2010 SC Biz 1

Page 1

Spring 2010

Do you know what’s manufactured in the Palmetto State? ALSO IN THIS ISSUE:

A look ahead

S.C. Delivers

Sanford discusses his

Ports, Logistics &

final year in office

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Contents VOL.4, ISSUE 1

CEO and Publisher - Grady Johnson gjohnson@scbiznews.com • 843.849.3103 Vice President of Sales - Steve Fields sfields@scbiznews.com • 843.849.3110

Spring 2010

COVER STORY

25

Managing Editor - Andy Owens aowens@scbiznews.com • 843.849.3141 Special Projects Editor - Allison Cooke Oliverius aoliverius@scbiznews.com • 843.849.3149 Senior Copy Editor - Beverly Morgan bmorgan@scbiznews.com • 843.849.3115

A snapshot of six industries within South Carolina’s manufacturing sector and the products they make right here in the Palmetto State. The products are diverse — such as pharmaceuticals used to treat cancer, chemical compounds used to make plastic water bottles, tiny diapers and massive airplanes. Cover illustration courtesy of Force Protection Inc.

FEATURES

Publisher, Columbia Regional Business Report Bob Bouyea bbouyea@scbiznews.com • 803.401.1094, ext. 204 Staff Writer - Mike Fitts mfitts@scbiznews.com • 803.401.1094, ext. 204 Staff Writer - Chelsea Hadaway chadaway@scbiznews.com • 843.849.3142 Staff Writer - James T. Hammond jhammond@scbiznews.com • 864.235.5677 Staff Writer - Scott Miller smiller@scbiznews.com • 864.235.5677 Research Assistant - Leslie Halpern lhalpern@scbiznews.com • 843.849.3123 Art Director - Ryan Wilcox production1@scbiznews.com • 843.849.3117

18

Teaching the art of economics

Senior Graphic Designer - Jane Mattingly production2@scbiznews.com • 843.849.3118 Director of Business Development - Mark Wright mwright@scbiznews.com • 843.849.3143 Account Executive - Bennett Parks bparks@scbiznews.com • 843.849.3126

20

Reducing Sanford: your carbon A look ahead footprint

14

DEPARTMENTS

S P E C I A L S EC T I ON PAGE 3 5

4 | Viewpoint

BUSINESS

8 | Technovation 10 | Spotlight: Aiken 12 | Trends

2

Circulation and Event Assistant - Kim McManus kmcmanus@scbiznews.com • 843.849.3116 The entire contents of this publication are copyright by SC Biz News LLC with all rights reserved. Any reproduction or use of the content within this publication without permission is prohibited. SCBIZ and South Carolina’s Media Engine for Economic Growth are registered in the U.S. Patent and Trademark Office.

Cities Mean

6 | Upfront

48 | 1,000 words

AL S O INCL U DED

Circulation and Event Manager - Kathy Allen kallen@scbiznews.com • 843.849.3113

Ports, Logistics & Distribution in South Carolina

SC BIZ | w w w. s c b i z m a g . c o m

A publication of the Municipal Association of South Carolina.

Mailing address: 389 Johnnie Dodds Blvd., Suite 200 Mount Pleasant, SC 29464 Phone: 843.849.3100 • Fax: 843.849.3122 www.scbiznews.com

Viewpoint

Taxing questions: Hard cases make bad law here’s a saying in the legal field that multimillionaire owners of megamansions in n d “hard cases make bad law.” With regard Charleston’s historic district and highly prized to South Carolina’s laws, the phrase can beachfront property. certainly be applied to property taxes. Despite the opposition, the reform legisla-A long and generally successful cam- tion was passed. Since then, businesses havee paign against rising property taxes on owner- decried the extra burden they bear for fund-n occupied homes started years ago in Charles- ing local needs and the damper this puts on ton County, and it was hailed as a victory for economic development. And now the last big valuations so that two people living next to homeowners. chicken has landed: The residential real estate each other in homes of equal value can have But this year, the chickens came home market, after suffering through the “near- radically different tax bills based on how long to roost, to use a better known phrase. As I death” experience of last year, now finds re- they’ve owned their homes. Exactly where is was writing this article, the covery hamstrung by the the fairness in that? Like so many “tax reforms,” this one has struggle continued in the LegLike so many ‘tax “point-of-sale” reappraisal of islature to undo or modify the existing homes and new con- rearranged the deck chairs on a fiscal Titanic. reforms,’ this one struction. South Carolina needs a fair and balanced tax damage done by distorting homeowner property valuaIt means that the widow policy on all fronts, instead of a tug-of-war has rearranged tions and shifting the tax burtrying to sell her home to that ultimately hurts governments’ ability to the deck chairs on fund her move to an assisted fund infrastructure improvements and proden to homebuyers and sellers, as well as to businesses and living community finds that vide essential services that maintain our quala fiscal Titanic. owners of second homes. “tax reform” is one more bar- ity of life and support future economic develThe impetus for the “rerier to achieving that goal. opment. By the time this article is published, it’s forms” that capped increases Then there’s the issue of in a homeowner’s property appraisal so long mobility: Americans move for jobs and op- possible the Legislature will have settled on as the homeowner stayed in the same home portunity, and the shaky housing market some sort of compromise that will soften the is certainly understandable. In the years has put a damper on such moves. That hurts blow from the “point-of-sale” rule. But there’s prior to the recent national real estate down- South Carolina because we have enjoyed a good chance that the compromise will be turn, coastal property valuations were rising in-migration that has strengthened our econ- little more than a Band-Aid on South Carolirapidly, driving up appraisals and taxes for omy. Likewise, if a growing family living in a na’s messed-up tax laws, where major surgery homeowners who had owned their homes for “starter home” wants to trade up to a larger is needed. Don’t get your hopes up for that; many years. In some cases, it created undue home, it faces a double whammy in the form from what I can tell, the tax doctor is out to financial hardship, and it was argued that peo- of higher taxes for prospective buyers of the lunch and won’t be back in the office anytime ple ought to be able to live out their lives in starter home, as well as the higher taxes on the soon. homes that sometimes had been passed from larger home they hope to buy. generation to generation. The “hard case” that made the “bad law” All that is understandable. But back in the was the rapid rise in coastal home valuations. Bill Settlemyer days when this campaign was in full bloom, The “bad law” is the law that distorts property bsettlemyer@scbiznews.com the Charleston Metro Chamber of Commerce and the S.C. Chamber of Commerce opposed NEW SUBSCRIBERS: the reform proposals, arguing that the change would jeopardize funding for education and Subscribe online at SCBIZ reaches thousands of South Carolina’s top other local needs and harm economic develwww.scbizmag.com or call decision-makers. Add your name to the list by opment. 843.849.3116. ordering a print subscription to SCBIZ. The Charleston chamber pointed to legCURRENT SUBSCRIBERS: islation in other states that used “means test- Your subscription also includes SCBIZ Daily. Deliving” to direct property tax relief only to those ered to your e-mail inbox each weekday morning, Change your address online who truly faced financial hardship from ris- SCBIZ Daily is your link to statewide business news. at www.scbizmag.com or call ing taxes. Others pointed out that “reform” 843.849.3116. One year for $43.50 as proposed would also bring tax relief to

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Boeing and South Carolina. The Dream Begins.

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Plumm Design to create 50 jobs in Beaufort BEAUFORT – Plumm Design, a manufacturer specializing in customized metal designs such as countertops, facades, range hoods and decorative tin panels will locate its new operations in Beaufort County. The $3.2 million investment is expected to generate 50 new jobs over the next five years. “We are pleased to locate our new operation in Beaufort County. The facility and the strong work force will help us meet the growing demand for our products. The Beaufort business community has extended us a warm welcome, and we appreciate all the support we have received from state and local officials,” said Christopher Plummer, president and CEO of Plumm Design. The Pennsylvania-based company will open a 26,000-squarefoot facility on Bay Pines Road in the county’s industrial district. The company is in the process of expanding its product line, with plans to launch American-made ranges with a French range aesthetic and a line of home accent pieces to include headboards and mantels.

Charleston company creates iPhone app for health care videos CHARLESTON – Benefitfocus Media subsidiary icyou has launched an iPhone application. It allows users to access and upload health care videos on topics such as medical breakthroughs, pregnancy, diabetes, nutrition and health care reform. “You’re not always sitting in front of a computer when you want to find out what’s happening in the world of health,” said Nina SossamonPogue, vice president of Benefitfocus Media. Benefitfocus launched the company in 2007 with a Web site and has since evolved it to include the iPhone application. The program is available as a free download from the Apple store online.

6 SC BIZ | w w w. s c b i z m a g . c o m

3,200 That’s the estimated number of jobs the South Carolina’s Centers of Economic Excellence program has helped create since its inception in 2002, according to the organization’s fiscal 2009 annual report. The report also states that the program has brought in nonstate investments of more than $250 million.

Proterra to invest $68M $68M, M hire 1,300 in Greenville GREENVILLE – Proterra Inc. plans to begin construction this spring on a 240,000-square-foot manufacturing and R&D center on 25 acres at the Clemson University International Center for Automotive Research. Proterra plans to invest $68 million in the site and hire 1,300 people during the next seven years. Colorado-based Proterra and its partners design and manufacture all-electric and battery-dominant hybrid drive solutions and complete vehicles for commercial applications, including buses, parcel delivery vehicles and other Class 4-8 trucks. Proterra’s very first vehicle, a battery-dominant fuel cell hybrid transit bus funded by the Federal Transit Administration, is in service in Columbia. The company will lease land at the CU-ICAR campus, with the potential to expand into the entire 50-acre site.

Forbes ranks Augusta-Aiken, Columbia in 50 fastest-recovering MSAs across U.S. COLUMBIA – An analysis by Forbes magazine has put South Carolina’s five largest metro areas among cities recovering the fastest from the recession. Forbes ranked the 100 largest metropolitan statistical areas, as defined by the U.S. Office of Management and Budget, using unemployment rate, size of regional economy, foreclosures, home prices and sales rates. Forbes then averaged those rankings and came up with its list. The Augusta-Aiken and Columbia MSAs ranked higher than 50 on the list, and Charlotte-Gastonia, N.C.; Greenville-Mauldin-Easley; and Charleston-North Charleston-Summerville ranked in the bottom 50. The fastest-recovering region was Omaha, Neb., and the slowest-recovering of the 100 MSAs was Lakeland, Fla. Florida, which has been riddled with foreclosures and plummeting home prices, held six of the bottom 10 spots on the Forbes list. COLUMBIA – South Carolina’s recruitment of The complete list of cities and MSAs can be found at the Forbes Web site. Here is a list of metro the Boeing 787 Dreamliner assembly plant to areas in South Carolina: North Charleston continues to draw attention. Recession recovery among S.C. regions Acknowledging Boeing’s site selection, Business Facilities magazine recently named the S.C. Home Foreclosed Department of Commerce its 2009 Deal of the Total Metropolitan Statistical Area Economic Jobless price homes Year award winner. The Commerce Department 22 Augusta-Aiken 18 56 20 23 was featured in the magazine’s January issue. 35 Columbia 37 56 7 37 “The choice of North Charleston as a manu54 Charlotte-Gastonia, N.C. 73 82 39 47 facturing site for Boeing’s best-selling commercial jet will have a seismic impact on South Caro66 Greenville-Mauldin-Easley 43 70 16 58 lina’s economic development,” noted Business 75 Charleston-N. Charleston-Summerville 25 61 58 66 Facilities Editor-in-Chief Jack Rogers. Fifteen agencies nominated 19 “big-ticket projects” for the award, the magazine said. A panel of judges evaluated economic impact statistics, job creation estimates and project narratives submitted by the applicants. Each nomination carried a projected overall economic CHARLESTON – An analysis by a Dow Jones financial markets publisher has put Charleston in the impact of more than $1 trillion. Top 50 best cities in which to do business. South Carolina beat out the Tennessee MarketWatch scored the nation’s 101 largest metropolitan areas — those with 500,000 or more Department of Economic & Community Developpeople — using 10 metrics, including five that measured companies per capita and five that looked ment, which attracted Hemlock Semiconductor’s yment, growth and gross domestic product. at economic stability, including employment, polycrystalline silicon plant in Clarksville, and the Virginia Economic Development Partnership, South Carolina’s major markets which announced the Areva/Northrop Grumman t: were in the middle third of the list: project. • Charleston ranked 47. In addition to the Business Facilities award, • Columbia ranked 56. the Commerce Department was also honored b Southern Business & Development maga• Greenville ranked 67. by z zine. The publication named Commerce Deputy S The three best places for Secretary Jack Ellenberg the 2010 Person of t Year, calling him the “man who landed the business were: the g • Des Moines, Iowa golden goose.” • Washington, D.C. “In his years as an economic development p • Omaha, Neb. practitioner, he has worked many of the Palm metto State’s largest and most notable projects, d: i The bottom of the list included: including BMW, Michelin and Google,” the magaz said. “While BMW will likely remain South • Scranton, Pa., at 99. zine C • Fresno, Calif., at 100. Carolina’s most important catch in its economic d • Youngstown, Ohio, at 101. development history to date, the recent Boeing deal directed by Ellenberg will certainly advance to a close second when it is all said and done.”

