Hyundai and Kia use Foreign Trade Zone status to handle and process auto cargoes arriving at the port.

By Dominique Cantelme
From the May/June 2012 issue

The United States is the largest trading nation in the world for goods and services. Its 327 official ports of entry, including seaports, airports, and land border locations, provide the link for getting goods to consumers and transporting U.S. made products overseas for export.

According to U.S. International Trade in Goods and Services by the U.S. Census Bureau and the U.S. Bureau of Economic Analysis, U.S. exports of goods and services rose by 16.6 percent in 2010 and 14.5 percent in 2011. 2011 exports reached $2,103.1 billion and imports $2,661.1 billion. For goods, exports were $1,498 billion and imports were $2,235 billion. For services, exports were $604.9 billion and imports were $425.9 billion.

2011 exports of goods were up $202.4 billion from 2010. Increases occurred in industrial supplies and materials ($107.7 billion); capital goods ($44.8 billion); automotive vehicles, parts and engines ($20.5 billion); foods, feeds and beverages ($18.4 billion); consumer goods ($10.4 billion); and other goods ($0.5 billion). Imports of goods were up $293.8 billion from 2010. Increases occurred in industrial supplies and materials ($153.7 billion); capital goods ($61.8 billion); consumer goods ($30.4 billion); automotive vehicles, parts and engines ($29.0 billion); foods, feeds and beverages ($15.7 billion); and other goods ($3.2 billion).

2011 exports of services were up $56.0 billion from 2010. Increases occurred in other private services ($20.8 billion), royalties and license fees ($14.2 billion), travel ($12.2 billion), passenger fares ($5.8 billion), other transportation ($2.6 billion) and transfers under U.S. military sales contracts ($0.3 billion). 2011 imports of services were up $22.8 billion from 2010. Increases occurred in other private services ($10.3 billion), passenger fares ($3.9 billion), travel ($3.8 billion), other transportation ($3.5 billion) and royalties and license fees ($2.2 billion).

The U.S. Foreign Trade Zone (FTZ) program has been a critical tool in helping U.S. ports remain a strong economic force in the global community. The program was created in 1934 with the goal of helping businesses in the U.S. stay competitive with foreign manufacturers and suppliers. According to the National Association of Foreign Trade Zones, a not-for-profit trade association, there are currently 256 General Purpose Zones and 498 Subzones in the United States (including Puerto Rico). They handle almost $500 billion worth of merchandise annually.

Located in or near a U.S. Customs Port of Entry, FTZs benefit companies in many ways. Regardless of proximity, foreign and domestic merchandise in these areas are considered to be outside of “Customs territory”. This means that if the final product emerging from a FTZ is exported, no U.S. customs duties or excise taxes are levied. The FTZ program directly supports hundreds of thousands of U.S. jobs. And while the U.S. government incurs a reduction in Customs duty revenue by the use of FTZs, it more than makes up for it by the income tax gained from direct and indirect jobs FTZs help to create and retain. In addition, local governments benefit from sales and property taxes.

Look no further than the following ports and FTZ locations to position your business for success.

Philadelphia Regional Port Authority: Port On A Mission

The mission statement for the Philadelphia Regional Port Authority is as follows: The Philadelphia Regional Port Authority (PRPA) is an independent agency of the Commonwealth of Pennsylvania charged with the management, maintenance, marketing and promotion of publicly owned port facilities along the Delaware River in Philadelphia, as well as strategic planning throughout the port district. PRPA works with its terminal operators to modernize, expand and improve its facilities, and to market those facilities to prospective port users. Port cargoes and the activities they generate are responsible for thousands of direct and indirect jobs in the Philadelphia area and throughout Pennsylvania.

Concise words, solid message. But what does it all mean to you and your business? More specifically, what does the mission mean to your business if you decide to expand its operations to the Philadelphia region?

Dynamic things are happening at the almost four centuries-old seaport, developments that are combining the Philadelphia Regional Port Authority’s long history and unsurpassed experience with the efficiencies of the new. Thanks to the support of state and federal governments, the PRPA’s single biggest piece of news these days is the Philadelphia Regional Port Authority overseeing the deepening of the Port of Philadelphia’s main channel in the Delaware River from 40 to 45 feet. Projected for completion in about three years, the new deeper Delaware River will allow the industry’s new larger containerships to deliver and take on cargoes at the port, cargoes that companies in the region eagerly await or are eagerly sending outward.

Coinciding with the channel-deepening project is the Southport initiative, which is the construction of a brand new container-handling facility in South Philadelphia, adjacent to PRPA’s Packer Avenue Marine Terminal. Between deeper water and this new marine terminal complementing existing facilities, the already efficient, economical port will be able to serve area businesses better than ever before—exactly what they’d like to do for you.

PRPA’s marketing team stands ready to assist private businesses like yours in the development of effective logistics plans. Their even ready to help companies that aren’t including waterborne commerce as a major part of its operations, or even companies that do generate waterborne commerce but ship it through non-PRPA cargo terminals in the region. Why is this?

As Grantee of Foreign Trade Zone No. 35, PRPA has the ability to grant FTZ Zone or Subzone status to manufacturers operating in the FTZ jurisdiction. Having existing companies operate more successfully or attracting new companies to the region is good for everyone, whether or not PRPA’s public port facilities directly benefit.

Those that consider making the Port of Philadelphia part of their logistics chain will find that PRPA and its terminal operators are ready to serve the nation’s businesses. The Port of Philadelphia is proud of all the businesses they’ve helped to attain Zone or Sub-Zone status in the region, whether or not their cargoes are seen on their docks.

