Feature Story: 2014 Economic Development Awards
Every year, we move from the big-picture telescope we use to spot major developments in the economic development landscape and put the hundreds of new incentives and initiatives that cross our desk under the microscope. We kept our eyes peeled for the essential DNA of a successful jobs-creation effort and innovative formulas for growth that deserve to be replicated.
The focus of our 2014 Economic Development Awards is Achievement. As usual, we’ve sifted through the maze of new incentives (and some repackaged standards) and picked out the programs that break new ground, literally and figuratively. We also felt it was time to single out a statewide achievement in alternative energy that goes beyond the simple calculus of adding up wind turbines or solar panel arrays and honors a game-changing investment in the future of green power transmission. For our cluster development award, we wrapped our laurels around a statewide development that accelerated from a standing start to national leadership in what seemed like the blink of an eye.
Since everyone has been bemoaning the decaying state of America’s bricks-and-mortar infrastructure, we decided to accentuate the positive by bestowing our new IT Infrastructure award on three metros that bucked the trend and took matters into their own hands. Without further ado, here are the winners of our 2014 Economic Development Awards.
ACHIEVEMENT IN TARGETED INCENTIVES
This year, we’ve selected five innovative programs to receive our awards for Achievement in Targeted Incentives. Here are our honorees:
New York’s Empire State Development, for the START-UP NY program. START-UP NY (which stands for SUNY Tax-free Areas to Revitalize and Transform Upstate NY) is an initiative to turn SUNY campuses and other university communities across the state into tax-free communities for new and expanded businesses. Businesses will be able to locate in these zones and operate 100 percent tax-free for 10 years (no income, business, sales or property taxes and no franchise fees).
According to the program website, START-UP NY is geared to give businesses access to resources of world-class higher education institutions, including industry experts and advanced research laboratories. In turn, universities and colleges will become tax-free communities that provide their students and teachers access to real-world, cutting-edge
New York has tailored the START-UP NY program so that many different types of businesses are eligible to apply for the incentives. In order to participate, businesses need to support the academic mission of the college or university they hope to work with. Every business must create net new jobs in order to participate by being a new start-up company; being a company from out-of-state that is relocating to New York State; or by expanding as an existing New York State company (for example, a company creating a new line of business or opening a new advanced manufacturing facility) and not simply moving existing jobs from one location to another location in the state. In New York City, Long Island and Westchester County, businesses must be start-ups or high-tech companies.
Certain types of businesses are excluded from the program, including retail and wholesale businesses; restaurants and hospitality; professional practices like law firms and medical offices; and energy production and distribution companies.
Kentucky Cabinet for Economic Development, for the Kentucky New Energy Ventures (KNEV) Fund. The KNEV Fund provides seed-stage capital to support the development and commercialization of alternative fuel and renewable energy products, processes and services in Kentucky. The funds exist to stimulate private investment in Kentucky-based technology companies with high growth potential.
KNEV makes grants of $30,000 and investments ranging from $250,000 to $750,000+. Qualified companies must be Kentucky-based and have 150 or fewer employees. Funds are to be used for business development activities. KNEV will provide support for companies developing and commercializing products in the following areas:
- Alternative transportation fuels produced from coal, waste coal, biomass or extract oil from oil shale
- Synthetic natural gas
- Ethanol produced from food crops or cellulosic ethanol
- Any other fuel that is produced from a renewable or sustainable source.
Iowa Economic Development Authority, for the Export Trade Assistance Program (ETAP). The International Office at the IEDA offers financial assistance to eligible Iowa small businesses to help companies market their products and services to a global audience. ETAP may reimburse Iowa companies for up to 75 percent of its international marketing expenditures, in a qualifying trade show or IEDA trade mission held outside the U.S., to explore new markets or provide support to expand current markets.
Total reimbursement for ETAP participants shall not exceed $3,000 per event, with a maximum of three ETAP grants per application period. Payments will be made on a reimbursement basis upon submission of proper documentation and approval by the IEDA. To be eligible to participate in the ETAP financial assistance program, applicants must meet the following criteria (by Federal Identification Number):
- Employ fewer than 500 employees
- At least 75 percent of applicant’s total number of employees must be employed within Iowa
- Exhibit products or services or samples of Iowa-manufactured, processed or value-added products or agricultural commodities in conjunction with a foreign trade show or trade mission
- Have at least one full-time employee or sales agent participate in the event (a photo of the booth at the event must be provided with claim)
- If a company has utilized ETAP or other international financial assistance, they must have completed follow-up surveys from previous grants.
