Economic Resource Council

Could a Nevada County Business Incubator Succeed?

Russ Steele

I was looking for an other document in my Library, when I can across a report purchased long ago and put on my library shelf: Business Incubation Works.  From the stiffness of the pages, it looks like I never even read the report after buying it. It was published in 1997, and may have been on the shelf for a while. 

From part of the Executive Summary:

Business incubators are helping build healthy, lasting businesses and they are doing it for low cost and with a good return on investment to supporters. A very high percentage of incubated companies remains in their communities, confirming the goal of business incubators to build the business base and potential for job creation in their regions. This study - the most comprehensive one on business incubation to date - was conducted under a grant from the Economic Development Administration by the University of Michigan, National Business Incubation Association, Ohio University, and Southern Technology Council. Using a combination of surveys, focus groups, stakeholder panels, and regional macroeconomic analysis, the study found that:

• Business incubation programs help companies create many new jobs. In 1996 incubators reported, on average, that their firms had created 468 direct and 702 total jobs.

• Business incubation programs create new jobs for a low subsidy cost and a substantial return on investment. The estimated public subsidy cost per job created was $1,109.

• Incubator companies experience very healthy growth. For example the average annual growth in sales per firm was $239,535.

• Business incubation programs produce graduate firms with high survival rates - a reported 87 percent of all graduates are still in business.

• Most firms that graduate from business incubators remain in their local communities - an average of 84 percent.

• Most incubator firms provide employee benefits.

• Incubation programs contribute to their client companies' success and expand community entrepreneurial resources.

• Business incubation programs improve local community image.

• EDA-funded incubators perform better than or equal to non-EDA funded counterparts.

Macroeconomic research revealed wider impacts - in terms of wages, direct and indirect jobs, and local tax revenues - that incubator clients and graduates can have on their communities. Although the number of companies used in this part of the analysis was relatively small, the data revealed that incubator firms studied returned considerably more dollars to a community than it costs to subsidize the business incubator program.  [The rest of the summary deals with the conduct of the study]

Several cautions. This study was done in the go-go 90s and covered larger communities than we have in Western Nevada County. It would be good to read and study the whole report to see what lessons we can apply our local community.   

Gil Mathew Joins ERC

Gil Mathew has joined the ERC as President and CEO. Gil was the founder and President of Benchmark Thermal, a Grass Valley export manufacturer, designing and manufacturing industrial heating elements and applications for a variety of industries from aircraft galleys to semiconductor tools. Benchmark grew from 2 employees to 60 employees over its 23 years under Gil’s direction. He sold the business with the caveat that it must remain in Grass Valley for a minimum of 7 years.

 

Open Thread to discuss the Siefel Economic Strategy Report

Russ Steele

I have opened a thread for people to comment on the Siefel Report: Western Nevada County Economic Development Strategy which can be down loaded here.

Career Technical Education: Creating Options for High School Success

Chuck Neeley

A recent article appeared from Bonnie Graybill from the State of California that I thought was of interest:

Citing an estimated 30 percent high school dropout rate in the state, the commission said it found 'encouraging evidence' that what is now called 'career technical education,' or CTE, properly focused, 'can deliver an alternative approach to learning that can keep students engaged, help improve grade-point averages and prepare students for both the work world and higher education.'  The commission recommends that CTE programs already proven to work be replicated around the state 'to build a long-term, evidence-based strategy that fully integrates academically rigorous career technical education into the general education programs.'  It wants partnerships between those running CTE programs and potential employers, and says serious attention should be paid to expanding the shrinking number of teachers with both the technical expertise in their fields and academic credentialing." 