Yes, so much is happening at the Port of Philadelphia these days: deeper water; expanded cargo capacity, a vibrant FTZ program and much more. Why not take a moment to visit the Philadelphia Regional Port Authority’s web site, at www.philaport.com, to learn more about the news briefly touched on, as well as other exciting projects and initiatives. It might be your first step toward a profitable decision to make your business operations a productive member of the Philadelphia region’s stable and growing economy.

Port Freeport: 100 Years In The Making

Port Freeport came into being more than 100 years ago when the first jetty system was built in Freeport, Texas. Since that time, Port Freeport has become one of the fastest growing ports on the Gulf Coast and currently ranks 16th among U.S. ports in international cargo tonnage handled. With a current channel of 45-foot depth, soon to be widened and deepened, just three miles from open Gulf of Mexico waters, Port Freeport offers more than 7,500 acres for future development. Port Freeport serves its customers and stakeholders through development and marketing of competitive world-class navigational capabilities, technically advanced marine and multimodal terminal services and port-related industrial facilities while achieving profits and creating jobs as a leading economic catalyst for the Texas Gulf Coast.

Port Freeport offers the following benefits: rail, highway, vessel and/or barge transportation can be seamlessly utilized; direct access to the Gulf Intracoastal Waterway, Brazos River Diversion Channel, State Highway 36, State Highway 288 and Union Pacific Railroad; only a few minutes commute from quality schools, housing and medical care and just 59 miles south of downtown Houston, Texas—the nation’s fourth largest city; surrounded by a highly qualified, technical labor pool; available existing water supply, wastewater collection, electrical distribution, gas and telephone; existence of adjacent properties that could support future growth and development; air freight service by all national carriers from multiple surrounding airports within 60-mile radius; availability of local, high-quality trainable workforce and close proximity to universities and technical colleges; ability to manage inventory and/or manufacture duty deferred, inside its Foreign-Trade Zone; Texas is a right-to-work state, which leaves you the right to choose between union and non-union labor; the state of Texas, Brazoria County and Port Freeport offer competitive incentives, tax credits and exemptions.

Recent developments at Port Freeport include the construction of the first phase of its Velasco Terminal, which will add further cargo-handling capabilities at the Port. The construction of a new 800-foot-long dock and 20 acres of backlands promise an eventual offering of 2,400 feet of berthing and more than 90 acres of supporting land.

Meanwhile, Port Freeport continues to work in conjunction with federal and state authorities to advance the project to deepen the Port’s channel to 55 feet from its present 45 feet, plus substantially widen the channel as well. The Port is hopeful that the feasibility study will indicate, as have preliminary analyses, that benefits of the channel project should exceed its $300 million cost.

With so many developments pointing toward growing diversified activity at Port Freeport, there is much anticipation for the Port to expand upon its already impressive status as an economic cornerstone of the community and region—a dynamic force directly and indirectly responsible for more than 55,000 jobs and having an overall annual economic impact in Texas of $10.2 billion.

Unlike many ports, which are running out of available land, Port Freeport boasts more than 7,500 acres of currently undeveloped tracts, all proximate to the waters of the Gulf of Mexico. The Port is a mere three miles—45 minutes by ship—from the open sea.

The Foreign-Trade Zone Program adds to Port Freeport’s appeal. Since established in 1988, Port Freeport’s Foreign-Trade Zone No. 149 has helped American companies involved in global commerce to save money on the products they import into the U.S. through deferral, reduction and/or elimination of Customs duties assessed on foreign merchandise. In 2012, Port Freeport submitted an application to the Foreign-Trade Zones Board to reorganize FTZ No. 149 under the Alternative Site Framework offering FTZ benefits to companies located in Brazoria and Fort Bend County.

Those seeking additional information about Port Freeport are encouraged to check out Port Freeport’s web site at www.portfreeport.com or contact Mike Wilson at 1-800-362-5743, ext. 4325, or by e-mail at wilson@portfreeport.com.

Newark: World-Class Logistics

“It is not just about infrastructure, access is key,” said Lyneir Richardson, CEO, Brick City Development Corporation. “No other city in America offers access to Wall Street and global trade, just fifteen minutes apart. Manhattan is only minutes away,” said Richardson.

Newark boasts some of the finest infrastructure in the U.S. and indeed the world. With an international airport, seaport, state-of-the-art rail system and network of highways converging on the city, Newark also has become a global transportation hub. More than 620 million tons of freight—valued at over $850 billion—move through New Jersey’s ports every year. Newark is also one of the most connected domestic markets, with over six forms of transportation converging in one hub.

Access is what is fueling Newark’s competitiveness. Ongoing investments in access and infrastructure, including sustainable initiatives such as a bio fuel terminal (2011) and the raising of the Goethals Bridge—which will allow access to the Panama Canal—all help to strengthen access to global markets for the long-term.

Major corporate icons such as Panasonic, Prudential, Bonita Banana, Standard Chartered and United Airlines have selected Newark as their U.S. Headquarters, attracted by the city’s business advantages:

• Access to markets: Port Newark is the principal containership facility for goods entering and leaving the New York metropolitan region and the entire Northeast U.S.
• Access to talent: Newark’s fully developed transportation network allows easy access to an educated workforce in and near the city. Newark’s large multilingual population and six universities add to the value proposition. More than 40,000 college and university students attend school in the city, within a half mile of the central business districts.
• Access to Investment Incentives: A toolbox of tax credits, tax abatement, bond financing and loan programs incentivize businesses locating in Newark.

Mimeo.com, an online and on-demand document production and shipping firm, has a 75,000-square-foot data center and print production and distribution facility in the city. Mimeo.com’s products need to be packaged and shipped for just-in-time delivery around the world, and that’s only possible via cities like Newark, with access to a world-class transportation infrastructure.

