Spring 2007

QUIZ

Going "green" is such a growing trend (and rightly so) that we are planning an issue in the near future about the entire industry as it relates to economic development. You've heard about the loss of forests in South America and elsewhere and how that loss affects global climate change. Here's an interesting item. What percentage of the entire South's land is made up of forestland?

(a) 22 percent (b) 60 percent (c) 41 percent (d) 38 percent

(Scroll down for answer)

Missouri is on Huge Role

In 15 years, we have never "officially" cited Missouri in the annual SB&D 100. Yet, you'll find plenty of superlatives about The Show Me State in this issue, the 2007 SB&D 100. Missouri had its best year in "100" history, by far. In fact, between January of 2005 and March of 2006, the state rang up 82,500 new jobs and topped its best points year in our ranking by more than 100 points, earning an "Honorable Mention" in the state category (turn to pages 46 and 47 and other pages in the 2007 SB&D 100 section, found in this issue. 

Alabama Beats Louisiana for $3.7 Billion ThyssenKrupp Steel Facility Expected to Create 2,700 Jobs 

In the spring quarter, Alabama triumphed over Louisiana in the contest to win the  $3.7 billion ThyssenKrupp AG steel-mill complex, which is projected to employ 2,700 workers by 2010. In winning what may be the biggest private industrial development project of the decade, Alabama offered TK $811 million in cash and tax incentives, and the Alabama State Port Authority promised to invest at least $115 million at the Port of Mobile, less than Louisiana's $197 million, which reflected the extensive work that needed to be done at the proposed site near Baton Rouge.

Port Mobile will build a terminal where steel slabs from a TK mill in Brazil are to be transferred from ships and onto barges for delivery some 45 miles to the new steel making and processing complex in northern Mobile County.
         
On June 5, Alabama voters approved increasing the state Capital Improvement Trust Fund’s borrowing limit by $400 million, of which $195 million is to be given to ThyssenKrupp AG as part of the incentive package. The special election drew a small voter turnout, but tallied a comfortable majority of yes votes.
         
The company’s steel and stainless divisions will jointly build and operate the Alabama facility. The complex will have a state-of-the-art hot-strip mill to serve both steel and stainless operations. With annual capacity of 5.2 million metric tons, the joint-use mill will process 3 million tons of slabs from Brazil, plus processing up to 1 million tons made in an electric mill to be built at the Alabama site.
         
Construction is expected to create 29,000 jobs and begin by year’s end, according to TK’s projections. The plant will serve industries including automotive, construction, electrical and utility, in addition to serving manufacturers of appliances, precision machinery and engineered products.         
         
Initially setting its investment at $2.9 billion, ThyssenKrupp upped the figure some weeks later to $3.7 billion, to cover increased steel and stainless capacity, as well as additional equipment to broaden the facility’s product line. (The dollar value of the project will change with fluctuations in the exchange rate of the U.S. dollar vis a vis the Euro, the European Union currency, which is stronger than the U.S. dollar.)
         
TK executives said the project is the central element in its strategy to increase sales of steel and stainless steel in North America, where it already is a significant supplier.
         
ThyssenKrupp has been a part of U.S. history for 170 years, dating back to 1837 when Alfred Krupp, founder of predecessor company Krupp, provided coin-minting machine prototypes.

Mercedes Helped Recruit ThyssenKrupp to Alabama

Mercedes-Benz executives helped convince TK to choose Alabama, Mercedes’ choice in 1993 for an auto assembly plant. They discussed the quality of the work force and support the state’s industrial development training office could provide.
         
>From its $300 million investment in an SUV assembly plant in Vance, which went on line in 1997, Mercedes now has more than $1 billion invested in the 3 million-square-foot complex, with 4,000 workers producing three models. Last year, it churned out 173,600 vehicles.
         
ThyssenKrupp has long supplied steel to DaimlerChrysler, Mercedes’ former parent. But no decision has been made about the carmaker’s Alabama plant buying steel from TK’s Alabama facility.