Sacramento Bee (November 19, 2007) A3.

http://www.lhc.ca.gov/lhcdir/189/Report189.pdf
 

Recruiting Trends 2007-2008

Chuck Neeley

Michigan State University, in conjunction with MonsterTRAK and Monster Intelligence recently published the above publication.  The Executive Summary pinpoints what is happening on college campuses right now with regards to recruiting.  Graduates with a Bachelor's Degree in IT, and MBAs will continue to be in high demand.  Larger employers are getting aggressive in scooping up college grads to fill their huge pool of Baby Boomers that are about to exit the workforce.  While college graduates will bring energy, enthusiasm, and drive, their spirit of company loyalty will be lacking.  For more details, here is the link:

http://media.monster.com/monstertrak/gfx_email/gfx_msu/rt7-8finald.pdf

Business Location Decisions and Employment Dynamics in California

Chuck Neeley

Ran across a very interesting publication by the Public Policy Institute of California that is very interesting.  Talks about business migrations across State lines, and more.  It can be found at the following Web site:

http://www.ppic.org/main/publication.asp?i=710

California Facts: Nevada County

Chuck Neeley

It is truly amazing what you can find on the Internet nowadays.  We are in the process of updating the ERC Web site, and I am spending quite a bit of time surfin' the net in order to provide links to information that might be helpful to our viewers.  I ran across an official State of California link that provides a nice snapshot of demographic information for every County in the State.  Here is the link for Nevada County:

http://www.labor.ca.gov/cedp/pdf/Nevada.pdf

The Veterans Corporation - New Program

Chuck Neeley

The Veterans Corporation, a Federally-chartered non-profit supporting veteran business owners, has announced a new program to seed veteran entrepreneur support efforts across the US.  The new Veteran Entrepreneurship Grant program will provide grants of up to $50,000 for organizations who have designed innovative initiatives that help veterans start new businesses or that help entrepreneurs who need to prepare their firms and employees for potential military deployments.  The grants are for service organizations, not for individuals.  Learn more about the Veterans Corporation program and download application materials at:
http://www.veteranscorp.org/developmentgrants/

NC Tour: Nevada County Airport

Russ Steele

Nevada County Airport is home to the California Division of Forestry, Grass Valley Air Attack Base. This center of wild land fire fighting from the air is the permanent location for two Grumman S-2 Air Tankers that drop fire retardant, and an air attack lead plane that coordinates the efforts of the tankers. Aircraft from Nevada County Airport are on standby, ready at a moment's notice, to respond to fires throughout the foothills and mountains. When larger fires occur nearer to the airport, many other fire fighting aircraft use the airport as a base for fuel and supplies.

Search & Rescue and Medi-Vac aircraft also use the airport year round for public safety missions.
The California Highway Patrol, the Nevada County Sheriff's Department, and the FBI are only a few of the State and Federal agencies that use airport facilities.

The Nevada County Airfest is one of the major events and the Airport. Celebrating the past and future history of aviation in Nevada County.

Tenants on the Airport include

Sierra Mountain Aviation who does aircraft maintenance, including the Robinson Timber's Helicopters.

Alpine Aviation is a California-based flight service company founded in 1990. They offer flight charter, aircraft management, pilot flight training, and aircraft maintenance. Alpine operates a modern fleet of single and multi-engine prop and turboprop aircraft for travel to any destination in the contiguous United States. Serving the business and recreation traveler, Alpine Aviation offers scheduling conveniences and comfort advantages beyond standard commercial or private aviation alternatives.

A very interesting pictorial history of the Nevada County Airpost by Tim O'Brien can be found here.

Tour Photos:

Click to enlarge. Gregg Marshal our airport host.

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Click to enlarge. Gathering on the airport ramp.

 

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Click to enlarge. Ken Hughes, Unit Commander  explaining the CalFire mission

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Click for a larger image. Two  aircraft service  companies rent County hanger.

NC Tour: Benchmark Thermal Loma Rica Business Park

Russ Steele

Benchmark Thermal is a full line manufacturer of industrial heating elements.  Serving a wide variety of industries from food processing, semiconductors, petrochemical, to medical devices, since 1984. Benchmark offers innovative solutions for complex and technical applications.