The Portugal-based medical genetics testing company, CGC Genetics, located its first American outlet in Newark’s University Science Park.

Newark recently hosted the U.S./Portugal Business Development Trade Mission with Nuno Brito, Ambassador of Portugal to the USA, and Ambassador Allan J. Katz, Ambassador of the U.S. to Portugal.

The International Trade Administration (ITA) recently announced new data that shows that New Jersey’s merchandise exports increased 19 percent in 2011 compared to 2010, growing from $32.2 billion to $38.2 billion, exceeding the national average for merchandise export growth for the same period. New Jersey’s 2011 merchandise export sales increased to many top destinations, including the Netherlands (up 84 percent), Brazil (81 percent, Turkey (46 percent), Mexico (39 percent), and China (34 percent). Key merchandise export categories include: chemicals, petroleum products, computer and electronic products, transportation equipment and primary metal manufacturers.

“The companies that locate here, whether in downtown or our FTZ are selling truly innovative products and services to world destinations,” said Dudley Ryan, Vice President, CB Richard Ellis. According to Ryan, these companies are helping to advance the regional economy by creating high paying jobs and initiatives such as the U.S. National Export Initiative.

“Newark offers international companies access to the best transportation nexus on the East Coast and a gateway to the U.S. and Europe. Our infrastructure and distribution system are unrivaled. These, combined with the Foreign Trade Zone and proximity to New York and Washington D.C., makes Newark a truly attractive location for international companies seeking to invest in the U.S.,” said Richardson.

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A boardwalk through marshes leads to the Bodie Island Light in the Outer Banks of North Carolina.

The Carolinas, well known for their creative climate and low-cost business environment, are now an East Coast engine for growth hitting on all cylinders. North Carolina and South Carolina are busy certifying shovel-ready sites and pioneering new incentives.

In South Carolina, the focus also is on creative workforce development strategies. The South Carolina Department of Commerce is committed to meeting a business’ specific workforce needs. The Department of Commerce’s Workforce Division and the readySC™ program, offered through the S.C. Technical College System, coordinate training needs at no cost for eligible new or expanding companies throughout the state. The readySC™ program works with the state’s 16 technical colleges to develop training curriculum tailored to meet a company’s workforce requirements. More than a quarter-million workers have been trained since the nationally recognized program’s inception.

South Carolina won Business Facilities’ 2009 Deal of the Year Award for N. Charleston’s selection as the location for Boeing’s second final assembly plant for the 787 Dreamliner commercial airplane.

Across the state line to the north, Gov. Bev Perdue recently established the North Carolina Innovation Council to foster strategic investments and policies in the growing knowledge and innovation economy. The North Carolina Innovation Council is part of Gov. Perdue’s JobsNOW initiative. Through JobsNOW, the state will work aggressively to create jobs, train and retrain its workforce, and lay the foundation for a sustainable economic future.

“To continue growing jobs in North Carolina, we must make sure this state is poised to compete globally in the 21st century,” says Perdue. “Innovation is North Carolina’s launch pad to success in the global economy, and it’s a primary way for us to maintain and sharpen our competitive edge.”

“Business leaders know we are listening to them and working aggressively to meet their needs,” Perdue says. “Companies know that in North Carolina they will find top-quality talent, world-class infrastructure, a pro-business environment and premier education institutions. North Carolina is simply a great place to do business.”

NC Public Power: Leading the Way to Economic Recovery

As business leaders around the world continue to scan the daily headlines for encouraging economic news, at least one is already seeing signs that the global crisis has finally run its course.

“We’ve seen a measurable uptick in interest and activity over the last year and a half,” said Brenda Daniels, economic development manager for ElectriCities, a not-for-profit government service organization representing North Carolina cities and towns that own electric distribution systems.

Daniels isn’t overly surprised to find her organization’s membership playing the role of leading economic indicator.

“Companies that come out of the gate fastest and strongest after a recession are typically those that are most focused on efficiency and cost control,” she said, speaking from ElectriCities headquarters in Raleigh. “Not coincidentally, efficiency and cost control are two areas in which we excel.”

Daniels explained that one of ElectriCities’ many roles is to represent member communities to expanding and relocating companies. Her staff maintains comprehensive databases for all 70+ public power municipalities in North Carolina.

As easily as flipping a switch, a site selection professional can order detailed reports on dozens of North Carolina sites, from mountains to coast. Within 48 hours of a request, ElectriCities will send profiles of locations that precisely match the company’s specifications.

Daniels emphasized that the process is “fast, efficient, and entirely confidential.” Using ElectriCities as an introduction to North Carolina, site search managers have a turnkey information source. “They find all the information they need in one place.” ElectriCities’ staff produces a full profile that details infrastructure, site availability (including site and building photos), labor and even lifestyle data such as schools, hospitals and golf courses.

ElectriCities remains a partner through the entire process, helping companies with utility related issues, arranging site visits, and facilitating contact with local, county and state officials.

There’s another key factor that’s making the phones ring at ElectriCities: the availability, reliability and affordability of North Carolina public power.

“It’s no coincidence that some of the state’s most dynamic growth has occurred in our public power communities,” said Daniels. “Advanced manufacturing, food processing, metal-working, plastics—any power-intensive industry is going to find significant advantages here.”

Companies based in ElectriCities member communities recognize the cost efficiencies and superior customer service public power provides. Municipal utilities don’t have to pay dividends to shareholders, and those savings can be passed on to the utilities’ customers. Both ElectriCities and the member utilities work closely with companies to help them manage their power usage and keep costs down.

Businesses are also happy to have the personal touch public power provides. “Customers always tell us, we’d much rather work with you. We can call somebody, we can get an answer,” said Larry Cranford, electric department director in Statesville, an ElectriCities member community. “That doesn’t happen with other power providers.”