Choose New Jersey/NJ Economic Development Authority for Grow NJ (the Grow New Jersey Assistance Program). Base tax credits under the new Grow NJ program range from $500 to $5,000 per job (per year), with bonus credits ranging from $250 to $3,000. The geographic boundaries have been extended, and capital investment and employment eligibility requirements have been reduced. Thresholds are reduced for businesses located in Atlantic, Burlington, Camden, Cape May, Cumberland, Gloucester, Ocean and Salem counties and for businesses located in a newly created Garden State Growth Zone, which encompasses the four NJ cities with the lowest median family income.
WyoRECs™ Renewable Energy Credit Discount Program. WyoRECs is a partnership between the Wyoming Business Council and Powder River Energy Corporation (PRECorp) offering discounted renewable energy credits (RECs) to companies interested in taking advantage of green energy to power their growing Wyoming operations. The Business Council and PRECorp seek to make available WyoRECs™ as part of the Business Council’s business recruiting toolkit and to assist businesses in PRECorp’s service area which are seeking Business Council financing.
Ideal candidates are businesses that are seeking to expand or relocate in Wyoming and are interested in utilizing renewable energy sources or in offsetting their carbon footprint as part of their decision-making process for locating their business in a community. Many large national and global businesses actively site projects in areas where renewable energy sources are available in order to meet broader company-wide sustainability goals.
ACHIEVEMENT IN CLUSTER DEVELOPMENT
Georgia Department of Economic Development
With strong incentives and an aggressive growth strategy, Georgia has succeeded in rapidly building its film production sector into a $3.5-billion industry with several new studio complexes under development. This quickly expanding success story has earned the Georgia Department of Economic Development our 2014 Achievement in Cluster Development Award.
Fayetteville, GA soon will be the home to a 288-acre, full-service film and entertainment studio complex. The new Pinewood Atlanta Studios resulted from a cooperative effort including Fayette County Development Authority (FCDA), Georgia Department of Economic Development, Georgia Power and Coweta-Fayette EMC.
Phase 1 of the project will consist of 100,000 square feet of purpose-built sound states, 100,000 square feet of production offices and 200,000 square feet of workshops and service provider spaces. Additional phases over the next five years will add 600,000 square feet of sound stages as well as more workshop/office space for production companies.
The Pinewood Atlanta Studios project was the culmination of more than five years of efforts to grow the footprint of the film industry in Fayette County. In 2008, the state enacted the Georgia Film Tax Credit, which provides a tax credit equal to 30 percent of in-state expenditures on film productions that spend at least $500,000 in Georgia. The tax credit (which can be monetized and sold to companies and individuals) has spurred the statewide growth of film production in Georgia. In 2007, the statewide economic impact from film was estimated at $242 million; by 2013, this had grown to $3.5 billion.
Based on an economic impact study using Georgia Tech LOCI software and IMPLAN models, the Pinewood Atlanta Studios project is anticipated to create a direct economic impact of $391 million over its first five years of operation. The project will directly create 3,324 new jobs with $216 million in wages.
Other major film studio projects moving forward in Georgia include Jacoby Development, which will be located on 100 acres in Gwinnett County, where with an existing 500,000-square-foot building will be remade into 12 soundstages.
According to the architectural firm involved in the Jacoby project, the facility will be designed to Hollywood standards. Film star Tyler Perry, an Atlanta native, is building Tyler Perry Studios in metro Atlanta, a major expansion of his current facility, which includes five soundstages.
Triple Horse, a Covington, GA-based production studio, says it plans to expand with a 160-acre studio with multiple soundstages, post-production facilities and a backlot.
India’s Medient Studios is planning a project in Effingham County which will include a $90-million studio and entertainment complex with the goal of also becoming a major tourist destination.
