TEXAS: Deep in the Heart of Business

The Lone Star State is committed to doing whatever it takes to keep Texas wide open for investment and development.

Texas has a well-earned reputation as the best state in the U.S. to do business. Under Gov. Rick Perry’s leadership, the Lone Star State’s business climate continues to garner national attention. Texas offers a favorable tax climate, business-driven tort reform, and low cost of doing business.

Companies continue to flock to Texas because of several business advantages, including having one of the lowest tax burdens in the country—including no personal income tax. The many global companies that call Texas home greatly enrich its multi-faceted, wide-open-for-business landscape.

In July 2009, Texas was declared the winner of the “Best Business Climate” ranking by Business Facilities. We measured a range of critical development factors including cost of labor, incentives, infrastructure and tax climate. Texas, for the second time, also was the number one state on the Fortune 500 and 1000 lists of states that are home to the most company headquarters.

Texas is a top-ranked global destination for foreign direct investment. If Texas were a nation, its economy would be ranked 12th based its 2008 Gross Domestic Product (GDP) of $1.18 trillion, ahead of the countries India, South Korea and Mexico. In 2008, Texas exports were valued at $192 billion, up 14 percent from 2007.

Texas’ innovative, deal-closing fund, the Texas Enterprise Fund (TEF), provides incentives to businesses looking to expand or relocate to Texas, creating jobs and strengthening the economy. To date TEF has awarded more than $377 million and has announced the creation of nearly 54,000 new jobs in the state, generating more than $14 billion in capital investments.

Another incentive tool is the Texas Emerging Technology Fund (ETF), designed to expedite the development and commercialization of new technologies and to attract and create jobs in technology fields. As of March 2009, the ETF has awarded more than $234 million to Texas companies and universities.

Overall, the Texas economy continues to grow at nearly three times the national average. From December 2007 to December 2008, Texas accounted for 80 percent of entire job gains in the nine states with increased employment. Unemployment rates in Texas have remained consistently below the national average. In December 2008, Gov. Perry announced the creation of Caterpillar’s worldwide assembly, test and paint operations in Seguin, which is expected to create more than 1,400 new jobs and bring nearly $170 million in capital investment. Texas was proud to be ranked the No. 1 state for business and job growth for the fourth year in a row by CEOs in Chief Executive Magazine in March 2009.

Texas follows a comprehensive job-creation strategy focused on six key industry clusters: Advanced Technology and Manufacturing; Energy; Aerospace and Defense; Biotechnology and Life Sciences; Information and Computer Technology; Petroleum Refining and Chemical Products.

Among U.S. states, Texas ranks second in the number of patents issued annually and third in investments into venture-backed companies. Texas also continues to provide fertile ground for biotechnology and life sciences. According to Business Facilities’ 2008 Rankings Report, Texas ranks as one of the five top states for overall biotechnology strength and in the top ten for bioscience research funding.

Spanning more than 267,000 square miles of land, Texas is a state with abundant natural resources and energy. Texas is the No. 1 producer of oil and gas and refined chemical products in the United States. The state’s marketed production of natural gas represents one-third of total U.S. supply. As an oil and gas producer, Texas is a global leader contributing approximately 5.3 percent of worldwide refinery capacity.

Texas has been labeled one of the most affordable places to live in the U.S. The state’s cost of living composite index for most metro areas is lower than the national composite index of 100.

Texas’ beautiful landscapes, warm weather, excellent schools and southern hospitality make the Lone Star state’s quality of life unmatched. With endless miles of rivers, coastline, mountain ranges and national forests, it’s no wonder Texas has something for everyone. That same diversity extends to the people who call the state home, creating a rich cultural heritage that makes Texas extraordinary.

No matter what the industry, the Lone Star State is committed to doing what it takes to keep Texas Wide Open for Business.

Port San Antonio: Air Cargo Dynamo

The air cargo industry currently faces a number of challenges. As jet -fuel prices and shipping fees continue to rise, customers are switching their operations to ground and ocean transport in order to remain cost-effective. Escalating security concerns also have boosted demand for these alternate transport modes. Along with growing economic uncertainty on a global level, these factors are largely responsible for a 23.2 percent drop in air cargo demand between January 2008 and January 2009, according to the International Air Transport Association (IATA).

Despite this recent slowdown, however, world air cargo traffic is still expected to triple over the next twenty years. This growth can be attributed to the ongoing rise in international trade and the emphasis on efficient cargo delivery. The Boeing Company indicates that traffic will expand at an annual average rate of 5.8 percent for the next two decades, tripling current traffic levels.

