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ECONOMIC DEVELOPMENT STUDY TARGET INDUSTRY UPDATE
PREPARED FOR THE:
Scottsbluff/Gering (NE) Area
PREPARED BY:
September 2014
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TABLE OF CONTENTS Page #
Introduction
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Phase I: Preliminary Target Industry Analysis
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Phase II: Target Match (Strengths and Weaknesses) Analysis
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Location Needs of the Preliminary Targets Scottsbluff/Gering Area’s Strengths & Weaknesses
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Phase III: Updated “Best Fit” Target Industries
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Phase IV: Economic Development Recommendations
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Appendix: Trade Shows and Certified Sites Intake Form Analysis
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INTRODUCTION The Scottsbluff City Council contracted with Thomas B. Miller and Foote Consulting Group, LLC (FCG), global site selection and economic development firms, to complete this economic development study for the Scottsbluff/Gering, Nebraska Area. One objective of this multi-phased approach is to update the best target industry fits for the Scottsbluff/Gering Area and to develop a strategy to help these targets locate and expand here. The analysis was carried out in a multi-phased approach, including: 1. 2. 3. 4.
Preliminary Target Industry Assessment Target Match (Strengths And Weaknesses) Analysis Selection of “Updated Best Fit” Targets and Why Economic Development Recommendations PHASE I: PRELIMINARY TARGET INDUSTRY ANALYSIS
Introduction Targeting is well recognized as the best method of attracting economic development. Scottsbluff/Gering have been utilizing State of Nebraska and Nebraska Public Power District (NPPD) targets recently. In 2010, Battelle Technology Partnership Practice recognized a number of targets for Western Nebraska. Those that covered Scotts Bluff County included:
Ag Machinery Business Management & Administrative Services Financial Services Health Services Hospitality/Tourism R&D Engineering Services Software & Computer Services
These are generally fine, but are out of date and do not dig deep enough into what else is possible. Our objective here is to refine and update the target industries. We utilize a unique methodology designed to identify the best target industries. We maintain a database of actual, major private sector site locations/expansions1. For this analysis we looked at activity that occurred in 2013.
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We use Conway Data information, which tracts major locations and expansions (At least $1 million in capital investment, 50 new jobs or 20,000 square feet).
This database assists us in predicting growth trends and we utilize this data for selecting the best initial communities for our site location clients. The methodology is sound and proven for the following reasons:
Locations/expansions are driven by recent market conditions and these conditions will generally continue into the near future.
Companies (and site selection consultants) select regions first and then communities within these regions with the best business climates. This may mean, for example, a good labor climate, good market proximity, good transportation, and the availability of incentives; all positive business conditions. This will result in clustering, a concentration of like companies due to favorable business conditions.
Clustering is a “green light” for other similar companies to take a look. But they will only locate if the good business conditions remain. For example, they may find that the labor market for select skills depleted due to too much location/expansion activity. This is why we conduct careful fieldwork interviews with local companies for our site location clients, in order to help them to thoroughly understand the local business conditions.
This methodology is sound for economic development targeting. We will review and analyze both regional growth cluster and sector projections in order to help you to understand which existing (and future) businesses will grow. It will also set the stage for the next portion of this assignment: understanding the needs of the most active, fastest growing company types. Cluster data is excellent for target planning because:
It represents actual physical building activity (size and type of building). It represents actual economic development (both capital investment and jobs).
Multi-State Regional Location/Expansion Activity (“Growth” Clusters) FCG explored location/expansion trends in the Scottsbluff/Gering Area’s four-state region (Nebraska,Colorado, South Dakota, and Wyoming). We first screened location/expansion data in order to identify which industries (by NAICS Code2) located/expanded the most facilities in a multi-state region during 2013. We define these as “growth clusters”. The following two graphs (on the following page) depict this information. The first one shows general industry categories and the second shows individual industry sectors.
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The North American Industry Classification System (NAICS) was formerly the Standard Industrial Classification (SIC) system.
There were a dominate number of manufacturing projects. Office/call centers/data centers had a good number of projects. Warehouse/distribution (DC) project numbers were quite low.
The most active sector was Call/Data Centers/Software/IT, which includes many technology, IT, data center, and office uses.
Warehouse/Distribution (DC) was the second most active overall, but numbers were low due to slow retail sales and smaller regional populations. Interstate access and rail service is critical to attract this sector.
Industrial Machinery and Transportation Equipment were prominent with strong influence from agriculture and oil/gas/mining activity.
Food/Beverage was dominant and focused on the meat, dairy, and grain sectors.
Other active regional targets include: plastics, metals, chemicals, and computer/electronics.
The trend will be toward more locations/expansions in these general categories and industry sectors into the near term. They all, therefore, represent potential targets for the Scottsbluff/Gering Area. Major New Locations/Expansions in the Scottsbluff/Gering Multi-State Region” – 2013
Prominent sectors include: office (financial and data centers), food, machinery, and metals. Scottsbluff/Gering State Region – 2013 Major Locations/Expansions
State
City
Company
Product
Jobs
SqFt
Type
CO
Fort Collins
Woodward, Inc.
Control products
600
944,000
Mfg
CO
Aurora
FedEx
Package delivery
200,000
DC
CO
Greenwood Village
Fidelity
Financial services
500
100,000
Office
NE
Scottsbluff
Future Food Energy
Food
555
Mfg
NE
Columbus
Fab metals
150
Mfg
NE
Grand Island
JBS USA
Meat processing
172
Mfg
CO
Denver
Ardent Mills
Food
250
HQ
NE
Grand Island
CNH America
Machinery
150
Mfg
CO
Greenwood Village
Cool Planet Energy
Gas equipment
393
HQ
NE
Omaha
Nelnet, Inc.
Lending
300
Office
NE
Lincoln
Perot Systems
Lending
150
Office
CO
Centennial
Time Warner
Data center
75
NE
Dakota City
Tyson Foods
Meat processing
200
170,000
Office Mfg
The Preliminary Targets Based on the previous analysis where we looked at regional location/expansion activity, we feel that the best preliminary targets for the Scottsbluff/Gering Area include (not by priority): • • • • • • • •
Food Processing/Agricultural Products/Crushing Plants Data Centers Oils/Gas/Mining Industrial Equipment Warehouse/Distribution (rail-related DCs) Industrial Machinery/Fab Metal Products/Metals recycling (especially ag and oil/gas related) Plastics Products Electronics Assembly (includes solar fabrication—ingots to wafers) Call Centers (Higher-end tech support inbound call center).
Secondary Targets •
Medical
Retail (i.e. restaurants/hotels) should not be considered a primary target industry. Retail will naturally follow the attraction of targets over time. PHASE II: TARGET MATCH (Strengths and Weaknesses) ANALYSIS Introduction In corporate site selection, we analyze communities in order to determine if they possess the attributes most important for our clients. Our objective in this phase of work is to: 1. 2. 3. 4.
Understand the general location needs of preliminary targets Understand the strengths and weaknesses of the Scottsbluff/Gering Area Match these strengths with the needs of the preliminary targets Recognize the weaknesses of the community
Following this, we will: 5. Determine the “best fit” targets based on these factors and offer target profiles (Phase III) 6. Develop the economic development recommendations designed to help attract/expand the “best fit” targets (Phase IV).
The Location Needs of the Preliminary Targets Introduction First, we will provide pertinent background information on each preliminary target. This includes a brief description and important trends. Next, based on our site selection experience, we have listed the top site selection criteria for each target. Trends & Criteria Food Processing/Agricultural Products/Crushing Plants – NAICS: 311 & 312 Understanding the Sector Food processing is a dominant sector in the west due to the direct access to an abundance of raw food materials, (including corn; beef; beans; wheat; barley; chicken; and rapidly growing organic products), and access to western consumer markets. Companies in this industry manufacture and process a wide variety of foods, including meat; seafood; dairy products; fruits and vegetables; milled grains and oilseeds; baked goods; and candy. Major companies include U.S.-based Archer-Daniels-Midland (ADM); ConAgra Foods; Frito-Lay; Kellogg; Kraft Foods; Mondelez International; and Tyson Foods. International companies include, Grupo Bimbo (Mexico); Groupe Danone (France); JBS (Brazil); Maruha Nichiro Holdings (Japan); Nestlé (Switzerland); and Unilever (The Netherlands). Trends include:
The consumer price index for food, an indicator of food product values, rose 1.9 percent in April 2014 compared to the same month in 2013.
