Category Archives: Economic Development

UConn Parade Raises, Spends $90K; How Much Economic Benefit?

by Categorized: Economic Development, Economy, Entertainment/Tourism Date:

The final tally is in for Sunday’s UConn victory parade in downtown Hartford: Exactly $90,000 raised from 23 corporate sponsors.

And that’s exactly how much the Hartford Downtown Improvement District, the organizing group, will spend, said Mike Zaleski, executive director. As of midday Monday the bills totaled $86,500.

The most important economic effect of the UConn celebration: Cheerleading for Hartford. Dan Haar/The Hartford Courant

The most important economic effect of the UConn celebration: Cheerleading for Hartford.
Dan Haar/The Hartford Courant

The figure is up from $50,000 that Zaleski has set last Wednesday as a minimum needed to mount the celebration, and it’s up from the $70,000 that Gov. Dannel P. Malloy announced as the total early Friday morning.

The added dough enabled the organizers to rent a 20-foot video screen for the rally at the north steps of the state Capitol — for $13,475, delivered from a firm in Philadelphia.

Seems like a lot in an age when large-screen TV’s are dropping in price.  But I was at the event with friends, and one said, “This has a big-time feel.”

And that’s the economic point. Forget the money the 200,000 visitors to the Capital City did or did not spend. That’s small stuff. What makes an economy move is an improvement in how people feel about a region.

This event, one of the few mass-happenings that was truly racially integrated, accomplished that, though it can’t be measured. And it was problem-free except for one guy who fell out of a tree in front of the Hartford Public Library.

Aside from the obvious double championship, part of what made up the “feel” of the parade was a larger event, with 51 marching and rolling units, up from 33 last year, and a shorter route than in the past.

Metro Hartford is an $80 billion-a-year ecosystem of commerce. We don’t have a lot of growth but we do have a lot of wealth.  As we’ve learned, it’s not easy to convert that wealth into energy and positive feelings by the wide population.

In other words: Just as money doesn’t buy happiness, it doesn’t buy the sorts of good feelings that can lead to decisions by people and companies to spend in a region. That takes things like quickly organized parades that have a “big-time feel.”

Here’s the list of corporate sponsors who donated cash. It doesn’t include “in-kind” sponsors such as the Peter Pan bus company.

  • Webster Bank
  • Mohegan Sun
  • Cigna
  • The Travelers Companies, Inc.
  • The Hartford Steam Boiler Inspection and Insurance Company
  • Northeast Utilities
  • United Technologies Corporation
  • AT&T
  • Virtus Investment Partners
  • The Connecticut Buick and GMC Dealers
  • Harvard Pilgrim Health Care
  • Coca-Cola
  • Bank of America
  • The Hartford Financial Services Group
  • Aetna
  • SNY
  • Capital Region Development Authority
  • XL Center
  • CBS Radio
  • Rogo Distributors
  • Peel Liqueur
  • Robinson & Cole
  • Foxwoods Resort Casino

Let’s Have A Parade — This Weekend, Not Later

by Categorized: Economic Development, Entertainment/Tourism Date:

We have a championship. We might have two. Now let’s have a parade, and let’s make it this weekend.

Not next week. Not Easter weekend. Not later in the month. This weekend, like a real city that makes things happen.

Sunday is the day the city would like to have marchers.  Maribel La Luz, spokeswoman for Mayor Pedro Segarra, Tweeted “Sunday” in the hours after the men’s team won Monday night. But the planning is still in the works.

Michael Zaleski, executive director of the Hartford Business Improvement District, which coordinates these events, would like to see it happen this weekend.

“We set the precedent last year that we can do a parade in less than a week,” he said.

Before that, going back to the ’90s, it was almost always the second week after the UConn men or women — or both, in 2004 — hoisted the hardware.

Zaleski is always eager to step off quickly but his group doesn’t call all the shots. UConn, the governor’s office and the city all weigh in, not to mention the little matters of raising money from sponsors, and working groups along the route that might have events scheduled.