ACHIEVEMENT IN ALTERNATIVE ENERGY
Texas Governor’s Office
Many states are making giant strides in generating power from alternative energy. But converting energy from the sun, wind or water into electricity is only the first step in the migration from fossil fuels to a greener future. Building the new transmission grids that can carry clean energy from remote wind farms and solar arrays directly to industrial markets is the hard part—and one state stands out among the rest for putting its money where its mouth is and getting the job done. Texas has earned our Achievement in Alternative Energy Award for its completion early this year of the most ambitious power transmission project in the nation.
In January, Texas completed the last segment of the $6.8-billion Competitive Renewable Energy Zone transmission project (CREZ), capping nearly a decade of planning, upgrades and new construction along 3,600 miles of high-voltage transmission lines across central and West Texas.
CREZ is being overseen by the Electric Reliability Council of Texas (ERCOT), which runs the state’s largest electricity grid (and one of three grids in the nation located in Texas). The new expansion is allowing CREZ to transmit 18,500 MW of wind power—much of it emanating from windy West Texas—to load centers in the eastern part of the state. That’s about 50 percent more capacity than currently is installed in Texas and more than three times as much as any other state. CREZ has helped to spur a surge in new wind farm projects in West Texas and the Panhandle, where the new lines have opened millions of acres for potential development.
ACHIEVEMENT IN WORKFORCE TRAINING
Alabama Industrial Development Training (AIDT); Enterprise Florida
The Alabama Robotics Technology Park (RTP) represents a leap into the future for Alabama’s workforce training efforts. The project is a collaboration between Alabama’s workforce training agency AIDT (Alabama Industrial Development Training), the Alabama Community College System and the world’s leading robotics companies.
Alabama’s new Robotics Technology Park is a collaboration between AIDT, the state’s community college system and some of the world’s leading robotics companies. The RTP is considered one of the world’s most innovative and futuristic training centers. At the facility, workers from manufacturers such as Toyota, Honda and Navistar train on the latest equipment from the world’s top industrial robot makers and automation software firms.
The 60,000-square-foot Phase 1 building, called the Robotic Maintenance Training Center, opened in November 2010. In it, trainers from top industrial robots companies teach technicians how to work on automation equipment. The facility houses three dozen industrial robots and features an automated welding lab and an automated manufacturing line that operates to the strains of “Sweet Home Alabama.”
The 43,000-square-foot Phase 2 building, named the Advanced Technology Research and Development Center, is home to four companies that are testing cutting-edge robotics/automation technology. The building has a test track for unmanned vehicles designed for military applications (such as clearing mines) and for civilian uses including first response. Groundbreaking on the Phase 3 building, the Innovation and Entrepreneurial Center, is tentatively scheduled for the summer of 2014. It will be a location where companies can build and adapt manufacturing lines and processes with robots and automation for new uses.
The RTP has partnerships with the world’s leading industrial robotics companies, as well as automakers and their suppliers. It has a learning program for students at Calhoun Community College and has recently launched a mobile unit to demonstrate robotics. This mobile unit will be utilized for training as well outreach, making stops at high schools, community colleges and other locales. Nearly 30,000 school kids from across the state have visited the Robotic Training Lab since its introduction this past June.
Overall, AIDT training programs have shown tremendous success in upgrading the technology skills of Alabama’s workers to prepare them for the in-demand jobs of tomorrow. Since the agency was founded in 1971, it has assisted more than 3,150 companies and trained more than 553,000 workers, an average of nearly 13,500 a year.
Florida’s Quick Response Training (QRT) grants, administered by Workforce Florida, provide funding for customized training to new or expanding businesses. Through this customer-driven program, Florida is able to effectively retain and attract businesses creating new high-quality jobs. The grants are structured to be flexible and respond quickly to meet the employer’s training objectives.
With support from Gov. Rick Scott and the Florida Legislature, funding for the Quick Response Training program last year was doubled from $6 million to $12 million. A recent $2-million QRT initiative offers customized training to advanced manufacturing start-ups.
The QRT program is successful because it works with employers, workforce boards, colleges and school districts to find the best situation to provide training for new employees. The program matches the needs of businesses with colleges who can provide specific skills to workers to meet a company’s requirements. Eligible projects are new or expanding/existing Florida businesses that produce exportable goods or services, create new permanent, full-time jobs and employ Florida workers who require customized entry-level skills training.