Benchmark Thermal has a complete heater manufacturing facility, including a machine shop for the fabrication of flexible, tubular and cartridge elements. The engineering department is fully equipped to meet any heater design requirement. They provide product support with thorough testing and evaluation, and are committed to the ongoing research and development of new and improved products for evolving applications. Benchmark supplies a full range of heating elements essential to industry, from small flexible circuits to large circulation vessels with control panels.

Tour Photos:

Click to enlarge, Bus arriving at Benchmark Thermal

Click to enlarge. Sample of Benchmark Heaters

Click to enlarge, Another example of a pipe heater

Click to enlarge. Diane, "a Stringer," is winding heater wired to be sandwiched between two rubber sheets.

NC Tour: Maier Manufacturing Whispering Pines Business Park

Russ Steele

Maier Manufacturing is a Leader in quality plastic power sports accessories. They are the largest manufacturer of custom and O.E.M. type motorcycle and ATV plastics in the United States. They have been a leader in producing top quality plastic accessories for the Power sports Industry since 1972, and their products are used by thousands of riders around the world. They take great pride in building products by riders for riders.

Tour Photos, click to enlarge

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NC Tour: 2Wire in Nevada City Tech Center

Russ Steele

2Wire provides global telecom carriers with broadband services platforms that enable an integrated triple play of networked data, voice, and media services. 2Wire's award-winning products and services include residential gateways, broadband multimedia set-top boxes, remote management systems, and call center customer support. 2Wire's customers include global DSL market leaders AT&T, Telmex, BellSouth, BT, Embarq, SingTel, and others. For the past three consecutive years, 2Wire has been included in the Inc. 500 ranking of the fastest-growing private companies in the United States. With its headquarters in San Jose, California, 2Wire has additional offices in Texas and Arizona, as well as in Latin America, Europe, and Asia.

Tour Photos:

Click to enlarge, Main building

Click to enlarge

Testing lab

NC Tour: The Nevada City Tech Center-2

Russ Steele

Nevada City Tech Center is centrally located in Nevada City and thanks to it's classic architecture and unique amenity package, is fast becoming the premier business park in the County!.  NCTC offers up to 210,000 square feet of office and R & D space in a spectacular natural setting.

The first of 10 buildings is now complete and construction has started on the Liberty Hill Executive Condominiums which will offer the opportunity for small businesses to purchase as little as 1,000 square feet of this exciting business community. 

Tour Photos:

Click to enlarge, Picnic area

Click to enlarge Liberty Hill Concept

NC Tour: Ensemble Designs on Gold Flat Road, Nevada City

Russ Steele

Ensemble Design was started in 1989 by a former television station engineer who loved designing and building video equipment, and he decided to start a new company. He relished the idea of taking an existing group of equipment and adding a few special pieces in order to create an even more elegant ensemble. So, he designed and built his first product and the company was born.

As the company has grown, more former TV station engineers have joined Ensemble Designs and this wealth of practical experience fuels the company's innovation. Everyone at the company is focused on providing the very equipment you need to complete your ensemble of video and audio gear. We offer those special pieces that tie everything together so that when combined, the whole ensemble is exactly what you need. Products include frame syncs, audio embedders, video converters, and HD up/down converters.

Tour Photos:

Click to enlarge, Main building.

Click to enlarge David Wood explaining how company  operates

NC Tour: Trivia Questions

TOUR OF NEVADA COUNTY
TOUR BUS TRIVIA

The Nevada County Airport was built in 1932 by ___________, owner of the Idaho Maryland Mine, to fly gold to Mills Field, which today is  ____________________. The gold shipments were frequently robbed during ground transportation.

In 1956, who gifted the Airport land to Nevada County?

2Wire, who employs approximately 35 people in Nevada City, is actually headquartered in ______________? It is the __________________hub of the company.

What is the name of the ONLY single story building planned for the Nevada City Tech Center?

What is Ensemble Design’s largest government installation?

In what part of the world is Ensemble Designs’ equipment manufactured?

What is the name of the lunchroom at Ensemble Designs?

Ensemble has job openings in two departments at this time. Name one.

Why is the company named “Ensemble”?

Name a type of heater that Benchmark Thermal manufactures.

