Here is today's summary of economic development news, presented by the Economic Development Partnership of Alabama.
Oil spill by the numbers: Economic indicators show large dips after oil spill
Published: Sunday, April 24, 2011, 3:30 PM Updated: Sunday, April 24, 2011, 9:07 PM
By David Ferrara, Press-Register Press-Register
GULF SHORES, Alabama - People need power, and for cities along the beach in Baldwin County, that power also generates money.
Throughout the summer of 2010, however, in the wake of the record-setting BP oil spill, there was a significant drop in electricity use along the Alabama coast.
Thus, Gulf Shores - and its neighboring beachfront community, Orange Beach - saw a similar drop in revenue from Baldwin EMC, the energy cooperative that serves Baldwin and Monroe counties.
Every year, the municipalities receive franchise fee checks from the utility that represent 3 percent of gross sales.
For Gulf Shores, that check was roughly $906,000 for 2009 and about $878,000 for the year of the spill.
In Orange Beach, the 2009 figure was about $990,000 and about $951,000 for 2010.
With the anniversary of the Deepwater Horizon rig explosion at hand, the Press-Register analyzed various economic indicators in order to explore the wide-ranging impact of the oil spill that devastated the tourist industry in south Baldwin and Mobile counties.
"No matter how good of a year we have, we still have that hole - cash-wise - that we're in," Orange Beach Mayor Tony Kennon said. "But our folks always find a way to survive."
The power figures go hand-in-hand with a drop in lodging tax receipts.
In Orange Beach, for example, lodging revenue dropped from a little more than $6 million in 2009 to about $4.7 million in 2010.
During the peak months in Orange Beach - July, August and September - 2009 lodging revenue was recorded at about $3.2 million, with the highest monthly total of $1.4 million in August.
In 2010, lodging revenue for the same months was just under $2 million. The August total last year, $780,000, was down by almost half
University of Alabama experts: State economy hurt by higher food, fuel costs and Japan disaster
Published: Friday, April 22, 2011, 10:28 AM Updated: Friday, April 22, 2011, 4:26 PM
By The Birmingham News The Birmingham News
Economists at the University of Alabama Center for Business and Economic Research say the state's economy is being affected by higher food and energy costs and that its auto industry is being hurt by the disasters in Japan.
They lowered their forecast of Alabama gross domestic product growth in 2011 to 3 percent from 3.5 percent, the center announced today. GDP is the total of all goods and services produced in an economy.
The UA economists say higher food and energy costs are "constraining broader consumer spending gains." Pump prices are approaching $4 a gallon, and food inflation is running at a pace between 4 and 5 percent, according to analysts at Morgan Stanley.
The March 11 earthquake and tsunami in Japan have disrupted parts supplies to the Alabama operations of Toyota and Honda, the automakers have said. MORE READING: Production cuts
Meanwhile, key sectors of the Alabama economy have shed jobs, the UA economists say.
"The state's sizeable professional, scientific, and technical services sector, impacted by changing federal defense and space spending priorities, lost 2,100 jobs over the past 12 months," they note in a report. "In the face of fading federal stimulus funding and weak growth in tax revenues, local governments cut employment by 3,100 over the last year."
Alabama's economy, they stress, is rebounding. The state work rolls are expanding, and steelmaking and health care are giving the economy a lift.
UAH one of two finalists for site of National Solar Observatory
Published: Thursday, April 21, 2011, 7:40 PM Updated: Thursday, April 21, 2011, 7:44 PM
By Paul Gattis, The Huntsville Times The Huntsville Times
HUNTSVILLE, Alabama -- The National Solar Observatory has the University of Alabama in Huntsville among its final two choices for its new location, The Times has learned.
Working closely with NASA's Marshall Space Flight Center as the primary developers in the city's proposal to relocate the NSO to the Rocket City, the center is expected to bring 70 top scientists and engineers along with a $20 million budget.
The University of Colorado in Boulder is the other finalist.
The list of finalists was trimmed from seven and UAH was the only site east of the Mississippi. If the NSO chooses Huntsville, the new facility would be located behind the National Space Science and Technology Building on Sparkman Drive.
The National Solar Observatory Program, now looking for a new home, is a solar physics research effort operated for the National Science Foundation by an association of 40 universities and 1,000 scientists. Its main operations are now housed at two solar observatories near Tucson, Ariz., and Sunspot, N.M.