Asia will continue to be the main driving force for global air cargo demand, largely due to China’s substantial import and export boom. Additional air cargo growth will arise largely due to congested ocean ports that force manufacturers and retailers to ship high-demand goods via air. Given that trade connected to North America currently accounts for more than 60 percent of all activity, air cargo growth will continue to heavily rely on the economic status of the U.S.

Air cargo plays an important role in the global economy; whereas maritime shipping benefits from lower costs, air transport offers the advantages of speed and reliability. High demand continues to drive the consumption of many air-oriented products, such as fresh produce year-round, pharmaceuticals and high-fashion clothing and accessories, with economic growth continuing to be largely concentrated in the U.S. and China.

According to a congressional mandate issued in 2007, 100 percent of all cargo must be screened by August 2010. Many shipping groups oppose full cargo inspection, however, since such a regulation is costly and places a large burden on the efficiency of air transport. This, in turn, further delays commerce. As a result, companies are re-examining the use of air cargo as their primary means of shipping. Ground transport in the U.S. is extremely competitive with air transport, and international shippers are fully utilizing supply chains for less-expensive ground and ocean shipments.

Port San Antonio offers a great solution: A multi-modal logistics platform and aerospace complex, Port San Antonio is centrally located in San Antonio, TX and encompasses almost 1,900 acres of master-planned property, including Kelly Field (SKF) airport. Port San Antonio’s compelling advantage is its accessibility, which is located at the center of the North-South IH-35 NAFTA Corridor that connects Mexico, the U.S. and Canada. Furthermore, the adjacent IH-10 intersects the city from East to West and extends from California to Florida. As congestion slows cargo in other venues, Kelly Field (SKF) is only now emerging and, as a result, remains uncongested. This allows for the efficient transport and inspection of commodities en route to various destinations.

The Port’s airfield opened to domestic air cargo aircraft in March 2007, and its air cargo terminal was completed in 2008. Ample ramp and terminal space on the airfield allow for quick re-fueling and efficient turnarounds. With its extensive runway and ramps, Kelly Field is the premier physical asset of Port San Antonio’s development plan. Also, the air cargo terminal designates Port San Antonio as a direct point of entry for cargo in the international trade landscape. With its terminal and airport costs among the lowest in the industry, Port San Antonio is expected to increase commerce throughout the entire South Texas region for local businesses that wish to export their goods to the rest of the world.

International air cargo must be inspected as it arrives in the U.S. To meet this federal provision, the Port opened a U.S. Customs and Border Protection Federal Inspection Services (FIS) facility at the airfield in February 2009.

The new FIS facility at the airfield is utilized to conduct administrative and cargo processing functions for customers of Port San Antonio. An agricultural laboratory and several storage areas also are available for the accommodation of bonded goods. Prior to the opening of the FIS facility, all incoming commodities were processed in Laredo or at the San Antonio Municipal Airport before arriving at Port San Antonio.

With a myriad of opportunities for companies looking to maximize their shipping capabilities, Port San Antonio will continue to satisfy the stringent demands of the air cargo industry in the years ahead. By partnering with Port San Antonio, shippers and customers alike are opening themselves to greater opportunities in the international trade and commerce sector. Port San Antonio has been the city’s most important economic development project over the past decade, and future growth possibilities for both the Port and its partners are limitless.

Midlothian, TX: Crossroads to Success

It is all about “Location, Location, Location.” Now that Midlothian is on the radar screen of many site locators, it rapidly is becoming a submarket of choice. Many companies have discovered that Midlothian gives them excellent access to markets and competitive low cost site development in a community that is accustomed to and welcomes commercial and industrial citizens.

Midlothian is located at the crossroads of US 67 and US 287 24 miles south of Dallas, 27 miles southeast of Ft. Worth, and 29 miles south of DFW International. Ground transportation corridors are essential to the success of any manufacturing or distribution operation.

For longer haul situations, rail can be the preferred cost effective delivery system for finished goods and raw materials. Midlothian also is at the crossroads of the Burlington Northern Santa Fe Railroad (BNSF) and the Union Pacific (UP) rail systems. Two of Midlothian’s industrial parks, The Auto Park and RailPort, have true “at dock” dual rail service where the shipper can stand at his dock and negotiate with either rail provider.

Mid-Way Regional Airport on US 287 between Midlothian and Waxahachie provides corporations with an aviation fleet easy access to their facilities in North Ellis County.  Corporate jets have access to a 24/7 full service FBO with low cost refueling. Courtesy cars also are available. Mid-Way is a 243-acre general aviation airport and an excellent location for an aviation-related operation looking for a cost effective, central location. Airborne Imaging, with two DC3s and five additional planes, was among the first to locate their corporate hanger in Mid-Way Airport. The airport now has four box hangers housing more than 100 airplanes and is currently undergoing an expansion, which includes a runway extension to 6,500 ft.