U.S. nondurable goods manufacturers' shipments of food products, an indicator of demand for food manufacturing, rose 4.9 percent year-to-date in March 2014 compared to the same period in 2013.
U.S. retail sales for food and beverage stores, a potential measure of food demand, increased 2.8 percent in the first four months of 2014 compared to the same period in 2013.
Total U.S. wholesale sales of nondurable goods, a potential measure of food demand, rose 7.4 percent in March 2014 compared to the same month in 2013.
311224 311225 311230 311313
NAICS Codes Soybean and Other Oilseed Processing Fats and Oils Refining and Blending Breakfast Cereal Manufacturing Beet Sugar Manufacturing
Key Site Selection Needs for Food Processing (by priority) 1. Available labor skills
Key positions: machine operators (cutting, blending & PLC3); food technicians; maintenance mechanics; and warehouse workers)
2. Labor costs 3. Access to markets & raw materials/transportation costs 4. Good water and sanitary sewer capacities 5. Electric power costs/reliability 6. Fully improved industrial sites/specialized FDA certified buildings (may require rail service) 7. Incentives
Equipment tax exemptions (large capital investment)
Infrastructure
Training
8. Good highway access 9. Good labor/management relations. Call/Data Centers/Software/IT – NAICS: 513, 514, 518, 522, 523, 534, 531, 541, and 561. Understanding the Sector The call/data centers/software/IT is the largest regional sector comprised of a number of office and technology functions. This sector encompasses a number of NAICS codes, including: 513- broadcasting/telecommunications; 514-data services; 518-data centers; 522-credit services; 523-financial services; 534-insurance; 531-general office; 541professional services/software; and 561-call centers. Call Centers The sector continues to grow and has held up better than many other sectors during the last recession because: 1. The sector crosses virtually all industry types (every business has administrative, IT, and support components). 2. Companies continue to seek ways to reduce costs. They therefore either outsource administrative functions to a third party provider, or find lower cost locations.
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PLC – Programmable Logic Control
3. Software and related IT products continue good growth due to opportunities in mobile devices, netbooks, and “wearable” technology. 4. Defense security systems such as cyber communications, UAV, and borderrelated systems are growing. However, as in the manufacturing sector, more and more of this sector’s jobs are moving off-shore. Companies site lower costs, competitive pressures, and access to greater numbers of qualified personnel as reasons for off-shoring. But, many off-shore experiments have failed primarily due to poor customer service and some functions are being returned to the U.S. (i.e. Dell has returned some functions from India). The largest and fastest growing administrative back-office segment is call centers. There has been rapid volume growth in this industry. Inbound minutes are increasing faster than outbound minutes, even though outbound represents 60% of all calls. Companies in this industry operate telephone call centers that provide telemarketing, customer care, and other outsourced business services on a contract basis. Major companies include Convergys, Sitel, and West (all based in the U.S.), as well as Infosys (India) and Teleperformance (France). NAICS Codes Telephone Answering Services: 561421 Telemarketing Bureaus and Other Contact Centers: 561422 Trends include:
Total U.S. consumer spending, a driver of telemarketing sales, rose 1.1 percent, primarily from services expenditures, in March 2014 compared to the same month in 2013.
U.S. personal income, a measure of consumer ability to purchase goods and services through telemarketing, rose 3.4 percent in March 2014 compared to the same month in 2013.
Total U.S. revenue for other administrative and support services, which includes telemarketing services, rose 0.5 percent in the fourth quarter of 2013 compared to the previous year.
Because telemarketing is primarily tied to the sale of consumer products, demand for services is sharply affected by economic cycles. Although employee levels can easily be adjusted to demand, the high fixed costs of call centers are a problem if demand declines. To maintain flexibility, companies may operate a larger number of smaller call centers, or may share call center space with other users.
Generally, the call center industry is broken into three primary groups:
Outbound telemarketing centers consisting of outbound sales; insurance; fundraising; polling; credit card acquisition; and related functions
Inbound call centers consisting of customer service; order fulfillment; insurance; health care; credit card authorization; and the like
Technical support centers at the high end of the industry, and often called technical help desks, offering computer software/hardware or financial support.
Key Site Selection Needs for Call Centers (by priority) 1. Labor availability
Key positions: customer service representatives (CSR), help desk reps, telemarketers, and industry experts
2. Labor quality (turnover, absenteeism, etc.) 3. Labor costs 4. Telecommunications 5. Education/Training (and incentives) 6. Existing leased Class A/B buildings with ample parking and/or improved commercial sites 7. IT tech support 8. Commercial air service
Good access to corporate headquarters/related
9. Corporate income tax 10. Electric power (reliability & cost). Data Centers (and “Cloud” computing) Data centers are one of the largest growing sub-segments of this sector due the huge data demands for software, medical, and other industry providers. The development of data centers is a growth area in the United States and globally. Most state-of-the-art data centers are operating at capacity while demand is steadily growing. Data centers are not large job producers, but the capital investment is substantial. Demand is projected to outpace supply for the next 3-5 years and this in turn will cause significant price increases in wholesale data center and co-location rates. Use of the Internet is up 50 percent over the last five years. A data center is a facility used to house computer systems and associated components, such as telecommunications and storage systems. It generally includes redundant or backup power supplies, redundant data communications connections, environmental
controls (e.g., air conditioning, fire suppression), and various security devices. Large data centers are industrial scale operations using as much electricity as a small town and sometimes are a significant source of air pollution in the form of diesel exhaust. Data centers follow "Mission-Critical" criteria which means they are never “out.” The data center term "Six 9's,” meaning power availability 99.9999% of the time, applies. Cloud computing uses server virtualization to provide large, scalable, low-cost data center solutions. Pricing is typically done on an as-needed basis which allows small firms to utilize the service and provides an alternative for large firms that choose to outsource their data. U.S. operations consume a large percentage of the world's data center power. According to Site Selection Magazine: “In 2005, total electricity consumption by American data centers, including servers, cooling and auxiliary equipment, was approximately 45-billion kilowatt hours – about 1.2 percent of all U.S. energy consumption. All told, American data centers used about $2.7 billion worth of electricity in 2005. That was about 37 percent of all of the energy that the world's data centers used that year.” Data center servers have grown from 2.6 million to 11.6 million over the past decade due to increasing storage and security needs. Revenue has risen from $1.5 billion in 2006 to a projected $3.2 billion in 2010. New construction for large data centers is currently estimated at $5-$6 billion in 2010 and expected to double to $10-$12 billion by 2015. NAICS Codes Data centers: 518 Key Site Selection Needs for Data Centers (by priority)
Geographic diversity & disaster avoidance a. Spreading risk from a multiple location standpoint and voiding natural disasters
Electric power cost
State corporate income tax rates
State and local sales taxes a. Could be levied on millions of dollars worth of servers purchased that are replaced every three to five years b. Low rates and/or abatement or rebate on sales taxes are important
Personal property taxes on equipment
Utility infrastructure a. Electric power grid
b. Transmission fed power c. Onsite substation d. Fiber availability & bandwidth e. Water for cooling
“Ready to go” sites a. Acreage varies widely but a 25-acre minimum could allow proper security buffer b. Very large secure sites (100-acre plus) could accommodate mega centers c. Mobile “black-boxes” have altered site requirements
Speed to occupancy and state/community readiness.
