The 2008 Annual Report of the Iowa City Area Development Group
The Iowa City Area Development Group serves the business development needs of primary sector companies in our service territory.
We keep growing. Whenever anyone asks how things are in the Iowa City area, that’s how I respond. We are growing and we are on track to keep growing. Reflecting on the work of the Iowa City Area Development Group this past year and the success of our area companies, one theme continues to emerge: growth through innovation. Our business, community, and university leaders share a forward-thinking approach to keep the Iowa City area competitive nationally and internationally. There continues to be an ongoing commitment to research and development within many of our primary sector companies as well as with our university partners. Since the start of the Iowa City Area Development group almost 25 years ago, innovation, drive and entrepreneurial spirit have become cornerstones for this community. The big dreams and “blue sky” ideas of the past have transformed our current economic landscape into a diverse composition of companies in advanced manufacturing, biotechnology, medical technology, wind energy, and educational services. This diversity, coupled with the steadfast resiliency of our friends and neighbors, have helped this area endure not only a challenging economy and business climate, but one of the worst natural disasters in the history of our state and the nation. Even during these challenging times, the Iowa City Area Development Group stayed on task and true to its mission, focusing on the goals set forth in our Creating Advantage | Investing for Results campaign. I am happy to report that ICAD Group duplicated its success from last year in new capital investment and number of successful projects. Three new companies opened in the area, six companies expanded operations, and one company continues to employ 200 area workers thanks to the efforts of ICAD Group. Through this work, over $71 million dollars in new capital now flows through our local economy. Innovative research also played a key role this past year, helping to guide programming and project strategy for workforce and economic development initiatives. The Technology Corridor Skills 2010 report, a collaborative study published in early 2008 from the Iowa City Area Development Group, Priority One of Cedar Rapids and Kirkwood Community College, identified specific recommendations regarding the future of workforce needs for the entire Corridor. Additionally, the Skills Advantage Research Project, also released in FY2008, indicated that area employers require a future workforce with additional training and certification in soft and foundational skills. Where do we grow from here? Innovation often takes us to unexpected places and we are excited to see what extraordinary opportunities await the Iowa City Area Development Group in the coming year. Thank you for your continued commitment and contributions to growth through innovation.
Jeff Disterhoft, 2008 Chair Iowa City Area Development Group Board of Directors
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Workforce
Creating through
Skills Advantage Report and Consortium: Skills Advantage Research Project — A First in the Nation Report was released in January 2008. This unprecedented report was commissioned to provide statistically significant data on the foundational skills and capability of our regional workforce.
The report was a collaborative effort between economic development groups within and bordering the Technology Corridor, including the Iowa City Area Development Group, Priority One, Kirkwood Community College, Benton Development Group, Iowa County, Jones County Economic Development Commission, Cedar County Economic Development Commission, and Washington County Economic Development.
The Skills Advantage program assesses the skills of job candidates or current staff and certifies them in the core areas of Applied Mathematics, Reading for Information, and Locating Information. Based on performance, candidates are certified in one of three levels: Gold, Silver and Bronze. Presently, our region is at the Gold Level in Applied Mathematics and Reading for Information, and at Silver in Locating Information. More than 1,200 individuals have used Skills Advantage testing and more than 1,000 certificates have been awarded. 32% of employees in our region have the combined foundational skills to achieve a Gold Level certificate compared to 14% nationally.
The Skills Advantage Consortium was formed to encourage participation among area employers in the program. Members are able to share ideas and information regarding the program and its applications. Membership in the Consortium grew to 100 in FY2008 and continues to welcome new participants.
Laborshed Reports and Benefit Profile: Laborshed reports help the Iowa City Area Development Group clearly illustrate key characteristics of our workforce, including worker availability, occupations, wage and benefit requirements, and commuting patterns. This information is an effective tool to help recruit prospective companies researching our communities for new projects, as well as provide timely workforce data to existing businesses considering expansion.
In partnership with Priority One and Iowa Workforce Development, 21 laborshed reports were created in FY2008 specifically for the Iowa City area and the Cedar Rapids/Iowa City Technology Corridor reflecting workforce trends and patterns in sectors such as biotechnology, advanced manufacturing, information technology and educational services.