Kia to manufacture Optima sedan at West Point, Ga. plant, adding 700 jobs
Published: Thursday, April 21, 2011, 4:23 PM Updated: Thursday, April 21, 2011, 5:07 PM
By The Associated Press al.com
ATLANTA - Kia Motors plans to start manufacturing the Optima sedan later this year at its plant in Georgia, which is expected to add about 700 jobs.
The company announced Thursday that production of the 2012 Optima is set to begin in the third quarter. The plant in West Point, near the Alabama state line, currently employs about 2,300 people but Kia expects that number to grow to nearly 3,000 workers by the end of the year.
Kia Motors America and Kia Motors Manufacturing Georgia president Byung Mo Ahn says the company is experiencing tremendous growth in the U.S. and decided to move production from South Korea to Georgia for Optimas destined for North America.
Kia began mass production of its Sorento crossover utility vehicle at the plant in November 2009
Governor Bentley Proclaims April 25 "Skilled Trades Day"
MONTGOMERY, Ala., April 25, 2011 /PRNewswire/ -- Alabama Governor Robert Bentley has proclaimed today, April 25, as "Skilled Trades Day" in hopes of encouraging schools, teachers and parents to introduce students to opportunities in skilled trade careers. The proclamation is in keeping with Alabama Governor Robert Bentley's commitment to lowering the rate of unemployment and achieving economic growth for the state.
Governor Bentley's proclamation recognizes the importance of designating an official day that acts as an annual reminder to young people about the opportunities available to them in skilled trade careers, specifically in the growing industrial and commercial construction industry. The document also brings awareness about the upcoming shortage of skilled tradesmen, the impact of jobs in the construction industry in the state and the training opportunities available for students.
The Alabama Construction Recruitment Institute recommended the date because it coincides with the timing of the annual SkillsUSA Leadership Conference, scheduled to take place April 27-28 at the Birmingham-Jefferson Convention Complex. The event brings 1,800 students to Birmingham for a career expo and state championships in trade, technical and skilled service programs.
Tim Alford, executive director of ACRI, said the proclamation comes at an ideal time as students are deciding on career paths in anticipation of the graduation season.
"Students and parents often fail to consider skilled trade jobs because of a perception that these jobs are a lesser alternative," Alford said. "We need to make it clear to young people that training in skilled trade work can lead to successful careers. In fact, a recent Harvard University study reported that 27 percent of people with post-secondary licenses or certificates earn more than the average bachelor's degree recipient."
Executive Order Number 11
WHEREAS, the promotion of the film industry and film location sites in the State of Alabama is in the economic and commercial interest and welfare of the State of Alabama; and,
WHEREAS, the Alabama Film Office (AFO) is currently housed under the Alabama Bureau of Tourism and Travel and, after much consideration, it has been determined that it would be in the best interest of the State of Alabama if the AFO returned to being housed and operated under the Alabama Development Office (ADO).
NOW, THEREFORE, based upon these considerations, and for other good and valid reasons thereto, I, Robert Bentley, Governor of the State of Alabama, by virtue of the authority vested in me by the Constitution and laws of the State of Alabama, do hereby rescind Executive Order Number 45, signed December 31, 2008 and remove the AFO from the Alabama Bureau of Tourism and Travel and relocate it under the ADO.
BE IT ORDERED that this Executive Order become effective October 1, 2011 and shall remain in effect until amended or modified by the Governor.
Oil spill's economic impact? Nobody knows yet
Published: Monday, April 25, 2011, 9:30 AM
By Jeff Amy, Press-Register Press-Register
What's the total economic impact of the oil spill?
The short answer: Nobody knows yet.
Tourism, for example, seems to be recovering in Baldwin County and the Florida Panhandle, regions shunned in 2010 by many beach-goers. But there's some evidence that consumers nationally remain leery of Gulf of Mexico seafood.
"It's premature to determine that our economy has recovered until we go through a tourist season and get to the end of 2011," said Mike Ustler, BP's chief operating officer for Gulf Coast recovery. "We're cautiously optimistic."
A year after the spill, experts are studying the economic harm, with results to be used, at least in part, to assess federal fines against BP PLC. Those numbers may not trickle in for another year or more.
BP, on its own and through the Gulf Coast Claims Facility, has paid about $820 million in damage compensation to businesses and individuals in Alabama.