Oil/Gas/Mining Related (NAICS: 211, 332, 333, and related metals, equipment, product distribution (i.e. coal and fracking sand) Understanding the Sector Natural oil/gas mining through fracking technologies is booming in many parts of the U.S., including planned increases in Colorado; Montana; New Mexico; North Dakota; Oklahoma; Utah; and Wyoming, as well as in Canada. So much new supply of gas is coming from shale formations that futures prices, which soared to almost $13 per thousand cubic feet in 2008, dropped to little more than $2 in 2012 before rebounding to about $3.50. Inexpensive gas/oil has given U.S. manufacturers a competitive edge over foreign factories, helping to revive U.S. industry. The average U.S. retail price for diesel and regular gas, which influences oil and gas companies' ability to invest in new equipment, rose 1.9 percent and 1.8 percent, respectively, in the week ending May 12, 2014—compared to the same week in 2013. The spot price of crude oil, which affects investment activity in oil and gas drilling, rose 4.6 percent in the week ending May 9, 2014, compared to the same week in 2013. U.S. oil production is expected to rise from 7.3 million barrels a day in 2010 to 10.3 million barrels a day in 2020. That should be enough to slash imports about two-thirds by 2035, making America less dependent on oil from the volatile Middle East. Companies in this industry manufacture machinery and equipment used in oil and gas exploration and production, as well as water well drilling machinery. Major companies include Baker Hughes; Cameron International; National Oilwell Varco; Schlumberger; and Weatherford International. NAICS Codes Oil and Gas Field Machinery and Equipment Manufacturing: 333132
Key Site Selection Needs (by priority) – Oil/Gas Pipe Supplier 1. Available labor – machining skills & quality
Key positions: machinist; maintenance mechanic; machine operators (CNC); welders; and warehouse workers
2. Labor costs 3. Access to Western markets/transportation costs 4. Interstate highway access 5. Electric power (reliability & costs) 6. Improved sites and/or existing buildings 7. Rail access 8. Available training (and incentives) 9. Good access to suppliers 10. Good labor/management relations Many projects also need intermodal sites (with rail). The best sites require: 1) Access to regional market commodities 2) Access to a railroad mainline or shortline connecting to a mainline 3) Physical ability/permission to spur off of the mainline with loop tracks 4) Good Interstate or 4-lane highway connections 5) Transloading equipment/infrastructure 6) Fully improved with utilities 7) Worst-case accidents or spills locations identified 8) “Certified,” if possible. Warehouse/Distribution (DC) Understanding the Sector The warehouse/distribution (“DC” for distribution center) sector has historically been one of the fastest growing and largest in regards to new locations/expansions of any industry sector nationally. The sector suffered during the recent recession as locations/expansions where slowed by lower consumer demand for retail products. However, growth in online or e-commerce retailing (i.e. Amazon) has spurred new activity for DCs over the last few years.
The DC sector comprises a number of NAICS codes, including: 421 & 422-wholesale distribution; 484-truck transportation; 488-transportation support; 492-couriers; and 493warehouse/distribution. The following are some key points regarding the state of logistics industry which affect DC projects today: •
Fuel prices, impacted from the demand-supply imbalance, will continue to drive rates northward.
•
On the international side, port congestion is a major problem, particularly the West Coast ports of Long Beach and LA.
•
There are dire predictions about:
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Drastic driver shortages
Continued worry about the overall transportation infrastructure
Likely increase in security requirements, etc.
With these challenging issues, there’s a growing desire to optimize the network of distribution centers.
With these in mind, the following national DC trends are significant: •
Freight costs drive site selection decisions
Along with labor costs they are either first or second in importance.
Access to customers; very specific and detailed freight modeling is done in order to optimize shipping costs and time.
Access to Interstate highways is often critically important.
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Projects are very fuel cost sensitive – optimizing shipping distance
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Regionalization is occurring – meaning the development of smaller boxes serving regional markets versus massive boxes serving larger national market area (speed to market, lower shipping costs).
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Many companies are rethinking of integrating rail – it will provide a cheaper shipping alternative in the future; if all else is equal, the prospect will choose the rail site over the non-rail site.
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Direct highway access is often important – “5 to 55” (5 minutes to reach 55 miles per hour for trucks) means immediate access to limited access Interstate and major highways.
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Large flat sites are best – many searches will start with available buildings, but most will end up with a build-to-suit since the buildings may not meet needed specifications.
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DCs are attracted to port sites (i.e. Long Beach, Houston, and Charleston)
East Coast ports, with expansions to serve “Post Panamax” ships that can pass through the expanded Panama Canal starting in 2014, will likely grow faster in order to serve the larger population base in the East. Competition between East Coast ports to capture this new traffic has been intense, but in our opinion, the Port of Charleston has the inside tract as the port of choice.
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DCs are attracted to intermodal (rail, truck, barge and/or air freight) sites (i.e. Joliet, IL; Kansas City; and Alliance, TX)
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Retail tax issues are driving many siting decisions for online retail DCs.
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Every manufacturing project also has a warehousing component.
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There is a general lack of understanding of freight modeling in the economic development community.
NAICS Codes 421; 422; 484; 488; 492; and 493 Key Site Selection Needs (by priority) 1. Access to market/transportation/freight costs
Access to intermodal freight terminals and ports growing in importance
2. Labor costs/availability
Key positions: material handlers, forklift drivers, and truck drivers
3. Electric power (costs/reliability) 4. Access to Interstate highways (“5 to 55” – ability to reach 55 miles per hour within 5 minutes) 5. Large sites (50 to 250 acres) or large buildings (40,000-square-foot plus) 6. Rail service for select operations 7. Incentives
Infrastructure
Training
8. Good labor/management relations.
Electronics Assembly (including Solar Fabrication) Understanding the Sector This is the industry involved with the development and application of electronic devices, circuits and programmable machines that perform high-speed processing. This industry has mushroomed out of the recession with the growth of solar; smart phones; tablets; related “apps;” and defense-related cyber security. Companies in this industry manufacture semiconductors and other electronic components. Products include diodes; transistors; integrated circuits; silicon wafers; and other solid-state and semiconductor components. Companies that make capacitors, resistors, and transformers, as well as electron tubes (cathode ray tubes and vacuum tubes), printed circuit assemblies, and connectors are also included in this industry. NAICS Codes Bare Printed Circuit Board Manufacturing: 334412 Semiconductor and Related Device Manufacturing: 334413 Capacitor, Resistor, Coil, Transformer, and Other Inductor Manufacturing: 334416 Related Industries:
Computer Peripheral Equipment Manufacturing Contract Electronics Manufacturing Electrical Products Manufacturing Semiconductor Manufacturing
Key Site Selection Needs for Electronics Assembly (by priority)
Labor skill availability and quality Key positions: assemblers; electronic technicians; winders; testers; maintenance mechanics High level security clearances are a plus Labor costs Education/training with incentives
Electric power Supplier network Overnight carriers (FedEx; UPS) Proximity to markets/good highway access Fully improved industrial parks Building costs Corporate taxes.
Industrial Machinery/Fabricated Metals Products/ Metals Recycling Understanding the Sector Industrial machinery is a diverse sector covering the manufacturing and assembly of equipment used to aid and service other industrial sectors. Fab metals and metals recycling equipment is often closely connected. Examples of active regional segments include farm equipment; machinery; oil/gas equipment; wind power equipment; conveyor equipment; guns; and sheet metal. Companies in this industry transform purchased metals into intermediate or end-use products by forging; stamping; bending; forming; welding; machining; and assembly. Major companies include Ball Corporation; Flowserve; Mueller Industries; Snap-On; and The Timken Company (all headquartered in the U.S.); as well as Jiangsu Guotai International (China), Schaeffler Technologies (Germany), and Toyo Seikan Kaisha (Japan). Because of the special manufacturing processes involved for individual parts, most companies make a limited range of products. Trends include:
U.S. durable goods manufacturers' shipments of fabricated metal parts, an indicator of fabricated metal parts production, rose 1.6 percent year-to-date in March 2014 compared to the same period in 2013.
U.S. steel mill product prices, an indicator of commodity steel costs for fabricated metal products manufacturers, rose 2.2 percent in April 2014 compared to the same month in 2013.
NAICS Codes Iron and Steel Forging: 332111 Nonferrous Forging: 332112 Custom Roll Forming: 332114 Key Site Selection Needs (by priority)
Available labor – machining skills & quality o Key positions: machinist, maintenance mechanic, machine operator (CNC), and warehouse workers Labor costs
Access to Midwest markets/transportation costs Interstate highway access Electric power (reliability & costs) Improved sites/existing buildings (min. of 20,000 square feet) Rail access
Available training (and incentives) Good access to suppliers
Good labor/management relations
Recycling Materials and Metals Understanding the Sector Companies in this industry engage in wholesale distribution of automotive scrap, industrial scrap, and other recyclable materials. Major scrap metal wholesalers include America Chung Nam, Commercial Metals Company, and The David J Joseph Company (all based in the US), as well as ELG Haniel (Germany), European Metal Recycling (the UK), and Sims Metal Management (Australia). Scrap metals are the largest portion, but some companies handle paper, plastics, glass, and other materials. The North American steel industry annually recycles millions of tons of steel scrap from recycled cans, cars, appliances, construction materials, and other steel products, according to Steel Recycling Institute (SRI). Trends include:
Total U.S. durable goods manufacturers' shipments, a driver of scrap metal supply from manufacturing waste, rose 3.4 percent year-to-date in March 2014 compared to the same period in 2013.
Total U.S. revenue for waste management and remediation services, which includes scrap metals and recycling services, rose 3.3 percent in the fourth quarter of 2013 compared to the previous year.
U.S. steel mill product prices, an indicator for demand of scrap metal, rose 2.2 percent in April 2014 compared to the same month in 2013.