A Fringe Benefit Profile was also completed in FY2008, providing a detailed analysis of employerrelated benefits. A random sample of Iowa City and Cedar Rapids employers across all industrial classifications and employment ranges provided information for the study. Benefit information is indexed by industry, benefit, and company size. ICAD Group uses this data when recruiting companies and assisting with expansion projects to ensure our clients have the most recent data when determining a competitive benefits package for their employees.
2 The 2008 Annual Report of the Iowa City Area Development Group
Growth Innovation
FY2008 Projects and Programming
Skills 2010 Report and Workforce Recruitment: The Technology Corridor Skills 2010 Report, published this year, forecasts specific needs for workforce and skill sets for the Cedar Rapids/Iowa City Technology Corridor. This comprehensive study is a follow-up to the Skills 2006 Report and was published through a partnership between Kirkwood Community College, the Iowa City Area Development Group, and Priority One of Cedar Rapids.
Among some of the remarkable new findings, a total of 16,472 new and replacement workers will be needed in the next three years. Primary sector industries with the greatest job growth and replacement needs were advanced manufacturing, healthcare, education, and information solutions. Additionally, employers reported specific skill sets, including technical and foundational skills, missing from their incumbent and applicant pools. Nine recommendations were listed in the report to address these and other specific findings.
Much of ICAD Group’s FY2008 workforce projects, such as Skills Advantage, Laborshed Reports, and the Fringe Benefit Profile, were operating concurrent to the Skills 2010 report and contributed to the implementation of many recommendations. Additional programming was created or updated to educate college students about employment opportunities in the Corridor and recruit workforce talent from out of state.
The Iowa City Area Development Group and Priority One continue to promote employment, opportunity and quality of life in the Corridor using CorridorCareers.com. Website visits, unique visitors, and page views have all increased this year as a result of our targeted marketing efforts, including the Corridor Career Fair, our inaugural Internship “Real World” program, RAGBRAI sponsorships, our Pick Your Pace packet, regional and national career fairs, alumni outreach, and print advertising.
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Busines Recrui Corporate Outreach: Our relationships with primary sector companies that operate in the Iowa City area often extend beyond our city limits and the boundaries of Johnson County. In FY2008, we made personal visits to 25 company headquarters to speak directly with company executives who oversee operations in the Iowa City area.
Additionally, the Iowa City Area Development Group met with 11 national site location consultants in the past year about projects or opportunities for their clients to do business in the communities we represent.
Whether we’re communicating with companies currently here or prospects interested in extraordinary opportunities, the benefit of face-to-face communication is immeasurable. Each meeting gives us another opportunity to promote the vitality of our area, highlight the quality and availability of our workforce, demonstrate the success and growth of our companies and leave a lasting impression that the Iowa City area is an ideal location.
Market to Emerging Sectors: The Iowa City area is home to a diverse collection of companies ranging in size and sector. From Fortune 500 companies to emerging entrepreneurs, the Iowa City Area Development Group annually identifies and researches companies and industries that we believe would prosper in our region and complement our economic environment.
Based on our findings, customized marketing plans are developed and implemented when data in an industry or cluster shows promise. Plans include direct mail or e-mail campaigns, site visits, industry-specific web pages, and attendance at tradeshows and conferences. This past year, ICAD Group sent representatives to the Radiological Society of North America (RSNA) annual meeting in Chicago and the American Wind Energy Association (AWEA) trade show in Houston. ICAD Group was also scheduled to attend the Bio International Convention in San Diego this past June but canceled due to flooding.
4 The 2008 Annual Report of the Iowa City Area Development Group
ss itment
While each connection and interaction has potential, our marketing to the wind energy industry proved most promising. Of the 24 companies visited at the AWEA trade show, 4 have visited our area since June to research sites and expansion opportunities. Further, we have launched a direct marketing campaign to more than 450 companies involved in the wind energy supply chain directing them to a new section on our website, and we plan to utilize upcoming events to schedule meetings and build interest in the Iowa City area.