Commerce Dept. wins Deal of the Year award

Charleston, Columbia, Greenville, top cities in which to do business

w w w. s c b i z m a g . c o m | S p r i n g 2 0 1 0

7

Te c h n

vation

SCRA MUSC Innovation Center By Chelsea Hadaway, Staff Writer

SCRA President Bill Mahoney (from left), MUSC President Ray Greenberg and Charleston Mayor Joe Riley debut the SCRA MUSC Innovation Center. (Photos/Leslie Halpern)

ithin an old mattress factory at the foot of the Ravenel Bridge, researchers are creating antibodies to treat disease, harvesting bacteria to produce fuel, testing new drugs for efficacy and developing drugs to treat cancer. These startup biotech companies are all working in the new SCRA MUSC Innovation Center, which opened in December. The S.C. Research Authority and the Medical University of South Carolina created the center to fill a need for laboratory and research space for biomedical startup companies coming out of MUSC. The center has space for about 15 different companies and wet lab space for 11. “This facility, in the shadow of the Cooper River bridge, represents the future of Charleston,” MUSC President Ray Greenberg said at the grand opening. “In 10 to 15 years, when Charleston is recognized as a leader in life sciences and biotechnology, people will point to today” as the beginning, Charleston Mayor Joe Riley added. “This is an important part of the growth and development of our community.” MUSC’s focus on entrepreneurialism and high-tech innovation, coupled with the $200 million in federal research money it re-

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8 SC BIZ | w w w. s c b i z m a g . c o m

ceives annually, yields startup companies that need a low-cost place to perform research. At the Innovation Center, researchers can lease space that includes equipment like subzero freezers, fully vented labs, autoclaves, tissue culture rooms and sterilizers. In addition to the center providing access to equipment, rent is priced on a break-even basis, said SCRA CEO Bill Mahoney. It’s generally about 30% below market price. Immunologix COO Ryan Fiorini hopes his company, a tenant at the Innovation Center, can go out on its own and build space nearby in the next few years. Fiorini founded the company with CEO Doug Carnes about a year ago. They licensed technology invented at MUSC that allows them to treat various diseases, such as autoimmune diseases and viruses. The company’s space at the center will be used to manufacture these products for different clients, such as pharmaceutical companies. Leasing space at the Innovation Center allowed them to take their company to the next level, because clients were coming to them but they didn’t have a space to commercialize their technology. “If we didn’t have this, we would’ve had to move out of Charleston or raise more money, probably upwards of $1 million,” Fiorini said. They needed wet lab space and equipment, and they have saved hundreds of thousands of dollars by leasing space at the center, he said. Instead of the normal overhead costs for a new company, they only have to purchase specialized equipment. Another company that moved into the center in January was Microbial Fuel Cell Technologies, known as MFC Tech. Its main goal is to use bacteria to produce biofuels — both ethanol and hydrogen. The idea for the company was hatched in 2006 by MUSC professor Hal May, who decided to team up with Michael Nelson, another researcher with experience launching companies. MFC Tech gained ground when the Energy

An electrochem ical bioreactor is used to produc e biofuels such as ethanol and hydrogen from cellulosi c biomass. Bria n Corbett works with an experimental cell.

Department awarded May and Nelson a grant to improve the process of converting cellulose into ethanol. They decided to turn their research into a commercial product. After stacking up a couple of other grants from agencies including the National Science Foundation, the company started researching ways to use microorganisms and bacteria to create biofuels. The concept of using bacteria to produce electricity wasn’t a new one, but this application is taking the idea in a different direction. The company is trying to patent the process of using bacteria to make biofuels on a large scale. “We are an R&D company, but we want to add another D — demonstration,” May said. If he wanted to do only R&D, he could go back to MUSC, he said. For the technology to become commercial, the bioreactors that create the fuels have to be large, and currently there aren’t any that are big enough. So the researchers at MFC, Brian Corbett and Tsutomu Shimotori, are working on creating these larger bioreactors. The plan is to have units large enough to sell for commercialization by 2012 or 2013, May said. But to get to that point, the founders need to leverage partnerships to acquire funding, a step they are pursuing now. They are still going after federal grant money, too. They just applied for a Department of Energy grant for $500,000, which they would use to induce bacteria to produce hydrogen, another emergent application that is being explored right now. “The hydrogen market is big,” May said, and MFC Tech has ramped up efforts on the hydrogen bioreactor side of the company in response. May hopes to be able to develop product lines for ethanol and hydrogen bioreactors, and possibly carbon dioxide, in the coming years. And although MFC Tech would need a larger space eventually, May hopes to keep the Innovation Center space as an incubator to do initial testing and research for the lines. SC

BIZ

Aiken

Spotlight

Aiken By James T. Hammond, Staff Writer

(Ph t supplied (Photos li d by b th the G Greater t Aiken Chamber of Commerce)

10 SC BIZ | w w w. s c b i z m a g . c o m

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hen Fred Humes, director of the Aiken/Edgefield Economic Development Partnership, sets out to sell a business prospect on locating in Aiken County, his pitch isn’t necessarily all about tax breaks and industrial parks. Lifestyle is an important part of the package. Take, for example, the $72 million-a-year equestrian sector that has spread pastures and fences across the sprawling region. There also is the University of South Carolina at Aiken, with academic opportunities including theater, business and nursing. Last year, USC-Aiken was ranked first among public baccalaureate colleges in the South by U.S. News & World Report magazine. The university has placed in the top three in that category for 12 consecutive years and has topped the list six times. Aiken also has a unique asset in the 300square-mile Savannah River Site, home to the recently designated Savannah River National Laboratory. Because of that facility, and its half-century-long role in supporting the nation’s nuclear weapons arsenal, Aiken County has at times boasted the highest number of people with doctoral degrees per capita of any county in the nation. “There are just 12 national laboratories in America, and we have one of them right here in Aiken County,” Humes said. “It’s such advantages as these that we see generating the well-paying jobs of the future.” Once a secretive, inwardly focused reservation, the federal Savannah River complex has in recent years been drawn into research projects with national, state and local entities for peaceful purposes, primarily in the pursuit of alternative fuels to reduce the nation’s dependency on foreign oil imports. The Savannah River Site is a treasure trove of knowledge about hydrogen, for example, because of its half-century of work on isolating tritium, the radioactive isotope that put the “hydrogen” into the name for thermonuclear bombs. Today, national lab scientists are working to solve the tough technical challenges of storing hydrogen for use in

Facts Aiken Coun ty covers m or e than 1,00 miles, makin 0 square g it one of th e largest coun graphically ties geoin South Car olina. It has of more than a population 150,000. In 2006, Aiken announced County $183 millio n in creating alm new investm ost 550 new ent, jobs and pla at No. 6 in th cing Aiken e state for n ew investm ent. transportation systems. Humes notes that the Center for Hydrogen Research unveiled a hydrogen fueling station — one of two stations in the state — last March at Sage Mill Industrial Park. The other is in Columbia. The Sage Mill facility is located in an advanced manufacturing park. Bridgestone/Firestone, located at Sage Mill, uses hydrogen fuel cell forklifts, and officials believe the new station will contribute to the development of hydrogen infrastructure in Aiken County. Kimberly Clark, the county’s largest private-sector employer, also uses the fuel cell forklifts. Humes believes the commitment of these two manufacturers to alternative fuels will give the region an advantage in developing the technology for wide-scale business applications. Aiken County built the 60,000-squarefoot Center for Hydrogen Research, which opened in 2005, to take advantage of local expertise in this field. Half the space will be used by the Savannah River National Laboratory; the other half is available for the private sector and academia. Companies can interact and contract services with the 50 hydrogen scientists and researchers at the lab. The number of people whose jobs relate to the Savannah River Site totals nearly 10,000; many are employed by federal agencies and private contractors. In addition, the county has a diverse industrial base, including paper products, tires, textiles, drugs and automotive suppliers. Alternative energy: A biomass energy plant, the biggest such project in South Carolina, is being designed for the Savannah River Site. The Energy Department expects the systems will save about $35 million in energy and maintenance costs. Recent news: MTU Detroit Diesel Inc. plans a new manufacturing facility to make general and special-purpose diesel engines for use in a variety of applications. Officials said the new plant, in the SKF building of the Sage Mill Industrial Park, will require new investment of $45 million and will create 250 new jobs.

AIKEN AND EDGEFIELD COUNTIES: WHERE MANUFACTURERS AND TECHNOLOGY MEET PO Box 1708 Aiken, SC 29802 www.edpsc.org fhumes@usca.edu

Center for Hydrogen Research

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11

Tr e n d s Unemployment rate

Employment

12%

Employment

Dec. 2009

% change Nov. 2009 Dec. 2008 from last year

Employed (Total Nonagricultural)

1,847,500

1,853,400

1,906,900

(3.1)

Government

349,100

350,800

355,900

(1.9)

Leisure & Hospitality

189,200

195,600

202,600

(6.6)

Manufacturing

211,900

211,900

236,100

(10.2)

Trade, Transportation & Utilities

358,800

357,600

371,700

(3.4)

Unemployed

273,175

266,330

207,171

24.1

10% 8% 6% 4% 2% J

Source: S.C. Employment Security Commission on

F

M A

S.C. 2008

<

<

<

<

<

<

<

< <

<

<

<

<

<

<

<

Higher than previous month

8.7% - 9.9%

V =

Lower

10.0% - 11.9%

Same

12.0% - 14.9%

<

=

Hotel Occupancy Rates 2008

% change

Berkeley

$1,347,576,585

$1,451,180,014

(7.1%)

Charleston

$5,393,386,867

$5,962,824,568

(9%)

Dorchester

$560,242,925

$309,195,206

44.8%

Lexington

$2,887,542,012

$3,120,690,948

(7.4%)

Newberry

$227,657,183

$236,614,571

(3.7%)

Orangeburg

$615,971,569

$657,260,341

(6.2%)

$4,891,248,745

$5,349,127,851

(8.5%)

$695,666,207

$740,833,728

Lowcountry

Midlands

Sumter

(6%)

Upstate

Month

2009

2008

% change

Jan.

