Here is today's summary of economic development news, a free service of the Economic Development Partnership of Alabama, representing Alabama's private sector investment in economic development. If you enjoy NewsFlash, thank an EDPA Partner.
Birmingham Business Alliance chief says failed incentive bills may keep jobs out of state
Published: Tuesday, May 29, 2012, 5:45 AM
The failure of two key incentives bills in this year's legislative session puts the metro area and the rest of the state at a competitive disadvantage in attracting new jobs,
the head of the Birmingham Business Alliance said last week.
Brian Hilson, chief executive of the BBA, said in an interview while he is pleased with the economic development incentives the Legislature did pass in the recent regular session, he thinks an opportunity was missed to level the playing field by not passing House Bills 159 and 160.
"We're very disappointed," Hilson said. "This was an opportunity for Alabama to add incentives that would make us competitive with the other states we go up against in recruiting new industry."
There are already 19 states offering similar incentives, officials have said.
The bills were opposed by the Alabama Education Association, which argued they would prevent money from going to the Education Trust Fund.
But Hilson and other economic developers said the trust fund would grow as jobs and companies grow in the state, more than making up for any direct loss in taxes caused by the incentives. He said the AEA has often opposed incentives bills out of fear the Education Trust Fund would lose money.
In 1994, when the first major incentives legislation was passed to recruit Mercedes-Benz to Alabama, Hilson said the trust fund had $2.9 billion. By 2008, it had grown to $6.7 billion. The recession brought that down to $5.2 billion in 2010.
Birmingham-based Jim 'N Nick's begins pork pipeline with processing plant
Published: Tuesday, May 29, 2012, 7:45 AM Updated: Tuesday, May 29, 2012, 10:43 AM
BIRMINGHAM, Alabama -- Jim 'N Nick's, the Birmingham-based barbecue chain, is getting into the hog business -- literally.
The chain co-founded in 1985 by Jim Pihakis and his son, Nick Pihakis, in mid-July is opening a pork processing facility in Eva, 60 miles north of Birmingham. The plant will process hogs raised by farmers Jim 'N Nick's is recruiting as partners, said Nick Pihakis, who has run the company since his father passed in 2000.
Within five years, Pihakis hopes to have 40 farms raising 400 hogs a year, a heritage breed for barbecue that is a cross between the popular Berkshire pig and the Mangalitsa, a wooly breed. So far, he has recruited five farmers and has 75 hogs.
"They produce about eight to 10 pigs twice a year so our numbers will grow," Pihakis said in an interview. "Our idea is to contract farmers to raise the hogs. It will give farmers needed work and provide a valuable service for us."
Pihakis said having their own pork processing facility will lead to substantial savings for Jim N Nick's, which serves about 4 million pounds of pork a year. The chain now has 30 barbecue restaurants across the Southeast, including new locations opening in Tuscaloosa and Charlotte by the end of May. A Jim 'N Nick's will open in Nashville in September, and will be that city's fourth.
Pihakis said the pork processing facility fulfills a goal he set seven years ago, but had to abandon as he was unable to recruit pig farmers. He revitalized the effort after finding out about an abandoned processing plant in Eva last year.
The plant in Morgan County has been empty since a farmer's plan to raise and sell emu meat at the site fell through, Pihakis said. The state gave Morgan County a $650,000 grant to redo the facility, and Pihakis inked a deal to turn it into Jim 'N Nick's pork processing plant.
Cities move ahead with feasibility study on bringing back passenger rail linesGrant to help fund Birmingham-to- Montgomery study
1:42 AM, May. 30, 2012 |
The city, working in conjunction with the state, is moving forward with a study to determine if it's feasible to re-open a passenger railroad line connecting Birmingham, Montgomery and Mobile.
In 2009, the Alabama Department of Economic and Community and Community Affairs (ADECA) received a $200,000 matching grant from the Federal Railroad Administration (FRA) to fund the study, which will look at ridership, revenue and whether the line would share the existing tracks between Montgomery and Birmingham or build new ones.
But difficult economic times and trouble securing the matching funds delayed the process, said Brenda Jones, a transportation program coordinator for ADECA.
Robert Smith, Montgomery's director of planning, said the first part of the study will look at a Birmingham-to-Montgomery connection, and will cost $200,000. The grant will cover half, Birmingham will contribute $50,000, the city of Montgomery will contribute $30,000 and Montgomery County will contribute $20,000.
Phase II of the study will determine the feasibility of connecting Montgomery to Mobile, Smith said. The project will cost $200,000 and will depend on Mobile's willingness to contribute.
If the Montgomery County Commission decides to contribute, the state will put out a request for proposals to hire a firm to conduct the study. Smith said once that process is complete, the study will take 12 months.
The city and state have already started discussions with Amtrak, which previously ran a daily passenger train - the Gulf Breeze - from Birmingham to Mobile, Smith said.
OUR VIEW: Proposed constitutional amendment would help state's industrial recruiting efforts
Published: Wednesday, May 30, 2012, 5:45 AM
There are always plenty of incentives to ignore or vote against proposed constitutional amendments on an election ballot: The language is usually indecipherable; the proposed changes often involve a county or city on the other side of the state; the state's sorry excuse for a constitution is so jam-packed with amendments it doesn't need any more.
Sometimes, though, voting yes for a constitutional amendment is exactly the right thing to do. This November's general election ballot will have at least one proposed constitutional amendment deserving of approval. (There will be at least 10 to be voted on Nov. 6; we'll have more to say on the rest of the proposed changes closer to Election Day.)