What major market does Benchmark Thermal supply heaters to?

What year was Maier Manufacturing founded?

In today’s market, Maier Manufacturing’s sales are higher in motorcycles or ATV’s?

How many students attend Nevada County Public and Charter Schools?

Our schools employ over __________teachers and ________classified staff members.

Who sponsored today’s Tour of Nevada County?

Tour of Nevada County Update

Russ Steele

At the first annual Tour of Nevada County I followed the tour with a digital camera and laptop, posting some of the highlights on this blog. We are going to follow along again this year and take more photos and posting them during the day. This year I am fortunate to have WiFi access at the Fair Grounds, and I will not have crawl under the counter looking for an ethernet connection like last year. I have also made arrangements to send pictures from the Airport Reception Office. Other times, I will use the some of the free WiFi access in Grass Valley and Nevada City to send the pictures.

Tour bus riders will be challenged with trivia contest by the Tour guides on their buses. I will post these trivia questions here after the tour starts. I do not want to give anyone an early advantage. Log in later today and see how well you know Nevada County and watch the tour progress.  Answers to the trivia questions will be provided once the tour is over.

Tour destinations include:
2Wire
Nevada City Tech Center
Nevada County Airport and CDF
Benchmark Thermal
Maier Manufacturing
Ensemble Design

Labor Day Economic Forecast

Chuck Neeley

The California State Employment Development Department recently produced an economic forecast that is of interest.  The real estate market is having a deleterious impact on jobs in that sector, but otherwise the economy appears to be doing okay.  The report can be viewed at the following link:

http://www.calmis.ca.gov/SpecialReports/Labor-Day-Briefing.pdf

September 2007 - California Wine Month

Chuck Neeley

Governor Schwarzenegger has renewed the designation of September as California Wine Month.  See his proclamation at the following site:

http://gov.ca.gov/index.php?/proclamation/5766/

Wine is becoming a very significant commodity in California, and is a growing commodity in Nevada County. 

Following are a few statistics about the significance of wine to California:

• California is the fourth largest producer of wine in the world

• California produces 90 percent of all of the wine in the nation

• Wine-type grapes are grown in 46 out of the 58 counties in the State, and cover more than 500K acres

• After Disneyland wineries and vineyards are the 2nd most popular destinations for tourists in the State

For more info on Nevada County, go to the following site:

http://www.northernsierrawinecountry.com

California Business Portal

Chuck Neeley

The State of California has a Web site that is dedicated to businesses.  It is known as the California Business Portal.  It has a lot of good references for businesses just starting out, as well as existing businesses wanting to grow and expand.  It's a resource that I recommend you review.  The Web site is located at:

http://www.calbusiness.ca.gov/default.asp

Business Census

Chuck Neeley

The Census Bureau has launched a new Web site to help businesses understand the economic census and how it benefits them.  The site includes economic snapshots of selected industries and business facts and ratios about every industry.  The economic census is conducted every five years, and more than four million businesses will get forms later this year for the 2007 Economic Census.  Check it out a the following Web site:

http://business.census.gov

California Investment Guide

Chuck Neeley

If you are an existing California business, or are considering moving your business to California, you may want to review the following publication that is published by California Business Investment Services:

http://www.labor.ca.gov/calbis/cbbusincentives.pdf

Population Projections for California and Counties 2000-2050

Chuck Neeley

The California Department of Finance, Demographic Research Unit, has just released new
projections of population by county by age, race/ethnicity, and gender.  The time period is 2000 - 2050.

The reports are available on their Web site at: http://www.dof.ca.gov/HTML/DEMOGRAP/ReportsPapers/ReportsPapers.asp

Demographics are Destiny

Chuck Neeley

I believe that we have a degree of control over the destiny of Nevada County, if we will take the steps to plan for the future.  One of the many newsletters that I receive is from State Senator Dave Cox.  In his most recent edition was an article that speaks to destiny as it relates to demographics.  It is a good read, and so I include it below in full for your reading pleasure.