Daniels believes the optimism she sees is also driven by North Carolina itself, which is renowned for its pro-business climate, excellent job training programs, and low labor costs. “People just expect North Carolina to bounce back faster and stronger than other places.”

She cited the examples of Lubrimetal Corp, which will locate in Granite Falls creating 19 jobs and investing $1.9 million. Also Freightliner/Daimler Trucks in Gastonia will expand with 100 new jobs. “The recent decisions of these companies to locate and expand here shows a lot of confidence in North Carolina and our public power communities.”

North Carolina is perhaps the only state that’s perennially ranked among both the best states for business AND the best places to live. People and companies alike are drawn to the Tar Heel State’s outstanding universities, its beaches and its Blue Ridge Mountains, the low cost of living and doing business, and its temperate four-season climate.

To learn more, call Brenda Daniels at ElectriCities toll-free 1-800-768-7697 est. 6363 or mobile 919-218-7027; email bdaniels@electricities.org; or visit www.electricities.com.

Workforce Quality: The Key To Growth In Winston-Salem

Winston-Salem, NC keeps popping up in conversations among site consultants, economic development professionals and, most importantly, business leaders looking to expand or relocate their operations. And for good reason.

In particular, Winston-Salem has become a prime spot for several key industries: life sciences and health care; advanced manufacturing; financial services; and a growing presence in logistics and data centers. Why? Location helps, along with a robust infrastructure. However, it is the overall combination of several unique qualities and attributes that gets us into the game.

The way community and business leader, educational institutions, city and county government organizations all work together is a true difference maker in creating an ideal, pro-business climate in Winston-Salem. This ability to easily collaborate allows area leadership to both serve the community’s best interests and nurture business development.

The latest example of the community’s collaborative spirit is Wake Forest Biotech Place, a state-of-the-art multipurpose biotechnology research and innovation center. The new research facility is a world-class 242,000-square-foot redeveloped historic structure. This modern biotech research laboratory opened in early 2012 and is where internationally recognized researchers are pioneering new fields of medicine. However, the redevelopment of the property was only possible through close collaboration among Wake Forest Baptist Health, Piedmont Triad Research Park, Wexford Science & Technology, government, community and business leaders.

As every economic development professional knows, getting these community “planets” to align anywhere is, at best, difficult. The fact that Winston-Salem does it on a consistent basis is downright extraordinary. The combination of available workforce and advanced education programs puts Winston-Salem on many companies’ short lists for expansion and relocation. The training programs being developed by Forsyth Technical Community College have even attracted the attention of the last two Presidents of the Unites States, with both dropping by for visits during their respective terms.

A prime example is Caterpillar’s decision to build an advanced manufacturing facility here in Winston-Salem. Workforce availability, customizable training and education capabilities, coupled with an ideal site and sensible business incentives, all combined to make the decision an easy one for Caterpillar management.

Winston-Salem comes by its creative culture honestly. Dating back to its origin as a Moravian settlement, the city has always placed a high value on the arts. Through the early 20th century, that creativity led to innovation in manufacturing that transformed the area into a booming industrial center. The resulting prosperity brought with it the development of new avenues for creativity, such as the founding of the first Arts Council in the nation in Winston-Salem.

Today, examples of Winston-Salem’s culture of creativity can be seen throughout the community—along the Arts District on Trade Street, in the galleries of the numerous art museums, at performances of the UNC School of the Arts, Milton Rhodes Fine Arts Center, Winston-Salem Symphony and other organizations. The most striking effects of this culture of creativity, however, reach well beyond the art world. The area’s long-standing emphasis on creativity has spawned innovations in life sciences, nanotechnology and advanced manufacturing.

Consider the well-publicized advances of the Wake Forest Institute for Regenerative Medicine, for instance, where scientific discovery meets real world clinical applications. The groundbreaking research teams at the institute created the world’s first laboratory-engineered organ—bladder tissue that has been successfully implanted in children and adults—and are working to engineer more than 20 different organs and tissues. Breakthroughs like these happen not by accident, but when the right people and resources come together in an environment that encourages expression and creativity. And it is no accident that the institute anchors one corner of Piedmont Triad Research Park, Downtown Winston-Salem’s urban research campus.

On their own, each of the qualities we’ve described makes a huge difference in Winston-Salem’s success. And, depending on the industry, one of the attributes may provide the tipping point for the city getting chosen for a business’s expansion or relocation plans. Together, though, collaboration, workforce quality and innovation make Winston-Salem stand out as a place where businesses thrive. For more information on Winston-Salem, visit www.wsbusinessinc.com or contact Winston-Salem Business, Inc., at 336-723-8955.

Oconee County Is Reinventing Itself

Oconee County is no longer Upstate South Carolina’s best kept secret. The message of a business climate built for success is spreading thanks to being home to Fortune 500 Companies such as Duke Energy Corporation, Johnson Controls, Inc., Sandvik, US Engine Valve, Schneider Electric and BorgWarner Automotive. Steeped in history and tradition, Oconee County is home to natural beauty, a low cost of living, a pro-business atmosphere and unparalleled access to the United States.

Not many communities can match the wonderful climate in the beautiful foothills of the Blue Ridge Mountains with which Oconee County is blessed. The area also has world class lakes—Hartwell, Jocassee and Keowee and premiere rivers—Chattooga, Keowee and Chauga so there is plenty to do from an outdoor sports perspective.

Along with the abundant recreational choices, there are plenty of opportunities to enjoy the culture and fine arts of the communities. Thanks to close neighbors Clemson University, the cities of Greenville and Anderson even more entertainment is available. If quality of life is a driving factor for a personal or business choice, then look no further.