Total U.S. wholesale sales of durable goods, a potential measure of scrap metals demand, rose 4.8 percent in March 2014 compared to the same month in 2013.
Trend: Electronic Scrap Grows Worldwide – Global electronic waste, or e-waste, continues to grow with most of the increase in emerging markets, according to a United Nations-sponsored report by the Solving the E-Waste Problem (Step) Initiative. The current volume of e-waste is about 49 million tons. About half comes from the U.S., the EU, Japan, and Australia. By 2017, global volume is expected to reach about 65 million tons, with about 37 million tons coming from emerging markets. Volume is increasing in economies with growing middle classes and increasing electronics consumption. However, e-waste from developed nations is also shipped to less-developed regions for recycling, often in unregulated and unsafe conditions, according to the Step report. NAICS Codes Recyclable Material Merchant Wholesalers: 423930
Plastics Related Understanding the Sector Companies in this industry manufacture plastic bags and bottles; plastic film and sheets; plastic pipe and foams; rubber hoses; and tires. Major companies include U.S.-based Berry Plastics; Cooper Tire & Rubber; Goodyear; and Newell Rubbermaid, as well as Amcor (Australia); Bridgestone (Japan); Michelin (France); Pirelli (Italy); and Reynolds Group Holdings (New Zealand). U.S. nondurable goods manufacturers' shipments of plastics and rubber products, an indicator of plastic and rubber products production, rose 3 percent year-to-date in March 2014 compared to the same period in 2013. The spot price of crude oil, a key raw material in plastic and rubber manufacturing, rose 4.6 percent in the week ending May 9, 2014, compared to the same week in 2013. NAICS Codes Plastics Bag and Pouch Manufacturing: 326111 Plastics Packaging Film and Sheet (including Laminated) Manufacturing: 326112 Un-laminated Plastics Film and Sheet (except Packaging) Manufacturing: 326113 Key Site Selection Needs for Plastics Products (by priority)
Labor costs and unskilled/semiskilled availability
Key positions: machine operators, maintenance mechanics, and warehouse workers
Electric power (reliability and costs)
Fully improved sites and/or existing buildings (30,000-square-foot minimum)
Access to market/transportation costs
Customers often require JIT delivery
Rail service
Pellets are often brought in via hopper car
Incentives (training and offsets for large capital equipment costs)
Good labor/management relations.
Scottsbluff/Gering Area’s Key Economic Development Strengths & Weaknesses Introduction FCG examined key site selection criteria prevalent in all the preliminary targets as they relate to Scottsbluff/Gering Area. Each is rated from poor to excellent. Criteria include:
Transportation/Logistics Labor Costs Labor Availability & Quality Industrial Sites Key Services (i.e. utilities, education/training, medical, etc) Quality of Life/Cost of Living
The analysis included fieldwork interviews with company, training/education, and development officials. We benchmarked Scottsbluff/Gering Area against several competitor and source4 cities for select criteria:
Denver, CO Cheyenne, WY Sidney, NE Hays, KS
Transportation/Logistics___________________________
Below Average
The ability of a company to receive and deliver goods economically is often a determining site selection factor. Scottsbluff/Gering Area fails to deliver on key factors from a transportation/logistics standpoint:
50 miles from I-80 Interstate highway access
Limited industrial sites and none “certified”
Dual rail potential with BNSF and UP Class 1 mainline railroads, but few “ready to go” sites
Adequate air carrier service (i.e. UPS/FedEx)
Very poor commercial air service
Key Conclusion: Scottsbluff/Gering Area has limited potential from a transportation/logistics viewpoint to serve western regional markets because of the distance to I-80.
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Large metro areas where target company headquarters may be located.
Labor Costs________________________________________________Excellent Wage rates and salaries are the single most important labor factor both affecting the availability of good quality workers in a marketplace and affecting a company’s competitive position. Up to 80% of the annual operating costs of a project can be labor. Select salaries follow utilizing salary data from our Economics Research Institute (ERI) database, 1st Quarter 2014. Wages are for workers with one-year experience, median without benefits.
Scottsbluff/Gering Area manufacturing salaries are lower than those in all other comparison communities, with one exception. CNC Operator in Sydney is slightly less.
Scottsbluff/Gering Area call center/tech support salaries are lower than those in all other comparison communities, with one exception. Customer Service Representative (CSR) in Sydney is slightly less.
Scottsbluff/Gering Area salaries are lower than those in all other comparison communities, with two exceptions. Warehouse Laborer in Sydney and Hays are slightly less.
Key Conclusions: Scottsbluff/Gering Area is the overall low cost wage/salary area. By locating here target employers would save:
0.4% over Sidney 7.7% over Cheyenne 24.8% over Denver 0.7% over Hays
Labor Availability_______________________________
___Below Average-Excellent
The ability to attract the right skills is critical to the success of a project. We use the FCG Availability Index, which measures labor availability on a one to ten point scale (1 = very poor; 5 = average; and 10 = excellent). We use the same index in all of our labor market analysis nation-wide and this gives a true “apples-to-apples” comparison of different communities. Generally, scores of 0 to 3 are “poor;” 3 to 4 are “below average;” 4 to 6 are “average;” 6 to 7 are “above average;” 7 to 8 are “good;” 8 to 9 are “very good;” and 9 to 10 are “excellent.” Based on 17 company interviews, the following chart depicts labor availability:
The availability of skilled workers is rated “below average,” especially those with experience, such as: o o o o o o o o
nurses welders machine operators (CNC) truck drivers (CDLs) lenders IT workers maintenance mechanics truck mechanics
o o o o
sanitation/wastewater electricians public accountants ultrasound technician (hospital) o rehab technician (hospital)
Semiskilled, unskilled, and clerical availability is “above average to “very good.” o Customer Service Representations are rated “very good.” o There is some need for more agricultural workers.
Management availability is rated slightly “above average.”
Quotes
“Can’t find 20 machine operators now.”
“Don’t want more large employers here…pushes up wages.”
“Older workers have more mechanical skills…there is a generation gap…the young folks don’t have it.”
“Outsiders not welcome, tough to recruit new talent…”
“We are having a very tough time filling management jobs.”
“We need 15-20 skilled folks right now…poor availability.”
“Young professionals will be very hard to find and recruit; reaching out for marketing and logistics managers.”
Key Conclusions: Based on the recent fieldwork, in the Scottsbluff/Gering Area:
Overall labor availability is rated above average (6.42).
There is “below average” availability of manufacturing skilled positions, such as CNC machinists, welders, truck drivers and maintenance workers.
There is “good” availability of unskilled and clerical workers across the board. Customer Service Representative (CSR) availability is “excellent.”
Recruitment of some management talent will be a challenge.
Labor Quality_______________________________________Above Average-Excellent The ability to find quality workers will be critical to the success of any target company project. Through interviews with the local employers we were able to determine current labor quality in the Scottsbluff/Gering Area market. We use the FCG Quality Index, which measures labor quality the same way we measure labor availability, as described on Page 25. Characteristics include:
Turnover Absenteeism Attitudes – on-the-job Trainability – employees response to training Basic skills – math, English, grammar, blue print reading, etc. of applicants Communications – Employer/employee and employee/employee on-the-job Alcohol/drugs – Perceived situation Productivity – Employer’s measure.
The following are the labor quality ratings:
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Quotes
“Do your homework and the number and kind of people you need.”
“Know your employee needs; study to see that skills are here.”
“Might be white collar here…not production folks.”
“Our productivity is “spotty”…need smarter work, not harder work.”
“Understand culture and people before you come in and learn about the community.”
“We offer 3X redundancy for telecommunications…one of only 2% of cities in the U.S. that offers fiber to all homes.”
“Workers will fight for overtime pay (OT) pay…they won’t work weekends; want to fish and drink beer.”
“You will pay less here.”
“Young workers are too dependent on computers and not as motivated by money.”
Key Conclusions: Companies will be pleased with the labor quality in the Scottsbluff/Gering Area.
Overall labor quality is rated good (7.40).
All sectors, including basic skills which in many markets is average or below, are rated above average to very good.
