April 2008 | Business Facilities - Economic Development, Site Selection & Workforce Solutions

The devastation caused by Hurricane Katrina in 2005 started a national conversation about levees. Suddenly, a lot of people who couldn’t tell the difference between a levee and a highway berm wanted to know if these manmade barriers were high enough and strong enough to withstand the next big wave from Mother Nature. While most of the attention focused on the plight of New Orleans, levees along the flood-prone Mississippi River also drew their share of the national spotlight. The Army Corps of Engineers marched up and down the big river, surveying tools at the ready. They didn’t have much to do in Davenport, Iowa. Like just about every other town on the banks of the Mississippi, Davenport (population 100,000) has a flood problem. What Davenport doesn’t have is a levee. As a fascinating story in today’s Wall Street Journal details, the city fathers in Davenport have wrestled with the question of whether to build a levee for almost 50 years—they even received authorization from Congress in 1970 to build one—and have finally decided that they are better off without one. Instead, the city bought out low-lying homes and businesses and tailored its waterfront development plans to activities and structures that will not be disrupted by the occasionally unruly river, but rather will be enhanced by its magnificent presence. Today, Davenport’s waterfront includes a downtown park with an historic bandshell and a minor league ballpark protected by its own floodwall. A large art museum was built atop a flood-ready parking lot. A new skateboard park was placed next to the river—when the river rises, the boarders just scoot uptown and wait for the crest to pass. A few passes with mops and brooms, and everyone is showing off their moves again. According to the Journal report, the river-friendly planning has been so successful that Davenport and its neighbor on the other side of the Mississippi, Rock Island, IL, are teaming up to develop another stretch of riverfront with special landscaping and materials that will allow the water to come in and make cleanups easier. They call their plan RiverVision, and are confident that the attractive waterfront also will draw new businesses and residences to their downtown areas. Davenport and Rock Island have asked for $10 million in federal funding for RiverVision. If you think that’s too much, consider this: It would cost at least $55 million to build a levee on just one side of Old Man River. Levees? We don’t need no stinking levees!


The devastation caused by Hurricane Katrina in 2005 started a national conversation about levees. Suddenly, a lot of people who couldn’t tell the difference between a levee and a highway berm wanted to know if these manmade barriers were high enough and strong enough to withstand the next big wave from Mother Nature. While most of the attention focused on the plight of New Orleans, levees along the flood-prone Mississippi River also drew their share of the national spotlight. The Army Corps of Engineers marched up and down the big river, surveying tools at the ready. They didn’t have much to do in Davenport, Iowa. Like just about every other town on the banks of the Mississippi, Davenport (population 100,000) has a flood problem. What Davenport doesn’t have is a levee. As a fascinating story in today’s Wall Street Journal details, the city fathers in Davenport have wrestled with the question of whether to build a levee for almost 50 years—they even received authorization from Congress in 1970 to build one—and have finally decided that they are better off without one. Instead, the city bought out low-lying homes and businesses and tailored its waterfront development plans to activities and structures that will not be disrupted by the occasionally unruly river, but rather will be enhanced by its magnificent presence. Today, Davenport’s waterfront includes a downtown park with an historic bandshell and a minor league ballpark protected by its own floodwall. A large art museum was built atop a flood-ready parking lot. A new skateboard park was placed next to the river—when the river rises, the boarders just scoot uptown and wait for the crest to pass. A few passes with mops and brooms, and everyone is showing off their moves again. According to the Journal report, the river-friendly planning has been so successful that Davenport and its neighbor on the other side of the Mississippi, Rock Island, IL, are teaming up to develop another stretch of riverfront with special landscaping and materials that will allow the water to come in and make cleanups easier. They call their plan RiverVision, and are confident that the attractive waterfront also will draw new businesses and residences to their downtown areas. Davenport and Rock Island have asked for $10 million in federal funding for RiverVision. If you think that’s too much, consider this: It would cost at least $55 million to build a levee on just one side of Old Man River. Levees? We don’t need no stinking levees!