QRT training can be conducted at the business’s facility, at the training provider’s facility or at a combination of sites that best meets the needs of the business. Program instructors can be either full- or part-time educators, vendors, subject matter experts or professional trainers from the business. A local, state educational entity—a community college, area vocational/technical center or university—is selected by the business to serve as the fiscal agent for the grant funds and is available to assist in the application process, program development and delivery.
Training is limited to 24 months or less. The company is required to post all job openings associated with the QRT project through the local regional workforce development board’s one-stop center. The one-stop center is available to provide assistance in recruiting potential trainees for initial screening, testing and other services free of charge to the company. The criteria (such as education and skill levels) and the selection of trainees is the responsibility of the business.
ACHIEVEMENT IN IT INFRASTRUCTURE
Chattanooga, TN; Lafayette, LA; Bristol, VA
Three metros who took it upon themselves to install world-class high-speed broadband service for their businesses and residents are the recipients of our Achievement in IT Infrastructure Awards.
Chattanooga, TN is proud to call itself America’s first “Gig City,” a title it secured with an ambitious initiative to provide everyone in the city with access to ultra-high-speed broadband of one gigabyte per second.
As we recently reported in the BF Blog, technology experts are warning the U.S. is falling dangerously behind in making high-speed broadband available to a majority of American consumers and businesses. Even developing nations like Romania, Moldova and Latvia are far outpacing America, according to Ookla, the most widely cited indexer of download speeds around the globe.
Hong Kong leads the field with an average speed of 68.94 megabits per second (Mbps). Singapore (59.29), Romania (56.94), South Korea (48.64), Japan (41.78), Macau (40.76), Lithuania (39.85), Sweden (39.46), Netherlands (38.92) and Taiwan (36.96) round out the top ten Net speedsters. America does not take a bow until 32nd place on the index, averaging 20.55 Mbps, a relative snail’s pace compared to the fastest services available globally. Ookla’s index is a rolling mean throughput in Mbps over the past 30 days, where the mean distance between the user and the server is less than 300 miles.
But three metropolitan areas took the lead in showing the rest of the country how it’s done: in addition to Chattanooga, Bristol, VA and Lafayette, LA now offer some of the fastest broadband speeds in the nation.
Chattanooga residents can get 1 gigabit per second service for about $70 per month. That’s 50 times the average speed for homes in the rest of the country and as fast as world-leader Hong Kong. It takes 33 seconds to download a two-hour, high-definition movie in Chattanooga, compared with 25 minutes for those with an average high-speed broadband connection in the rest of the country. Chattanooga took a unique approach to building a high-speed Internet network: the city council formed a joint venture with a local power company.
According to a recent report in The New York Times, “the Gig” (as the taxpayer-owned fiber-optic network is known in Chattanooga) is driving the development of tech start-ups in the city. It’s allowing tech entrepreneurs to attract new capital and talent to the region. Since the fiber-optic network switched on, former factory buildings on Main Street, and Warehouse Row on Market Street, have been converted to loft apartments, open-space offices, restaurants and shops. The city has welcomed a new population of computer programmers, entrepreneurs and investors, the Times reports. City officials credit the Gig with creating at least 1,000 new jobs.
EPB, the city-owned utility formerly named Electric Power Board of Chattanooga, said that about 3,640 residences are signed up for the gigabit service offered over the fiber-optic network, as well as 55 businesses. Industry analysts said the adoption of gigabyte service usually is incremental until the price point drops [in Seoul, a gigabit can be had for as low as $31 per month, primarily due to government subsidies).
More than 800 miles of fiber-optic cable hum invisibly underground in Lafayette, LA a city of 120,000, delivering Internet speeds of up to 100 megabits per second—rare for even major cities. The cutting-edge connectivity in the heart of Cajun country is due not to a private telecom giant but to a public municipal service that offers higher speeds and often lower rates than the private sector.
LUS Fiber, a subsidiary of Lafayette Utilities System, the city-owned power company, offers the speedy Internet service. The Louisiana Supreme Court ruled in favor of the city in 2007, beating back legal challenges from private service providers who tried to block the project.
BVU, Bristol, VA’s utility company, started thinking about bringing high-speed broadband to the city’s 17,000 residents in the late 1990s. BVU initially built a dark-fiber network and data center to serve its city government. Because Virginia laws prevented BVU from serving residents directly, the city initially hoped that a carrier would step in and provide broadband.