Industrial Sites
Poor-Average
Good products (sites and buildings) must be available in order to attract economic development. Two, out of three, site searches begins with a building search. However, the majority of lookers still end up constructing a building since it turns out that the existing spaces don’t work. The Scottsbluff/Gering Region has a number of existing and potential industrial sites available and most need some improvements. We toured potential sites during our first visit and did a detailed inspection/analysis on another visit. One of the hottest trends in site selection today is the identification of “certified or shovel ready” sites and buildings. Certified or shovel ready means that the site/building has passed a rigorous professional site selector inspection and analysis and is deemed “ready to go.” Certified sites” are the best available or the “cream of the crop” and often are the first products requested/shown in a site selection. Criteria for certified sites include:
Acreage (10 acres; minimum levels) All utilities at the site or a formal plan to extend to the site Asking price from a willing seller 27
Certification by a professional site selection firm Minimized risk factors for development No environmental liabilities Outside known flood-prone areas Permitting process, timeline, and fees Property boundary survey and topographic maps completed Report of comprehensive site information from a site selector’s viewpoint Truck quality road access Zoning in place or an expedited rezoning plan.
FCG has identified the seven top sites (three in Scottsbluff and four in Gering), and carried out an initial “certified-site-type” review from a site selector’s viewpoint (see details in the Appendix). During this analysis we carried out an “intake form” assessment, determining the best sites that should next be “certified.” This assessment only briefly looks at each site, but does not look in detail at such areas as flood plain review. This will come later in the “certified” analysis. Speculative (“Spec”) buildings may be a good fit for your community. Remember that existing buildings will draw more prospects to town since about 80% of all site selection searches begin with building searches. But less than half find the building that they want, and they end up buying a site. The best sites are (maps and Intake Forms are available in the Appendix): Scottsbluff 1. Scottsbluff City Site (43 acres; city-owned)* 2. 42nd Street Data Center Site (200-300 acres) 3. Nationstar East Site (40-50 acres)* Gering 4. 5. 6. 7.
Gering Hill East Site (land fill site; 225 acres; city-optioned) Sugar Factory Sites (80-200 acres) Shane Site (13 acres)* Expressway Site (140 acres)
Closest to Certified Site Status (“ready to develop”)* Scottsbluff/Gering is in need of developable sites with rail access. Many industrial and warehouse/distribution companies will require rail for inbound and some outbound service, including potential targets: food/agriculture; oil/gas/mining equipment; industrial machinery/fab metals and plastics. 28
Key Conclusions: Scottsbluff/Gering has a number of attractive industrial sites that, with some work, will attract new industrial development. The key will be to get them improved and one good step is to put them through a Certified Sites Analysis.
Incentives_____________________________________ _____________
Good
Economic development incentives are the deal closers when all other key factors are equal. Incentives are usually not a top location criteria; however, they are critical when a company is down to a few finalist communities and everything else is equal. They are often the “hidden” criteria, or the tie breaker. Each state/community has a number of attractive programs used regularly for new locations/expansions: Nebraska The Nebraska Advantage Package includes Nebraska’s comprehensive economic development incentives that meet the needs of your expanding or relocating business. It is Nebraska’s comprehensive economic development incentives that meet the needs of your expanding or relocating business. During the 2012 Legislative session, additional legislation was passed which further enhanced this competitive incentives package. The Nebraska Advantage Act, multi-tiered benefits, have a six-tier program including:
Tier 4 – $12 million new investment and 100 new jobs: In addition to the sales tax refund, jobs credit, and the investment credit; qualifying businesses under this tier receive a personal property tax exemption on turbine-powered aircraft, personal computer systems, agricultural product processing machinery, and personal property used in a distribution facility for up to 10 years.
LB840 and TIF are great incentives; since 1995, $2.5 million was released ($5,000 per employee), funded by city sales tax (55 communities in Nebraska).
Incentive laws designed to benefit companies that decide to build large data centers in the state. One provides tax incentives for data center projects companies invest at least $200 million. These are sales- and use-tax refunds, property tax exemptions, and refunds on IT hardware and software purchases. Additional incentives are discussed in the following section focused on taxes.
Kansas
Promoting Employment Across Kansas (PEAK) Program: returns 95% of withholding tax to the company as a credit if company meets the median wage of the county for 5-10 years
Training: give $400 per new employee
Property Tax Credit: 10% of capital investment 29
Sales Tax Rebate
Personnel Property Tax Exemption
No Corporate Income Tax: for corporate headquarters moving to KS
Hays offers tax abatements, TIFs, and IRBs (which allows a sales tax exemption).
Colorado The State offers very few cash incentives before a location is announced. The most used include:
Customized Job Training: $800 per job
Strategic Fund Program: for high tech jobs; $2000-$5000 per job
Advanced Manufacturing Fund: $3-$4 million grant fund for expanding manufacturers
Enterprise Zone (EZ): Covers most of the state and offers property tax abatement and up to 10 tax credits
Aviation Development Zone Tax Credit: special tax credits on products brought back into Colorado for assembly.
Some local communities offer special incentives, such as the Loveland cash fund (up to $250,000 per project). Wyoming Due to the existing corporate tax structure, Wyoming offers fewer incentives than other states.
Business Community Ready Community Program: The BRC funds seven types of projects
WyoRECs Renewable Energy Credit Discount Program
Community Development Block Grant (CDBG) Program
Wyoming Partnership Challenge Loan Program.
Incentives Conclusion We feel today the most important incentives are (in order of priority): 1. Training related – with flexibility 2. Tax credits tied to job creation 3. Site infrastructure assistance
4. Property tax relief 5. Building/site financing 6. Project financing
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Key Conclusions: The Scottsbluff/Gering Area should be able to compete effectively with the state and local incentives available. Taxes _________________________________________________
_____Excellent
Even though taxes are generally a relatively minor portion of the annual operating costs for a project (generally 10% to 15%), they are typically compared in a site selection project. The report from the Tax Foundation and KPMG, Location Matters, was released in 2012. The report’s study accounts for all business taxes: corporate income taxes; property taxes; sales taxes; unemployment insurance taxes; capital stock taxes; inventory taxes; and gross receipts taxes by state. It compares overall taxes for select new and mature project types: Headquarters; Research & Development (R&D); Call Center; Distribution Center; Capital-Intensive Manufacturing (such as a steel plant); and Labor-Intensive Manufacturing (such as a truck plant). The results allow site selection experts to screen states more accurately and quickly for consideration by their clients. We used this for making tax comparisons for a new location (as opposed to a mature expansion) in Nebraska, Colorado, Kansas, and Wyoming. Overall Rank of all 50 States for New Firms
Nebraska – 1 Colorado – 47 Kansas – 48 Wyoming – 9
New Corporate Headquarters
Nebraska – 1 Colorado – 34 Kansas – 42 Wyoming – 11
New Distribution Center
New Research & Development (R&D) Operation
Nebraska – 2 Colorado – 40 Kansas – 49 Wyoming – 16
Nebraska – 22 Colorado – 40 Kansas – 50 Wyoming – 5
New Capital-Intensive Manufacturer (Steel)
New Call Center
Kansas – 47 Wyoming – 15
Nebraska – 1 Colorado – 34 31
Nebraska – 2 Colorado – 45 Kansas – 37 Wyoming – 23
New Labor-Intensive Manufacturer (Trucks)
Nebraska – 2
Colorado – 47 Kansas – 33 Wyoming – 12
According to the study, Nebraska ranks first for both new corporate headquarters and for new call centers. The state also ranks second for both new capital-intensive and new labor-intensive manufacturing. Tax incentives are the major contributing factor to the strong showing for all of these firm types. For example, the corporate headquarters and the call center benefit from some of the most generous investment tax credits and job tax credits in the nation. Similarly, only three states offer a more generous investment tax credit for capital-intensive manufacturers. The property tax abatement for manufacturers is also very generous. Key Conclusions: Nebraska rated first or second in all explored categories, except for a new distribution center. Colorado rated poorly (below 34) for all categories. Kansas was also poor (below 33 and one at 50). Wyoming rated in the top 20 for all categories except for a new capital-intensive manufacturer. Electric Power_____________________________________________
___Excellent
Electric power costs and reliability are critical site selection factors in almost all projects.
Nebraska Public Power District (NPPD) serving Scottsbluff now offers one of the lowest costs in the country. Approved new rate for qualified businesses: $.0029$.0036 per KwH; threshold is one megawatt with a 60% load factor.
Power is redundant, plentiful, reliable and affordable. Recourse mix is diverse and includes renewable and green energy options.
The cities of Gering and Sidney have municipal power systems (“munies”) and have slightly higher rates.