A river runs through it

8 years ago

A river runs through it

A river runs through it

The devastation caused by Hurricane Katrina in 2005 started a national conversation about levees. Suddenly, a lot of people who couldn’t tell the difference between a levee and a highway berm wanted to know if these manmade barriers were high enough and strong enough to withstand the next big wave from Mother Nature. While most of the attention focused on the plight of New Orleans, levees along the flood-prone Mississippi River also drew their share of the national spotlight. The Army Corps of Engineers marched up and down the big river, surveying tools at the ready. They didn’t have much to do in Davenport, Iowa. Like just about every other town on the banks of the Mississippi, Davenport (population 100,000) has a flood problem. What Davenport doesn’t have is a levee. As a fascinating story in today’s Wall Street Journal details, the city fathers in Davenport have wrestled with the question of whether to build a levee for almost 50 years—they even received authorization from Congress in 1970 to build one—and have finally decided that they are better off without one. Instead, the city bought out low-lying homes and businesses and tailored its waterfront development plans to activities and structures that will not be disrupted by the occasionally unruly river, but rather will be enhanced by its magnificent presence. Today, Davenport’s waterfront includes a downtown park with an historic bandshell and a minor league ballpark protected by its own floodwall. A large art museum was built atop a flood-ready parking lot. A new skateboard park was placed next to the river—when the river rises, the boarders just scoot uptown and wait for the crest to pass. A few passes with mops and brooms, and everyone is showing off their moves again. According to the Journal report, the river-friendly planning has been so successful that Davenport and its neighbor on the other side of the Mississippi, Rock Island, IL, are teaming up to develop another stretch of riverfront with special landscaping and materials that will allow the water to come in and make cleanups easier. They call their plan RiverVision, and are confident that the attractive waterfront also will draw new businesses and residences to their downtown areas. Davenport and Rock Island have asked for $10 million in federal funding for RiverVision. If you think that’s too much, consider this: It would cost at least $55 million to build a levee on just one side of Old Man River. Levees? We don’t need no stinking levees!


The Hopeful Hopi Tribe

The Hopeful Hopi Tribe

Today, an article out of Arizona caught my attention for a couple of reasons. First, I don’t often come across economic development news stories that highlight the great plans and ideas of Native Americans. Secondly, when I do come across such news, it usually details the construction of a casino on an American Indian reservation. That’s why this article about the Hopi tribe’s ambitious and inspiring development plans propelled me to blog. Rather than opening a casino, which has become a money-making trend it seems, the Hopi tribe is opening the “Gateway to Hopi Land,” which includes a business park, motel, office space, and more. It sounds like a smart, comprehensive economic development plan to me.


A breath of fresh air from coal country

A breath of fresh air from coal country

Earth Day has everyone thinking “green” this week, so we thought this would be the perfect time to talk about a coal mine in Wales. No, we’re not going to dig up the tired old “canary in a coal mine” analogy to underline the dire environmental condition of our planet. In this case, the coal mine is the canary, and it’s singing a happy tune. The last active deep coal mine in Wales shut down recently. This may be bad news for the miners, but it’s good news for the rest of us, especially when one takes a trip along the “Renewable Energy Route Map” that the Welsh Assembly Government is busy implementing. Tapping into a rich and creative vein of alternative energy research and development, the country in the southwest corner of the United Kingdom is determined to make a huge impact in “clean and green” technology. Wales may be a relatively small place, but its planning is big and bold. It intends to get all its electricity from renewable sources by 2025, and to become a net exporter of clean energy within the same timeframe. Projects moving forward include: — A 10-mile dam stretching from the south of Cardiff, Wales to Somerset in England that would harness the immense tidal power of the Severn estuary. Experts estimate that the $17 billion project, which was first proposed in 1849 and briefly discussed in the 1980s, could eventually supply up to 5% of the U.K.’s electricity. — The world’s first “tribrid” buses. These triple-hybrids are powered by a combination of hydrogen fuel cells, batteries and ultra-capacitors, linked by sophisticated computer controls that constantly monitor energy requirements of the vehicle and adjust power accordingly. The prototype, a 16-passenger bus based on the commercial Iveco design, is expected to have a range of 150 miles per charge. — A car you can park in your hallway. This one-meter-wide, two-passenger concept vehicle, appropriately called Narrow Car, will get 100 mpg, achieve speeds of up to 85 mph, and, not surprisingly, “leans into corners like a motorbike.” In case you are wondering, the passenger sits behind the driver, so a narrow waist is not a requirement to drive the Narrow Car. The Welsh Assembly also has mandated that beginning in 2011 all new buldings in Wales be constructed to zero carbon standards. It’s Energy Route Map is accompanied by an equally bold introduction: “The Assembly Government fully recognizes the importance of minimizing future global warming and is very determined to show how Wales, as […]


