Category Archives: Economic Development

Cities Must ‘Get Their Act Together,’ Malloy Says

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

Gov. Dannel P. Malloy, standing in front of a bank of Rentschler Field upper-level windows overlooking Hartford and East Hartford, recounted his achievements to a roomful of local and regional economic development officials Wednesday — but added a blunt twist.

Malloy at Rentschler Field Wednesday Dan Haar/the Hartford Courant April 23, 2014

Malloy at Rentschler Field Wednesday
Dan Haar/the Hartford Courant April 23, 2014

When someone asked the governor about struggling cities, he didn’t just cite all the money his administration has spent, and will spend.

“Cities have to get their act together,” said Malloy, who’s seeking re-election this year. “I did this for 14 years.”

Malloy had a somewhat easier time of it as Stamford’s mayor, since that city, alone among the Big 5 of Bridgeport, Stamford, Hartford, New Haven and Waterbury, has a vast, stable base of rich and upper-middle-class neighborhoods, not to mention Wall Street firms.

But as governor, even his critics must admit he’s had some success bringing a bit of efficiency to entrenched agencies.

“We have more than 1,000 fewer people working in state government than the day I came in,” Malloy told the gathering, organized by the state Department of Economic and Community Development. “But some of this has to be done at the local level.”

Was he suggesting staff cuts at cities and towns? No, at least not right away. Rather, he’s calling on them to find ways to be more efficient through technology and management — and therefore less dependent on the state and able to operate with fewer people.

Hartford Mayor Pedro Segarra proposed a budget this week with deep cuts and perhaps layoffs. Without referring to that, Malloy said, “I can look you in the eye and say I am not responsible for a single layoff at a municipality,” as state aid to cities and towns has remained stable.

 

Bagging Earth Day With The Hartford Marathon

by Categorized: Commerce, Economic Development Date:

Among the gazillion Earth Day releases that crossed my inbox Tuesday, an offer from the Hartford Marathon Foundation stood out for its advance planning and sentiment.

HMF bagLast October, the marathon folks didn’t throw out all those plastic banners that lined the start and finish in and around Bushnell Park and the state Capitol — the end of the line for ING’s lead sponsorship.  On Tuesday, they rolled out a line of bags and wallets made of those very banners in blue, orange, black, white and other colors.

They know runners like to own race-related stuff — though in this case, it isn’t free with a registration. It’s sold at www.shophartfordmarathon.com,  prices ranging from $15 for an 8-inch “zippered caddy” to $38 for a 14-inch “messenger bag.”

No word on whether the bags were sewn by local runners.

State Offers $6.5M To Corporate Relocation Firm To Stay — And Grow

by Categorized: Economic Development, Real Estate Date:

No one knows how to move out of state like the folks at Cartus Corp., a Danbury company that offers relocation services such as home-buying and rentals to corporations.

So the state stepped in with a $6.5 million forgivable loan at 2 percent interest after Cartus, a longtime Connecticut presence, thought hard about moving to Texas or New York.  Cartus will keep the whole $6.5 million if it maintains its current local staff of 1,275 and adds at least 200 more people in the next five years.

Cartus will also invest $15.4 million in a facilities upgrade, as part of its state-aided expansion. And if the company keeps its staff intact for five years and doesn’t add more people, it will be allowed to keep $1.95 million of the loan principal.

All in all it’s a good deal for Gov. Dannel P. Malloy and the state taxpayers, a cost of about $32,000 per new job if Cartus adds 200, or $4,400 for each job added or retained if we count 1,475 present and future jobs.

The deal is not part of Malloy’s “First Five” program, also called “Next Five,” because the total invested by Cartus is less than the threshold for that program. But each deal is custom-designed anyway.

And for each deal, we ask, would the company have really left? That’s the question we can never answer. Cartus and its parent company, Realogy Holdings Corp., were part of the old Cendant Corp., which broke up a few years ago. Realogy, traded on the New York Stock Exchange, also owns Better Homes and Gardens Real Estate, CENTURY 21, Coldwell Banker, ERA, Sotheby’s International and other real estate businesses.

“Cartus has been proud to call Connecticut home for nearly 60 years, and we are committed to growing our operations here,” said Kevin Kelleher, the Cartus CEO “This new investment will position the company for future success.”

Now that Cartus is staying, we’ll have a home run if Malloy and his economic development commissioner, Catherine Smith, can get Cartus to move more people into Connecticut than out.

 

 

 

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.