This weekend, for example, it’s Palm Sunday, making that morning less than ideal and The Bushnell has a production Saturday and Sunday at 3 p.m. — “Hell Hath No Fury Like a Woman Scorned.”

And speaking of scorned women, ask Geno Auriemma before tonight’s game in Nashville whether he and his team can appear in a parade this weekend and see what happens. Bad idea.

The various offices in the planning will probably have a date set by Wednesday. “Rest assured,” said Andrew Doba, spokesman for Gov. Dannel P. Malloy, “the planning has begun. Let’s go Huskies!”

It should be obvious that a parade needs to happen in the first few days, and that’s how the pros do it. Look at the last six national championships, in order going back:

  • Seattle Seahawks, Super Bowl Sunday, Feb. 2, parade Wednesday, Feb. 5
  • Boston Red Sox, World Series Wednesday, Oct. 30, parade Saturday, Nov. 2

tribune blackhawks

  • Chicago Blackhawks, Stanley Cup Monday, June 24, parade Friday, June 28
  • Miami Heat, NBA Finals Thursday, June 20, parade Monday, June 24
  • UConn Huskies women’s basketball, Final Four Tuesday, April 9, parade Sunday April 14
  • Louisville men’s basketball Final Four Monday, April 8, NO PARADE — but the team marched in the annual Kentucky Derby Festival Pegasus Parade on May 2.

A parade is mostly just a celebration but there’s an economic side to it. In the long run, companies locate where people want to be, and people want to be where there’s excitement, and places with excitement hold parades quickly.

Do we want to be Louisville?  We already beat Kentucky. Enough said.

Bill Would Require Labor Breakdown For Companies Receiving Big State Aid

by Categorized: Economic Development, Government, Labor, Politics, Public finance Date:

State taxpayers want to get their money’s worth when they give a company a huge aid package, and to that end, many lawmakers want to add a new hurdle.

Any firm that gets at least $10 million in state assistance would have to file a report showing how it intends to favor Connecticut-based contractors for any construction work covered by the aid, under a bill that advanced Thursday in the legislature.

The firms would also have to report on the names of construction contractors, the total number of full-time construction employees on the site and the wages paid, and the total number of construction workers on the project who live in Connecticut.

“We want to see more Connecticut construction jobs as a result of these state investments,” said state Sen. Gary D. LeBeau, co-chairman of the legislature’s Commerce Committee, which advanced the bill to the Senate floor in a 12-5 vote.

The bill is part of a long debate over how much the state should demand of the companies it backs with economic development aid. Unions support the bill and the Connecticut Business and Industry Association opposes it, saying it’s onerous.

Gov. Dannel P. Malloy’s development commissioner, Catherine H. Smith, told lawmakers she’s concerned the bill “may dissuade some larger companies from considering the state.

The administration’s caution is probably wise. Promoting local jobs is great but we wouldn’t want other states to shut out Connecticut-based construction workers. And when it comes to new business regulations, Connecticut is on the watch list — so we should pass up even some decent ideas, for the greater good.

CareCentrix To Add 150 Downtown Hartford Jobs In 2014

by Categorized: Economic Development, Health Care, Real Estate Date:

CareCentrix, the health care management company that moved from East Hartford to downtown Hartford in 2012, is aiming to add 150 local jobs in 2014 and is taking an additional floor of the “Stilts” building at 20 Church St.

The new jobs, largely staffing the company’s call center operations but also including management, would bring the total staff in downtown Hartford to 500 — three years before the company said it would reach that number in an agreement with Gov. Dannel P. Malloy for $24 million in state aid.

It is, in short, one of Malloy’s successes in the First Five program, though the price Malloy paid — $80,000 per new job, or $48,000 per job including those that were already in Connecticut — is considered steep, especially since many of the jobs pay less than $40,000 a year.

CareCentrix, which manages home health care, also has large operations in the Tampa, Fla. area, where costs are lower. The company could have moved its headquarters there or elsewhere, and then-CEO Eric Reimer told The Courant’s Mara Lee in early 2013 that the labor cost difference was a big factor in the company’s ability to extract the $24 million from Malloy.