Instead, BVU and its OptiNet division crossed several legal hurdles and gained approval to provide broadband and voice services to residents on the Virginia side of the city in January 2003.
In 2010, BVU added 388 route miles to its current 10 Gbps fiber network, building out a middle-mile network to eight rural Appalachian counties thanks to a $22.7 million BTOP grant. Seven of those counties were classified as economically distressed—bringing high-speed broadband to those areas could be the economic boost they need.
ACHIEVEMENT IN PUBLIC-PRIVATE PARTNERSHIPS
Indiana Economic Development Corp.; Greater Fort Lauderdale Alliance
Two organizations that continue to execute best practices and set a standard for excellence earned our 2014 awards for Achievement in Public-Private Partnerships: the Indiana Economic Development Corp. and the Greater Fort Lauderdale Alliance.
The Indiana Economic Development Corporation (IEDC) is Indiana’s lead economic development agency, officially established in February 2005 to replace the former Dept. of Commerce. In order to respond quickly to the needs of businesses, the IEDC operates like a business.
Led by Indiana Secretary of Commerce Victor Smith, the IEDC is organized as a public-private partnership governed by a 12-member board. The IEDC Board of Directors is chaired by Gov. Mike Pence and reflects the geographic and economic diversity of Indiana. IEDC focuses its efforts on growing and retaining businesses in Indiana and attracting new business to the Hoosier State.
IEDC has had great success in its aggressive effort to spur international investment in Indiana. Over the past two years, it has secured deals with more than 110 international companies, which are expected to bring more than 8,700 new jobs and more than $3.25 billion in investment to Indiana over the next several years.
IEDC is the engine that powers non-stop business expansion in Indiana across a diverse range of growth sectors. A good example is this month’s announcement by Lippert Components, Inc. to expand its South Bend operation and add up to 200 new jobs. The Elkhart County-based company, a tier-1 supplier of components for recreational vehicles, manufactured homes and other industries, is investing $6 million to lease and equip a 500,000 square-foot distribution facility (formerly the A.J. Wright Distribution Center) in South Bend.
“The RV industry has found a strong home here in the Hoosier State,” said Gov. Pence. “With our low taxes and affordable economic climate, Indiana businesses are able to keep costs down and keep our economy moving forward.”
Indiana’s favorable business climate has been a magnet for relocations. Last fall, Gov. Pence joined executives from Drew Industries, Lippert Components’ parent company, to celebrate the opening of its new headquarters in Indiana. In April 2013, the RV components manufacturer announced plans to invest $12.8 million to relocate its headquarters from White Plains, NY to Elkhart, IN and expand its manufacturing operations in Goshen and Elkhart, creating up to 800 new jobs by 2017. With more than 5,200 full-time employees across the country, Lippert Components currently has approximately 4,000 employees in Indiana.
Another company that recently relocated to Indiana is AM Manufacturing Co., a dough processing machine builder for the food industry, which is moving its headquarters to Munster, IN from Dolton, IL, creating up to 40 new jobs by 2016. The company will invest $2.28 million to lease, renovate and equip a 56,800 square-foot facility in Munster. The new facility, which will be operational this summer, will allow the company to move previously contracted work in house, as well as build a larger showroom to display machines for customers.
Also announcing expansion plans this month was Fort Wayne Metals, a research, development and fine-grade medical wire producer. The Fort Wayne, IN-headquartered company will invest $29.4 million to construct, renovate and equip a 33,000 square-foot facility on its 50-acre Ardmore Avenue campus in Fort Wayne, bringing its total footprint in the community to 553,000 square feet. With seven production facilities, a warehouse, a research and development center and a metallurgical laboratory in Fort Wayne, the expansion will allow Fort Wayne Metals to increase capacity for the production of stainless steel, nickel, cobalt, nitinol and titanium wire, as well as many composite materials in various forms.
IEDC has spearheaded efforts to continue to advance Indiana’s position as a top-10 national leader in automotive manufacturing and biotechnology.