Access to Immediate Information: Through the 2008 fiscal year, the Iowa City Area Development Group responded to 43 requests from businesses and consultants researching our area for expansion or location projects.
ICAD Group maintains multiple information sources to provide the timeliest data possible. The Location One Information System速 (LOIS) provides a complete inventory of buildings and sites available in the ten cities represented by our organization. Aerial photographs are taken each year to demonstrate our continued growth and are formatted to clearly show property boundaries, major infrastructure and transportation accessibility. Participating cities also provide key community data, including demographics, major employers, labor force and education, that is easily accessed in LOIS through the ICAD Group website.
Printed and electronic information continue to play equal roles when responding to project requests. ICAD Group maintains a library of marketing materials including Prospect Packets, workforce materials and our new Working Numbers brochure to showcase the business advantages of our area, available financial assistance, transportation options, as well as utility and workforce data. Much of this data is also featured on the ICAD Group website, and will be easier to access, e-mail and download when a new version of www.iowacityareadevelopment.com goes live this fall.
A new website was also launched this fiscal year to promote the entire Technology Corridor. Interested companies and consultants can now log on to www.tech-corridor.com to maximize their information quests and research regional information provided by the Iowa City Area Development Group and Priority One of Cedar Rapids.
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Existing Industry and Entrepreneurial Development Existing Industry: Each year, the Iowa City Area Development Group conducts a series of in-depth interviews with executives from primary sector companies in our service territory to gauge the condition of the economic environment and the status of area companies. Data collected through this process examines the growth, risk, value, and satisfaction of each company. 62 executives, our highest number to date, participated in this year’s study. Among the findings: • • •
Existing companies added 1,446 jobs in FY2008 and plan to add more than 1,350 jobs in the next 36 months 81% of companies reported expansion plans, a 21% increase over FY2007 “Quality of workforce” and “Quality of life” ranked highest for community strengths
A summary of this data, titled “Minding Our Own Businesses,” is published every year and made available to clients and investors of the Iowa City Area Development Group as well as the communities we serve. This information is also shared with site selection consultants and corporate leaders to spotlight the strengths of our communities and companies and show how our data compares year-to-year within the area and among regional and national trends.
ICAD Group’s “Minding Our Own Businesses” existing industry program received a national Innovation Award for Leveraging Competitive Intelligence from Blane, Canada Ltd. in FY2008 for use of its Synchronist® Business Information System.
Entrepreneurial Development: Fostering growth through innovation often begins at the grassroots level. The Iowa City Area Development Group provided assistance to 14 entrepreneurial companies in FY2008.
Looking forward, our organization will continue to strengthen relationships with the University of Iowa in an effort to bolster Entrepreneurial Development. Plans are currently underway to engage in a study to learn how to best support the entrepreneurial climate of our area and communication continues with state leaders to create effective policies and programs to assist emerging companies.
Iowa City is #2 in the Nation (Mid-Size Cities) for Volunteer Rate (Volunteering in America 2008)
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FY2008 Financial Report In FY2008, the Iowa City Area Development Group experienced another strong year, generating $757,823 in income. Expenses for FY2008 were $583,987, slightly lower than the previous year. Net income of $173,836 has been directed towards marketing, workforce and business recruitment program implementation in FY2009. Funding for ICAD Group programming, projects and expenses comes from income generated through private and public investments, grants, and earned income from our annual meeting and in-kind support.