37.5%

42.1%

-10.0%

Feb.

46.5%

52.1%

-10.70%

Mar.

51.8%

60.5%

-14.80%

Apr.

58.1%

62.0%

-6.20%

May

53.1%

61.0%

-12.90%

June

61.4%

65.9%

-6.80%

July

65.5%

67.4%

-2.80%

Aug.

57.3%

61.3%

-6.50%

Sep.

49.8%

48.0%

3.60%

Oct.

50.3%

53.1%

-5.20%

Anderson

$1,412,517,056

$1,523,564,804

(7.2%)

Nov.

42.7%

44.0%

-2.90%

Greenville

$5,437,230,117

$6,315,519,494

(13.9%)

Dec.

35.9%

36.6%

-1.90%

Spartanburg

$2,517,546,119

$2,775,982,303

(9.3%)

Total

50.9%

54.5%

-6.60%

$50,367,394,889

$54,659,612,075

(7.8%)

Statewide

D

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2009

Richland

N

20% & higher

Net Taxable Sales County

O

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<

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S

U.S. 2009

Unemployment Rate Unemp <

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<

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=

J A

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< < <

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S.C. 2009

*Major metropolitan areas Source: S.C. Department of Revenue & Taxation

1 2 w w w. s c b i z m a g . c o m | W i n t e r 2 0 1 0

Source: Smith Travel Research

Airplane Passenger Boardings 2009 Airport

Jan.

Feb.

March

April

May

June

July

Aug.

Sept.

Oct.

Nov.

Charleston International Airport

65,186

67,864

90,074

98,837

103,605

104,646

108,197

100,205

87,539

105,737

89,255

75,460 1,096,605

GSP International Airport

42,609

39,790

51,444

52,280

55,519

60,136

62,705

56,027

52,456

55,872

51,797

49,784

630,959

Hilton Head Island Airport

2,510

2,976

5,547

6,872

7,177

6,771

7,393

6,957

6,249

6,601

4,121

2,977

66,151

Myrtle Beach International Airport

33,781

35,557

59,589

73,563

71,781

73,623

85,904

87,546

64,096

68,370

49,046

40,651

744,387

Columbia Metropolitan Airport

35,661

35,848

42,683

46,290

47,685

48,040

49,053

45,905

39,915

45,426

41,461

41,407

519,374

Company

CY Total

Source: Individual airports

Economic Development Announcements New/Expansion

Dec.

County

Investment

Jobs created

E

Composite Resources Inc.

York

$3.5 million

50

N

Plumm Design

Beaufort

$3.2 million

50

N

MTU Detroit Diesel Inc.

Aiken

$45.0 mllion

250

E

DC Machine LLC

Berkeley

$3.0 million

25

E

Capsugel

Greenwood

$15.0 million

50

N

Akebono Brake Corp.

Lexington

$35.6 million

283

E

Suminoe Textile of America Corp.

Cherokee

$6.5 million

50

E

Parkdale Mills

EdgeďŹ eld

$3.0 million

16

N

Bennettsville Printing

Marlboro

$3.0 million

N

Proterra Inc.

Greenville

$68 million

40 1,300

Source: S.C. Department of Commerce. Announcements through Feb. 5, 2010.

w w w. s c b i z m a g . c o m | S p r i n g 2 0 1 0 1 3

14 SC BIZ | w w w. s c b i z m a g . c o m

Sanford A look ahead By Mike Fitts, Staff Writer

Gov. Mark Sanford agreed to sit down with SC Biz News and talk about his aspirations for South Carolina’s economy in his remaining year in office. Even as he did so, the House Judiciary Committee was meeting across the Statehouse grounds to vote that he be censured but not impeached. Here’s what the governor had to say.

w w w. s c b i z m a g . c o m | S p r i n g 2 0 1 0 1 5

Sanford said he hopes sustainable tax reform will be part of his legacy as governor. (Photo/Provided)

In a recent interview with SC Biz News, Gov. Mark Sanford said counties should play to their strengths to attract jobs and economic development. (Photo/Provided)

SC Biz: Given the economy, what can you the tax for every business in South Carolina. do to help our jobless rate in the year that Disproportionally, that will impact small you’ve got left? business. Sanford: You can be clear and hopefully There’s talk of tort reform. I don’t see that not mistaken in the notion that it’s business getting to the point of critical mass; it would that creates jobs, not government. Because if be nice if it did. not, you can go down a lot of alleys that mayOn the spending side ... that Balkanized be, supposedly are about job creation, but in budget-setting approach means that we don’t the long run may have other effects. ... Where look down the road at all. That’s why I think do most jobs come from? Most jobs come spending limits are so important so that we from businesses that are indigenous to South avoid some of the excess that comes with the Carolina. Boeing is good times and putexciting, it’s wonderful ting ourselves in pre... but the bottom line cisely the math trap is that the bulk of jobs that we’re now dealing that we create in this with. state are going to be created by small busiSC Biz: Is there any nesses creating one short-term measure employee, two emthat could help state ployees without fanbusinesses with the fare, without ribboncredit crunch? cutting. Sanford: South Try always to imCarolina imprint on pact the playing field global credit markets Mark Sanford on which a business is so small. You can S.C. governor here in South Carothink that you’d have lina can compete with an impact, but the other businesses across the country or across reality is credit markets are a lot bigger than the world. So for us, that means this year, Em- what’s going to happen in South Carolina’s ployment Security Commission reform. If we legislative body. don’t do something about it, what we’re lookYou couldn’t have the kind of excess we ing at is, in essence, a doubling of the wage had in financial markets and not have this as rate, which means essentially a doubling of a consequence.

“Look at the numbers. There’s been more actual economic investment in the last two years than there has been at any point in South Carolina history.”

16 SC BIZ | w w w. s c b i z m a g . c o m

SC Biz: How does your relationship with the legislative branch in the last year work to get some things done? Sanford: I’m hopeful. I wouldn’t have stayed around if I didn’t believe that, in this case, God couldn’t make lemonade out of lemons. The question in my mind has been: Can we take the political energy that’s been in the room and do something good with it? You’re undoubtedly going to see a bit less strident Mark Sanford. SC Biz: Is that a result of everything you’ve been through? Sanford: You can’t go through what I went through over six months and not have a slightly different perspective on life. “Pride cometh before a fall,” is what my Dad used to say. Well, I did the pride thing, and I did the fall thing. I’ll frankly come out and approach things differently than I have in the past — not the merit of the idea, but in some cases how those ideas are presented. SC Biz: What can South Carolina do for those rural counties that struggle, especially with high unemployment rates? Sanford: I think a couple of different things. One is playing to strengths. Part of it is that we’re in a unique spot in the world with regard to the timber basket — playing to strengths like that. Distribution continues to be an area that can’t be exported to China that plays well with the mesh of different interstates that cross our state. If you look at the geographic proximity of some of the rural counties to some of the larger urban areas, whether it’s Columbia, Charleston

or Greenville, some counties may have a strength in just identifying the cost of housing and quality of life that comes with these areas. I think we want to be creative at how we look at economic development.

new. As long as you have businesspeople talking to businesspeople, it’ll all work out fine. An example would be the two empty buildings right now here at USC. I’ve been a critic of that for a long time, because we poured massive SC Biz: During your term, the Commerce amounts of money in ... let the private sector Department has been realigned and then has grow the technology cluster. been shrinking along with the rest of state government. Is it still effective? SC Biz: Anything that you look back on Sanford: Absolutely. In some cases, the and would do differently? streamlining that has taken place has accrued Sanford: We obviously could have had not only to the benefit of taxpayers but ac- more legislative wins if we had not pushed crued to the benefit of actual economic devel- the budget battle. But if we hadn’t pushed the opment outcomes. I was over at the Red Ven- budget battle, I wouldn’t have been true to tures announcement in Lancaster County, and much of what I ran on. ... Directionally, were they were telling me Commerce did a great we pushing in the right direction? I think we job. were. I would say the proof is ultimately in the pudding: Look at the numbers. There’s been SC Biz: What will be seen as your economEmbattled Gov. Mark Sanford smiles while welcommore actual economic investment in the last ic legacy? Is it Boeing? two years than there has been at any point in Sanford: I hope they talk about the first ing Boeing Co. to South Carolina. (Photo/Leslie South Carolina history. cuts to marginal income tax rates in South Halpern) Carolina history. I hope they talk about the SC Biz: Does Boeing show that South largest recurring tax cut in South Carolina I think that those kinds of things will yield Carolina still is competitive for major invest- history. I hope they would talk about the first- more in the way of economic activity and ments and can build new clusters? of-its-kind tort reform. I hope they talk about investment than even the Boeing announceSanford: I’ve consistently given credit to the first-of-its-kind workers’ comp reform. ment. (former Commerce Secretary) Bob Faith. ... I think his hunch (on aviation) has held true. I don’t think the government ought to be in the business of saying “This is the industry of tomorrow. You’re blessed, you’re not.” What I do think you want to do is say, “We have some degree of critical mass, for instance in tourism. Is there something we can do collectively 2442 Remount Rd, Ste 210, North Charleston, SC 29406 (843) 725-5700 | www.Malphrus.com that will help to grow that critical mass?” The Boeing thing’s a little bit different, because we weren’t really at the point of critical mass, but Bob and some others realized there might be something there, and their hunch was proved right. SC

BIZ

SC Biz: Your administration advocated thinking of the state’s economy in “clusters.” Will that change how the state looks at its economy going forward? Sanford: I suspect it will, because New Carolina is fully behind it, and there’s a technology cluster, a textile cluster, a tourism cluster, an agriculture cluster. What I think you want to be careful of is that it doesn’t just become a conduit to gather government largesse to existing industries. Because the real industry of tomorrow is the business we can’t imagine, can’t see — you didn’t see it coming, but it creates something

IKEA Distribution Center (right) and Target Import Warehouse (left) Savannah, Georgia The Target Import Warehouse is a 168 acre site with 1,050,000 square foot distribution center under one roof. IKEA Distribution Center is a 61 acre development consisting of a 780,000 square foot Phase1 building and a 780,000 square foot building pad for future development.

w w w. s c b i z m a g . c o m | S p r i n g 2 0 1 0 1 7

TEACHING THE ART OF

ECONOMICS By Bob Bouyea, Publisher, Columbia Regional Business Report

Murray Brockman is president of the S.C. Governor’s School for Science and Mathematics, which sits on 17.5 acres. (Photo/Bob Bouyea)

wo small groups of students huddled together at opposite sides of the classroom, talking in hushed tones. Much was at stake as they informally learned about proprietary information — the importance of not letting your competitors know what you’re up to. As part of an elective three-week interim entrepreneurial course at the S.C. Governor’s School for Science and Mathematics, students got the opportunity to infuse economics and finance in the development of new products. Murray Brockman, president of the school, said this allows the student to think beyond the science and math needed to create a product and about the economics of manufacturing and selling the product. Soon, all Governor’s School students will get the opportunity to gain this type of experience. The Economics and Finance Institute is being created at the Hartsville campus of the school, a residential high school for juniors and seniors who are gifted in science or math. Boosted by a $1 million gift from the BlueCross BlueShield of South Carolina Foundation and a $200,000 gift from BB&T Founda-

nomics into technology, science and math, Brockman said. “Infusion is the key to having enough hours in a day to teach it all,” he said. The first order of business is to hire a director for the institute. Brockman said the school will be looking for someone who might have experience in industry or in starting a business. The person will be a visionary leader and will create the curriculum, he said. The institute’s inauguration will be approximately one year after the director is hired.

