Omaha Chamber launches fund drive to spur economic development

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Posted: Thursday, February 14, 2013 12:00 am

When a Tennessee-based company that makes nutritional and health products decided to expand a few years ago, its executives naturally looked in their home state.

But the powers in the Volunteer State didn't respond as enthusiastically as Vireo Resources President Mark Faulkner had hoped — and a Husker offense, meanwhile, was eager and ready to swoop in.

Faulkner was so pleased with the Nebraska reception, he opened a Vireo site in Plattsmouth in 2009 and, three years later, built a bigger, $1 million facility next door.

He credits, in part, “hand-holding” by the Greater Omaha Economic Development Partnership for what today has become a $2million investment in the Omaha area.

Now the partnership — a four-county economic development arm led by the Greater Omaha Chamber of Commerce — is kicking off a fundraising campaign to add success stories to a list of company investments like those of Vireo and mega firms such as Yahoo, CLAAS of America, PayPal and Fidelity Investments.

“In every facet of the business formation, they walked us through,” said Faulkner, whose headquarters remains in Tennessee. “I needed that because down here, the idea of coordinating, being present at all the different things necessary to get a business planted in a new town would have been quite difficult to achieve on my own.”

Dubbed “Prosper Omaha,” the partnership's new campaign hopes to raise $23 million from private and corporate donors to fund operations from 2014 through 2018. The City of Omaha also provides $125,000 a year.

Prosper Omaha goals:

  • $3 billion in capital investment for new or existing projects
  • 12,000 new and retained jobs at or above median wage
  • 100 startup companies assisted
  • 1,000 local businesses assisted
  • 300 projects landed, half of them new to the region
  • Worldwide brand and image recognition strengthened
  • Regional employment with emphasis on east Omaha increased
  • Five new regional industrial parks
  • Community development corporation created for redevelopment of condemned and tax-forfeited properties
  • Lower taxes, fewer regulations, improvement in competitive rankings
  • Pro-business candidates recruited and groomed for state and local office
  • High school and postsecondary education attainment increased
  • Skilled employees for targeted industries increased

The bulk, $12.5 million, is to be used to recruit new businesses, expand existing ones and develop startups.

An additional $6 million is earmarked to build a more recognizable and “exciting” image or brand for the Omaha metropolitan area.

The remainder is to help improve the business climate through, for example, public policy changes. And to sustain growth by beefing up the talent pool.

“We're appropriately worried about the brain drain,” said chamber Chairman Terry Kroeger, publisher of The World-Herald and CEO of BH Media Group. “We've got some very sharp students we'd like to keep here.”

In return for campaign dollars, investors want results. Rod Moseman, who heads the 19-person partnership team, points to past efforts.

Since 2004, he said, the team landed 391 projects that brought about $4 billion in capital investment and created or retained 22,235 jobs in Douglas, Sarpy, Washington and Cass Counties.

Among anticipated results of the Prosper Omaha campaign: 12,000 new and retained jobs at or above median wage; 300 “landed” projects, half of which bring new business to the region; identification and assistance to 100 startup companies; and preparation of five new regional industrial parks.

Many details of the Prosper Omaha five-year operational plan are still being refined, said Wendy Boyer, a senior vice president at the chamber. She said the intent is not for the chamber to be the executor of all programs needed to reach goals. For example, in developing the workforce and talent piece, the chamber will bring community groups, educators and service providers to the table to ensure that all are on the same path.

The chamber also works closely with agencies such as the State Department of Economic Development.

“This enables us to be a catalyst to design a common vision,” Boyer said.

Campaign chairman Gary Rodkin, who is chief executive of ConAgra Foods, sees as critical a consultant's recommendation to build a more distinct message that captures Omaha's vibe. “What is our elevator speech?” he said.

He said today's economy provides no huge tail wind. “That means we have to be that much sharper in attracting folks to come here.”

Chamber officials will work the next several months on developing the identity-boosting strategy. They'll also be narrowing target industries and further defining how to improve the business climate.

The chamber's economic development arm, which formally became the Greater Omaha Economic Development Partnership in 2004, dates back two decades. Omaha had just lost a hard-fought battle for the BMW plant in 1992. While disappointed, the runner-up finish told business leaders they could compete on a worldwide stage, said David Brown, the chamber's chief executive.

