Anyone who thought state budget deficits were confined to one or two regions of the United States had a sobering wake-up call in the form of a report issued this month by the Center on Budget and Policy. The report indicates that the sea of red ink has now washed over no less than 44 states. Nevada, Illinois, New Jersey, Texas and California lead the list of states in arrears, each compiling current deficits that amount to roughly one-third of their budgets. Nevada currently is facing a $1.5-billion deficit that is equivalent to 45.2 percent of the state budget; Illinois’s deficit is about $15 billion, or 44.9 percent of its budget; New Jersey weighs in at $10.5 billion, or 37.4 percent of its budget; Texas is facing a $13.4 billion gap, 31.5 of its budget total; and California, despite draconian budget cuts in the past two years, still has a $25.4-billion gap to close. States that are closest to making ends, according to the center’s report, are Indiana, West Virginia, Montana, Iowa, and Massachusetts, which range from the Hoosier State’s 2 percent shortfall (approximately $270 million) to Massachusetts’ $1.8-billion deficit (5.7 percent of budget). Proposed remedies include a bill reportedly circulating in Congress that will enable states to file for bankruptcy so they can renegotiate obligations like pension payments. However, a less-painful cure can be found in the 2010 census results: the Census Bureau reports that the fastest growth was achieved by states without a state income tax.
Automotive parts supplier ArvinMeritor will invest $23 million in facility and equipment upgrades to its headquarters in Troy, MI. The company got approval from the Troy City Council this week for personal and real property tax abatements that will total $2.4 million, $454,457 which will be city taxes, over a 12-year period. ArvinMeritor, which specializes in heavy duty truck, defense and industrial drive train components, will invest $10.7 million in new equipment and $6.4 million in facilities upgrades within the next five years. The upgrades are part of ArvinMeritor’s plans expand its output of hybrid drive train systems and enhanced safety features on defense vehicles, and re-enter the off-highway axle and brake markets. The upgrades will allow ArvinMeritor to add 125 engineers, designers and technicians to its current staff of 749. The average salary of these new jobs will be $1,185 per week.
Alaska Gov. Sean Parnell submitted four pieces of legislation to encourage increased investment in Alaska’s resource development and create job opportunities for Alaskans. “We continue to focus on legislation that will create economic opportunities and jobs for Alaskans,” Governor Parnell said. The governor transmitted a bill to establish a 20 percent tax credit for qualified research and development conducted by corporate taxpayers in Alaska. The proposed legislation would stimulate private-sector investment, entrepreneurial activity, and business expansion in Alaska that will bring opportunity and sustainable long-term benefits to the state. Gov. Parnell also submitted a bill to enable the Alaska Industrial Development and Export Authority (AIDEA) to invest in projects that promote economic development, including transportation, communications, and intellectual property. The proposed legislation provides greater flexibility for AIDEA to partner with investors in establishing joint investments. The governor also proposed a bill establishing the Alaska micro-loan revolving fund, the mariculture revolving loan fund, and the commercial charter fisheries revolving loan fund within the Department of Commerce, Community, and Economic Development. The legislation would promote economic development by helping small businesses across the state access critical capital. Another measure submitted by the governor would allow AIDEA to issue guarantees and make loans to help finance projects funded through a federal new markets tax credit program. Under this legislation, AIDEA would have the ability to help reduce the financing costs for a project to foster more economic development in Alaska, especially in areas with great need for new investment.
Representatives of development agencies in two states whose ports are competing to become the go-to destinations from an expanded Panama Canal appear to be pooling their resources. South Carolina’s Lowcountry Economic Alliance reportedly has joined the Georgia Ports Authority and the Savannah Economic Development Authority signing a joint resolution in support of deepening both the Savannah and Charleston harbors and developing the Jasper Ocean Terminal. “Lengthy conversations with our counterparts in Georgia have shown that we have the same goal – economic prosperity for the Lowcountry and the Coastal Empire,” alliance board member Kim Statler told SavannahNow.com. “Our competitors are overseas, not across the river.” The Lowcountry Economic Alliance is the regional economic development arm of Beaufort and Jasper counties in South Carolina.