South Carolina is a mere two days’ drive from nearly 208 million Americans—a whopping two-thirds of the United States population. Oconee County is well-positioned midway between Atlanta and Charlotte. Market access along the Interstate 85 Corridor is one of the strengths Oconee has to offer. Whether it is an expansion opportunity or relocation decision, Oconee County has a proven record that it possesses a competitive advantage when it comes to the right location.

Many in the business and economic development community have found that the State of South Carolina has a top-ranked business climate. The cost of living is about 10 percent lower than the national average and there is a solid foundation for business growth due to low taxation.

In addition to the pro-business environment, companies come to South Carolina for its ready-trained workforce––ranked No. 6 in the country by CNBC. The state’s northwestern-most county offers companies a workforce that is trained with a strong work ethic. The remnants of the textile age have instilled in the people a knack for being hard-working and dependable. With new career choices emerging, a partnership with the local technical school has proven valuable in getting the Oconee County workforce of tomorrow ready today.

When you take that fact and combine it with location, you will understand why Oconee County is coming off one of its’ best years for economic development announcements. BASF recently made the decision to invest $60 million dollars in expanding their operations at the Seneca, SC plant. BorgWarner Torqtransfer Systems, Inc. continues to invest in Oconee County having completed a$25 million dollar expansion this spring.

These recent successes have helped to usher in a new outlook towards economic development from the County perspective with investment in a speculative shell building to entice new business and new opportunities for job creation. Oconee County is also in the process of developing two new industrial parks, one on SC Highway 11 and the other along Interstate 85.

Oconee County is in a period of profound transformation and has a powerful opportunity to reinvent itself. As the global economy continues to improve, the county will be in position to meet the demands of the future. To learn more about South Carolina’s western-most county and the opportunities it boasts, visit www.oconeeSCedc.

NC Electric Cooperative: Providing Statewide Service

North Carolina’s electric cooperatives serve more than 2.5 million people across North Carolina in 93 of the state’s 100 counties. The 26 electric cooperatives are private, independent and not-for-profit entities committed to providing a high standard of service to residential, commercial, industrial and agricultural customers with at-cost electric service. Each of North Carolina’s electric cooperatives is governed by a board of directors elected from its membership. Members are also owners. North Carolina’s electric cooperatives emphasize the importance of community involvement, integrity, accountability and innovation.

The North Carolina Electric Cooperative serves a power distribution territory covering more than 23,000 square miles, nearly half of the state’s land.

Since 1995, North Carolina’s electric cooperatives have helped bring more than 14,600 jobs and $903 million of economic investment to the state.

When North Carolina farmers and their neighbors formed cooperatives in the 1930s and 1940s to supply themselves with electric power, they intended to improve more than the quality of their lives and work. They also knew they were contributing to the development of their communities.

Since then, this network of electric cooperatives has become a major force in North Carolina’s economy. Cooperatives are not-for-profit corporations owned by members—the people and businesses they serve. Members democratically elect their cooperative’s board of directors, who set policy and supervise the operations of the business. Revenue that is not required for general operations, infrastructure and system stability is returned to members in the form of capital credits or member dividends. In North Carolina in the 1930s and 1940s, local citizens organized cooperatives to provide safe, reliable and affordable electric power to homes and businesses that other utilities were unable to serve.

North Carolina’s network of 27 electric cooperatives serves nearly 30 percent of the state’s population, some 2.4 million people, with more than 860,000 accounts. Our power distribution territory covers approximately 23,800 square miles, nearly half the state’s land area, in 93 of the state’s 100 counties.

In 1949, we formed a statewide cooperative to acquire and supply wholesale electrical power to cooperatives collectively. The North Carolina Electric Membership Corporation (NCEMC) today helps to meet the power requirements of 26 of the state’s 27 cooperatives. NCEMC owns a 56.25 percent share of the Catawba Nuclear Station in York, S.C., one of the most efficient nuclear generating facilities in the nation. NCEMC also owns two diesel-powered generators that provide peak-load and emergency power to the Outer Banks.

Today, the total assets of the cooperatives combined is more than $5 billion.

Nationwide, 864 electric cooperatives serve more than 39 million members in 47 states. North Carolina’s electric cooperatives also are part of the 600-plus electric co-ops who have chosen to join Touchstone Energy, a nationwide coalition of cooperatives who pledge to adhere to our core values of integrity, innovation, accountability, and commitment to community.

Besides providing reliable electric power to members and their communities, North Carolina’s Touchstone Energy cooperatives have been heavily involved in overall regional economic development. Activities range from small business assistance to establishing industrial parks, from encouraging local educational and health care initiatives to supporting non-profit social services and neighbors in need.

The direct impact includes providing local employment, investing in our systems and staffs (which involves day-to-day commerce with other businesses and families), returning capital credits dividends to members, and direct funding of local and regional economic development projects. Each dollar that cooperatives spend, of course, is multiplied in its effect as those dollars make their way through the economy, spurring further productivity, income, employment and investment. Direct financial support from the state’s electric cooperatives is conveyed to business development, education, civic and community projects, and energy-efficiency and housing.

About 55 percent of cooperatives’ direct community spending supports local industrial and business development, that provides employment and creates goods and services. Programs include low interest loans and business opportunity grants, including the zero-interest Rural Economic Development Loans available  through the U.S. Dept. of Agriculture.

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Waupaca Mill

By Ed Shulman
From the March/April 2012 issue

With bailed-out industry giant GM back on top and the recovery picking up steam, industry analysts forecast 2012 global light vehicle assembly to be 83.5 million units, a 10 percent increase compared to 2011 estimates of 75.9 million units.