A joint effort by Greater Lafayette (IN), the City of Lafayette, Tippecanoe County and the Indiana Economic Development Corp. garnered an Honorable Mention in our 2013 Economic Development Deal of the Year Awards for its success in persuading Subaru of Indiana Automotive (SIA) to invest $400 million to build the Subaru Impreza at its Lafayette facility. The project will create 500 new jobs and yield an estimated direct economic impact of more than $1.8 billion over the next 10 years.
The SIA expansion announcement spurred a series of supplier expansions in the Greater Lafayette area, including the expansion of Heartland Automotive, which makes interior parts for Subaru. Heartland will be doubling the capacity of its Lafayette facility to meet demand from the Impreza line.
Heartland’s $19-million investment will create 225 new positions. Construction of the planned expansion at Subaru’s Lafayette plant is slated to begin this spring and is expected to be completed by the end of 2016. Construction continues on a $75-million expansion project announced in May of 2012, which is increasing SIA’s capacity from 156,000 to 180,000 Subaru units annually without overtime. Therefore, SIA will be investing close to $500 million since 2012 in the Lafayette plant.
The Greater Fort Lauderdale Alliance, through its CEO Council—and through its headquarters marketing and recruitment initiative—continues to excel in the delivery of high-quality, effective economic development programs. These programs have resulted in substantial upward mobility for current and new Broward County residents, while providing substantial returns on investment to local municipal partners through the generation of new revenue as a result of capital investments.
The Greater Fort Lauderdale, FL area continues to notch headquarters relocation and expansion success stories, including the recent announcement by Prolexic Technologies, a global leader in Distributed Denial of Service (DDoS) protection services, of the relocation and expansion of its Global Corporate Headquarters and 24×7 Security Operations Center to Fort Lauderdale.
Prolexic Tech’s expansion will result in 118 new jobs at an average salary of approximately $100,000 (along with the retention of 120 existing Florida jobs). The company will invest $1.16 million in the relocation of its current headquarters in Hollywood, FL to downtown Fort Lauderdale, where it will lease approximately 35,000 square feet of space at the New River Center office building. State and local incentives for the project included $826,000 from the Qualified Target Industries Tax Refund Program, $125,000 from the Governor’s Quick Action Closing Fund and $125,000 in a Direct Cash Incentive from the City of Fort Lauderdale for the hiring of Fort Lauderdale residents.
In addition, Workforce Florida, Inc. will provide up to $380,800 for customized training of new and retained employees through the Quick Response Training Program, and WorkForce One of Broward County will provide an additional $132,500 for local recruitment assistance programs and services.
“It was crucial that we secured a larger, more efficient office facility to accommodate our rapid expansion and attract the highest-quality employees,” said Scott Hammack, chief executive officer of Prolexic Technologies. “We’re pleased to stay in Florida and bring new jobs to Fort Lauderdale”.
The Alliance substantially expanded international business activities to raise the global footprint of Greater Fort Lauderdale/Broward County by taking an active and participatory role in Gov. Rick Scott’s missions to Brazil, Colombia and Spain, and a separate mission to Mexico, along with hosting and facilitating visits from Australia, Brazil, Chile, China, Colombia, Italy and the United Kingdom.
The Alliance has a strong partnership with Broward County’s Workforce One employment center, securing nearly $1 million in state and local training assistance for 1,107 employees in local companies.
The Alliance supports the GrowFlorida program designed to provide both technical assistance and access to capital to second-tier, high-growth companies in the area; it also provided assistance to Broward College to establish a new business incubator to promote small business. In 2012, the Alliance formed its first Port Everglades Action Team. Port Everglades, the 12th-largest cargo port in the U.S. and one of the top cruise ports in the world, is in the midst of three critical expansion projects that will create 7,000 new jobs regionally and support 135,000 jobs statewide over the next 15 years.
Throughout the year, a primary focus of the Alliance is assisting local companies succeed through its Business Retention and Visitation Outreach (BRAVO) program. In 2012, the Alliance visited 178 companies to assist with access to capital, workforce training opportunities, permitting issues and site location assistance.
ACHIEVEMENT IN DOWNTOWN REVITALIZATION
Baton Rouge Area Chamber
In 2013, we picked Baton Rouge, LA as our top-ranked metro for Economic Growth Potential, based in part on the city’s great success in executing the state’s strategy of bringing together business and higher education in innovative public-private partnerships that spur initiatives in new high-growth sectors. This type of cooperation has been central to the remarkable success the Louisiana capital has notched in its downtown development, earning the Baton Rouge Area Chamber (BRAC) our 2014 Achievement in Downtown Revitalization Award.
