

JP Morgan Chase will also provide experienced skills to Detroit’s non-profits by sending volunteers through the JPMorgan Chase Detroit Service Corps to help these non-profits solve challenging problems being faced by communities.

Read more about JP Morgan’s Detroit economic development investment plans in each of these categories here.

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