A Target Omaha fundraising effort was launched and a team of professionals formed to sweep a potential business off its feet. That team is expected to grow from its current 19 to 24 members, including consultants.

Moseman cites as an early success the lure of the Caterpillar CLAAS of America combine plant to La Vista in 1998.

In a courtship that went on for about two years, Moseman recalled sending people armed with fluorescent orange signs onto farmland because he wanted visiting site selection consultants to gauge the future plant's visibility from the Interstate. Chamber officials at the time didn't know the company's identity, and had to sleuth to find clues so they could tailor their message.

Success stories:

Largest capital investment: Novozymes, Fidelity INvestments, roughly $200 million apiece

Most jobs: PayPal, yielded 3,000-plus

Longest Courtship: CLAAS of America, about two years

A sampling of other firms recruited or expanded with help of chamber fundraising:

3M; ACI Worldwide; Aldi; Blue Cross Blue Shield of Nebraska; Brazilian Consortium of Stones; Cabela's; CSG Systems International; DoD Forensics Lab; EM Gear; Evonik Industries; Farm Credit Services; FirstComp; Gallup; Gavilon; Hyatt Place Hotel; Interpublic Group; Intersystems; LinkedIn; L'Oreal; Midtown Crossing; NatureWorks; Oriental Trading Co.; PenFed; Proxibid; SAC Federal Credit Union; Sergeant's Pet Care; TD Ameritrade; United States Cold Storage; Web Equity Solutions; Wes and Willy

Source: Greater Omaha Chamber of Commerce

“It's about setting yourself apart,” said Moseman.

Ten years later, the community landed two projects of Internet giant Yahoo, in part by rewriting a state incentives law and building a custom website that touted the attributes of the Omaha area.

The password-secured site, set up to resemble Yahoo's home page, was the creative response by the partnership and the Nebraska Department of Economic Development to a request for proposals. The search box on the interactive site contained the words: Search (no more).

Moseman called it a “home run” that helped yield a La Vista data center and a west Omaha customer care center.

The partnership team also advises companies on available incentives from state and local governments.

In the case of Vireo, Faulkner said the company has received $75,000 in business incentives as well as about $28,000 in state job-training assistance to prepare nutraceutical production technicians. He also received land valued at about $50,000 from the City of Plattsmouth.

Three years after opening in a multitenant building in Plattsmouth, Vireo grew fivefold by expanding into its own new $1 million building. Faulkner said that with construction, equipment and payroll, his company has invested more than $2 million.

A workforce of a few in 2009 has grown to about 15, with plans to hire a few more workers.

Of the 50 different products manufactured there, the two main products are AminoActiv, an anti-inflammatory cream or capsule, and Con-Cret, a muscle-building supplement. Both are developed in conjunction with the University of Nebraska Medical Center, another reason that Faulkner was drawn to the Omaha area.

It was a UNMC contact that put Faulkner in touch originally with state economic development officials, which led him to the chamber's “one-stop shop” for business needs.

Nebraska has continued to foster Vireo's growth. Faulkner was part of Gov. Dave Heineman's trade mission to China last summer and, while there, signed an agreement to distribute AminoActiv in China.

Of local officials, he said: “They really streamlined the process and made it quite simple for me.”

More industrial parks:

To compete for new and big business, a community must have more shovel-ready industrial sites, says David Brown, CEO of the Greater Omaha Chamber of Commerce. So the chamber's economic development arm aims to prepare five new industrial parks across the metro area.

That would be done with $40 million to be secured by public and private sources, according to the chamber's Prosper Omaha plan. That amount is in addition to the $23 million Prosper Omaha fundraising goal to pay for business recruitment-related efforts over the next five years.

The plan calls also for a separate $10 million to be secured for a community development corporation that would land-bank and redevelop condemned properties.

Chamber officials declined to identify specific sites.

But chamber and city officials currently are eyeing north Omaha property they call the future Ames-Locust Industrial Park near 16th and Locust Streets. And last year, the chamber led environmental testing efforts at 20 acres around the former Salvation Army Industries properties near 27th and Martha Streets and at another 20 acres to the south around a defunct grain elevator.

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