The Auto Park (FTZ 113) is a 600-acre light industrial park that fronts US 67 on the northeast side of Midlothian. It is a secured, private facility with dual rail access. The Auto Park is 50 percent developed with a full service automobile distribution and processing center with intermodal facilities. MidTexas International takes a flexible approach to development by working with each user to design a facility that meets their individual needs. Major tenants in The Auto Park include Mazda North America, Kia Motors America, Inc., and Toyota Motor Sales, USA, Inc.

RailPort is a 1700-acre dual rail business park located on US 67. The mixed-use park is zoned heavy to light industrial and commercial. Various parcels are available. The park is home to a 1.35-million-sqaure-foot Target distribution center, the 850,000-square-foot Toys “R” Us distribution center, and Midlothian International Power, a 1650-megawatt power plant. In 2010, Eagle Roofing Products will open a 360,000-square-foot manufacturing facility.

Navarro College recently has  announced the expansion of their Midlothian campus. The initial 25,000-square-foot. building of the planned 125,000-sqaure-foot campus for Navarro College and Texas A&M-Commerce University opened in the Spring of 2006. Already at capacity, plans are now underway to begin construction on Phase II. The second building will house another 25,000-square-foot of classrooms and is scheduled for completion by Fall 2010. This unique partnership gives Midlothian residents the opportunity to receive a four-year degree without leaving Midlothian. Residents also may choose from several four-year universities within 30 minutes of Midlothian, including Northwood University, Southern Methodist University, University of North Texas (S. Dallas campus), and University of Texas-Arlington.

Midlothian is a pro-business community that welcomes industrial and corporate citizens alike. Local incentives include Freeport Tax Exemption, tax abatements, an Enterprise Zone, Foreign Trade Zone, and Chapter 380 agreements.

Port Freeport: Unwavering Commitment to World Trade

Port Freeport completed one of the most successful years in its history in 2008 and port administrators continue to prepare for a still-brighter future—by advancing the project to deepen its channel to 55 feet, moving ahead with the new multipurpose Velasco Terminal, and literally laying the foundation for burgeoning imports of wind energy components and handling of other project cargos.

While these and other long- and short-term infrastructure projects are indicative of Port Freeport’s capability to meet demands of global commerce for decades to come, the ability to respond to the moment— as officials did when Hurricane Ike struck Sept. 13, 2008—even more fully embodies the vigilant spirit of the people of Port Freeport.

The key to grasping future opportunities and to managing present crises is the same: Being prepared. In the case of the port’s response and recovery related to Hurricane Ike, it was blessed to have an exemplary plan in effect and to have a dedicated team in place to execute it in near-flawless fashion. In fact, Port Freeport Managing Director Phyllis Saathoff led the American Association of Port Authorities in authoring its post-Katrina “Emergency Preparedness and Continuity of Operations Planning Manual for Best Practices.” Saathoff and Operations Director Al Durel, Security Manager Rick Benavidez and the rest of the port’s administrative staff spearheaded an effort that had Port Freeport servicing its customers two days after the storm hit and able to help out neighboring ports by taking in some of their cargo until they were able to get back on their feet. Thankfully, the port did not sustain major damage, but some of the homes of employees did, and officials came to their aid, providing temporary housing and other assistance.

Port Freeport’s public docks handled more than 1.7 million tons of cargo in 2008, up some 15 percent over fiscal year 2007. Those numbers don’t include the tens of thousands of tons of petroleum, chemicals and other cargos that move through Freeport’s private docks. Through the first 11 months of fiscal 2008, port revenue was more than $9.25 million, on track toward a record-setting year, and projections indicate fiscal 2009 revenue will increase by a remarkable $3.1 million. At the same time, the Port Freeport Port Commission has lowered the ad-valorem tax rate for a seventh straight year, to 5.35 cents per $100 valuation.

Port Freeport already is directly and indirectly responsible for nearly 60,000 jobs and has an overall economic impact in Texas of more than $9 billion a year. Those figures may be expected to increase substantially with the expected completion of the project to deepen its channel to 55 feet from its current 45 feet, as well as significantly widen it. Thus far, cost-to-benefit ratios show gains will far exceed the project cost of $300 million to $320 million, about half of which is to be borne by Port Freeport. Everyone is hoping for summer 2009 completion of the five-year feasibility study process for the deepening project, which, with other modifications, would facilitate access for larger ships carrying liquefied natural gas to the newly opened Freeport LNG/ConocoPhillips terminal on Quintana Island and for bigger liquid bulk vessels transporting crude oil to various private terminals.