Coskata Inc. plans to build a new ethanol plant at the Crossroads of America Industrial Park in Boligee, Alabama. The Illinois-based company has secured a $250 million loan guarantee from the U.S. Department of Agriculture and will seek additional funding for the plant, which will turn wood and plant waste into ethanol. After the rest of the money is raised, the company can outline a construction schedule to begin building. The Greene County project will create approximately 300 construction jobs and 700 direct and indirect jobs, including operators and engineers along with those that provide the materials to produce the ethanol, such as harvesters and haulers of pulpwood and plant biomass. The facility will generate around 55 million gallons of biofuel each year to help reduce dependence on foreign oil. According to a release from Coskata, the cellulosic ethanol they plan to make is a “high octane renewable fuel with a superior environmental footprint compared to gasoline”. The company said the Boligee plant will be the “largest planned cellulosic ethanol facility in the country.” Cellulosic ethanol is considered to have advantages over conventional ethanol, which is derived from grains such as corn and wheat or soybeans. In addition to recruitment by the state and local officials for more than two years, Coskata said Boligee was chosen because of its abundant supply of wood biomass. “Today’s announcement is very exciting for the state of Alabama and Greene County,” Gov. Robert Bentley said. “It has the potential to create hundreds of good quality jobs and economic development in an area of the state where they are sorely needed.”
A tentative agreement has been reached to build UMass Dartmouth’s proposed $22-million biomanufacturing facility in Fall River on land that had more recently been offered as a site for a casino, university and city officials told SouthCostToday.com. A final decision will be made after additional review at the state level. The $22 million facility, which would be funded with a mix of state and university money, was originally planned as the anchor tenant in a proposed 300-acre BioPark in Fall River, MA. A decision by the Fall River Redevelopment Authority last May to sell the original site to the Mashpee Wampanoag tribe for development as a resort casino threw had put the project in doubt. However, city officials reportedly discovered a deed restriction prohibiting a casino on the site and decided this week to rescind the sale and revive the BioPark project. Under the tentative agreement reached between the university and the city, the Fall River Redevelopment Authority would donate several acres of land to UMass for the facility; the facility would be sited closer to the front of the park than planned originally. The remainder of the 300-acre park would be developed by the Fall River RDA as a biotechnology business park. Covenants further reinforcing the biotechnology focus of the development will be written into the deed, officials told SouthCoastToday.com.
The South Carolina Department of Commerce and Anderson County announced that Delta Power Equipment Corporation, a maker of power tools, will establish its new operations in Anderson County. The company will invest more than $3.6 million and expects to generate 40 new jobs. “The new facility will allow Delta Power Equipment to continue its tradition of providing top-notch woodworking equipment to our customers. We look forward to establishing our new operations in Anderson County. South Carolina provided us with the positive business environment and market access we were looking for when deciding where to locate. We appreciate all the support we have received from state and local officials,” said Bryan Whiffen, president and CEO of Delta Power Equipment Corporation. Delta Power Equipment Corporation will locate its new corporate offices and manufacturing operations in an existing building in Anderson County. The company expects to start operations at the new facility by the beginning of April. “Anderson County is pleased to begin 2011 with this wonderful announcement,” said Anderson County Council Chairman Tommy Dunn. “We are excited about Delta Power Equipment’s decision to locate in our county. Their $3.6 million investment into our community and 40 new jobs will be a boost for our local economy. We know this is just the beginning of good things to come for our county.” Delta Power Equipment Corporation will begin hiring for new positions at the end of the month.