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Telecommunications____________________________
_____
________Excellent
The 100% fiber optic network ranks Scottsbluff/Gering Area in the top 5% of the ”most wired” areas of the country, and includes a 750-mile cable connecting to Denver and national research networks. This superior infrastructure means that businesses will not be limited by reduced connectivity options. Education_______________________ _______ Average-Good (Needs Improvements) Today’s students are tomorrow’s workforce. Prospects are therefore most concerned about higher education and the flow of skills into the work place. Longer term, they are concerned with the quality of the secondary schools. We interviewed (and in some cases toured) several educational officials. Secondary Schools The local secondary school system has connections with Western Nebraska Community College (WNCC). Here are the strengths and weaknesses that we uncovered: Strengths
Highly committed staff to career academy programs
Nebraska is known for its excellent school programs, commitment, and leadership in education
Drop out levels are low; commitment to graduation high. 80% graduation rate in Scottsbluff and approximately 90% in Gering
Lots of energy and participation for dual credit programs
Career Advisory Council soft skills certificate is the right idea
Weaknesses
Hardly any connection or communication with major private sector leaders and economic development (no business education consortium or roundtable)
No deep understanding of private sector needs except in a few cases
Lack of infrastructure, old buildings at high school, difficult to implement career academy programs
Scottsbluff ACT scores for composites averaged 18.9 for the district; Gering 18.8 and 21.5 for the state
Lack of commitment to IT careers and training (may be an early age problem); low computer: student ratio
Scottsbluff’s agriculture program limited and handcuffed with space; does some welding but machining and metal fabrication is almost non-existent
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Cultural support for education and careers, especially blue collar, is traditionally low.
Higher Education Western Nebraska Community College (WNCC) offers programs to assist businesses. Here are the strengths and weaknesses that we uncovered: Strengths:
Good organization in strong Midwest Community College system
Apparently strong customized job training programs with the private sector on a contract basis
Strong dual credit programs with area high schools
The Business and Community Education (BCE) division was established to develop skills for the workplace, individuals, and employers through education with no boundaries in response to community and economic needs.
The Corporate Academy Associate of Occupational Studies (AOS) degree is customized to meet the needs of a specified corporation wishing to pursue higher education and professional development for its employees.
The John N. Harms Advanced Technology Center of Nebraska (HATC) was established to develop skills for the workplace, individuals, and employers through education with no boundaries in response to community and economic needs.
Weaknesses:
No collaboration between target industries and career development and curriculum
No metal fabrication/machining programs
Little emphasis on information technology programs, CISCO Academies, Microsoft certification, etc.
Key Conclusions: The secondary schools and community college programs appear good, but there is a need for better education/business connections in the training of skilled positions needed by target industries and related careers, such as metal fabrication/machining, etc.
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Quality of Life/Cost of Living/Community Services____
________ Poor to Excellent
Quality of life aspects of a community (cost of living5, medical services, recreation, shopping, culture and community services) are all important in hiring, relocating, and retaining employees. If managers refuse to take the move, the new project could be in jeopardy. From our cost of living data base we learned:
The Scottsbluff/Gering cost of living is below the national average and the second lowest of all comparison areas.
Scottsbluff/Gering executive home prices are the second lowest of all comparison locations.
5
All data comes from our ERI Relocation Assessor database. Cost of living items include: consumables, transportation, health services, housing/utilities/property taxes and miscellaneous items.
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Based on community interviews, we learned the following:
All items were rated “good” to “excellent”
Telecommunications were also rated “excellent” due to high concentration of fiber in the community
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Only air service was rated “poor,” since the Great Lakes local service is limited and the service is poor.
All other items were listed as “above average” to “very good.”
Quotes
“Friendliness and patience here…marvelous people!”
“Getting permits was easy…2 weeks…little bureaucracy.”
“Good broad band.”
“Good electric power…low cost!”
“Happy to live here!”
“Need consolidated schools.”
“Need to consolidate police and fire.”
“Region has good family values, low crime rate, and good work ethic.”
“Understand culture and people before you come in and learn about the community.”
Key Conclusions: Many aspects of quality of life generally rate well due to Scottsbluff/Gering Area’s low cost of living and community services. However, the area falls short in a few areas, including commercial air service.
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Scottsbluff/Gering Area’s Strengths & Weaknesses Vs. Preliminary Target Needs We next assessed Scottsbluff/Gering Area’s strengths and weaknesses against the preliminary target location needs. Scottsbluff/Gering Area Strengths
Scottsbluff/Gering Area Weaknesses
Oil/Gas/Mining Equipment & Service
Market access to shale plays in ND, CO, & WY Labor availability for unskilled Labor costs & quality Electric power Incentives Taxes Access to suppliers Labor/management relations Regional locations
Skilled labor Certified sites with rail Specialized training programs
Some skilled/management availability Certified sites Specialized training programs Supplier network
Certified sites Poor State assistance
Electronics Assembly
Labor availability - unskilled Labor quality Labor costs Existing building/ office sites Incentives Taxes Electric power Overnight carriers (FedEx; UPS) Proximity to markets Regional locations
Data Centers
Geographic diversity & disaster avoidance Electric power cost State corporate income tax rates (with incentives) Sales taxes (with incentives) Personal property taxes (with incentives) Utility infrastructure including good fiber Regional locations
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Scottsbluff/Gering Area Strengths
Scottsbluff/Gering Area Weaknesses
Plastics Products
Access to market/transportation costs Labor costs Unskilled/semiskilled availability Electric power Future container transload capability Incentives (training and offsets for large capital equipment costs) Taxes Labor/management relations Regional locations
Skilled labor Certified sites with rail Existing buildings No direct I-80 access
Skilled labor Certified sites with rail Specialized training programs
Industrial Machinery/Fab Metals/Recycling
Market access Unskilled labor availability Labor quality Labor costs Electric power Incentives Taxes Access to suppliers Labor/management relations Regional locations
Warehouse/Distribution (DC)
Market access to West Labor costs Unskilled labor availability Electric power cost & reliability Labor quality Incentives (training) No inventory tax Labor/management relations Regional locations
No direct access (50 miles) to I-80 Certified sites with rail Freight costs to large consumer markets
Certified sites with rail Skilled labor
Food Processing/Agricultural/Crushing Plants
Market access Labor costs & quality Unskilled labor Electric power cost/reliability Excess water/sewer capacities Regional locations Incentives Taxes
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Scottsbluff/Gering Area Strengths
Scottsbluff/Gering Area Weaknesses
High End Tech Support Call Centers
CSR labor – base labor that can move up Labor quality Labor costs Telecommunications Class A office building Incentives/training Taxes IT tech support Electric power costs/reliability Regional locations
Commercial air service
PHASE III: UPDATED “BEST FIT” TARGET INDUSTRIES We identified the “best fit” targets for the Scottsbluff/Gering Area (by priority) based on the Phase II analysis:
Data Centers (NAICS: 518, including 518210)
Food/Agricultural/Crushing Plants (NAICS: 311, including 311991; 311422; 311612; 311999; & 312)
Oil/Gas/Mining Equipment (NAICS: 211& 332, including 332911; 333, including 333132; 333249; 333999; and related metals, equipment, product distribution—i.e. coal and fracking sand)
Industrial Machinery/Fab Metals/Recycling Plants (NAICS: 332, including 332111, 332112, & 332114; 333, including 333111, 333249, & 333514)
Plastics Products (NAICS 326, including 326111; 326112; 326113; 326122; & 326119)
Call Centers – Higher-end tech support inbound (NAICS: 561, including 561421 & 561422; 519, including 519130; 522, including 522291; & 541, including 541191)
Why the “Best Fit” Targets Work Data Centers
Outstanding and improved electric power costs push this to the top of the list
Good potential site in the future
Good specialized state incentives promote this target o Potentially poor administration service from State officials 40
Lower tax potential
Outstanding fiber availability & bandwidth.
Food/Agricultural/Crushing Plants
Manufacturing at future rail sites
Good labor availability, but some skilled labor concerns
Need for low cost and reliable electric power
Water and wastewater excess capacities available
A need for more specialized technical training.
Oil/Gas/Mining Equipment & Services
An opportunity to serve the shale gas/oil play and mining regions of Colorado , Montana, North Dakota, and Wyoming and could provide transportation savings for serving more than one region
Strong potential subsectors:
o Pipe o Frack sand o Mining/industrial equipment o Chemicals o Trucking/hauling Good labor availability, but some skilled labor concerns
Need for low cost and reliable electric power
Good sites with rail possible in the future
A need for more specialized technical training.