Oklahoma Ranks Third In Per Capita Income Growth In Nation

According to figures released by the Bureau of Economic Analysis, Oklahoma had the third highest per capita income growth rate, 7.55 percent, in 2006. But Oklahoma ranked 37 in per capita personal income among the 50 states, up from No. 39 in 2005.

Louisiana Economic Development Wins CoreNet Award

CoreNet Global, which calls itself the world's leading professional association of corporate real estate executives, awarded its Leadership & Innovation Award to Louisiana’s Economic Development agency. The agency was cited for “refining and creating strategies to address the unique needs of citizens and businesses following hurricanes and Katrina and Rita.”

First Buildings to Start Rising Soon at The Allen Group’s Ambitious Dallas Logistics Hub Development
                                                     
San Diego-based The Allen Group said construction would start by June on two buildings at its 6,000-acre Dallas Logistics Hub site, which is expected to take 30 to 40 years to fully develop.
         
These initial structures are a 637,000 square-foot building, and a smaller one of 208,000 square feet. The company said it hasn’t signed up any tenants for either building, but is confident both will be fully occupied.
         
The Dallas Logistics Hub plan calls for it to be completed in the next 30 to 40 years, when it is expected to employ about 30,000 workers in as much as 60 million square feet of distribution, manufacturing, office and retail facilities. About 65 percent of the land will be set aside for industrial and distribution space, the balance for offices and other commercial development.

Metro Atlanta No. 1 in Population Growth

Atlanta gained about 890,000 residents between 2000 and 2006, pushing the population of metropolitan Atlanta over 5.1 million, and making it No. 1 in growth, followed by Dallas, Houston, Phoenix and Riverside, Calif.

Tennessee Set to Open Development Office in Beijing; Gov. Bredesen will Head Trade Mission to China

Already the state with the fastest rate of growth in exports to China, Tennessee is out for more. The state is opening an economic development office in Beijing, and Gov. Phil Bredesen is heading a state trade mission to China in October.

The U.S.-China Business Council listed Tennessee as the fastest growing state in the U.S. in terms of trade with China. And over the last five years, Tennessee exports to China have grown by 1,103 percent according to the U.S.-China Business Council.

China buys $1.8 billion of goods and services from Tennessee, making it Tennessee's third largest trading partner behind Canada and Mexico. Tennessee companies’ exports of goods and services totaled $22 billion last year, almost double the total five years earlier.
         
Tennessee also operates economic development offices in Germany, Japan and Canada. Over 600 foreign owned companies have established business operations in Tennessee and the U.S. Business Roundtable estimates that 1-in-5 U.S. jobs and over 600,000 Tennessee jobs are tied to international trade.

Exports of Alabama Goods Rose 13 Percent in 2006
         
Shipments of Alabama-made products to foreign destinations increased 13 percent last year to $13.9 billion, the U.S. Commerce Department said. Alabama's exports have risen 68 percent from 2002. During the period, state businesses increased shipments to China by 183 percent, to Germany by 162 percent and to Japan by 51 percent.

Alabama's leading exports are transportation vehicles, machines, chemicals and electronic equipment, the Commerce Department says.

Significant Job Losses Coming to Kennedy Space Center

As NASA retires the aging space shuttle fleet, between 5,000 and 8,000 jobs will be lost at the Kennedy Space Center, or nearly half the government's space program's work force there. The overall effect on Central Florida is expected to be huge, affecting as many as 21,000 total jobs.

Rice Named Most Productive of Texas Research Universities

Among Texas research universities (those with at least 15 Ph.D. programs in different disciplines), Rice was No. 1 in what Academic Analytic’s calls faculty scholarly productivity.
         
It arrives at the rankings by analyzing a number of factors, including the number of publications the institution's faculty publishes and the amount of federal research funding granted to the Ph.D. programs and the awards and honors received by the faculty. The data is plugged into an algorithm, or equation, that computes the program's score.
         