Demographics Are Destiny?

Some of our readers may have seen headlines recently about population projections that forecast California to have nearly 60 million people by 2050, and that Latinos will be over 50 percent of the population somewhere around 2040. The current population of California is about 37 million.

There is no question that the Latino population in our state is growing, and the population of non-Hispanic Whites is declining. Let’s look deeper into these population projections and try to determine what they mean.

The projections recently featured in newspapers came from the State Department of Finance (DOF), which does research on population trends in the state. California is becoming increasingly diverse. The White population fell below the 50 percent mark just before the 2000 census was taken. At that time, it became reality that no racial group had a majority in California. Thirty years earlier, Caucasians were 80 percent of the state’s population.

It is also true that the state’s population growth no longer comes from migration from other states. That number is now negative, meaning more Californians are leaving to other states than are coming in from the rest of the U.S. Our growth now comes from in-state births and immigration from other countries, both legal and illegal. It is also a fact that our population is becoming older. The first Baby Boomers will reach retirement age in 2011, and the percentage of senior citizens will continue to increase after that. Between 2000 and 2020, the 65 and over age group is projected to increase by 71 percent.

On the other hand, the number of children in California is not expected to grow nearly as much. People born during the “baby bust,” which followed the baby boom, are having fewer children. In addition, second-generation Latino families have lower birth rates than their first-generation parents. The growth rate of working aged people aged 25-64 is expected to grow at a rate slightly higher than the overall population.

Geographically, it is a fact that population growth is faster in inland California than it is on the coast. The DOF projections show Riverside County growing by 3 million people over the next 50 years, and Placer County increasing by 500,000 – a 200 percent increase. Sierra County is the only county that the DOF projects will lose population over the next 50 years.

We must remember that these projections are just that: projections. Many things could happen in the next 50 years. The phenomenon that has upended previous projections has been economic recession, such as the one in the early 1990’s that cut California’s projected growth rate over that decade by nearly one million people.

What does all of this mean? It means that health care spending will continue to increase, and the demand for senior citizens services will go up. Since the aging of the population is a national trend, the pressure on Social Security and Medicare will be intense State school enrollment will slow, but many inland areas will continue to see challenges with more students from homes where English is not the primary language. Growth in the inland areas presents the challenge to increase our housing and transportation infrastructure while preserving agricultural land. And most importantly, we must preserve an economic climate that provides jobs to all of our citizens that will finance our aging, educational, and infrastructure challenges.

To look at the Department of Finance population projections, go to:
http://www.dof.ca.gov/HTML/DEMOGRAP/ReportsPapers/Projections/P1/P1.asp

Federal Technology Funding Guide

Chuck Neeley

The Larta Institute has made available to the general public a guide which is quite useful for those business involved in innovation and R&D.  Check it out at the following Web site:

http://www.larta.org/Veda/FTFG/Final%20FTFG.pdf

Small Business Opportunities in Gov't Contracting

Chuck Neeley

If you run a small business and have wanted to know more about how to land Federal government contracts, then you may want to consider attending the upcoming conference put on by The Federal Technology Center in Sacramento.  Dates for the two-day conference are October 23-24, 2007.  They are currently accepting registrations.  For more details go to:   www.TheFTC.org/govlinkconference

 

Strategic Questions - ERC

Chuck Neeley

This morning was the ERC's annual Investor/Partner Breakfast.  A portion of the meeting was dedicated to a roundtable discussion on a list of questions that I had posed.  I was heartened by the response, as the feedback was excellent.  Now I would like to open up the same list of questions to the general public.  I would appreciate your thoughts.  Here are the questions:
1)  On what types of business/industry should the ERC focus?
2)  What are the best ways to attract new business to Nevada County?
3)  How can we increase Investor/Partner membership in the ERC?
4)  On what issues should the ERC take a stand?
5)  In percentage terms, how should the ERC focus its time?  (Creation, retention, expansion, and attraction of business)
6)  What are the key issues that the ERC should address in the coming year?
7)  What role should the ERC have in economic visioning for the County?
8)  Do you find the ERC Web site useful?  How about the ERC Blog?
9)  How should we approach sales tax leakage to adjoining Counties?
10)  What suggestions do you have for improving communications from the ERC?
11)  What would you characterize as the difference between the below listed organizations?  (ERC, Chambers of Commerce, Nevada County Business Association)