General Motors has claimed the number one spot in the automotive industry just two years after GM filed for bankruptcy. According to media reports, the automaker has topped sales in every corner of the globe, managing to increase profits despite years of financial struggles.

GM suffered its share of ups and downs over the past decade, but saw the worst of its struggles in 2009 when it filed for bankruptcy. In an attempt to restructure the company, GM let go of several of its top lines, including Pontiac and Saturn, in addition to selling its subprime auto loan business.

Since that time, the company slowly moved toward recovery. It has been able to repay more than half of its TARP funds received from the government, while also allowing GM to reenter the subprime business and pushing to sell shares on the New York Stock Exchange.

Now, after selling 640,000 more cars and trucks than it did in 2010 and earning more than $7 billion in profits in three quarters last year, the company pushed back to the top of the auto industry in 2011, surpassing last year’s winner, Toyota.

Toyota took the spot as the top automaker in 2010, but suffered massive losses after the tsunami in Japan devastated many of the company’s plants, impacting its ability to build cars and ship parts to other automakers around the world. Now, experts say it the largest Japanese automaker is recovering from its losses and gearing up for a strong year.

Ford is also among the competition GM faces with sales up 11 percent in the past year. With that said, auto consumers may see a rise in incentives and deals as automakers contend for the top spot.

Autofacts, PwC’s automotive forecasting service, forecasts 2012 global light vehicle assembly to be 83.5 million units, a 10 percent increase compared to 2011 estimates of 75.9 million units. Although complex macroeconomic and geopolitical issues remain, strong vehicle production in the first half of 2011 is driving assembly volumes to increase over prior estimates. Chinese and Indian markets are driving significant growth in the baseline global assembly estimates.

Japan’s auto industry is fighting back with the majority of the country’s vehicle manufacturers and suppliers expected to be back to full tilt by September. Japan’s faster than anticipated recovery has also contributed to the upward revision of the global assembly estimates.

The country has been rebuilding its industry over the summer months and is now on course for an output of 8.4 million units for 2011—some 221,000 more than had been previously expected. Autofacts also predicts that globally, total light vehicle assembly will be 75.9 million units in 2011, nearly a 6 percent increase from 2010 levels.

“While economic uncertainty continues, light vehicle production thus far is demonstrating resilience with stronger than expected growth,” said Calum MacRae, PwC’s lead automotive analyst, Autofacts. “Perhaps the most significant element to the third quarter forecast is the faster than expected recovery of the Japanese automotive value chain, with most manufacturers expecting full capacity to be restored by September.”

Inflationary fears and registration quotas have contributed to a slowdown in vehicle sales growth in China. In response, the Chinese government has announced new incentives, which could boost demand in the second half of the year from the 5.8 percent recorded in the first half. Europe’s sales environment remains weak to mixed across primary markets, but production is being supported by strong export growth to China, Russia, Turkey and the US.

China’s coastal cities are coping with severe traffic congestion and Beijing, by example, has limited new car registrations to only 240,000 in 2011. Automotive sales in India have also moderated. As of June 2011, the Indian market has reported 16 percent annual growth compared with 34 percent in 2010.

Sluggish economic growth, weak consumer spending and Japanese inventory shortages have caused a mid-year sales slump in the US market. While North America’s automotive supply chain continues to address capacity constraints it is still on course for a 2011 production forecast of nearly 13 million units, a roughly 1 million unit increase from 2010.

Perry County: Bringing the Right Components

Finding balance is often a never-ending quest that consumes lifetimes. For the lucky few, that quest is realized when the right components are brought together to achieve the desired goal.

The balance that has been achieved in Perry County, IN, was forged by dedicated visionaries who committed their efforts to bringing together key partnerships for the ultimate goal of balancing the abundant natural resources with a progressive business climate. The end result is the ability to execute successful, world-class business operations in an atmosphere that lends itself to breathtaking views, outdoor adventures and tranquility. For outside observers, an afternoon cruise through the tree-lined hills and valleys can occasionally result in a glimpse of a high-tech production facility that is in the midst of competing on a global scale.

“There were a multitude of locations that would have worked along the river,” commented Bruce Tesch, Plant Manager of ThyssenKrupp Waupaca, an iron foundry. “This community just jumped forward and provided everything that ThyssenKrupp was requiring.”

Some of this rural county’s business successes are directly related to its location. Sitting in the heart of the United States near the geographic center of North America and the median center of the US population, Perry County sits on the banks of the Ohio River, the nation’s busiest waterway. The county’s proximity to two commercial airports, coupled with interstate access, port facilities and railroad services make it ideally situated to meet the transportation needs of any commodity-based business.

As the epi-center for gray and ductile iron products, much of Perry County’s productivity focuses on automotive and heavy construction components and component parts. ThyssenKrupp Waupaca’s Plant 5 operation features the largest vertical molding machine in the world to aid with production of parts for end-users including Toyota, Ford, Caterpillar, Chrysler and Cummins. Webb Wheel Products (an OEM producer of components for the heavy truck industry) and ATTC Manufacturing (a supplier of more than 80 component parts to Toyota for use in 10 different vehicles) both utilize advanced robotic machining equipment in their processes.

This advance manufacturing environment helps these companies to produce the next generation of products faster, cheaper and cleaner. As manufacturing changes with newly adopted methods of production, the Perry County business community promotes the advancement of new, technologically enhanced methods of production. In addition, employees are encouraged to offer their input into processes and career enhancement, both of which further improve the company’s competitive advantage.

Those businesses that have chosen to come and stay in Perry County have done so to take advantage of the array of economic opportunities balanced with attractive living options available for employees and their families. At the end of their work-day, employees of these companies have the opportunity to participate in an assortment of activities including family–oriented events, outdoor-recreation in the Hoosier National Forest, and water sports on the Ohio River.