For the state, the numbers add up based on the taxes paid and purchases made by the employees. Adding life to downtown Hartford boosts the economic value of the jobs if it helps the city center attract more people from out of the region.

The firm also fits with the economic development strategy for Metro Hartford, and especially downtown, as a center for health care management — anchored by the health insurers.

“Connecticut has a proud history of supporting health care companies. We are honored to be part of this history as we continue to grow,” said John Driscoll, CareCentrix CEO, in a written statement.

The company scheduled an event on Tuesday at 1 p.m. to mark its lease of a new floor at 20 Church Street. CareCentrix now occupies floors 9, 11 and 12 for a total of 73,000 square feet, a spokeswoman said. “Stay tuned for more details on an upcoming job fair,” she said.

Mayor Pedro Segarra, who was set to be at Tuesday’s event, had said recently that a company planned to bring about 200 jobs downtown. He didn’t name the firm.

It’s unclear whether Segarra was referring to CareCenrix, or CohnReznick, the accounting and management consulting firm that said this month it will consolidate offices in Glastonbury and Farmington to Metro Center, down church Street from the Stilts Building, with about 200 employees and the promise to add 40 more in exchange for a state loan of $1.2 million.

Or, Segarra might have been talking about a third firm that we haven’t yet heard about.

Hartford Marathon: $14 Million In Value For Region

by Categorized: Economic Development, Economy, Tourism Date:

The ING Hartford Marathon, which won’t have that corporate name at its next running in October, created
$14.1 million in financial value this past fall, a 26 percent increase over 2012 according to a new report.

The value came from mostly from direct spending of $9.4 million, largely on hotels and restaurants for the thousands of out-of-state runners, volunteers and fans who descended on the capital city for the Oct. 12 event.

The report by Witan Intelligence Inc., released by the Hartford Marathon Foundation, attributed the larger economic impact to more participants and higher spending per party — an average of $388 for groups attending the event together, which averaged 3 people. That per-party figure was up 37 percent from 2012 and comprised 34 percent lodging and 22 percent meals.

Click here to see the report.

Maybe I’m biased as a runner in the half-marathon, one of five events that drew 17,381 runners, but this seems to understate the economic value at a time when we see a lot of tourism studies that overstate.  The reason is that economic value comes from a combination of psyched locals and motivated visitors, both of which the marathon brings in good number, with intensity.

“We are proud to help contribute such a positive impact back to the businesses and communities that have welcomed our race participants, volunteers and spectators year after year,” said Beth Shluger, executive director of the Hartford Marathon Foundation.

It’s unclear how the spending by local sponsors affects the total. Shluger said in October that the marathon collected $2.8 million in contributions, including $1.6 million in cash and the rest in-kind.

Despite the financial success, the foundation is still looking for a title sponsor for this year and beyond, as ING has dropped out after spinning off from its corporate parent. Shluger reported progress in talks with local corporations but nothing solid to announce yet.

 

 

State Names Board For Bioscience Fund

by Categorized: Economic Development, Health Care, Public finance, Technology Date:

The state’s newly created, $200 million Bioscience Innovation Fund now has an advisory committee filled with some of Connecticut’s high-powered figures in the field.

The fund, overseen by Connecticut Innovations, the state’s quasi-public technology investment and assistance arm, was created by the governor and legislature earlier this year as a way to target drug development projects and other bioscience innovations, at firms or universities, with public money that could also attract private investment.

Chairing the committee is Claire Leonardi, CEO of Connecticut Innovations.

The board, with members appointed by Gov. Dannel P. Malloy or legislative leaders, includes Peter Farina, Ph.D., executive in residence at Canaan Partners; Steven Hanks, M.D., vice president of medical affairs for the central region at Hartford HealthCare; Joseph Kaliko, CEO of Gaming Innovations International; Marc Lalande, Ph.D., chairman of the Department of Genetics and Developmental Biology, and head of genomics and personalized medicine programs at UConn; William LaRochelle, Ph.D., an executive at Roche 454 Sequencing Solutions International; Charles Lee, Ph.D., scientific director at The Jackson Laboratory;  Alan Mendelson, general partner of Axiom Venture Partners; Edmund Pezalla, M.D., national medical director for pharmaceutical policy at Aetna; Carolyn Slayman, Ph.D., professor of genetics and cellular and molecular physiology and deputy dean at Yale School of Medicine; and Eleanor Tandler, founder and CEO of Novatract Surgical.