Industrial Machinery/Metal Fabrication/Recycling
Good potential for many types of manufacturing operations, particularly tied to agriculture, mining/drilling, and possibly renewable wind energy related manufacturing (nacelle units: gearbox, generator, and transformer components & blade assembly)
Recycling needs are growing
Good labor availability, but some skilled labor concerns
Good sites with rail possible in the future
Need for low cost and reliable electric power
A need for more specialized technical training. 41
Plastics Products
Good availability of unskilled workers
Need for low cost and reliable electric power
Potential sites with rail for transport of plastic pellets, but no I-80 direct access.
Call Centers
Class A Nationstar Mortgage building is excellent and has an outstanding skilled worker base
40-50 acres next door offers unique expansion opportunities
A specialized real estate and marketing plan would get tenants in place. PHASE IV: ECONOMIC DEVELOPMENT RECOMMENDATIONS
The following are designed as general guidelines to approach target marketing. Marketing Related
Aggressively pursue the top “best fit” targets – This will include tools and programs found here.
Work now to market the Nationstar Building – This Class A office facility offers an outstanding opportunity for a customer service operation, especially mortgage services. Good skilled labor is currently available and you don’t want to lose them to relocation or other companies.
Develop research materials on the targets - Obtain consultant assistance where needed here. o Lead Lists o Cost Comparison Reports – provide detailed cost comparisons of Scottsbluff/Gering versus select competitors for each target industry based on a hypothetical target project o Freight/logistics modeling – to help determine your competitive position in regards to manufacturing freight costs and to provide good marketing materials o Conduct more in-depth workforce analysis
Resident survey to pin-point education levels, skills and commuting patterns
More extensive employer interviews to determine availability quality and costs
Work to analyze and improve target technical training needs. 42
Conduct Prospecting Missions – Obtain consultant assistance here. o Denver (minimum of twice a year) o Cheyenne (minimum of twice a year) o Dallas o Chicago o Des Moines
Attend Select Trade Shows – possible opportunities are listed in the Appendix
Partner with the Nebraska Department of Economic Development and Nebraska Public Power District (NPPD) on trip opportunities. Also regularly attend International Asset Management Council (IAMC) and CORENET
Certify seven industrial sites (3 in Scottsbluff and 4 in Gering). A professional site selector led certified sites process will assure improved industrial site availability. Prospects and site selectors seek certified sites to ensure availability, ready status (all permits in place), and speed to market; all which save time and money. In a future contract, we will take these “intake form” assessed best sites and officially certify them for you.
Conduct a “Spec” building analysis/plan. This analysis will be tied to the site/building needs of your targets and will focus on their need for “spec” buildings. Generally, we recommend an industrial building with:
40,000 to 60,000 square feet 10% office 28’ to 32’ ceiling heights 1-2 dock doors; one overhead door Fully sprinkled In an industrial park setting Our Team is available to assist with these recommendations.
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APPENDIX Potential Target Industry Trade Shows (In Cooperation with NPPD) IPPE 2015 – International Production & Processing Expo The IPPE 2015 – International Production & Processing Expo will be held in United States in January 2015 (Not Final). The show consists of 3 co-located events: Feed Expo Poultry Expo Meat Expo The Expo is dedicated to the entire poultry market and is a source for funding the U.S. Poultry & Egg Association. The event covers topics, products and services relevant to the processors and producers of turkeys, broilers, eggs, ducks, breeding stock, and allied companies. The Expo is dedicated to the legislative, business, and regulatory interests of the animal feed industry, including nutrition, food safety, and the environment and contributes through the American Feed Industry Association to the production of healthy, wholesome milk, meat, eggs, and fish. The Expo is sponsored by the American Meat Institute and dedicated to the equipment and supplies for processing and packaging red meat products. The Expo brings together poultry, meat, and feed industry purchasing decision makers http://www.ippexpo.org/ International Plastics Showcase: March 23-27th Orlando, FL The world’s largest plastics trade show and conference of the year—brings together all sectors of the supply chain to include end markets and brand owners. Featuring industryfocused education, showcasing equipment and material suppliers, emerging technologies, and running equipment for every phase of plastics processing. Every sector of the industry is represented with 2,000 suppliers, and the full range of technology solutions for every phase of plastics processing: machinery, chemicals and additives; resins and compounds, design engineering systems; software; molds and dies; tools; and more.
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FAB Tech November 11-13, 2014 Atlanta FABTECH is in Atlanta, GA November 11-13, 2014 bringing together an anticipated 27,000 attendees and 1,400 exhibiting companies all under one roof. North America’s largest metal forming, fabricating, welding and finishing event will be held at the Georgia World Congress Center. Featured Technologies: Arc Welding, Assembly, Bending & Forming, Brazing & Soldering, Business Services, Coil Processing Cutting, Fastening & Joining, Finishing/Paint & Powder Coating, Finishing/Plating, Gases & Gas Equipment, Hydroforming, Inspection & Testing, Job Shop/Contract Mfg., Lasers, Lubrication Maintenance & Repair, Material Handling, Metal Suppliers, Plate & Structural Fabricating, Press Brakes Punching, Resistance Welding, Robotics, Roll Forming, Safety & Environmental, Saws, Software, Machine Controls, Stamping, Thermal Spraying, Tool & Die, Tooling, Tube & Pipe Fabricating or Welding, Tube & Pipe Producing, Waterjet, Welding Consumables, Welding Machines. AFCOM (for Data Center Professionals) The data center environment is constantly changing, making it difficult to stay abreast with the latest information and technology. AFCOM offers data center and facilities management professionals the best practices, insights, tools and resources to successfully manage today’s data center infrastructure. According to the 2014 State of the Industry Survey, the demand for ongoing education and networking among data center and facilities managers is greater than ever before. In response to the community, AFCOM is launching 6 regional Symposium in 2014 to provide ongoing, vendor-neutral education, networking, and access to the latest technology and service providers. These that are in the Fall: http://www.afcom.com/events/afcomsymposium-denver-2014/ http://www.afcom.com/events/afcomsymposium-columbus-2014/ Contact Center Expo & Conference May 4-7, 2015 | Orlando, FL Formerly referred to as ACCE, this event has a reputation as being THE annual global gathering for the contact center industry. Contact Center Expo and Conference includes four full days of workshops, site tours, case studies, panels, and discussions on a comprehensive selection of contact center-specific topics, all taught by leading industry experts. You’ll also find valuable networking opportunities, inspiring keynote speakers, and the latest technologies and services from top industry vendors in the expo hall.
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Certified Sites Analysis “Intake Forms” Introduction Providing a completed intake form is the first step in qualifying for site certification. Attached are the forms and all of the sites below appear to be in good shape for certification. Site Name: Scottsbluff City Site Location (City): Scottsbluff, NE (US Highway 26 & County Road (CR) 92 Expressway)
Please mark the appropriate boxes. 10 or more developable acres? Yes X No _ 43 acres 46
Willing seller with set asking price? Yes X No _ $20,000 per acre Proven alignment with a local city, town, or county? Yes X No _ City-owned
Dedicated access? Yes X No _ Adjacent to 4 lane Expressway US 26 with access road; SR 92; County Road (CR) 24 BNSF rail spur; must secure right to utilize; good potential of rail extension onto site All utilities at site (water, sewer, electric power, telecommunication)? Yes X No _ If all utilities are not at site, can a "Will Serve” letter to extend utilities to the site be provided? Yes _ No _ Letter of commitment from local government, county, or economic development group? Yes X No _ Do any environmental issues exist? Yes _ No X Are you in the process of documenting/remediating environmental factors with proper organizations? (e.g. Phase I ESA; Clean Water Act; 100-year assured water supply; endangered species reviews; geotechnical report; air quality designation) Yes X No _ Have topography maps on site. Has been used for farming, so no previous industry has been located on the site Is site outside known flood-prone areas? Yes X No _ Building site will have to be raised out of floodplain - 0 to 18” (varies) Industrial/office (no retail) zoning or expedited rezoning plan in place? Yes X No _ Authorized Representative Contact Information Name: Rawnda Pierce Title/Organization: Executive Director, Twin-Cities Development Assoc. Address: 1620 Broadway, Scottsbluff, NE 69361 Phone: 308-632-2833 Email:
[email protected] 47
Site Name: 42nd Street Data Center Site Location (City): Scottsbluff, NE (by the cemetery off 5th Street and 42nd Street)
Please mark the appropriate boxes. 10 or more developable acres? Yes X No _ 200-300 acres Willing seller with set asking price? Yes __ No X Proven alignment with a local city, town, or county? Yes X No _
Dedicated access? Yes X No _ On County Road H (4th Ave); near County Road 21 All utilities at site (water, sewer, electric power, telecommunication)? Yes X No _ Sizable power near site; sewer and dark fiber near; City water tower and water service on west side; City sewer and water run along 42nd Street, but not on the site.