FY2008 Investment in Economic Development Total Expenses: $583,987 (including in-kind expenditures) Workforce Business Services: 23% $132,348
Entrepreneurial Development: 7% $40,342
Business Recruitment: 12% $71,694
Existing Business Retention & Expansion: 13% $75,709
Communications and Partnerships: 23% $137,060 Administration: 22% $126,834
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FY2008 Campaign Progress Report Last year, the Iowa City Area Development Group completed its investment campaign and launched a five-year economic development program called “Creating Advantage | Investing for Results.” This program includes specific goals for targeted business recruitment, business expansion/retention and regional economic growth. Despite a sluggish national economy, the Iowa City Area Development Group produced significant results during the second year of this program. In FY2008, ICAD Group duplicated its success from a year ago in capital investment and projects and helped attract nearly $15 million in additional annual personal consumption expenditures, generating a two-year total of more than $40 million in annual expenditures by employees of our clients. 2007 – 2011 Goals Recruit 12 new targeted companies to the area Assist 30 existing business expansions Attract or retain 2,880 jobs in the area that pay $18/hour in wages and benefits Attract $250 million in new capital investment to our communities FY2008 Projects and Results Recruited three new companies • Precision Revenue Strategies • ITC Midwest • Metro Wire
Assisted with six business expansions • Alpla of Iowa • JM Swank (ConAgra) • Syngenta • Kleffmann Group • Acciona North America • Titronics
Retained a major area employer • River Bend Industries (formerly North Liberty Plastics)
331 new jobs created; 200 jobs retained Generated $13.4 million in earnings with an average base wage of more than $18/hour, excluding benefits Attracted over $71 million in new capital investment to the region
Totals to Date GOAL Direct New Jobs Direct New Earnings/Payroll New Capital Investment Recruitment Projects Expansion/Retention Projects 8 The 2008 Annual Report of the Iowa City Area Development Group
Total to Date 1,047 $88.9 million $143.1 million 7 11
% of Total to Date 36% 82% 57% 58% 37%
FY2008 Return on Investment According to a study by Economic Strategy Center released at the end of FY2008, the on-going economic development efforts of the Iowa City Area Development Group continue to change the landscape of the Iowa City area economy. Business expansion, attraction and retention activities have a ripple effect on the entire local economy as capital investment and job creation stimulate growth in local business revenue; generate additional tax revenue for area communities, counties and the State of Iowa; and contribute to job creation through supplier (indirect) and consumer (induced) spending. Once again, investors realized a high return on their investment in the Iowa City Area Development Group. Our work during FY2008 produced an annual return of $33 for each dollar invested in ICAD Group. Additionally, each dollar spent by ICAD Group on attraction and expansion projects generated approximately $127 in new capital investment and retained $34 in capital investment. Economic Impact of New Jobs Created in FY2008 • 528 total jobs (331 direct, 197 indirect & induced) • New job multiplier of 1.59 (each direct new job supports an additional 0.59 jobs in other sectors throughout the Iowa City area) • $18.7 million in total annual payroll earnings from new jobs • $81.6 million in economic output from jobs created Economic Impact of Jobs Retained in FY2008 • 289 total jobs (200 direct, 89 indirect & induced) • $9.2 million in total annual payroll earnings • $49.6 million in economic output from jobs retained • $19 million in capital investment from jobs retained Earnings Impact Generated through New Payroll • Over $256,000 in state tax revenue • Over $5,700,000 in personal accounts through local financial institutions • Over $14,400,000 in annual personal expenditures
Analysis provided by Economic Strategy Center, the research division of National Community Development Services, Inc.
Iowa City is the #2 Best Small Place for Business (Forbes Magazine 2008) The 2008 Annual Report of the Iowa City Area Development Group 9
2008 Investors A M Management
City of Coralville
Graham Packaging
A W Welt Ambrisco Insurance
City of Iowa City
Graphic Printing & Designs
Acme Electric Company ACT, Inc. AEGON USA Aero Rental Alliant Energy Alpla of Iowa Amana Colonies
City of Kalona City of North Liberty City of Solon City of Tiffin City of West Branch City of West Liberty CIVCO Medical Instruments
Growth Property Management/ Spartan Structures/ Growth Initiatives
Kabel Business Services
Merit Electric Ltd.