U.S. Bumper to Bumper Blues

U.S. Bumper to Bumper Blues

With the familiar dread of my 5pm drive home on the New Jersey Garden State Parkway hovering, I have decided to blog about the state of U.S. highway infrastructure. A gloomy topic on a sunny day. Yesterday, I received Walker Industrial‘s spring newsletter called “Outlook,” which provides a brief, but potent picture of the traffic and roadway problems facing the nation right now. With so many relocating and expanding companies looking for easy access to transport routes for their shipping and distribution centers, I found it troubling, though perhaps not surprising, that our major cities and ports are suffering from the severe congestion of their surrounding highways, many of which are operating at 90% or more of their traffic capacity. Almost the whole stretch of Interstate 95 from New York City to Richmond, VA is exceeding its capacity, as are highway connections snaking around Los Angeles, Seattle, Chicago, Dallas, and Atlanta, among others. Road congestion is also slowing up port activity in New York, New Jersey, and southern California, according to the Walker report. Here is the kicker: in 2005, President Bush commissioned a team to examine the U.S. highway infrastructure problems. Three years later, the findings still have not been released—that’s a long time to be sitting in gridlock!


Will Minnesota’s JOBZ be AXED . . . for good?

Will Minnesota’s JOBZ be AXED . . . for good?

It was about this time last year that I blogged about Minnesota’s economic development golden child—JOBZ—which was on the legislative chopping block last year–largely criticized for the wage requirement attached to tax incentives offered. The JOBZ program, which was implemented in 2004 and offers tax breaks to businesses in designated zones, survived another year. However, after a not-so-great run in 2007, the program is (again) facing possible extinction. Governor Tim Pawlenty now has his fingers crossed that his beloved program will be resuscitated with some hearty revisions in the 2008 legislative session. While the program’s wage requirements are still an issue for some, it seems that mismanagement is another big concern: Just prior to the opening of the 2008 Minnesota legislative session in February, the Office of the Legislative Auditor reported that the “administration of JOBZ needs significant improvement.” The office maintained that: * “The JOBZ program has not provided much help to certain economically distressed areas in Greater Minnesota.” * “DEED’s process for reviewing JOBZ compliance is slow, inefficient, and may fail to identify some businesses that are not meeting their obligations.” * “The program’s effectiveness is reduced by the lack of a statewide perspective in the approval of JOBZ deals and the absence of any budgetary constraints.” * “The estimates published by the Department of Employment and Economic Development overstate the impact of the JOBZ program.” * “There are significant problems with the business subsidy agreements signed by local governments.” The office did, however, make note of the fact that the program “has been a useful economic development tool in some cases.” About 120 companies eagerly signed up the first year of JOBZ. However, since then, the number of new projects has fallen an average 26% a year, and that decline accelerated last year, according to an article on the Minnesota Public Radio (MPR) Websitewhere Minnesota Department of Employment and Economic Development Commissioner Dan McElroy said, “I wouldn’t describe the whole [program’s] outlook as bleak. But JOBZ needs clarification by the legislature and we’re working hard to get that.” In the MPR article, Mankato business consultant Ed Tschida, who works mainly with city and county governments on economic development projects, often involving JOBZ, offered a bleak prognosis for the program. “Certainly all evidence is that it will continue to decline,” said Tschida. “I don’t see anything turning that around.” Tschida noted a number of reasons for this decline, including that businesses are finding the benefits of the program aren’t as beneficial as expected, concern over court challenges of […]


Brother, can you spare a tank of Exxon Supreme?

Brother, can you spare a tank of Exxon Supreme?