Jewel Mullen, M.D., the state’s public health commissioner, and Catherine Smith, commissioner of economic and community development, are ex-officio members with voting rights. The fund is run by Jeremy Crisp, Ph.D., the CI executive vice president and chief innovation officer.

The fund, to be disbursed over 10 years to projects that show commercial promise, is scheduled to award $10 million the first two years, $15 million for the third and fourth years, and $25 million in years five through 10.

 

 

 

New Haven Independent: J. Press Building To Go

by Categorized: Commerce, Economic Development, Real Estate, Retail Date:

New Haven isn’t quite as bad off as Hartford when it comes to its history of tearing down historic buildings, especially the ones that are not landmarks, but rather contributors to the street life of the city.

The New Haven Independent reports that the J. Press building on York Street will be demolished because it’s structurally unsound.  The upscale clothing store will rebuild on the site — and another little piece of urban color will vanish.

 

Social Change At Wesleyan, For Real

by Categorized: Economic Development, Education Date:

Many students gravitate toward social change in the economy in a sincere but unfocused way, at Wesleyan University as much as anyplace. For one class at the Middletown college, economic activism was very real on Wednesday night as students ended the semester by handing out checks to four local groups.

“Money and Social Change,” the course taught by Haddam social enterprise consultant Joy Anderson, is not about the theory of how the economy does or does not make people’s lives better — it’s about how to actually use money to change the world in organized, measurable ways.

No better way to do that than to do it, so students in Anderson’s class set out to find four groups worthy of $2,500 each, money from the Learning By Giving Foundation of Doris Buffett, sister of the billionaire Warren. They targeted the goal of  “equal access,” then compiled a list of more than 250 community organizations, profiling 100 of them before voting.

“Alliances were formed,” said Wesleyan senior Alex Cantrell, at Wednesday’s event on the campus — offering at once an understatement and a three-word distillation of how the world works.
In the end, the class chose the winners based on publicly available information without conducting any interviews. Winners were Vista Vocational & Life Skills Center, an arts and education group for people with disabilities; CPEP, the Connecticut Pre-Engineering Program, which helps under-represented students learn about science, technology and math fields with hands-on projects; the Business/Industry Foundation of the Middlesex County Chamber of Commerce, which does a variety of grants and funding; and ITNCentralCT, a ride service for seniors and visually impaired people.

All of them thanked the class not so much for the money, though it matters, but for the recognition. When it comes to social change, which by definition requires an evolution in the way people think, “that, as much as anything, is what matters,” said Anderson, a Wesleyan graduate who also holds a Ph.D in American history, and whose Criterion Institute is prominent in the world of social investing and entrepreneurship.

It’s notable that at the hour-long event, and in a classroom afterward as each of the students presented a project supporting his or her “theory of change,” I didn’t hear a single word against the prevailing corporate market system. Clearly and increasingly, the U.S. economy is not working as well as it once did for most people and it’s not expanding access to education and jobs as well as it did in years past.

But “Money and Social Change,” which Anderson taught in 2012 and plans to repeat again next fall, is about managing and creating change in practical, doable ways, not about fighting the system.
Full disclosure, I’m an active Wesleyan alumnus and have moderated a discussion there about social enterprise with Anderson and others.

For the groups who came away with the checks — almost came away, as Anderson quipped, “The checks are not quite in the mail yet” — this was a chance to talk about their projects.

Vista is staging a performance of “Joseph and the Amazing Technicolor Dreamcoat,” with half the cast disabled, half not — part of the group’s goal to “bring the community to the individuals” in the programs, executive director Helen Bosch said.