Kelly Heating Service
Midland Communications
Hawkeye Title & Settlement Services LLC
Cook Appraisal
Hills Bank & Trust Company
Corridor Business Journal
HJR Financial Group
Bio-Research Products, Inc. Bradley & Riley PC Brandt Heating & Air Conditioning Build to Suit Ltd. Carolson, Hartsock & Guither PLC (formerly Clifton Gunderson LLP) Carousel Motors Central Iowa Power Cooperative (CIPCO) City Carton Recycling
Mercer Administration Merit Construction Company
Arlington Development/ Prime Ventures (John Moreland & Gary Watts)
Benson & Hepker Design
Mediacom
Johnson County Board of Supervisors
CompleWare Corporation
Beisser Lumber Company
Mechanical Contractors of Iowa
Hawkeye Ready Mix
American Bank & Trust Company
Bank of the West
Iowa City Landscaping
Meardon, Sueppel & Downer PLC
Iowa City PressCitizen
Ambrose Development
Bachmeier Interiors
Iowa City/Coralville Convention & Visitors Bureau
McEleney Autoplex
Hawkeye Harley Davidson
Clear Channel — KKRQ & KXIC
Steve Atkins
Iowa City Area Chamber of Commerce
Herteen & Stocker Jewelers
King’s Material, Inc. Kirkwood Community College Knutson Construction Services
Mercy Iowa City
MidAmerican Energy
Midwest Development & Investment Corporation MidWestOne Bank
CRANDIC Railway
Hodge Construction Company/Randy’s Carpet/Greg Apel
Creative Management — McDonald’s
Holiday Inn Express Hotel & Suites
The Eastern Iowa Airport
Holiday Inn Hotel & Conference Center
Economy Advertising/ TruArt
Home Repair Team, Inc.
Ewers Men’s Store
Hospers & Brother Printers
Lenoch & Cilek Ace Hardware
Howard R. Green Company
Lensing Funeral & Cremation Service
Hunter Companies
Lepic-Kroeger Realtors
OPN Architects, Inc.
Hy-Vee Food Stores
Liberty Bank
Fleck Sales/Miller Distributing
Innovative Software Engineering
Liberty Communications
Pearson Educational Measurement
Freedom Security Bank
Integrated DNA Technologies
Liberty Growth
Frohwein Office Plus
International Automotive Components (IAC)
Loparex
Iowa Book LLC
McComas-Lacina Construction
Cramer IT Consulting
Farmers & Merchants Savings Bank First American Bank First Trust & Savings Bank
Gazette Communications GEICO
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John & Audrey Kofoed
MMS Consultants, Inc.
KZIA Z102.9
Moyer & Bergman PLC
L L Pelling Latta, Harris, Hanon & Penningroth LLP Leepfrog Technologies
Linn County REC MainStreet Partners
Myriad Developers LC NAI Iowa Realty Commercial/Iowa Realty Nesper Sign Neumann Monson PC New Ventures
Peterson Contractors, Inc. Phelan, Tucker, Mullen, Walker, Tucker & Gelman LLP PIP Printing & Document Services
Plumbers Supply Company Procter & Gamble/ Oral B Laboratories Pulkrabek Law Office Quad City International Airport R R Donnelley Regal Construction Regions Bank River City Radio — KCJJ Roberts Dairy Company Rockwell Collins Rohrbach Associates PC
Technigraphics TMD, LLC Towncrest Pharmacy Toyota-Scion of Iowa City TrueNorth Companies LC University Athletic Club University of Iowa — Oakdale Research Park University of Iowa — UI Research Foundation University of Iowa Community Credit Union
RSM McGladrey, Inc.
University of Iowa Hospitals & Clinics
Ryan Companies
Unzeitig Construction
Selzer Werderitsch Associates
US Bank
Sheraton Iowa City Hotel/hotelVetro
Vetter’s Inc. — Culligan Water Technologies
Shive-Hattery
Weitz Industrial
Shoemaker & Haaland Professional Engineers
Wells Fargo Bank
Shuttleworth & Ingersol PLC Simmons Perrine PLC SouthGate Development Services South Slope Cooperative Communications Company Spielman’s Event Services
History In 1984, the Iowa City Development Corporation held its first meetings to unify the local business community, the City of Iowa City, and the University of Iowa in a common mission and establish a strategy for recruiting business to the area. Now, almost 25 years later, the Iowa City Area Development Group serves its investors and members by using those guiding principles to expand business recruitment efforts, grow and retain existing business, enhance workforce business services, support entrepreneurial development and create collaborative partnerships throughout the region.
West Bank West Liberty State Bank West Music Company Wolf Construction
Every effort has been made to provide a complete and accurate listing of our investors. If there has been an error or omission, we apologize. To correct or records, please contact us.