Do you have a tough time deciding whether to order that side of fries with lunch or put those nickels aside in case gas prices rise before your evening commute? Well, if your name was Rex Tillerson, you’d have a much wider range of choices. Rex is the chairman and CEO of Exxon Mobil Corp., now the largest U.S. company based on its market capitalization of $479 billion. If Exxon Mobil were a country, it would have one of the ten largest economies in the world. With gas prices rapidly approaching $4 per gallon and most of us non-CEOs drilling an extra hole in our belts to avoid running on fumes, this probably wasn’t a good time for Exxon Mobil to announce Rex’s new compensation package. Like the oil “bidness” in general, Rex is having a very good year. His annual remuneration now totals $16.7 million, up almost 29 percent from last year’s personal bonanza. The one day I paid attention in Mrs. Russell’s algebra class tells me this is roughly equivalent to the percentage increase in the price of Regular Unleaded during the past 12 months. According to wire reports, Rex is getting $1.87 million in base salary and a $3.36 million bonus this year. The rest of the T-Rex sized compensation for the Exxon Mobil chief is expressed in the increased valuation of his vested stock grants and pension. Presumably, this shields Rex’s Everest of swag from those nasty types at the IRS who are busy right now preparing to audit you for the $20 health-care deduction you took for antacids while preparing your tax returns this week. Now, we know what you’re thinking: At least ol’ Rex has to pull up at the pump in Irving, TX, and fill up the 40-gallon tank in his Rolls side by side with all the Honda Civic and Ford Focus-driving customers. Sorry to disappoint you, but Rex’s deal also provides $41,000 for “personal use of corporate aircraft.” However, in an apparent bow to public relations, Exxon Mobil announced that it is discontinuing its practice of reimbursing top execs for their country-club memberships. Don’t even think about heading down to Irving and demanding a charitable donation from Mr. Tillerson: Exxon also is required to provide more than $220,000 this year for “security” to protect Rex.


Beijing drivers carry a torch for Detroit

Beijing drivers carry a torch for Detroit

The biggest status symbol in China isn’t a Mercedes, it’s a roomy, six-passenger Buick. That’s right, General Motors’ venerable sedan is the most sought-after vehicle for the rising middle class in the world’s most populous nation. If Detroit’s downtrodden automakers have their way, this will not prove to be a fluke – say, like the French having a peculiar fondness for old Jerry Lewis movies – but rather will be the shape of things to come overseas. According to the lead story in today’s Wall Street Journal, some of the same factors that caused Detroit’s auto giants to cede their place at the top of the world’s auto producers to Toyota may now prove to be a springboard to a revival of U.S. automotive hegemony. The Journal reports that all those lean years of downsizing and forced concessions from the auto workers’ union have now positioned U.S. auto plants among the most cost-effective in the world. Factor in a weak dollar – which makes U.S.-made goods cheaper for overseas buyers – and plenty of available plant capacity, and suddenly GM, Ford and Chrysler are poised to invade overseas markets. Chrysler actually is shifting production of minivans and Jeeps from Europe to the U.S. to take advantage of lower costs and available plant capacity, the Journal reports, and Ford is considering ramping up exports if it can match GM in bringing its labor costs down. GM, meanwhile, reportedly is planning to build a new small car in Lordstown, Ohio, that would be geared to overseas sales. Toyota, which successfully invaded the U.S. automotive market by building assembly plants in America that did not use union labor, is said to be very concerned about GM’s new labor pact with the United Auto Workers. The tables have turned. Exports of U.S.-made cars and light trucks have more than doubled since 2002, notching $50 billion in sales last year. U.S. carmakers are aggressively targeting buyers in more than 80 countries, including huge emerging markets in Asia and South America. If GM’s ambitious plans come to fruition, Chevy Malibus made in Kansas and Michigan soon will be rolling down the streets of Rio de Janeiro. And if the Tigers can find some decent pitching, Motown soon may be roaring on all cylinders.