Companies in Perry County have had the opportunity to benefit from the strong partnerships that were established years ago by those visionaries. The community’s commitment to working with companies to help to insure each business remains competitive in a global economy manifests itself on the first day of contact.

“Perry County really rose to the top from the standpoint of the assistance they gave to making it come together and the real strong pro-active nature they took and the clear interest in having the business,” noted Kent Finkbiner, President of Webb Wheel Products who located in the County in 2004.

Most recently the Perry County Development Corporation, the county’s lead economic development agency, addressed a warehouse need of a local business. The corporation identified an older building in the downtown Tell City area and rehabilitated the building with the end result being a 52,000 square foot warehouse with three loading docks. The business now has improved efficiencies and closer scrutiny of its inventory.

With a population of nearly 20,000 people, Perry County offers the charm of a smaller, rural community combined with the progressive corporate attitude and sophisticated infrastructure usually found in larger metropolitan areas. Leadership in Perry County proactively works to grow the regional economy through business attraction, retention and expansion; through encouraging and supporting entrepreneurs; and through providing government and workforce advocacy. All of this is done with the ultimate goal of positively impacting each business’ bottom line expenses while maximizing employee income and overall quality of life.

To further explore the benefits of conducting business in Perry County the Perry County Development Corporation has posted company testimonials online.

Harrison County: Epicenter of Supplier Network

Given the strong presence of Ford Motor Company in Louisville, KY, Harrison County is an ideal location for suppliers to the automotive industry. Recently, ICON Metal Forming, a metal stamping company in Corydon began hiring to make parts they will produce for the new Ford Escape that will be made at the Louisville Assembly Plant about 35 miles away in Louisville. ICON presently employs 300 workers. The Economic Development Corporation and the County Government have assisted ICON with expansion projects in the past by supplying incentives to train workers and reduce the company’s property taxes.

The incentive programs offered by the ED Corporation are quite flexible and can be customized to meet the individual needs of the manufacturers. Assisting companies in the automotive industry gives the community an opportunity to “upskill” our labor force, as was described in Business Facilities’ Economic Development Deal of the Year cover story in our Jan/Feb issue, which named Kentucky’s automotive partnership with Ford Motor Company the Gold Award winner.

This rural community has outstanding highway access on I-64 just 25 miles west of Louisville’s city center. Recent investment in infrastructure projects has allowed Harrison County to expand the sewer and water capacities available and has brought improved roadways to better accommodate business development. The Economic Development Corporation is marketing a Business Park that is owned by the Chamber of Commerce and is certified Shovel Ready by the State of Indiana. The Harrison Rural Electric Cooperative supplies electricity to the industrial area and provides outstanding dependability with two substations within a mile of the Business Park. Sites have been considered by several suppliers to Toyota Motor Corporation, which has assembly plants 90 miles west in Princeton, IN and 90 miles east in Georgetown, KY.

The property has attracted Howard Packaging; a California based plastic injection molding company that makes bottles for Lucas Oil Products, which established a production facility and distribution center in Corydon in 2002. Lucas Oil has grown considerably since locating here and produces about 80% of its world-wide oil and fuel additives at the Corydon facility. The Business Park still has 60 acres remaining that is Shovel Ready and nearby parcels can also be developed for additional expansion.

Because of its ideal location Harrison County has been one of the fastest growing counties in Indiana over the past 30 years. The aggressive approach to creating jobs has helped to improve the overall standard of living for the existing residents, has kept property tax rates among the lowest in the state and the population of the county continues to grow even during challenging economic times.

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Ardmore, OK

By Dominique Cantelme
From the March/April 2012 issue

Aerospace refers to the industry that researches, designs, manufactures, operates and maintains vehicles moving through air and space. A world leader in advancing science and technology, the diverse field encompasses commercial, industrial and military applications and in most industrial countries is a cooperation of both public and private industries (e.g., U.S. government runs NASA to explore and research while companies like Boeing may manufacture their aircrafts).

The U.S. is home to the world’s largest aerospace industry. A new report by professional services network company Deloitte Touche Tohmatsu Limited (DTTL), entitled The Aerospace and Defense Industry in the U.S.: A financial and economic impact study, which was commissioned by the Aerospace Industries Association (AIA), demonstrates the irreplaceable impact the aerospace and defense industry has on America’s economic and national security and emphasizes the industry’s support of more than three million American workers. The research conducted shows that aerospace and defense generated $324 billion in sales in 2010, contributed 2.23 percent to the GDP, had a direct payroll of $84 billion, paid federal and state cash income taxes of $38 billion and exported $90 billion worth of goods. Aerospace and defense also is the number one contributor to the nation’s positive trade balance at a net $42 billion.

“Aerospace is a bright spot in a bleak economic landscape,” says Marion Blakely, president and chief executive officer of the AIA. Aerospace and defense contributes to national security, delivers humanitarian aid, prompts new technology to help reduce casualty rates in armed conflict, brings safer and more fuel efficient jet transportation and provides groundbreaking technology to connect society with advances in digital communications. In addition, aerospace and defense workers enjoy one of the highest average wages compared to many other industries.

Dayton: Forging the Future of Aerospace

The Dayton Region is in a period of profound transformation and has a powerful opportunity to reinvent itself. The aerospace industry has the potential to forge a bright new future for the region. At the heart of this economic engine are Wright-Patterson Air Force Base (WPAFB) and Springfield Air National Guard Base (SANG). Wright-Patterson is the largest single site employer in Ohio, with a direct, annual economic impact of more than $5 billion per year.