CPEP’s CEO Bruce Dixon described the active summer and after-school program, which recently included Hartford Public High School students modifying and sending a wind turbine to a remote school in Nepal.  Dixon described the message he heard in the grant from the Wesleyan class: “You guys are on the right path, keep doing what you’re doing.”

Connecticut Innovations Launches New Brand

by Categorized: Economic Development, Government Date:

Connecticut Innovations, the state’s quasi-public technology investment agency, unveiled new logos and branding that emphasizes its broader reach, including a more dynamic website (www.ctinnovations.com) and services that reflect its 2012 merger with the Connecticut Development Authority.

CTI_Logo_Final

The web page opens with an image in the shape of a brain, with a network of multi-colored bands that could be imagined to represent the “entrepreneurial ecosystem” that CI is working to nurture, dubbed CTNEXT.

CTI_Ribbon_Brain

The consolidated CI has become more active in dealmaking under Claire Leonardi, with debt deals, grants, internships, networking and other services to augment its core function, equity deals in start-up and early stage companies. “The early-stage portfolio now contains 91 companies,” CI said in a release.

STR Takes Extraordinary Measure As Partial Meltdown Continues

by Categorized: Corporate finance, Economic Development, Energy Date:

The long, slow meltdown at STR Holdings Inc. intensified Wednesday as the solar materials maker announced it was firing four ranking executives including Barry A. Morris, the chief operating officer.

This isn’t a shakeup. No, in a federal filing, the Enfield-based company said it’s eliminating the four positions “in connection with ongoing cost-reduction measures.” Also leaving next month are the vice president for human resources, the chief technology officer and the vice president for finance.

Remaining executives, including CEO Robert S. Yorgensen, will pick up the slack, the filing said.

Robert Yorgensen in 2010, better times for STR Holdings. Michael McAndrews/The Hartford Courant

Robert Yorgensen in 2010, better times for STR Holdings.
Michael McAndrews/The Hartford Courant

While some people might take pleasure in seeing a company eliminate jobs at the top rather than just laying off rank-and-file workers, this is not a good development for anyone. Cutting four top jobs to save money is the sort of measure that happens at the most desperate firms, and STR has posted operating losses totaling $8.7 million in the first two quarters of 2013 on sharply lower sales.

STR, in fact, had the ignoble distinction of trading at a market value below the level of its cash on hand for a few weeks this summer, according to Forbes. That means the market is basically saying the firm is worth more dead than alive.  On Wednesday, shares closed at $2.26, down just 2 cents, perhaps partly due to its strong, debt-free balance sheet and the fact that Wall Street likes cost-cutting.

Morris made $440,000 in 2012, according to federal filings, including value realized from stock and stock options. The salaries of the other executives were not listed.

The near-demise of STR proves the shakiness of picking winners — by investors and by public agencies that hand out loans, grants and tax credits — even in industries that apparently can’t fail.  There is no record of any backing by the state Department of Economic and Community Development, but in 2010, STR received federal tax credits totaling $829,000 as the government attempted to build up the solar industry.

STR, which had revenues of $288 million in 2008, went public at $10 a share in November, 2009. A year later the shares hit a high of $27.68, as STR, which makes encapsulation materials for solar panels, seemed impervious to the collapse of solar panel prices caused by China’s entry into the industry.

In 2010, with 290 employees in Connecticut, STR decided to move its local plant from Somers to East Windsor, expanding its work force further. But it’s been mostly downhill from there. STR has closed the plant, relying on operations in Malaysia and Spain, and in January of this year, announced it had lost its biggest customer, First Solar.

I couldn’t find the number of employees the company now has in Connecticut — some of the decline was due to the sale of a business a couple of years ago — and a spokesman did not return calls seeking comment.

Sales in the first half of this year fell below $20 million, but as with any public company CEO, Yorgensen  put his best spin on his Aug. 7 earnings release. “Despite continued headwinds, we have begun production-scale shipments of our next-gen EVA-based encapsulants to three new customers in China,” he said in the release.