The primary responsibility of BRAC’s economic development efforts is the recruitment, retention and expansion of business and industry in the nine-parish Capital Region. The goal is to create wealth within the region as measured by job creation, payroll, capital investment and public return-on-investment. BRAC is a non-profit, investor-driven organization with over 1,000 member businesses, civic organizations, education institutions and individuals.
The crown jewel of the downtown development effort in Baton Rouge is IBM’s new 800-job technology center, a facility that will provide software development and software maintenance services to clients in the U.S. Louisiana’s thriving capital landed this jewel with an unprecedented partnership which marshalled the resources of Louisiana Economic Development, the Baton Rouge Area Foundation (BRAF), Baton Rouge Area Chamber, Louisiana State University and the City of Baton Rouge/East Baton Rouge Parish.
“The new technology center in the Baton Rouge area has the potential to transform the region into a software development hub, which is one of our region’s targeted sectors,” said Baton Rouge Area Chamber CEO Adam Knapp. “There are so many positives to this story. The company will help strengthen our competitiveness for talent, help diversify our region’s economy and work in a close relationship with our key partner, Louisiana State University.”
A central element of the public-private partnership involved in securing the IBM center is the construction of a mixed-use, riverfront complex that will be developed by Commercial Properties Realty Trust (CPRT), a real estate investment trust that manages and develops property holdings of the Baton Rouge Area Foundation (BRAF). Inspired by New Urbanism design principles, the complex will include an office building that will house the new IBM Services Center, as well as a separate, 11-story residential building with 95 river-view apartments and nine separate townhomes.
The riverfront complex is being built on the old Advocate newspaper site bordered by Main, North, and Lafayette streets and River Road. Total investment for the combined development is estimated to be $55 million. The approximately $30.5-million office building will be funded by the State of Louisiana ($14.8 million) and the City of Baton Rouge/Parish of East Baton Rouge ($3.0 million), as well as $12.7-million in Community Development Block Grant funds.
In addition to the 800 jobs that will be created at IBM’s Baton Rouge facility over the next four years, LSU estimates the project will result in approximately 542 new indirect jobs, for a total of approximately 1,342 new, permanent jobs in the Capital Region.
Baton Rouge also has established itself as a leading hub for the hot growth sector of digital media. As we detailed in our March/April 2012 cover story, Baton Rouge (known as the Creative Capital of the South) has attracted development studios including Electronic Arts, Firebrand Games, Crawfish Games and the Academy Award-winning visual-effects studio Pixomondo. Louisiana Technology Park in Baton Rouge has welcomed a new digital media studio called Level Up Lab. Level Up is the first of its kind in the South and provides qualified, prescreened companies the chance to create games and mobile apps in an 1800-square-foot studio inside the Tech Park.
BRAC had its best year ever in economic development in 2013. The Capital Region set a record high for employment and appears poised for multiple years of growth. The Chamber goal’s for this year include securing new payroll of $57 million through the creation of 1,000 new direct jobs in the Capital Region, and expanding attraction of the coastal and water engineering target sector and additional international business attraction.
BRAC also is working to realize a region-wide agenda to enhance science, technology, engineering and math (STEM) education and workforce needs. At BRAC’s recent annual meeting, CEO Knapp projected that the software sector in the Baton Rouge area will see growth of 18 percent between 2012 and 2018 and there will be an increase of 9 percent in engineering jobs over the next five years.
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Topic Tags: Alabama Industrial Development Training (AIDT), Baton Rouge, BF-March/April-2014, Bristol, Chattanooga, Choose New Jersey, Economic Development Clusters, Empire State Development, Enterprise Florida, Export Trade Assistance Program (ETAP), Georgia Department of Economic Development, Greater Fort Lauderdale Alliance, Grow NJ, Indiana Economic Development Corp, Iowa Economic Development Authority, Kentucky Cabinet for Economic Development, Kentucky New Energy Ventures (KNEV) Fund, Lafayette, NJ Economic Development Authority, public-private partnerships, START-UP NY, WyoRECs™ Renewable Energy Credit Discount Program