Story Construction Company The 2008 Annual Report of the Iowa City Area Development Group 11
Iowa City Area Development Group Staff To accomplish our goals, the Iowa City Area Development Group relies upon a team of five professionals and a volunteer board of directors all dedicated to serving the business development needs of our area.
Our Role in Economic Development •
•
Promote the Iowa City area as a choice business location to local, national and international firms Serve the Amana Colonies, Coralville, Iowa City, Johnson County, Kalona, North Liberty, Solon, Tiffin, Tipton, West Branch and West Liberty and represent all communities equally
•
Provide comprehensive workforce business services and expertise to help businesses start, succeed and stay in the Iowa City area
•
Communicate with existing companies to identify needs and trends of the economic environment and work proactively to sustain and grow the area’s economy
•
Position the area competitively to ensure the Iowa City area is a final contender for top projects
•
Assist existing businesses and companies outside the region find locations best suited to their needs
•
Facilitate negotiations between businesses and selected communities, bringing key partners to the table including utility companies, community colleges, the University of Iowa and state economic development officials
Joe Raso, President Sheri Jelinek, Executive Assistant Mark Nolte, Business Development Director DaLayne Williamson, Workforce Business Services Director Eric Hanson, Communications Director
FY2008 Board of Directors Retiring Board Members Tim Gholson, Market President Wells Fargo Michael Hahn, President McComas-Lacina Construction Dr. Meredith Hay, former Vice President for Research, University of Iowa Dale Helling, Assistant City Manager City of Iowa City Don Jackson, Human Resources/Public Affairs Manager, Procter & Gamble Donna Katen-Bahensky, former Director/CEO UI Hospitals & Clinics Tracey Mulcahey, Assistant City Administrator/ City Clerk, City of North Liberty Terry Smith, Director Compliance and Delivery Support, MidAmerican Energy Dr. Mick Starcevich, President Kirkwood Community College Ross Wilburn, Council Member City of Iowa City
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Private Sector
Public Sector
Jeffrey A. Disterhoft, ICAD Group Chair President/CEO, University of Iowa Community Credit Union
Regenia Bailey, Mayor City of Iowa City
Ronald R. Reed, ICAD Group Chair Elect President/CEO, Mercy Iowa City David Bywater, Vice President/COO Economy Advertising Kevin Digmann, Project Manager Hodge Construction Company Scott Fisher, Senior Vice President Mercer Administration Tom Gelman, Partner Phelan, Tucker, Mullen, Walker, Tucker & Gelman LLP Tom Goedken, Vice President ACT, Inc. Tom Hobson, Senior Manager of Government Relations, Rockwell Collins Brad Langguth, Vice President Hills Bank & Trust Company Hass Machlab, President Innovative Software Engineering Dan Mann, Airport Director The Eastern Iowa Airport Kevin Monson, President Neumann Monson Architects PC
Kelly Hayworth, City Administrator City of Coralville Ryan Heiar, City Administrator City of North Liberty Terrence Neuzil, Supervisor Johnson County Board of Supervisors
Small Cities Representative and Chamber of Commerce Jerry Melick, Manager Liberty Communications Nancy Quellhorst, President Iowa City Area Chamber of Commerce
Education Jordan Cohen, Interim VP for Research University of Iowa Tom Sharpe, Associate VP for Research IOWA Centers for Enterprise Pamela York, Executive Director University of Iowa Research Foundation
Chuck Peters, President & COO Gazette Communications Dr. Jean Robillard, Vice President for Medical Affairs, University of Iowa Carver College of Medicine Lynn Rowat, Market President West Bank Damon Terrill, Senior Vice President & General Council, International Legal & Regulatory Affairs, Integrated DNA Technologies
Iowa City is the #8 Up-And-Coming Tech City (Forbes Magazine 2008) Iowa City is #10 among America’s Smartest Cities (Forbes Magazine 2008)
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Iowa City Area Development Group 325 East Washington Street Suite 101 Iowa City, Iowa 52240 (319) 354-3939 | Fax (319) 338-9958 www.iowacityareadevelopment.com Report prepared by Eric Hanson Report design by Benson & Hepker Design