The Legislature in the closing hours of its special session last week approved a proposed constitutional amendment that rewrites the rules for a state commission that can sell up to $750 million in bonds to help land big economic-development projects. The amendment would make a common-sense change that would help give the state money it needs to lure businesses and jobs to Alabama.
Twelve years ago, state voters approved Gov. Don Siegelman's Amendment 666, which allows a state bond commission headed by the governor to issue up to $750 million in bonds to entice industries to move to and expand in Alabama. Money from royalties paid by companies for natural gas wells drilled off the state's coast pays off the bonds. So far, the commission has issued $720 million in bonds, so there is little left to use for an economic-development project.
Gov. Robert Bentley said the state could refinance some of the bonds at a lower interest rate, but the law as written counts the refinancing bonds against the $750 million limit instead of replacing the existing bonds in the calculation. The proposed constitutional amendment would end that double counting, he said.
"It will free up $130 million, and it will really help us over the next two or three years," Bentley told The Associated Press.
That money could be critical for landing economic-development projects, especially since Bentley's big industry-recruiting push failed during the Legislature's regular session. Bentley had proposed a constitutional amendment that would have allowed companies agreeing to expand or build new facilities in Alabama to keep part of their employees' state income tax withholdings.
Clifton named CCEDC president
Published 12:04am Wednesday, May 30, 2012
The Covington County Economic Development Commission (CCEDC) has named local attorney Rick Clifton its president and CEO.
"The CCEDC is pleased to welcome Clifton to this position," said Ed Short, CCEDC chairman. "He brings more than 20 years of diverse experience in business, military and economic development efforts through his work as an attorney and an active member of the community."
Clifton, who currently practices law with Albrittons, Clifton and Moody, has worked closely with the Andalusia and Opp Industrial Development Boards, the CCEDC, and the South Alabama Regional Airport.
Short said he has a proven track record for building partnerships that promote area growth.
"Appointing a president and CEO with Clifton's experience will allow CCEDC to not only sustain its economic development efforts, but also enhance the recruitment and retention endeavors that are vital to any successful economic development plan," Short said.
Voters have say on economic incentives
Proposed constitutional amendment would increase state's borrowing to entice industry
12:27 AM, May. 28, 2012 |
Alabama voters will decide in November whether to allow Gov. Robert Bentley to increase the state's borrowing to provide more money to entice industries to locate and expand in the state.
In the closing hours of its special session Thursday, the Legislature approved a proposed constitutional amendment that would rewrite the rules for a state commission, headed by the governor, that can sell up to $750 million in bonds to boost the state's economic development. The commission has almost reached its limit and lacks the money needed to attract big projects unless voters approve the amendment, Bentley said.
"It will free up $130 million and it will really help us over the next two or three years," he said.
Bentley got elected in 2010 on a job creation platform. The state's unemployment rate peaked at 10 percent in July 2011 and is now down to 7.2 percent.
Bentley is refusing to take a salary as governor until the rate shrinks to 5.2 percent. Recruiting large industries or getting existing industries to expand often requires a financial commitment from the state, as well as tax breaks.
Foley named one of 'Alabama Communities of Excellence
'Published: Sunday, May 27, 2012, 6:38 AM
FOLEY, Alabama -- After a three-year effort by residents and officials, Foley was named one of seven state cities recognized as "Alabama Community of Excellence."
The south Baldwin County city, along with Arab, Childersburg, Eufaula, Hartselle, Livingston and Montevallo, was recognized Monday at the annual meeting of the Alabama League of Municipalities in Birmingham.
The program, known as "ACE," is intended to recognize and help plan economic and community development in cities with populations between 2,000 and 18,000, according to a league statement. Gulf Shores is the only other Baldwin or Mobile County city to receive the recognition, the statement said.
City Councilwoman Vera Quaites and City Clerk Vickey Southern accepted the award for Foley.
Miriam Boutwell, Foley city planner, said officials and residents began working on the program in 2009. She said ACE representatives will continue to work with Foley to make certain that the city continues efforts to conform to the program.
"It's a good thing for the city," Boutwell said. "In addition to having the designation, you have to keep working. We've had a comprehensive plan for how we want the city to grow, but this is more broad."
In his State of the City address earlier this month, Mayor John Koniar said the program is similar to the ratings by the Insurance Service Organization that continues checks on fire protection services.
EDPA Foundation awards $100,000 grand prize in the sixth annual Alabama Launchpad
Business Plan Competition
Birmingham, Ala. - May 22, 2012: A software development team from UAB beat out five competitors to
take home $100,000 in seed funding awarded during the finale of the Economic Development
Partnership of Alabama's Alabama Launchpad Business Plan Competition held at Alabama State
University on May 18.
The winning company, inDegree, offers an alumni tracking service that helps universities stay connected
with graduates and build stronger alumni communities, while helping students to leverage their alumni
networks in the job market.
The service benefits universities by helping them meet compliance standards and by helping to tap into
a possible donation revenue source from "lost" alumni. For alumni, degree verification services give an
advantage in the job market. The platform works through applications that aggregate university
transcript data with student/alumni social media profile data.
The finale, in which each team delivered a 12 minute pitch to the panel of reviewers, was the
culmination of a process that began in September 2011. Since admission to the program, teams have
received mentoring to refine their business plans from volunteer professionals across the state.
"This competition has been an incredible learning process for us," said inDegree Co-founder and Chief
Technology Officer Molly Wasko. "In fact, we're currently making further changes to our business model
based on what we've learned during the past few days. The prize money is certainly a game changer for
us, but also the feedback and support from judges and others is priceless. The commitment from our
mentors here in the Birmingham community and the support of the other UAB Launchpad teams made
a meaningful difference."
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