Springfield ANG is increasing the extensive capabilities of the National Air and Space Intelligence Center (NASIC), the Department of Defense (DoD) air and space intelligence agency and will be a cornerstone in the region’s unmanned aerial systems (UAS) strategy. The fiscal injection into the local economy and the strategic missions of these installations offer an unprecedented foundation to build upon. The academic and private-sector aerospace capabilities that have been developed in the region as a result of Air Force research, development, test, evaluation and collaboration have positioned the Dayton Region to be a national leader in aeronautics and aerospace systems. The goal is to reestablish leadership of the United States in the world of aeronautics research, development, technology and manufacturing and set the national aerospace agenda, while rebuilding Dayton’s regional economy.

Currently no aircraft are being manufactured in Southwest Ohio, but the Region is a national leader in the aircraft manufacturing supply chain. The combined strengths of both Dayton and Cincinnati create a nearly complete supply chain within just a 50 mile radius. Of the top 30 manufacturing industries that the aircraft manufacturing sector requires for aircraft production, 24 are concentrated in Southwest Ohio. In these same 30 industries in the aircraft manufacturing supply chain, Ohio ranks third in the nation in the number of jobs and capacity, with only California and Texas offering greater capacity, but at significantly higher wages.

Unlike other communities that solely focus on manufacturing aircraft, the Dayton Region leads aerospace research and development, as well. Home of the Air Force Research Laboratory, the Region also houses R&D contractors and small businesses that focus on the technological needs of the Air Force and the aerospace industry.

Ardmore, OK: Location, Capacity

Ardmore, OK is ideally located to serve the Texas/Oklahoma and South Central markets. With many distribution centers such as Best Buy, Dollar General, Dot Foods, Meadowbrook Meats, Michelin and others—in addition to its proximity to Interstate 35 which runs through the west side of Ardmore and provides easy transportation access to points north and south—Ardmore has become a major shipping and distribution hub.

The Ardmore Industrial Airpark, formerly an Air Force Base, is situated 16 miles northeast of Ardmore. From Interstate 35, take State Highway 53, a super-wide improved two lane, nine miles directly into the Airpark. The Airpark is also accessible from Ardmore utilizing the four-lane Highway 77, then Highway 53. The airstrip has two runways with landing lights, the longest a 150 ft. x 9,000 ft. (plus a 500-foot overrun). The airport features full instrumentation including glide-scope; adequate flight space for flight testing; an FAA-staffed control tower; parking capacity for 100 commercial-sized aircraft; an airplane wash rack and sewer facilities; a fueling and defueling station; 24 hour fire, rescue and security systems; and a full service FBO. A rail spur from the BNSF main line serves the Ardmore Industrial Airpark.

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Located in Will County, among the 10 fastest growing areas of the nation, the Village of New Lenox offers businesses and residents a progressive local government, a key location on Interstate 80 and Interstate 355, low Will County taxes, and an unbeatable quality of life.

New Lenox is poised for industrial and commercial growth thanks to its convenient location. Access to U.S. Route 30 and I-80 provides connections with I-57 to the east and I-55 to the west. Rail commuters use the Rock Island District Line and travel time to the Loop in Chicago is less than an hour from either of two New Lenox Metra Stations.

In November 2007, the Illinois State Toll Highway Authority opened Interstate 355 into New Lenox at a cost of $730 million. The I-355 extension provides access to the north and western suburbs and has attracted high quality development.

In Fall 2008, New Lenox voters approved Home Rule Authority in the Village which allows for special economic tools to assist with new development. The Village has approved an Inducement Agreement with the Zaremba Group to build a 1.1 million square foot mixed-use development at the I-355 and U.S. Route 6 Interchange. MGM Development owns 181 acres at the I-355 interchange that is poised for retail development.

Silver Cross Hospital will open in February 2012, a new 300 bed hospital (costing $450 million) located on a 76 acre parcel at the I-355 Interchange. NexCore Group, LP is constructing a 200,000 square foot Medical Service Building that will open in November 2011 on the Silver Cross Hospital Campus.

HSA Commercial Real Estate has leased their entire 60,000 square foot Medical Office Building located on the Silver Cross Hospital Campus; the building opened in Fall 2009.

Provena Saint Joseph Medical Center will open a 45,000 square foot Medical Arts Pavilion in the next year on U.S. Route 30 across from the new Walmart Shopping Center.

In the 1,200-acre Cherry Hill Business Park, Smurfit Stone is among the nine national companies that conduct business operations in the rail-served park. Smurfit produces over 2 billion square feet of corrugated product annually. Along U.S. Route 30, the New Lenox Retail Center opened in Fall 2010 and will contain more than 550,000 square feet of retail with Walmart and Menards as anchors and more than 10 outlets.

Village Station is a transit-oriented development (TOD) which is slated for development on the south end of New Lenox at the intersection of Laraway and South Cedar Roads. This TOD is approved for commercial and residential development on a 236-acre parcel. In September 2006, the second Metra Station opened at Village Station on the Metra Southwest Service Corridor Line, providing several commuter trains daily to Chicago.

New Lenox’s population is growing as well. The 2010 Decennial Census is expected to place our population at about 25,000 residents; our future population is expected to reach 100,000 by 2030. Residents have a median household income of $96,864. For over a decade, the community has experienced strong residential housing growth.

Lincoln-Way West High School opened in 2009. New Lenox Elementary School District #122 and Lincoln-Way Community High School District #210 are gold medal and blue ribbon award winning schools.

New Lenox has one of the lowest tax rates in Will County ($6.7925 per $100 assessed valuation), creating an opportune climate for business expansion and development. New Lenox strives to balance residential, commercial, and retail growth while maintaining a healthy economy and a great quality of life. It is easy to see why New Lenox is a logical place to operate your growing business.

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