Economic Report of the President

Chuck Neeley

The Economic Report of the President was released this month.  It is a lengthy document, and is broken out into the following chapters:
Chapter 1.    The Year in Review and the Years Ahead
Chapter 2.    Productivity Growth
Chapter 3.    Pro-Growth Tax Policy
Chapter 4.    The Fiscal Challenges Facing Medicine
Chapter 5.    Catastrophe Risk Insurance
Chapter 6.    The Transportation Sector: Energy and Infrastructure Use
Chapter 7.    Currency Markets and Exchange Rates
Chapter 8.    International Trade and Investment
Chapter 9.    Immigration
The Executive Summary is a quick read, and I recommend it to you.  The report in its entirety can be found at the following link:
http://www.whitehouse.gov/cea/2007_erp.pdf

Open Seats on Board of Directors

Chuck Neeley

The ERC is looking to fill two open seats on its Board of Directors.  Candidates must have a keen interest in the future of the community, particularly as it relates to economic development.  The initial term will be for two years.  If you would like to be considered for one of the positions, please contact either Jeff Johnson, Chairman, at 273-9262, or Chuck Neeley, President/CEO, at 274-8455, no later than January 15, 2007.  Candidates will be required to submit a short narrative on their qualifications.

Videobroadcasting Survey

Chuck Neeley

For readers from the Videobroadcast community, I would be interested to know your response to the following questions:
1)  What California companies (suppliers and customers) that are outside Nevada County do you have the strongest links with?  Do you have the ability to influence any of these firms to move to Nevada County?
2)  What market niches in videobroadcasting should we pursue?
3)  Are there related niches that we should pursue?
4)  What periodicals (magazines, journals, newsletters, etc.) are the principal ones in your industry?  Do we get enough press in these periodicals?  If not, how can we do better?
5)  What professional associations are the principal ones in your industry?  Is Nevada County appropriately recognized in these associations?  If not, how can we do better?
6)  Do you have a good awareness of the activities of the ERC?  What should the focus of the ERC be during the next year?  Are you an Investor/Partner in the ERC?  If not, how does the ERC need to change to meet your expectations?

Your responses would be sincerely appreciated.  Thank you!

Charitable Contributions - ERC Foundation

Chuck Neeley

As we rapidly approach the end of 2006, some of you may be contemplating making end-of-year donations to charities.  You probably have a few special charities that you have a passion for, but perhaps you hadn’t stopped to consider the ERC Foundation in your calculus as a possible destination for some of your gift giving.  The ERC Foundation was established a couple of years ago to enhance the ability of the ERC to provide education and training to local businesses and economic data to the general public.

We would like to expand the influence of the ERC Foundation on meeting the needs of this community.  The importance of the ERC Foundation increased in 2006 through sponsorship of events like the Tour of Nevada County and the Community Appreciation Breakfasts.

Please consider a gift to the ERC Foundation.  Contact our office at 274-8455, or send a check to us made out to the ERC Foundation to the following address:
    ERC Foundation
    P.O. Box 515
    Grass Valley, CA  95945

Thank you!

Sierra Nevada Wealth Index

Chuck Neeley

The Sierra Business Council (SBC) periodically publishes a Sierra Nevada Wealth Index.  You may want to take a quick read, at least through the Summary which can be found at: http://www.fwpages.com/home/index.php?site_config_id=36&page_selection=2260&s_page=
The wealth index, according to the SBC, is comprised of natural, social, and financial components.  They reported, in essence, that while we are generally prosperous, there is still room for improvement in several areas.  It is an interesting read.

Introduction

Welcome to the new & improved ERC Blog.  I welcome your comments and suggestions in this new media.