The enhanced channel also will allow larger container ships access to the Velasco Terminal project. Ultimately, the $300-million terminal will encompass 2,400 feet of new berthing and more than 90 acres of backland and be capable of handling 700,000 TEU’s.

Furthermore, Port Freeport is laying rock for stabilization of ground for handling of ever-increasing imports of eco-friendly wind energy components and other project commodities; longtime tenant American Rice Inc. (ARI)/Grupo SOS has just completed a major facility expansion; Dole and Chiquita banana imports continue to steadily flow into the Port, while Turbana is adding to its chill-space capacity for handling additional palletized banana imports; and Parker Cabett Subsea’s manufacture of cabling for the offshore energy industry adds to the diversity of Port Freeport operations. Port officials also are working to enhance highway and rail connections.

Port Freeport is clearly prepared to handle whatever comes its way, through more than $1.5 billion in private and public investments and through an unwavering commitment, along with industry partners, to serving ever-growing world trade and the needs of the local and regional community.

Make Brooks City Your Home Base

Unique. State-of-the-art. Collaborative. Innovative. These words only begin to describe the truly one-of-a-kind development environment found at Brooks City-Base, located in San Antonio, TX. There is no other concept like it anywhere in the U.S.

Located on the site of the historic, former Brooks Air Force Base, Brooks City-Base was created by an Act of Congress and special legislation approved by the State of Texas in June of 2001. Brooks City-Base has been recognized as a leading research and technology center, comprising approximately 1250 acres, more than two million square feet of laboratory, office, educational, light industrial and recreational space, and more than 300 acres available for immediate development. The campus offers unique assets that are ideally suited for research and development, education and training. Brooks City-Base is home to a distinguished list of marquee tenants including DPT Laboratories, Earth Tech, Inc., Holt Cat, Grubb Engineering, Jacobs Engineering, Challenger Learning Center of San Antonio and The Brooks Academy of Science and Engineering. Southeast Baptist Hospital recently announced its plans to construct a state-of-the art hospital and medical office building.

In 2008, Forbes ranked San Antonio as the second most “recession-proof” city in America. Additionally, it boasts vast land available for immediate development in a city that is well known for its business-friendly climate, quality of life and highly skilled and affordable work force. The Brookings Institute recently ranked San Antonio as the top economic performer in the United States for major cities. San Antonio’s strong reputation as a tourism and convention destination also gives Brooks City-Base a location advantage other cities cannot match.

One of the most attractive development benefits that Brooks City-Base has to offer is that all the property on the campus is owned by the Brooks Development Authority (BDA), allowing flexibility, speed and customization of economic development projects. The BDA is able to offer a variety of unique incentives and financing alternatives for investment, including City/County Joint Tax Phase-In Program, Freeport Tax Exemption Incentive Program, Texas Enterprise Zone Designation, Federal Empowerment Zone (EZ), Workforce Training Assistance, design build, lease back options and specialized financing options. Furthermore, the “city-base” redevelopment model utilized by the BDA represents a “best practice” case study for other military communities to encourage successful public/private partnerships.

The mixed-use campus has been master-planned to implement land use strategies to encourage development within the core industries of bio-medical technology, pharmaceutical, healthcare and IT. As Brooks implements these innovative strategies, the campus is investing in the facilities and infrastructure to foster future growth opportunities.

Brooks City-Base has been actively updating and renovating its infrastructure for current and future tenants since 2002. These improvements involve a fiber implementation system that provides high-speed connectivity to nonfederal organizations on the campus with a reliable backup system that will ensure telecommunication reliability for all tenants at Brooks. There are currently over $170 million in projects being planned and constructed onsite.

Upgrades continue to be made to the water and wastewater systems through Brooks City-Base’s longstanding relationship with the San Antonio Water System. Detention/retention basins have been added to supply additional storm drainage and create ecologically friendly ponds along the migration path of hundreds of species of migrating birds. Also, Brooks City-Base participates in a water-recycling program assures businesses a dependable water supply.

Another development asset of Brooks City-Base is the campus’ official EPA redevelopment certification. In 2002, the Texas Commission on Environmental Quality (TCEQ) and the U.S. EPA determined that Brooks City-Base is “ready for reuse.” This means that environmental conditions on the property are protective of human health and the environment, based on its current and anticipated future use as a research and technology center. Brooks City-Base is the first and only facility in Texas and the first federal facility in the nation to receive this certification.