The University of Texas at Austin was ranked No. 2 in the state. The school’s V.P. for Research Juan Sanchez comment to the school’s newspaper–“It’s like comparing pears with apples. Rice is a private school, and we are a public school”–sounds like sour grapes.

Texas Creates $22 Million Incentive Pot to Win Back Movie Makers

In the last four years, says the Texas Film Commission, the state lost at least 32 film projects to states that had it out-gunned with their film incentives. No more. Gov. Rick Perry, on June 7, signed a bill creating $22 million of incentives for movie makers.
         
Projects shot on location in Texas and completed after September 1, qualify for a rebate of up to 5 percent of their spending in Texas to a maximum $2 million. An additional 1.5 percent is available for locations defined as being in “under served areas of the state”.
         
In announcing the incentives, Perry said filmmaking “creates jobs, builds the economy and serves as an incubator for the development of creative arts industry. As does the production of television programs, television commercials and video games.”
         
Louisiana, he noted, experienced a 30-fold increase in film production after implementing incentives in 2003; New Mexico reported a 50-fold increase.

General Dynamics Building Mine-Resistant Vehicles for Marines in Alabama, Under $244.5 Million Contract

General Dynamics Land Systems will invest $2.6 million and add 270 employees to build mine-resistant military vehicles at its facilities in Aniston and Oxford, Ala., to support a $244.5 million contract to assist with the production of 1,000 vehicles for the U.S. Marine Corps’ Mine Resistant Ambush Protected vehicle program.
         
The vehicles will be assembled in a leased 80,000-square-foot facility in Oxford with 220 new employees. Fifty additional new workers will be employed at a supporting site at the Anniston Army Depot.

To the Roar of Jets, K.C International Airport is Adding the Zoom-Zoom of Race Cars and Go-Karts
         
KCI airport has been working to attract developers for the 12.5 square miles of surplus land it controls and doesn’t need for airport operations. A 640-acre segment  was supposed to become the site of a 300,000 to 500,000-square-foot distribution center, but construction has yet to start.
         
The latest development deal to announced is with FastTrack LLC, which signed a lease for land to create the KCI Motorsports Park. It will operate, says FastTrack, like a golf country club but for motor sports enthusiasts who want a place to race their cars and karts.
         
Memberships are expected to start at $5,000, but you can become a founding member for $100,000. Plans are to develop a 3.7-mile road course track where members can play SpeedRacer in their own cars, a track for karts, a clubhouse, driving school, private garages and maintenance facilities. Construction is to start this summer on the north part of the road course, clubhouse, kart track and other structures, with completion next spring.

Fastest Growing Airport? It's Charlotte

Charlotte/Douglas International Airport is the fastest-growing airport in the country according to figures released in the spring quarter. In the six months that ended in February, 1.7 million additional passengers, a 13 percent increase over the same period last year, used the airport. New York's Kennedy placed second in the six-month span, with a growth rate of 11.2 percent.

Jacksonville Sets Aside 56,000 Acres for Industry

In the spring quarter, the Jacksonville City Council approved legislation that would designate 56,000 acres in the city for industrial uses, eliminating any chance the land could be used for residential/housing developments. Called the Industrial Land Preservation Bill, land is being preserved in the city for industrial sactuaries that include buffers and uses that are compatible within the areas they are located.

South Leads Nation in New Home Sales

Alright, sometimes we write things that are obvious to us, but must be written to educate others. The South has lead the country in new home sales for years and years, as evidenced by its population, which is about the same as the Midwest and Northeast put together. But, just in case you didn't know, the South lead all U.S. regions in new home sales in April with 981,000.

South Carolina Sues North Carolina Over Water

It's been about 10 years since Alabama, Georgia and Florida went to court over water use from rivers that run through those three states. The fued among those three states continues in court after court, with few long term solutions accomplished. Now, the Carolinas are fighting over water uses from the Catawba River, a waterway that runs through both states. Expect many more lawsuits centering on water use between states that share the same sources. In fact, this is only the beginning. 

QUIZ ANSWER

The answer, according to the Southern Region of The Nature Conservancy is (b) 60 percent.