T

18 SC BIZ | w w w. s c b i z m a g . c o m

Students at the Governor’s School for Science and Mathematics listen during a lecture. The school will be instituting economics and finance education into its curriculum. (Photo/Courtesy Governor’s School)

tion, the school is set to develop curriculum that infuses economics and finance into its core courses, Brockman said. “When they (the students) leave here, they have a high level of understanding of science and math. Economics should be the same way. It should be as natural as walking,” he said. “What we want to do is establish a concentration in economics and finance.” The key to making it work is infusing eco-

Economics 1.0 The recent interim class is the school’s first introduction to economics. It featured Ralph Hulseman, president of Hoowaki, an Upstate company that manufactures a super hydrophobic rubber material used in products such as watercraft, snow removal equipment and wind-turbine blades. The material is a self-cleaning substance applied to a surface to repel water and stop ice buildup, among other uses. Each group in the class had to come up with a new use for the product, a business plan and a prototype. After the projects were judged,

the best idea received an A-plus and pizza. The second-place finisher received an A. The students received experience being entrepreneurs and gave Hulseman fresh ideas on how his product could be used. All Hulseman had to do was spend a little time at the school and provide the students with product samples so the prototypes could be made. At the end of the class, Hulseman had two new products in which to use his material. Hulseman said he sells hydrophobic tools to product manufacturers that incorporate the material into their line of products. One group came up with the idea of a beach sandal to which sand won’t stick. The other group created a windshield cover to which ice won’t stick. Both teams did research and held conference calls with potential retailers, or simply stopped in on them, to determine whether their products had merit. The group developing the windshield cover, for example, called a Boston car dealer, who thought it would be a good product for the northern region of the country. Once the students determined the products were good ideas, they talked with manufacturers to determine the cost of making the product. The students looked at cost advantages and target markets. “At this age, they are fearless,” said Brockman, the school president. When the students had completed the research, written the business plans and created the prototypes, they were independently judged. Hulseman was pleased with both presentations, and he announced that the sandal idea won. Hulseman wouldn’t hesitate to participate in the class again. Beyond getting ideas to take to his partners, a future benefit might be that a student decides to go to work for his company or becomes a client, he said.

Spawning the idea The idea to incorporate the disciplines came to Brockman during visits to universities across the country. While at Stanford, he met with the school’s head of engineering. Brockman was told that, as the engineering school was addressing a retention issue, it discovered that students’ passion for the subject was being crushed under the weight of the chemistry, math and other science courses the students had to take to fulfill requirements. Stanford’s solution was to incorporate engineering into those courses to keep the students’ interest.

But it was Hildy Teegen, dean of the University of South Carolina’s Darla Moore School of Business, who suggested infusing economics and finance into the curriculum. “We will be infusing economic thinking into science and math, and vice versa,” Brockman said. The goal is to equip students with the ability to look at the economic solution to real work problems and determine how that will drive the technology. “That is the critical need our country has,” Brockman said. “Some students will create a new technology and go on to create a new company. We want that to be as natural as breathing.”

Corporate hope Visiting business schools across the country and hosting think tank luncheons with some of the state’s business leaders are two examples of ways the GSSM Foundation, which raises funds for the school, and the school itself have worked to launch the Economics and Finance Institute, said Kim Bowman, the foundation’s executive director. Mike Brenan, president of BB&T of South Carolina, said the purpose of financial participation in the institute is that, by promoting capitalism and free market, the school aligns itself with a goal of BB&T’s charitable foundation. “These students are obviously highly motivated in science and math; this program lays the foundation of capitalism,” Brenan said. “The hope is they come back to South Carolina after college.” Judy Davis, executive vice president and chief legal officer for BlueCross BlueShield of South Carolina, agreed that one of the goals is to keep some of the state’s brightest students in South Carolina. To do that, the state needs to create good job opportunities and the right conditions for the students to start their own businesses. Several students will go on to become doctors, but exposure to economics could lead them into business, Davis said. She pointed to her organization’s CEO, Ed Sellers, who majored in physics but ended up with an MBA and at the head of one of the state’s largest companies. Davis and Brenan hope their companies will be attractive options for students after they graduate from college. “It will add to our value and to the community. Our challenge is, how do we make this community attractive to young profes-

The school is starting an Economics and Finance Institute to teach students the economic principles of research and development. (Photo/Courtesy GSSM)

sionals? We are looking at the arts and parks,” Davis said.

Growing pains As the school is developing the Economic and Finance Institute, it is also preparing to grow its student population by more than double and adding two wings to the main building. The expansion will add 70,000 square feet of space that includes engineering and science labs, a robotics area with a machine shop, a basketball court, locker rooms and other common areas for the students. This addition will also allow the school to grow from its current 128 students to 300 students. However, before that can happen the economy needs to recover so the Legislature will budget to allow the school to grow by adding staff and, therefore, adding more students. “GSSM and the GSSM Foundation share a vision for moving the school forward as a national model of excellence. A unique component of this vision is the Economics and Finance Institute,” Bowman said. “With generous corporate investors and a toolbox of innovative experiential learning opportunities, we are embracing a progressive new approach.” SC

BIZ

w w w. s c b i z m a g . c o m | S p r i n g 2 0 1 0 1 9

r e d u c i n g

your carbon By Allison Cooke Oliverius, Special Projects Editor

he concept of carbon credits and carbon offsets sometimes takes a while for Seph Wunder’s clients to grasp. “But when that lightbulb goes off, it goes off,” said Wunder, an attorney with Haynsworth Sinkler Boyd and a member of the firm’s Climate Change Team. As a member of the team, Wunder meets regularly with local government officials and business owners to explain ways they can develop energy efficiency projects and sustainability programs to reduce their carbon footprint — and then capitalize on those programs. Part of that includes carbon credits and carbon offsets, which are commodities that are bought and sold like stocks. “There are emerging hard assets out there that entities may or may not be aware of,” added John Boyd, an attorney and also a member of the Climate Change Team.

T

Efficient Energy Advisors is a new company, founded by Beaufort County entrepreneur John Rosenberg, that helps commercial and institutional clients reduce their energy costs. The company begins with an energy audit and then offers suggestions on ways to reduce energy consumption and save money. Solutions include making a structure more energy-efficient, using renewable energy and purchasing carbon credits. “At the end of the day, it’s still economics,” Logan said, “and a lot of the energy-saving ideas, such as alternative fuel, is not new. ... It just didn’t make economic sense when fossil fuels weren’t so expensive. It’s only going to become more expensive and more limited in supply, because the rest of the world is developing and their energy consumption is only going to increase. The economics are going to change in favor of some of these alternative energy technologies.”

Old concept becomes a new necessity

Waste to energy

Although carbon footprint reduction is not a new concept, Terry Logan of Efficient Energy Advisors says it’s only now that individuals, business owners and government agencies are really beginning to understand the economic benefits of doing so.

Logan, a scientist and part owner of Efficient Energy Advisors, says humans are at fault for the global warming that is impacting the environment. “Human activity since the dawn of the Industrial Age has increased the concentrations of so-called greenhouse

20 SC BIZ | w w w. s c b i z m a g . c o m

‘Human activity since the dawn of the Industrial Age has increased the concentrations of so-called greenhouse gases in the atmosphere.’ Terry Logan, Efficient Energy Advisors

gases in the atmosphere,” he said. “These gases absorb solar radiation that would otherwise escape beyond the earth’s atmosphere, and this trapped radiation results in global warming, an increase in the average temperature of the earth.” Carbon dioxide is the most important greenhouse gas, because of the sheer volume that is produced; but Logan said other gases that are produced in smaller amounts are more potent in the absorption of infrared radiation. Methane is one of those gases. Scientists say methane gas, a natural byproduct of the rotting of materials in landfills, can live in the atmosphere for 12 years. But when you calculate methane’s carbon dioxide equivalent, its lifespan grows to 25 years. Berkeley County is on the cutting edge of efforts to harness methane from landfills and put it to good use. Colin Martin, executive director of Berkeley County Water & Sanitation, said the county spent $2.5 million in 2009 to install special wells in its landfill that will be used to draw out the methane. Once the gas is pulled from the landfill, there are two options: The gas can be burned at the blower-flare station, which destroys the harmful emissions; or the gas can be sent through generators that will turn the waste byproduct into energy.

Martin said Santee Cooper recently agreed to purchase the methane gas and turn it into electricity. It should have generators up and running by August. Berkeley County has also signed a contract with Blue Source Inc., a national firm that buys and sells carbon credits. Credits can be earned when methane is removed from the atmosphere, and they are traded like stocks. “There are a number of good-news stories from this,” Martin said. “One, the money we generate will help hold down the costs of waste disposal. Two, we are removing these things from our environment. And three, not only are we removing them, we are substituting this form of energy for another, cleaner form.”

w w w. s c b i z m a g . c o m | S p r i n g 2 0 1 0 2 1

The place for industry. Pee Dee Touchstone EnergyÂŽ Commerce City

Berkeley County is one of six counties in South Carolina to install a landďŹ ll extraction system for methane gas. (Photo/Berkeley County)

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VISIONARIES

The carbon credits that entities earn from the reduction of carbon emissions are traded on the Chicago Climate Exchange, a legally binding greenhouse gas emissions allowance trading system. The credits are sold to entities that use them to offset their own emissions. “The clean energy legislation that has passed in the House and is now being considered by the Senate will change the complexion of this process of monetizing and collecting credits,� Martin said. “People are going to need these credits to meet newer, tougher standards.� These newer, tougher federal standards on carbon emissions are expected to be handed down in the next few months, but they will take years to implement, Martin said. “We are now a global economy,� Logan said, “and there are companies here who have major clients overseas and in Europe, and those clients are asking, ‘Do you have a plan to reduce your carbon footprint?’ The European countries are ahead of us in this stance.� He added that, with the legislation being considered, “There is a lot of uncertainty right now, and the more advanced companies tend to want to get ahead of the curve. They are asking, ‘How can I reduce my carbon footprint, what is it going to take and what is it going to mean for me financially?’� SC

BIZ

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SC BIZ | w w w. s c b i z m a g . c o m

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30

Letter from the

EDITOR What draws people to live in a city? Some would say it’s the basic services provided like police and fire protection, or infrastructure like water and sewer. Others might say it’s the access to recreational and cultural amenities available to residents. Still others might point to quality of life attributes a city or town can provide. This issue of Cities Mean Business magazine examines three perspectives on what draws people to live in cities and towns and what makes them attractive for job growth and economic development. First, we look through the eyes of several South Carolina mayors to get their insight on the role of cities. From planning and economic growth to collaboration and a sense of community, these mayors from cities and towns of all sizes discuss their points of view on how cities build a sense of community for their residents. Local leaders around the state also are doing more and more to integrate higher education institutions into the fabric of their downtowns. We’ve explored this in an article that focuses on four growing partnerships that are bringing a variety of institutions to downtown spaces. Local leaders say the long-term economic development implications of this type of partnership are huge. Tying directly to the idea of locating higher education programs downtown is the value of recruiting and retaining young talent and “creative class” workers in a community. We’ve also included an article that reveals what three cities are doing to attract and keep young and creative talent in their hometowns. In these times of economic stress, it’s even more important to stay focused on the long-range plans that make our cities and towns magnets for job growth and economic development. Join us in reading about how that’s happening in communities of all sizes around the state.