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If all utilities are not at site, can a "Will Serve” letter to extend utilities to the site be provided? Yes X No _ Letter of commitment from local government, county, or economic development group? Yes X No _ Do any environmental issues exist? Yes _ No X Are you in the process of documenting/remediating environmental factors with proper organizations? (e.g. Phase I ESA; Clean Water Act; 100-year assured water supply; endangered species reviews; geotechnical report; air quality designation) Yes _ No X Is site outside known flood-prone areas? Yes X No _ Industrial/office (no retail) zoning or expedited rezoning plan in place? Yes __ No X Authorized Representative Contact Information Name: Rawnda Pierce Title/Organization: Executive Director, Twin-Cities Development Assoc. Address: 1620 Broadway, Scottsbluff, NE 69361 Phone: 308-632-2833 Email:
[email protected]
Site Name: Nationstar East Site Location (City): Scottsbluff, NE (Highway 26; 27th street and 21st street.)
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Please mark the appropriate boxes. 10 or more developable acres? Yes X No _ 30 acres below ditch 30 acres above ditch Willing seller with set asking price? Yes __ No X Family will discuss price and what they want to sell. Willie Quindt is family representative: 308-631-8937
Proven alignment with a local city, town, or county? Yes X No _
Dedicated access? Yes X No _ Hwy 26
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All utilities at site (water, sewer, electric power, telecommunication)? Yes X No _ If all utilities are not at site, can a "Will Serve” letter to extend utilities to the site be provided? Yes _ No _ Letter of commitment from local government, county, or economic development group? Yes _ No _ Do any environmental issues exist? Yes _ No X Are you in the process of documenting/remediating environmental factors with proper organizations? (e.g. Phase I ESA; Clean Water Act; 100-year assured water supply; endangered species reviews; geotechnical report; air quality designation) Yes _ No X Is site outside known flood-prone areas? Yes X No _ Industrial/office (no retail) zoning or expedited rezoning plan in place? Yes X No _ Authorized Representative Contact Information Name: Rawnda Pierce Title/Organization: Executive Director, Twin-Cities Development Assoc. Address: 1620 Broadway, Scottsbluff, NE 69361 Phone: 308-632-2833 Email:
[email protected]
Site Name: Gering Hill East Site
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Location (City): Gering, NE (US 92 Scenic, CR 25 & CR 24)
Please mark the appropriate boxes. 10 or more developable acres? Yes X No _ 225 acres Union Pacific rail on south side; no agreement on spurs; no engineering Willing seller with set asking price? Yes X No _ City of Gering maintains an option Price is unknown Proven alignment with a local city, town, or county? Yes X No _ City of Gering maintains an option Dedicated access? Yes X No _ 52
US 92 (scenic) on south; CR 24 on west Union Pacific (UP) rail line to the south All utilities at site (water, sewer, electric power, telecommunication)? Yes _ No X Electric power All others must be extended If all utilities are not at site, can a "Will Serve” letter to extend utilities to the site be provided? Yes X No _ Letter of commitment from local government, county, or economic development group? Yes X No _ City of Gering maintains an option Do any environmental issues exist? Yes _ No X Are you in the process of documenting/remediating environmental factors with proper organizations? (e.g. Phase I ESA; Clean Water Act; 100-year assured water supply; endangered species reviews; geotechnical report; air quality designation) Yes _ No X Is site outside known flood-prone areas? Yes X No _ Industrial/office (no retail) zoning or expedited rezoning plan in place? Yes X No _ Authorized Representative Contact Information Name: Rawnda Pierce Title/Organization: Executive Director, Twin-Cities Development Assoc. Address: 1620 Broadway, Scottsbluff, NE 69361 Phone: 308-632-2833 Email:
[email protected]
Site Name: Sugar Factory Site 53
Location (City): Gering, NE (Off Hwy 92 near Lockwood Rd.)
Please mark the appropriate boxes. 10 or more developable acres? Yes X No _ 60-80 acres Willing seller with set asking price? Yes X No _ Price unknown Proven alignment with a local city, town, or county? Yes X No _ Dedicated access? Yes X No _ Lockwood Road west of US 92 4-lane Union Pacific (UP) rail is to the south and west and would have to be extended; no engineering
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All utilities at site (water, sewer, electric power, telecommunication)? Yes _ No X Sanitary sewer – City treatment plant is nearby to the west Water and gas is just to west Telecommunication at adjacent properties If all utilities are not at site, can a "Will Serve” letter to extend utilities to the site be provided? Yes X No _ Letter of commitment from local government, county, or economic development group? Yes X No _ Do any environmental issues exist? Yes_ No X Just need to be mindful that treatment plant is in close proximity. Are you in the process of documenting/remediating environmental factors with proper organizations? (e.g. Phase I ESA; Clean Water Act; 100-year assured water supply; endangered species reviews; geotechnical report; air quality designation) Yes _ No X Is site outside known flood-prone areas? Yes X No _ Industrial/office (no retail) zoning or expedited rezoning plan in place? Yes X No _ Authorized Representative Contact Information Name: Rawnda Pierce Title/Organization: Executive Director, Twin-Cities Development Assoc. Address: 1620 Broadway, Scottsbluff, NE 69361 Phone: 308-632-2833 Email:
[email protected]
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Site Name: Shane Site Location (City): Scottsbluff, NE (Broadway, Ave B & W.12th St.)
Please mark the appropriate boxes. 10 or more developable acres? Yes X No _ 13 acres Willing seller with set asking price? Yes X No _ $1.5 million for entire 13 acres, but owner is willing to entertain offers. Property qualifies for TIF funding. Owner contact is Shane Aulick 308-641-2345.
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Proven alignment with a local city, town, or county? Yes X No _ Dedicated access? Yes X No _ Direct access to W 12th St., Broadway Ave., W. 8th St, and Ave B All utilities at site (water, sewer, electric power, telecommunication)? Yes X No __ If all utilities are not at site, can a "Will Serve” letter to extend utilities to the site be provided? Yes _ No _ Letter of commitment from local government, county, or economic development group? Yes X No _ Do any environmental issues exist? Yes X No _ Former cement foundations, etc. on site must be removed. Was an EPA cleanup site from former refinery. Are you in the process of documenting/remediating environmental factors with proper organizations? (e.g. Phase I ESA; Clean Water Act; 100-year assured water supply; endangered species reviews; geotechnical report; air quality designation) Yes _ No X Is site outside known flood-prone areas? Yes X No _ Part of the property is in 100 year flood plain. Industrial/office (no retail) zoning or expedited rezoning plan in place? Yes X No _ Authorized Representative Contact Information Name: Rawnda Pierce Title/Organization: Executive Director, Twin-Cities Development Assoc. Address: 1620 Broadway, Scottsbluff, NE 69361 Phone: 308-632-2833 Email:
[email protected]
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Site Name: Expressway Site Location (City): Gering, NE (US 92, CR 23 & CR 22)
Please mark the appropriate boxes. 10 or more developable acres? Yes X No _ Two sites: 80 acres (south side) and 60 acres (north side) Willing seller with set asking price? Yes X No _ Bob Unzicker owns parcel to East Max Miller owns parcel to West Price unknown Proven alignment with a local city, town, or county? Yes X No _ Dedicated access? Yes X No _ Access to US 92 Potential access to the Union Pacific rail spur to the northwest
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All utilities at site (water, sewer, electric power, telecommunication)? Yes X No _ Gas, sanitary sewer and water service are on west side (within 500 ft. at residential site) Electric power in place Telecommunications properties adjacent to site If all utilities are not at site, can a "Will Serve” letter to extend utilities to the site be provided? Yes X No _ Letter of commitment from local government, county, or economic development group? Yes X No _ Do any environmental issues exist? Yes X No _ The two sites are divided by a drainage way which may flood. Are you in the process of documenting/remediating environmental factors with proper organizations? (e.g. Phase I ESA; Clean Water Act; 100-year assured water supply; endangered species reviews; geotechnical report; air quality designation) Yes _ No X Is site outside known flood-prone areas? Yes _ No X Above 500 year flood plain levels Industrial/office (no retail) zoning or expedited rezoning plan in place? Yes X No _ Authorized Representative Contact Information Name: Rawnda Pierce Title/Organization: Executive Director, Twin-Cities Development Assoc. Address: 1620 Broadway, Scottsbluff, NE 69361 Phone: 308-632-2833 Email:
[email protected]
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