Maybe they should put a high-tech door in that big border fence

Maybe they should put a high-tech door in that big border fence

With the U.S. economy on life support — in the form of regular transfusions of cash from the FED — and jobs disappearing in epidemic proportions, this may seem an odd time to talk about a red-hot employment sector. Well, it appears that there is one type of worker who is in short supply in almost every major enterprise in America: highly educated people with superior technical skills. You know the type we’re talking about. They don’t need your help setting up their email address on their first day on the job because they already are analyzing the database architecture for your supply-chain management system. Our education system hasn’t been producing enough of these  ”brainiacs” for years, particularly in math-intensive and/or engineering disciplines, leaving the U.S. devoid of homegrown talent to run the advanced technologies we invented. Unfortunately, Congress has been busy cutting off our ability to import the talent we need to remain competitive in the global economy. The politicians who beat their chests and shout about keeping farm workers and day laborers from illegally entering the country haven’t done much about that problem, but the across-the-board immigration quotas they have enacted in recent years have raised the bar for skilled workers who want to come here legally. The number of HB-1 visas available to skilled foreign workers annually has been capped at 65,000, less than a third of the total issued in 2000. This ceiling has been hit on April 1 — the first day applications are accepted — in each of the past two years, according to the National Association of Manufacturers. The visa “winners” are determined by lottery. To make matters worse, backlogs and multi-year waiting times in the employment-based green card system — which allows highly educated foreign-born employees to remain in the U.S.  — are forcing many skilled workers to go home soon after they get here. Efforts to reduce these waiting times have been complicated by increased security restrictions put in place after 9/11. The EB green card program has an annual allotment of 140,000 visas, but these are allocated equally across all countries around the world, regardless of population. Spouses and children count against the quota, which has not been raised since 1990. Thus NAM went out of its way on April 1 — the opening and closing day of the 2009 HB-1 visa application “season” — to thank some forward-thinking members of Congress who support raising the visa cap. “We are grateful to those Members of Congress who have acknowledged the […]


American Jobs on a Death March?!

American Jobs on a Death March?!

The word recession has been emblazoned in the psyche of most Americans over the past few months. The term has become ubiquitous (although most people probably don’t know the true definition), and you can’t escape it these days. It seems that all this talk of recession has forced employers to cut 80,000 jobs in March, the highest job loss in five years, according to an AP article. An array of industries, including construction, manufacturing, retailing, and financial services, were all hit, outpacing gains in a few industries, such as government and education. This stands as the third straight month of losses this year, pushing the unemployment rate to 5.1% from 4.8%–the highest since September 2005, when Hurricanes Katrina and Rita dealt a deadly blow to the U.S. economy. According to the article:   The economy is suffering the effects of a housing collapse, a credit crunch and a financial system in turmoil. That’s causing people and businesses to hunker down, crimping spending, capital investment and hiring. Those things in turn further weaken the economy in what has become a vicious cycle. For the first time, Federal Reserve Chairman Ben Bernanke acknowledged Wednesday that the country could be heading toward a recession, saying federal policymakers are “fighting against the wind” in combating it. Many other economists and the public believe the recession already has arrived. Bernanke wouldn’t tip his hand about the Fed’s next move. However, many economists believe the central bank will lower interest rates again when they meet later this month.   So, it seems that there is still some time to avert a true recession, which is generally defined as a decline in real gross domestic product for two consecutive quarters (6 months). It is hoped that the government’s latest $168 billion stimulus package of tax rebates for individuals and businesses will help revive consumer confidence and the economy, although some analysts feel the gesture is a little too late to stave off the impending recession. I, for one, plan to do my part to help ward off a recession by using the funds to purchase a brand new Macbook! On a side note: The National Bureau of Economic Research’sframework for judging recessions: A recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales. A recession begins just after the economy reaches a peak of activity and ends as the economy reaches its trough. Between trough and […]


Airlines Nosediving One by One

Airlines Nosediving One by One

For years now—probably since after the 9/11 attacks, understandably—I’ve noticed the media paying a lot of attention to the troubles of the airline industry. People’s fear of flying, the popularity of e-tickets, and the trimming of airline’s costs (from eliminating meal service to reducing baggage limits) are just a few issues that have dominated headlines. More recently, articles discussing the soaring costs of jet fuel have been largely unavoidable. But in the last few weeks, I’ve really been stunned by the multitude of airline death blows. Just today, Alitalia swerved closer to bankruptcy as talks with Air France/KLM folded, while ATA abruptly shut down, stranding thousands of passengers and firing over 2,000 employees. On Monday, Hawaii’s Aloha Airlines said farewell to its last passenger; the airline shut down its 61-year-old operations by letting go of 2,000 to 4,000 employees. And last month, Delta announced that it would offer buyouts to over half its workforce, a whopping 30,000 employees, and United said it would ground about 15 to 20 jets, 4% of its fleet. While industry experts claim most larger carriers are safe, for now, from closing shop, they expect to see a stream of smaller operations to continue going under. This is a really serious trend that seems to be coming to a head. Tens of thousands of jobs have already been lost, with more to come.