Reba Hull Campbell rcampbell@masc.sc

Editor

CONTENTS 4 What makes a city? A city is more than just an address. Several mayors across the state in municipalities large and small give their insight about what being a city means. Cover photo: A fire-eating display during a presentation at Pecha Kucha Beaufort. (Photo/Riann Mihiylov)

Cities Mean

BUSINESS A publication of Municipal Association of South Carolina 1411 Gervais St., P.O. Box 12109 Columbia, SC 29211 803.799.9574 mail@masc.sc www.masc.sc

9 The creative class The arts make cities an attractive place for young, creative professionals By Amy Geier Edgar, Contributing writer

Miriam Hair Executive Director, Municipal Association of SC Reba Campbell Deputy Executive Director, Municipal Association of SC Editorial staff Casey Fields Mary Brantner Contributing writer Amy Geier Edgar

Published by

12 An ideal fit Higher ed programs bringing new life to downtown areas By Amy Geier Edgar, Contributing writer

www.scbiznews.com

A publication for the Municipal Association of South Carolina

www.citiesmeanbusiness.org | Cities Mean BUSINESS 3

FEATURE STORY

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What makes What makes

city?

aa city? hen people talk about cities, many things might come to mind: city hall and local government, or the entity that provides utilities, sanitation, public safety and transportation, or the quality of life that comes from living in a city or town. Indeed, cities are all of these things, but they also are so much more. Cities are where people live, work and play. They are economic engines for the state. They plan for the future, pro-

W

A publication for the Municipal Association of South Carolina

vide a safe and welcoming place for residents to call home, and care for those most in need. Cities are multifunctioning and ever-changing. The Municipal Association of South Carolina spoke to several mayors across the state, in municipalities large and small, to get their insight about what being a city means.

PLANNING An important function of cities is the planning process. Required by

statute to complete and update a comprehensive plan, cities use these plans to create goals for the physical, social and economic growth, and development and redevelopment of the area. “It is important for cities to make sure that they are meeting the expectations of the residents, as well as those that they hope will move there,� said said Manning Mayor Kevin Johnson. “One way to meet those expectations is to have a long-range plan and

www.citiesmeanbusiness.org | Cities Mean BUSINESS 5

What makes a city?

Crowds flocked to Greer City Park for the inaugural Freedom Blast on July 4, 2009. Attendance topped 8,000 by the end of the evening. (Photo/Steve Owen, city of Greer)

to keep that plan current. The long-range plan is also important as it relates to land development and zoning issues,” he said. Long-term planning is especially important for smaller cities, said Arvest Turner, mayor of the town of Ninety Six. “The future of cities depends upon strategic planning. This is especially true for small towns. We struggle to survive with status quo. Long-term planning sets a goal to work toward. If we do nothing, small towns will cease to exist,” Turner said. It is the planning process that is the hallmark of cities — that ability to “control our own destinies, to control what we look like in the future,” said Greer Mayor Rick Danner. “Typically a city — as opposed to a county or a state — has a smaller defined area and a much better ability to do comprehensive and long-range planning,” Danner said. “We have the tools to do planning on an intimate, detailed level.” Greenville Mayor Knox White agreed, saying, “One of the hallmarks of cities is we focus more intently on planning and on proactive economic planning.” Long-range plans help cities prepare for growth or recession, and help establish goals to get residents what they really need from their cities, according to Newberry Mayor Ed Kyzer. Once a plan is in place, planning officials meet goals or adjust them as necessary. The end result can benefit the entire community, as seen in North Augusta, which has recently completed a $20 million municipal center and

has a 5- to 10-year plan to add a second major municipal park, said Mayor Lark Jones. Community design is an important part of long-range planning, said Little Mountain Mayor Buddy Johnson. “Some designs only accommodate automobiles, there’s no lighting, no sidewalks,” Buddy Johnson said. “Unless you have the infrastructure set up on the front end, everything can be really bland.” A key to good planning is to gather residents’ input and to have a focused, common goal, he said. “If you don’t have the input and don’t plan in advance, you’re always to trying to catch up and don’t have an enhanced quality of life,” Buddy Johnson said. “When you look at why people want to live in certain areas, community design is very important.”

QUALITY OF LIFE A city with a good quality of life will attract more residents and is more desirable for businesses or industries looking for a place to locate. These mayors agree that a strong system of parks and trails, playgrounds and recreation centers, and accessible green space all contribute to a good quality of life. A community with strong cultural programs, safe neighborhoods, good design and walkability also is appealing to residents. The development of a new city park in Greer is the perfect example of the blending of park space and an urban environment,

6 Cities Mean BUSINESS | www.citiesmeanbusiness.org

Danner said. It has opportunities for residents to walk, play, relax or picnic. “This is truly a city park,” Danner said. “It offers opportunities for all the people in the city.” Recreation for everyone, from youth to senior citizens, is an important factor for quality of life, as well as events such as festivals and cultural events that interest residents, said Manning’s Kevin Johnson. “But I think things that add beauty and hospitality to the town are also amenities that residents appreciate,” he added. “The quality of life for residents is automatically improved when residents live in a clean, litter-free environment where they are friendly and respect each other.” The availability of dependable services also is a factor in good quality of life, said Turner. “We must continue to have our residents as a priority,” Turner said. “By providing basic services such as fire protection, police protection, street and sanitation services, residents get a sense of security that they are being looked after by their town or city.” That sense of security is important so that residents can feel safe and comfortable leaving their homes and enjoying all their city has to offer, Kyzer said. Activities and entertainment options can include everything from theater and shopping, to skate parks and bowling, to music and festivals held on Main Street, Kyzer said. For a larger city, such as Greenville, quality of life is impacted by positive redevelopment of blighted areas and smart growth and development, which considers environmental issues and the walkability factor for pedestrians, said White. Other quality of life factors important to many citizens are good schools and educational opportunities. Libraries and neighborhood schools, such as the historic Little Mountain Elementary, provide a valuable education for the youngest residents and can become the center of the community, Buddy Johnson said.

BUILDING A SENSE OF COMMUNITY Cities often establish their own identity and build a sense of community around their history or traditions, such as Little Mountain’s school. Others find their identity through their geographical surroundings. However a city defines itself, it’s important for a city to understand its assets and work with them, White said.

A publication for the Municipal Association of South Carolina

What makes a city? “People are in search of authenticity,” White said. “The challenge is not to fall into the trap of what’s trendy, but to look deeper.” A city needs to be about more than just an address for residents, Danner said. People need to have a sense of what the community is about. Although Greer is among the state’s 20 largest cities, most people consider it a small town and that pleases local officials, he said. “People here feel like they’re part of a caring community,” Danner added. One challenge with growth is maintaining that sense of community, North Augusta’s Jones said. “The sense of community is in the minds and hearts of residents, but there are things local government can do.” Establishing community parks and holding downtown festivals are ways to create a common identity, he said. Community building also is considered when planning, Jones said, adding that North Augusta is growing two major city parks and is contemplating whether to make them “identical twins” that offer the same amenities such as soccer fields and basketball courts, or “brother and sister” parks that offer different features. The major concern, Jones said, is making both parks accessible to all residents and maintaining that sense of community. One way to build a sense of community is through citizen involvement, Kevin Johnson said. “This involvement allows them to buy into decisions that impact their daily lives and makes them feel like they are a big part of the community. Involving key influencers and stakeholders in the discussions and decisions helps build a close-knit community. There is not much that can’t be accomplished when you have a close knit community that feels like they are a part of what the city has to offer.” Turner agreed. “It takes all organizations, civic groups and residents working together to improve the quality of life for all involved. It is necessary to have public meetings, neighborhood gatherings, etc., to emphasize the importance of community pride.” Building that sense of community pride was so important in Little Mountain that officials developed a digital archive of their oral histories, artifacts and photos, and hired a media production company to produce a short documentary detailing the community’s heritage. “There have been a lot of people moving in who don’t know of our history and

customs,” Buddy Johnson said. “Unless you have something to show them, it’s difficult to continue with our goals of having village characteristics.”

PROVIDING SERVICES

TRAINING/LEARNING FROM OUR NEIGHBORS Many times, cities can find solutions to their most challenging issues by looking to other cities. “By learning from our neighbors, we can put into practice things that they are doing that will work well in our town,” Kevin Johnson said. “More importantly, we can learn to avoid mistakes that might have been made by them. As we visit nearby cities or attend training sessions, some of the most valuable lessons are given when we share ideas, issues and concerns with our neighbors. We can also discover ways that we can work together which will give us the opportunity to serve our constituents in a more efficient manner.” The best way to improve a city or community is to look to other towns or cities that are successful, Danner said.

Communities also are built around the services that cities provide, from essential services like public utilities and public safety, to social services like caring for the homeless or elderly. “As citizens of a community, we need to help those who need it,” Danner said. Social services are valuable to a community, especially in tough economic times, said Kevin Johnson. “I think it is important to emphasize that a community is no stronger than its weakest resident,” he said. “A strong community is one in which everyone looks out for those in need.” Often, social responsibilities fall to cities alone, White said. Greenville has worked to continued on page 8 > address its homelessness issue by creating an extensive housing program and providing affordable housing, he said.

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What makes a city? a particular development is not in our city, we can still benefit by the fact that the development is located within our region,” he said. Turner said small towns struggle financially, and it is crucial that they are involved with their local economic development associations within their counties. “With that relationship, we can keep our small towns and surrounding areas in the loop of the considerations that will be made within the county,” Turner said.

CITIES AND COUNTIES WORKING TOGETHER

The Newberry Fire House Conference Center draws residents and visitors downtown for meetings, training, weddings and other social events. (Photo/city of Newberry)

< continued from page 7 “We’ve looked to Rock Hill, Aiken and others for insight to programs they may be offering,” Danner said. “We usually look to cities that are larger, because they offer ideas on how we can move forward in the future as we grow.” White said he is a big believer in searching for best practices from other cities. He cites the Reedy River project as an example and said Greenville officials traveled to a number of other cities to review other river redevelopment projects. “They provided valuable ideas,” White said, “but it was also important for us to stay authentic to our own experience.” Along with best practices, training programs also are vital for councilmembers and city employees to keep abreast of changing technology and information, Danner said. “Cities are competing in an environment of choice — businesses can choose to go anywhere,” he said. “It’s critical that we have training and ongoing education to compete.” While many elected officials receive technical training on their duties and responsibilities, Buddy Johnson said officials also should receive training on leadership and community building. He has attended various training sessions over the years in the South and in Boise, Idaho, and said the experience is invaluable. “Economic development starts with good communities and good communities don’t 8 Cities Mean BUSINESS

just happen. They are built by leaders with a shared community vision,” he said.