"They're never, ever going to make people whole," said Don Epley, a University of South Alabama economist who has studied the impact of the spill on real estate.
The $820 million represents close to 4 percent of the economy in Mobile and Baldwin counties.
Coastal Resiliency Coalition looks for new ways to shape south Baldwin County
Published: Monday, April 25, 2011, 7:00 AM
By David Ferrara, Press-Register Press-Register
GULF SHORES - A vigorous oil spill recovery for the Baldwin coast will require some different ways of thinking by business and community leaders, says Bob Higgins, chairman of the Coastal Resiliency Coalition.
Working to jump-start the process, the coalition is considering new approaches to lure revenue to the area, such as creating a tri-city business cooperative among Foley, Gulf Shores and Orange Beach, through which they would share tax revenue on big developments.
The larger emphasis, Higgins said, is, "What can we do to help individual businesses survive and what can we do working together to come out stronger?"
In the spill's aftermath, local and state officials have discussed the need to diversify the economy of the communities connected to the beach.
Gov. Robert Bentley, for example, is pushing for construction of a state convention center in Gulf Shores, calling it a top priority. In remarks at the beach a few days ago, Bentley said he wanted to draw visitors from the Florida Panhandle.
Private resorts on the beach have resisted the concept of a state-owned development, but Higgins suggested an alternative approach: The tri-city cooperative could fund the convention center construction and share the revenue.
State law allows for multiple cities to create a board for parks, playgrounds and entertainment facilities, according to Tracy Roberts of the Alabama League of Municipalities.
Higgins said there's even talk of urging the oil company responsible for last year's spill to pay for the center.
"It's alright with me if it's the BP Gulf Shores convention center," Higgins said, "as long as a convention center's there."
How well does he think that would play with people on the coast?
"I don't know, but we'd certainly take all the revenues that came out of it," Higgins said.
Plans drawn up in the 'War Room'
Many of the Coastal Resiliency Coalition's plans and dreams are being drawn up on poster-sized paper and pinned to the walls of what's known as the War Room, a corner office of Meyer Real Estate in Gulf Shores.
Economic chief looks back on career in Opelika
Al Cook spoke with us about his eight-year tenure with the city of Opelika
By Chris Anthony Opelika-Auburn News
Published: April 22, 2011
"Al Cook has done an exceptional job in every respect the last eight years. ... He will not soon be forgotten, and we will certainly miss Al Cook." Opelika Mayor Gary Fuller
Al Cook vividly remembers his first trip to the TigerTown site shortly after he became Opelika's economic development director in March 2003.
"I remember standing out there at that intersection where there was the gas line that went through the property and there was an old putt-putt golf course there and the road meandered around," he recalled. "There was nothing. And now you look at it, and it's really a great, great project."
But TigerTown has become more than just a great project. Cook said the largest retail shopping center in East Alabama is now providing close to 40 percent of Opelika's sales tax revenue.
And that's due in no small part to Cook, who in his tenure has seen the build-out of TigerTown, the selection of Opelika as the site of the Celebrate Alabama retail center, a slew of companies moving to the city's Northeast Industrial Park and a variety of expansions.
Now, eight years later, Cook is calling it a career.
The Opelika City Council approved the selection of Lori Huguley, project manager for the economic development department, as Cook's replacement at its Tuesday meeting. Huguley will take over following Cook's retirement May 31.
Opelika Auburn News
UAH employed to help in oil spill recovery
Posted: Apr 20, 2011 6:47 PM CDT Updated: Apr 20, 2011 7:51 PM CDT By Jack Madison - email
HUNTSVILLE AL (WAFF) - One year after the gulf oil spill began, the University of Alabama in Huntsville is part of a collaboration of state universities, government agencies, and others working to find solutions to the economic ramifications.
UAH researchers will work on plans to improve the transportation network in south Alabama to compensate for some of the economic consequences.
"Our model is going to produce analytical results that tell you whether investing in this road or that canal or some other infrastructure improvement will benefit the counties of south Alabama. And that's going to produce output in the form of digits, bits. We're going to pass those digits and bits to AEGIS Technologies, who are then going to use their GIS visualization technologies in order to create visualizations and animations that can convey our analytical results to the decision makers," said Mikel Petty, the director of the UAH Center for Modeling Simulation and Analysis.
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