When Japan, Inc. flexed its muscle in the U.S. auto and consumer electronics markets in the 1980s, there was a lot of hand-wringing in America that the Land of the Rising Sun posed an existential threat to U.S. manufacturing. Our friends in Japan responded to this concern, particularly in the automotive sector, by building huge assembly plants in the United States. The message was clear: Japan understood that destroying thousands of jobs in the biggest market for its products did not make long-term economic sense and endangered a strategic partnership between two allies. China, home to nearly a fifth of the world’s population, values jobs more than revenue. It has 1.5 billion mouths to feed and an authoritarian government which has an unspoken pact with the masses: unfettered growth in exchange for the political stability it requires to rule unchallenged. The Chinese politburo has wagered that U.S. leaders, addicted to China’s purchase of U.S. Treasury bonds that finance America’s exploding debt, will have no choice but to swallow the migration of U.S. jobs to the subsidized industries of China. They are doubling down on this bet by refusing to let the Chinese currency rise to its real value against the U.S. dollar, putting a boulder on their side of the balance of trade seesaw. The lead story in Saturday’s business section of The New York Times frames the dilemma confronting President Obama as he prepares to break bread in Washington this week with China’s president, Hu Jintao. In Massachusetts, a company named Evergreen Solar has blossomed in the past three years to become the third-largest maker of solar panels in the United States. Evergreen Solar received a big boost in this effort from a generous $43-million incentives package provided by the state. Last week, Evergreen Solar announced it will close its factory in Devens, MA and lay off the plant’s 800 workers by the end of March. The company also announced it has formed a joint venture with a Chinese company and will shift production of its solar panels to a plant in central China. The Times reported that a key factor in Evergreen Solar’s decision was “much higher government support” available for alternative energy initiatives in China. The Obama Administration says it is investigating whether the mammoth subsidies China has bestowed on its burgeoning alternative energy industry violate the free trade rules China accepted when it joined the World Trade Organization. As reported in this space last week, China’s annual investment in alt energy now tops $50 billion, far […]
Johnson Controls has broken ground on a $150-million, fully integrated battery recycling facility in Florence, SC, said to be the first new facility of its kind to receive an air permit in the U.S. in 20 years. The Florence Recycling Center, slated for completion during 2012 and to be operated by Johnson Controls’ Power Solutions business unit, will create an estimated 250 new jobs and approximately 1,000 indirect jobs in the area. This week’s groundbreaking was led by Alex Molinaroli, president of Johnson Controls Power Solutions, with more than 150 area leaders and community members in attendance. South Carolina State Sens. Hugh Leatherman and Yancey McGill were in attendance, as well as Florence Mayor Steve Wukela. “I’d like to thank the leaders from the Florence area and throughout South Carolina for their support and collaboration through this process, including the Florence County Economic Development Association, the South Carolina Department of Health and Environmental Control (DHEC), the Environmental Protection Agency (EPA), Senators Hugh Leatherman and Yancey McGill, and many others,” said Molinaroli. “They have been instrumental in helping us to achieve today’s milestone to be able to break ground on this important facility.” “The collaboration between the Florence community, organizations and business has been vital to the success of this facility,” said Allen Martin, vice president and general manager for Johnson Controls Power Solutions Americas. “Today is particularly rewarding for everyone who has been involved in the process.” “Johnson Controls continues to be a great corporate citizen, particularly through the extensive public process it took in getting this facility off the ground,” said Mayor Wukela, mayor of Florence. “The collaborative approach Johnson Controls took in working with us really illustrated its commitment to the region and the environment,” added Nancy Cave, North Coast office director for the Coastal Conservation League (CCL). The facility will be located directly off of US-76, on Paper Mill Road. Johnson Controls plans to develop 36 acres of the site for its new facility and parking, with the remaining acreage undeveloped. Portions of this undeveloped acreage will be permanently protected through a conservation easement.
In Iowa, the Iowa Power Fund Board has approved terms to start contract negotiations on a grant award for a DuPont Danisco Cellulosic Ethanol biorefinery that will produce cellulosic ethanol in Iowa, Biofuels Digest reports. With the terms approved, a final contract will be negotiated and could be approved as early as February’s Board meeting. The terms call for a $9 million grant from the Iowa Power Fund, combined with over $226 million in matching funds by DDCE, for a total project cost of over $235 million. The biorefinery will be capable of producing 25 million gallons of cellulosic ethanol per year, using corn stover as a feedstock. DuPont is reportedly evaluating several sites in Iowa for the refinery.