ECONOMIC ENGINES Not only are cities the economic engines of the state, Danner said they are also “the engine that is going to pull the train of economic recovery.” Danner said he thinks economic recovery in South Carolina is linked directly to cities, noting that BMW and Boeing — two of the largest economic drivers in the state — are regional and statewide drivers. In the new economy, more people want to live and work in urban areas, White said. When businesses are scouting for sites, cities with a good quality of life are a natural magnet, he said. “It’s no wonder that, across the country, urban areas are stronger in the recession,” White said. For small towns, regional cooperation is the best way to survive in this economy and to provide maximum services to citizens, said Kevin Johnson. “We need to understand the importance of recruiting economic development as a region and understand that although

Cities and counties need to have good working relationships to allow areas to grow and be progressive, Jones said. In some areas, the relationship between city and county governments can be weak. Part of the issue is the fractured offering of services by cities, counties, the state and special purpose districts, Danner said. That leads to a lot of overlap. Still, “there definitely is a role for cities and the services they provide, and a role for counties and their services,” Danner said. “There is also a future for collaborative efforts and even potential for other special purpose districts to offer an even higher level of service.” Increasingly, cities and counties share economic relationships. While manufacturers may need to locate in a county for reasons of size and scale, it’s likely their executives may want to live in a city for all of its amenities and quality of life offerings, White said. “Counties need strong cities as economic engines to attract businesses in the 21st century,” White said. “We need healthy, vibrant cities.”

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By Amy Geier Edgar

creative The arts make cities an attractive place for young, creative professionals

www.citiesmeanbusiness.org | Cities Mean BUSINESS 9

Creative Class

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typical work day for the Go To Team video production company might involve shooting sports footage or producing videos for ESPN, Fox Sports or ABC News. The company was founded in 1997 in Charleston by Patrick Bryant and Dwaine Scott, who saw a shortage of quality, organized camera crews outside of Atlanta. Over the years, it has attracted the attention of national clients, and has grown from two employees to 16, with five offices in the Southeast and a new branch opening soon in Atlanta. With all of their growth and success, the Go To Team chooses to keep its headquarters in Charleston. “Charleston is a fabulous town with a great quality of life,” said Bryant, managing partner. “That’s what municipalities need to have to keep and attract the professional young people that Go To Team hires.” Nationally, the economy is shifting away from manufacturing industries to the hightech, knowledge economy. The knowledge economy includes a sector of people coined the “creative class” by Richard Florida, author of Rise of the Creative Class. Florida said these creative types are highly-educated, well-paid

professionals whose work includes technology, finance, journalism, high-end manufacturing and the arts. The author said these creative workers often are young entrepreneurs and involved in their communities. Most importantly, the type of work they do allows them to choose where they live. Instead of moving for work, these creative workers will move where they want to live and the jobs follow. Many cities are realizing the impact that the creative class has on the economy and are taking steps to nurture it.

CREATIVE INDUSTRIES CLUSTER New Carolina — South Carolina’s Council on Competitiveness — is a public-private partnership working to improve the state’s economy. Its goal is to develop clusters — groups of businesses in a certain region that focus on or service the same industry. Companies within clusters come together to increase efficiency and innovation within that industry, while boosting the overall economy in their region. New Carolina identified a creative industries cluster in the Lowcountry, made up of the fields of preservation and restoration, cultural heritage, architecture and urban design, performing and visual arts, culinary arts, literary arts and publishing, and digital media and design. The Charleston Creative Cluster, dubbed “Parliament,” was formed two years ago, according to New Carolina’s Beth Meredith. She organized

a meeting with creative leaders in the city to discuss how to move forward. Meredith realized that creative people don’t work well sitting in a boardroom. So they set up a Pecha Kucha Night in Charleston. Pecha Kucha is an international event (about 200 cities worldwide hold similar events) that comes from the Japanese phrase “sound of conversation.” It’s a performance night that brings creative businesses together to explain and display their work, and also provides an opportunity to celebrate the city’s arts and culture. Performers have included skateboarders, chefs and poets, Meredith said. Similar Pecha Kucha nights have since been held in Beaufort, Columbia and Greenville. “We structure ours so that presenters talk about what inspires them and what keeps them in Charleston,” Meredith said. “It’s an opportunity to connect these creative people who otherwise would not meet. Some creative businesses are now working together.” The creative economy not only adds to quality of life for residents, but also is key for the future, Meredith said. “The creative economy is full of entrepreneurs,” she said. “As a city or town, we don’t want to rely just on big industry. We want to have a mix.” And the presence of the arts makes a city more attractive to young people. If you were to ask 20- to 30-somethings why they are in Charleston, they would reply that they want to live there, Meredith said. That’s because Charleston is a “cool” city, with great music and art scenes, wonderful cuisine and special events like Spoleto and Pecha Kucha.

BEAUFORT GETS ON BOARD Other communities also are taking steps to highlight their “cool” factor to young, creative types. Beaufort County held its first Pecha Kucha Night in October with 12 presenters and about 300 audience members attending the event in Port Royal. Organizers hope to hold the events four times a year. “It breathed some real energy into our artist and young professional communities. There was just an energy there that isn’t matched by many events and was just totally different,” said Ian Leslie, director of marketing and membership for the Lowcountry Economic Network. “Secondly, we showed young, creative, knowledge-intensive artists and business people that there are like-minded people already here. The purpose was to market that aspect to the people within our own county, but also to 10 Cities Mean BUSINESS | www.citiesmeanbusiness.org

A publication for the Municipal Association of South Carolina

Creative Class take the message outside the region and show others why they should consider moving their businesses here and working here,” he said. The arts are important in Beaufort because they makes the community better for the people who live there, said Beaufort Mayor Billy Keyserling. “With the support of the city, a community that has that artistic ambiance begins to attract young professionals and businesses,” Keyserling said. “While there’s a direct economic benefit for a community to be involved in the arts, the actual perception that a community is identified with the arts is an asset in and of itself. More economic development deals probably have been closed at Charleston’s Spoleto Festival than in the boardroom of the S.C. Department of Commerce.” Beaufort is keeping the creative class in mind as area leaders plan for the future. Lowcountry Economic Network Executive Director Kim Statler said growing knowledge-intensive, creative businesses is one of her group’s top four focus areas for economic development. “The reason we believe this strategy will be successful in Beaufort is because of the quality of life and character the city offers,” Statler said. “So many of the prospects we deal with already have a relationship with Beaufort and just need a little push to understand that they can live and work here. This doesn’t have to be solely a vacation destination for them.” In order to promote that, Statler said, they work on events like Pecha Kucha, and promote infill development and creating the types of office space that the new young professionals want to work in. It’s already clear that the arts are making an economic impact in Beaufort County. The Arts Council of Beaufort County, or ACBC, conducted an Economic Impact of the Arts study in 2008 through a grant from the S.C. Arts Commission matched by the Beaufort Regional Chamber of Commerce. The study, conducted by Georgia Southern University, found that the total arts economy output in Beaufort County is more than $213 million. The ACBC partners with the city of Beaufort to help grow the arts and to make sure everyone understands that the arts can be an economic driver, said J.W. Rone, ACBC’s executive director. “When we present an appealing community, that attracts industry,” Rone said. “The hightech industries and jobs in the creative economy don’t need an industry base. They can move where they want to, so quality of life issues become even more important for workers.”

Yoga abilities on display during the Pecha Kucha event in Beaufort. (Photo/Riann Mihiylov)

The quality of life in Beaufort was appealing enough for artist Deanna Bowdish to move there seven years ago and purchase a gallery. The Gallery offers original contemporary works of art by more than 60 local, regional and national artists. Bowdish notes that Beaufort is a wonderful community for artists with a wide range of art available, a good cost of living and supportive local organizations. “A strong arts community is essential to helping to create an identity for a community,” Bowdish said. “The creative work force is essential to a well-rounded community because they can adapt and adjust and offer fresh perspectives and ideas and help to revitalize a community.”

THE SPINOFF EFFECT That was the case in the city of Abbeville, where downtown revitalization was sparked in the 1970s by the renovation of the historic Abbeville Opera House. Today, thousands of theater patrons each year visit the opera house, including a number of artists. The city is now home to a number of antique and gift shops, boutiques, restaurants, hotels, and bed and breakfasts. Special arts events are held downtown, such as a Wine Walk — sponsored by the city’s art galleries, the opera house and local businesses — and the Art and Antiques on the Square — sponsored by the Chamber of Commerce, the Abbeville Artists’ Guild and the city. The city also has partnered with local artists by allowing the Artists Guild to sell commemorative bricks as a fundraiser. The bricks

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will be used in the third phase of the city’s streetscape project. In addition, the city is renovating an old livery stable, which includes 6,000 square feet of open space that will be used for live music and entertainment. “When you draw people into a city for the arts, it has a spinoff effect,” said Assistant City Manager Ashley Ramey. “Our small businesses are so important to us here. When people come for theater, they stay for food, shopping and other entertainment.” Having artists as residents also contributes to the revitalization of the historic city, Ramey said. “We have a historic downtown area and historic homes. These are attractive to people who are interested in art. They help to save these structures. Creative people are the ones who have the skills and interest in renovating these structures,” Ramey said. One such creative type who decided to stay in Abbeville is artist and gallery owner Judson Arce. Originally from Sullivan’s Island, Arce had been living in Florida and moved to Abbeville five years ago. “I fell in love with the charm of the town,” Arce said. “Plus the price is right. To buy real estate was very reasonable. I wouldn’t have been able to have my own gallery in Florida or Charleston.” “This is a lovely town. It does lend itself to being an arts destination,” said Arce, who serves as president of the Abbeville Artists’ Guild. “I’ve been impressed with the help I’ve gotten from members of the community and people with the city.”

www.citiesmeanbusiness.org | Cities Mean BUSINESS 11

t An ideal fi

Higher ed programs bringing new life to downtown areas By Amy Geier Edgar

W

hen Clemson University decided to move its graduate business program, a downtown location with access to real world business experience seemed an ideal fit.

In November, Clemson announced plans to relocate its Masters in

Business Administration program to downtown Greenville. The university leased more than 30,000 square feet of downtown office space in a building overlooking the Reedy River falls and park.

Left: Clemson University President James Barker (left) joins Greenville Mayor Knox White to raise the Clemson colors over the university’s new business graduate school home overlooking the Reedy River falls. (Photo/James T. Hammond) Above: Downtown Greenville. (Photo/Kevin Greene)

12 Cities Mean BUSINESS | www.citiesmeanbusiness.org

A publication for the Municipal Association of South Carolina

Clemson’s recent move is part of a trend of higher education institutions locating specific colleges or programs to downtown areas. Both sides can benefit from the arrangement. In many cases, cities will offer land or buildings to encourage colleges to locate downtown. The influx of hundreds of students and staff often leads to significant growth and development for a city. In addition, the chance to get hands-on experience with businesses and live in a “cool” urban environment is appealing to educated workers and students. “It was a high priority for the city to bring higher ed into downtown,” said Greenville Mayor Knox White. “We’re very pleased to have an emerging relationship with Clemson, first with ICAR and now with the business school downtown.” The university had been considering a downtown location for its MBA program for some time. About 10 years ago, a partnership began between the city of Greenville and Clemson when the university president held a summit seeking ways for the school to be more engaged in the city. The partnership first began with the International Center for Automotive Research, or ICAR, an advancedtechnology research campus dedicated to the automotive industry, said Nancy Whitworth, economic development director for the city of Greenville. Greenville does not have a major research university, but ICAR and the Clemson business school bring with them researchers, graduate students and the types of jobs so critical to the knowledge economy, Whitworth said. “From an economic development standpoint, it’s huge,” she added. Bruce Yandle, professor emeritus of economics at Clemson, was one of the early supporters of moving the business school to downtown Greenville. “Ideally, every graduate student in a downtown-located program will be engaged in a real-world, funded project with real deadlines, product expectations, and regular meetings with sponsors and team members,” Yandle said. “In other words: Welcome to the real world. Students engaged and coordinated by faculty members will be learning by doing. Their consulting experience will become the most significant part of their education. They will smoothly move from graduate students to work or to their own businesses.” The location also has an impact on faculty and helps attract students and staff, Yandle said.

A rendering of Presbyterian College’s new pharmacy school, which will be located in downtown Clinton.

“Many of the best faculty want to be in the center of things. They want to be engaged in their disciplines. They, too, are inspired by engagement,” he said. “Being located in the center of a dynamic downtown makes their Clemson affiliation all the more attractive and valuable.” Meanwhile, the city of Greenville’s leaders are excited to have an influx of some 300 people downtown to help with office and business recruitment, White said. “They’ll be bringing students, faculty, administration and staff to the downtown area. It’s like bringing any major employer downtown.” There also is the potential for those students to stay and work downtown after they have completed their degrees, White added. That would cut back on the “brain drain” that occurs when graduates leave an area for work in another location. “Graduate and advanced undergraduate programs located in the downtown centers put students where they want to be,” Yandle explained. “Some will establish residential locations that they will love. Some will marry or form close relationships they will want to maintain. Some will fall in love with the city itself and find it hard to pull up roots and leave. And most of all, some will become engaged in businesses as leaders or as owners. They will become wealth producers in the region.” Moreover, when those educated workers stay in the community, it helps build up the state’s burgeoning knowledge economy. Though progress is being made, the state ranks 40th among the 50 states in recent estimates of the knowledge economy index, Yandle said. That is because South Carolina lags in educational attainment. Part of the lag relates to the fact that the state has been a net exporter of college graduates, he said.

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Other universities also realize the significance of an urban location. The USC Upstate Web site plainly states that the school seeks to “become one of the Southeast’s leading ‘metropolitan’ universities ... a university which acknowledges as its fundamental reason for being its relationship to its surrounding cities, their connecting corridors and expanding populations.” As part of that vision to become a metropolitan university, USC Upstate decided to move its Johnson College of Business and Economics to downtown Spartanburg. Construction began in November 2008 and will be complete in the summer of 2010. “We certainly reached the conclusion that the business school would be a business driver in the downtown. It will lead to a demand for student housing and retail. It’s a nice match for what we’re doing in the downtown,” said Spartanburg City Manager Ed Memmott. “It also fits our larger goals for having a more highly-educated work force.” Colleges are attractive to cities because they “are typically stable employers and attract an educated work force,” Memmott said. The city of Spartanburg made land available to the business school and agreed to build a parking garage behind it. In addition, the city is constructing roads and infrastructure to support the business school as well as other projects that officials hope will follow. For instance, there is a large building next to the business school that is currently vacant. Memmott said city officials are hopeful that the new school will lead to redevelopment of that building, perhaps with student housing on the upper levels and retail on the first floor. If that student housing happens, it could lead to the growth of more shops, restaurants and entertainment in the downtown area.

www.citiesmeanbusiness.org | Cities Mean BUSINESS 13

David H. Wilkins, Knox White and James Barker with the new Clemson facility in the background. (Photo/James T. Hammond)

“We think this will be a real catalyst,” Memmott said he sees real potential in keepMemmott said. ing those students in the city after they graduate. The locale will benefit students by giving “If you look at trend lines and projections them more of a connection to downtown of how folks will want to live and what will businesses. Students will have the opportunity be attractive in the future, the long commute to participate in activities like a new business is not what people want,” Memmott said. incubator program or an enterprise class that “They’re looking for walkable, and bikeable, works on business plan projects for both ex- distances to work and entertainment. The isting and start-up businesses, more highly-educated folks said Dr. Darrell Parker, dean are a piece of the demographic “With a college of the Johnson College of seeking that (type of) lifestyle Business and Economics. in the future.” that’s open 16 to Parker co-wrote a paper, In Clinton, Presbyterian 18 hours a day, with USC Upstate ChancelCollege’s new pharmacy school lor John Stockwell, on the will locate in the downtown it creates other decision to move the busiarea. The city and county have business options. worked together to bring the ness school to downtown Spartanburg. It puts life into the school into a building that had They wrote, “The presence been sitting vacant. The city downtown.” of the business campus will purchased the building and is strengthen the city’s position leasing it to the college, said Dr. Charles Gould in attracting investment, inMayor Randy Randall, who president, Florencecreasing its tax base and enalso serves as executive direcDarlington Technical hancing the flow of downtown tor of alumni and community College traffic to the benefit of local relations for the college. The businesses. county plans to buy the land Long-range benefits will accrue to the city around the building and make parking lots, including stimulating innovation, supporting which will be deeded to and maintained by incubation, enabling continuing education the city. and enhancing the downtown ‘cool’ factor. Randall expects the city to see numerous Most importantly, the downtown campus will benefits from the new pharmacy school, which be predisposing some graduating business welcomes its first class in the fall of 2010. majors by virtue of their experience, comfort “In addition to having 350 more people levels, internship connections, etc. to build downtown, there are apartments being built careers and perhaps to live in the city.” downtown, people are renovating buildings 14 Cities Mean BUSINESS | www.citiesmeanbusiness.org

for apartments, people are looking at building eating establishments,” Randall said. “Hopefully there will be growth in several areas like restaurants and retail.” In addition, Randall hopes that some of the students will see the benefit of staying in the area after they graduate. “The need for pharmacists is in small, rural communities,” he said. Many technical colleges also have a downtown presence. Florence-Darlington Technical College has branches in Florence, Darlington, Hartsville, Lake City and downtown Mullins. A downtown satellite school is very important to a small city like Mullins, said FDTC President Dr. Charles Gould. “It gives a group of citizens access to higher education that they wouldn’t have otherwise,” Gould said. The school also creates business opportunities for the city, Gould added. “With a college that’s open 16 to 18 hours a day, it creates other business options. It puts life into the downtown. It brings cars, people and lights to the downtown. It means restaurants might stay open later,” he said. It also helps with economic development by providing work force development and offering one more tool in the inventory for county economic developers seeking to attract industry, Gould said. Gould said he has seen a boom in enrollment numbers. That could be partly due to laid-off workers going back to school for more training, but Gould said more importantly the message is sinking in that nearly 85 percent of all jobs, now and in the future, will require some college-level training. As the state’s economy continues to shift from manufacturing to a knowledge base, it is critical to provide higher education to students, and to find ways to keep those students in state after they graduate and join the work force. Increasingly, cities will be the key to engaging these educated workers. “People with advanced education typically like urban life, the arts, creativity, and engagement with ideas and knowledge. They may not wish to live in the heart of a city, but they want to be able to engage in activities in that city,” said Clemson’s Yandle. “And interestingly enough, knowledge workers want to be around students and university life. Our research shows that immigration to urban locations is strongly associated with the number of university and college students located in those urban areas.”

A publication for the Municipal Association of South Carolina

You see a police car. We see a police ofďŹ cer named Hal who works closely with ďŹ re departments and EMS, who knows every business owner downtown, who can name every city street and who buys 12 snow cones on Saturdays even though his T-ball team has never won a game.

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Cities Mean Business

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Cities Mean Business To learn more about how strong cities contribute to the state’s economic prosperity, visit www.citiesmeanbusiness.org.

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D

espite the pressures of the recession and despite its status as an economic sector in transition, manufacturing continues to constitute the largest industry cluster in South Carolina, according to a recent economic impact study Miley Gallo and Associates LLC conducted for the S.C. Manufacturers Alliance. The data showed almost 5,200 manufacturing establishments in the state in 2008. That is 4.5% of all establishments, though the manufacturers paid more than 20% of all wages paid in South Carolina and constituted more than 15% of all jobs. The following section highlights some of the products made right here in South Carolina. They are diverse — including pharmaceuticals used to treat cancer and the product used to make plastic bottles for the beverage industry, tiny diapers and huge airplanes. There are numerous industries within the manufacturing sector, but for the purposes of this report, we narrowed our focus to six industries and provided a snapshot of each. We’d like to thank the S.C. Manufacturers Alliance for their assistance. You can read more about the alliance and its “Made in S.C.” campaign on page 33.

Top Five list source: S.C. Manufacturers Alliance, www.myscma.com. See company Web sites for more information. Gross revenues are for calendar year 2008. Source: Dun & Bradstreet.

w w w. s c b i z m a g . c o m | S p r i n g 2 0 1 0 2 5

Made in S.C.

TOP FIVE 1

2

S

outh Carolina’s already strong aircraft industry in facilities across the state. received a boost in October 2009 when The The boat manufacturing industry added nearly Boeing Co. announced it would locate a $400 million to the state’s economy and supported second assembly line for the 787 Dreamliner in more than 9,500 jobs in 2008, according to a study North Charleston. The other production line is in conducted by the Darla Moore School of Business. Washington state. Several top-name fishing and pleasure boats With this announcement — are manufactured in the state, which includes an investment of at including Key West, Sea Fox, Scout least $750 million and the creation and Sea Hunt; and Beneteau USA The manufacturing sector of an estimated 3,700 jobs — South manufactures world-class sailboats. pays almost 13% of all Carolina landed one of the biggest The state is home to small property taxes in the state economic development deals in its companies like Charleston-based although it represents only history. The company’s decision Folbot, which employs 16 people about 5% of all establishto put an assembly plant here also and has been making folding ments. The sector paid bodes well for local attempts to kayaks since 1933, and large com$521 million in FY 2007 to launch a major aerospace manupanies like Honda, which employs local governments. facturing base — and for compamore than 1,700 people and makes nies that want to assist with buildpersonal watercraft and all-terrain Source: Miley Gallo & Associates LLC ing the facility and later supplying vehicles at its Timmonsville plant. Boeing with materials needed to Outside of watercraft, other build the giant aircraft. products related to the boating industry that are Boeing joins Lockheed Martin, GE Aviation made here include buoys and barrier floats, boat and nearly 100 other aerospace-related companies engines and boat covers. with operations in South Carolina. The S.C. DeDun & Bradstreet estimates that, together, the partment of Commerce estimates those compaaircraft and watercraft industries had an impact of nies employ more than 16,000 South Carolinians more than $700 million statewide in 2008.

FACT:

R Ranked by Gross Revenue G Boeing Co. 3455 Airframe Drive, North Charleston, SC 29418 www.boeing.com Line of business: Manufactures commercial jetliners and military aircraft. Product application: Includes the 787 Dreamliner. Company HQ: Chicago Gross revenue: $60,909,000,000 No. of employees: 294

Lockheed Martin Aircraft Center 244 Terminal Road, Greenville, SC 29605 www.lockheedmartin.com Line of business: Aircraft manufacturing and maintenance. Product application: Includes aircraft maintenance, modifications and state-of-the-art upgrades. Company HQ: Bethesda, Md. Gross revenue: $336,026,400 No. of employees: 1,200

(Photo/Courtesy Lockheed Martin)

Aircraft and boats

AAircraft and boats

3 Scout Boats Inc. 2531 W. Fifth North St., Summerville, SC 29483 www.scoutboats.com Line of business: Builds and repairs boats. Product application: Includes sportfishing and flat fishing boats, plus the marine industry’s first fiberglass hybrid boat. Company HQ: Summerville Gross revenue: $24,272,810 No. of employees: 50

4 Beneteau USA Inc. 1313 W. U.S. Highway 76, Marion, SC 29571 www.beneteauusa.com Line of business: Builds and repairs sailboats. Product application: Includes 10 different models of 31- to 50-foot sailboats. Company HQ: U.S.: Marion; World: France Gross revenue: $21,037,375 No. of employees: 155

5 Sea Hunt Boat Manufacturing Co. Inc. 2348 Shop Road, Columbia, SC 29201 www.seahuntboats.com Line of business: Builds and repairs boats. Product application: Includes sportfishing, skiing and pleasure craft. Company HQ: Columbia Gross revenue: $10,600,000 No. of employees: 85

Industry Analysis Aircraft and engines form a major U.S. export industry that is highly competitive in global markets and is expected to enjoy a bright future. The boat industry is linked to higher income and the demand for leisure activity. The industry, which is highly sensitive to recessions, recoveries and expansions, should see brighter days in the coming years. 26 SC SC BIZ BIZ| w| www. wsw. c bsiczbmi zam g .acgo.m com

Made in S.C.

TOP FIVE 1

AAutomotive R Ranked by Gross Revenue G

Michelin North America Inc. 1 Parkway S., Greenville, SC 29615 www.michelin-us.com Line of business: Manufactures automobile tires. Product application: Includes tires for cars, vans and pickup trucks. Corporate HQ: North American: Greenville Gross revenue: $8,300,000,000 No. of employees: 1,200

2 BMW Manufacturing Co. LLC 1400 S.C. Highway 101 S., Greer, SC 29651 www.bmwusfactory.com Line of business: Assembles complete automobiles, including specialty. Product application: Includes X5 Sport Activity Vehicle and the ActiveHybrid X6. Corporate HQ: Woodcliff Lake, N.J. Gross revenue: $4,181,375,000 No. of employees: 5,000

(Photo/Courtesy Michelin North America Inc.)

Automotive

3 Honda of S.C. Manufacturing 111 Honda Way, Timmonsville, SC 29161 www.honda.com Line of business: Manufactures motor vehicles and car bodies. Product application: Includes all-terrain vehicles and personal watercraft. Corporate HQ: U.S.: Torrance, Calif. Gross revenue: $1,463,481,250 No. of employees: 1,750

M

ore than 250 automotive and related comtruck and SUV tires, operates a facility in panies call South Carolina home. The state’s Graniteville. growing industry is chock-full of some of Other automotive-related products made in the highest-profile companies in the world. And South Carolina include fuel injectors; automatic they are kept company by some businesses whose brake systems; automotive lighting fixtures; glass names may not be recognized outside the county products, including mirrors; and plastic bumpers where they are based but whose products are mak- and bumperettes. ing a big difference. In early February, a company Some of the heavy hitters that develops and assembles drive include BMW Manufacturing, systems and energy-storage The average salary for which opened its first U.S. producsystems for heavy-duty vehicles ana manufacturing job in tion plant in Greer in 1994, and nounced it plans to invest $68 milSouth Carolina is $42,242. Michelin North America, which lion in a manufacturing and R&D The average salary for has its North American headquarcenter in the Upstate. Proterra other jobs in the state is ters in Greenville and several tire Inc. chose Greenville from among $32,420. production sites in the Upstate. sites in 30 states. The company Daimler produces its Sprinter will build a 240,000-square-foot Source: South Carolina Manufacturers Alliance van in Ladson, which is also home facility at the Clemson University to a plant for American LaFrance, a International Center for Automomanufacturer of firetrucks, ambulances and rescue tive Research. It expects to create 1,300 jobs. vehicles. As a whole, the industry had an estimated ecoYet another Ladson-based company, Force nomic impact of $8.9 billion in 2008, according to Protection Inc., manufactures mine-resistant, Dun & Bradstreet. ambush-protected vehicles used by armed forces In 2009, Business Facilities magazine named and security personnel. And BridgestoneSouth Carolina as the fourth-strongest state in the Firestone, which manufactures passenger, light U.S. for automotive manufacturing growth.

4 Force Protection Inc.

FACT:

9801 U.S. Highway 78, Building 1 Ladson, SC 29456 www.forceprotectioninc.com Line of business: Assembles military motor vehicles. Product application: Includes armored land vehicles designed to protect military troops. Corporate HQ: Ladson Gross revenue: $ 1,326,331,000 No. of employees: 500

5 Cummins Inc. 9051 Palmetto Commerce Parkway Ladson, SC 29456 www.cummins.com Line of business: Manufactures internal combustion engines and motor vehicle parts; assembles complete buses and specialty vehicles. Product application: Includes marine engines and turbochargers for a range of diesel engines. Corporate HQ: Columbus, Ind. Gross revenue: $412,700,000 No. of employees: 1,250

Industry Analysis The recession aside, the U.S. is still the world’s strongest single auto market, but others are gaining quickly. Because of currency risks, protectionism that limits imports, and low-cost energy and security, the U.S. is once again a growing auto producer. Auto production now ranks in the 10 U.S. industries in terms of real output. Future prospects are bright. w w w. s c b i z m a g . c o m | S p r i n g 2 0 1 0 2 7

Made in S.C.

TOP FIVE 1

2

Chemicals and plastics

3

T

he chemicals and plastics industry in South an R&D facility. Products made in South Carolina Carolina is responsible for making a wide vainclude a variety of additives, including tints, riety of items, including air freshener, plastic colorants and clarifiers used in plastics, polymers, shower liners, ibuprofen and paint. textiles and other household products. The companies located in the state provide Roche operates a bulk active ingredient thousands of high-paying jobs to South Carolinmanufacturing facility in Florence, where it makes ians and have invested more than $1.4 billion in the active ingredients for the manufacture of South Carolina from 2006-2008, Xeloda (cancer treatment), Pegasys according to the S.C. Department (hepatitis treatment), Xenical of Commerce. (weight-loss drug) and Tamiflu (flu The manufacturing sector Dun & Bradstreet estimates the medicine). employs 20% of all industry had a $970 million impact BASF Corp. has two production South Carolinians. on the state’s economy in 2008. plants in South Carolina — one in There are more than 5,000 Companies located here include Clemson and one in Spartanburg manufacturing businesses BP Corp. North America, which — where surfactants are manuin the state. produces more than 1.25 milfactured for use in consumer and Source: South Carolina lion tons of purified terephthalic industrial cleaning products and Manufacturers Alliance acid annually. PTA is used in the detergents. production of textiles, bottles, In addition, South Carolina is packaging and film products. BP’s plant is located home to Capsugel, which manufactures capsules outside of Charleston. and liquid-drug delivery products. The company Milliken & Co. has been a mainstay in South announced last year that it plans to expand its Carolina since 1884, when the company, then operations in Greenwood County, a $15 million based in New York, invested in a facility in investment that is expected to create 50 jobs. The Pacolet. The privately held company is now head- expansion is scheduled to be complete by January quartered in Spartanburg, where it also operates 2011.

FACT:

4

5

CChemicals and plastics R Ranked by Gross Revenue G

BP Corp. North America Inc. 1306 Amoco Drive, Wando, SC 29492 www.bpamoco.com Line of business: Petroleum refining; manufactures inorganic chemicals. Product application: Clear plastic bottles for beverages; see-through plastic packaging. Company HQ: North American: Warrenville, Ill.; World: London Gross revenue: $781,962,025 No. of employees: 325

Invista SARL Interstate 85 at Road 57, Spartanburg, SC 29302 www.invista.com Line of business: Manufactures plastic materials and resins. Product application: Includes containers for beverages, food and custom applications. Company HQ: Wichita, Kan. Gross revenue: $365,993,000 No. of employees: 500

Nan Ya Plastics Corp. America 525 Beulah Road, Lake City, SC 29560 www.npcam.com Line of business: Manufactures organic fiber and fiber products, plastics materials and resins, and cellulosic man-made fiber products. Product application: Includes polyester chip for textile and bottle/sheet industries, and fiber and yarns for carpet and auto industries. Company HQ: U.S.: Livingston, N.J. Gross revenue: $290,699,575 No. of employees: 905

Albemarle Corp. 725 Cannon Bridge Road, Orangeburg, SC 29116 www.albemarle.com Line of business: Manufactures inorganic chemicals, industrial organic chemicals, pharmaceutical preparations; petroleum refining. Product application: Consumer electronics, automotive, pharmaceuticals and agrichemicals. Company HQ: Baton Rouge, La. Gross revenue: $153,456,350 No. of employees: 475

Mitsubishi Polyester Film Inc. 2001 Hood Road, Greer, SC 29650 www.m-petfilm.com Line of business: Manufactures unsupported plastics film and sheet; manufactures paper packaging materials Product application: Includes food and product packaging, ribbons for fax printers, X-ray film. Company HQ: U.S.: Greer Gross revenue: $152,272,200 No. of employees: 600

Industry Analysis There are two worlds in the chemical industry, and two outlooks: medicinal chemicals and specialty chemicals. There are commodity chemicals in a highly competitive, low-profit segment of the industry. The United States’ advantage lies in intellectual property rights and major expertise in research and development. 28 SC BIZ | w w w. s c b i z m a g . c o m

Made in S.C.

TOP FIVE 1

2

Construction materials

S

3

everal companies announced new facilities CMC, which has facilities in Cayce, has been choor expansions in South Carolina in recent sen to design, fabricate and build the structural months, projects that will present opportuni- steel for the new Boeing plant. CMC expects five ties for the construction and construction materi- of its units in South Carolina to be involved in the als industries. Boeing project. Some of the design and fabrication The Boeing Co., for example, announced it will be done in Greenville. would build a plant of at least 550,000 square feet Other products made in South Carolina that in North Charleston to house its support the residential and comsecond assembly line for the 787 mercial construction industries Dreamliner. And Proterra Inc., include steel beams and sheetManufacturing’s share which manufactures, develops and rolled steel made by Nucor Steel; of South Carolina’s gross assembles drive systems and veneer flooring made by Anderson domestic product is $25.1 energy-storage systems for Hardwood Floors; brick, pavers billion, or 20% of the heavy-duty vehicles, announced and sculptures produced by Carostate’s entire GDP. in February it plans to build a lina Ceramics Brick Co.; carpet Source: Miley Gallo & Associates LLC 240,000-square-foot R&D and yarn manufactured by Shaw manufacturing plant on the Industries; siding, aluminum trim campus of the Clemson University and injection-molded shutters International Center for Automotive Research. A and accessories from Alcoa Home Exteriors; variety of road improvement projects are in the pressure-treated lumber manufactured by Cox works, including the rehabilitation of Interstate Industries; and gas and diesel engines made by 385 in Greenville. Caterpillar Inc. for construction and mining Numerous products made in South Carolina equipment. will supply the construction industry with materiDun & Bradstreet estimates the construction als to build these structures and roads. materials industry had a $4 billion economic CMC Steel South Carolina is one of them. impact on the state in 2008.

FACT:

4

5

CConstruction materials R Ranked by Gross Revenue G

Metromont Corp. 2802 White Horse Road, Greenville, SC 29611 www.metromontusa.com Line of business: Manufactures concrete structural support and building material. Product application: Includes schools, parking structures and office buildings. Company HQ: Greenville Gross revenue: $218,000,000 No. of employees: 200

Bonitz Inc. 645 Rosewood Drive, Columbia, SC 29201 www.bonitz.us Line of business: Manufactures prefabricated metal building panels. Provides industrial and commercial building renovating, remodeling and repair service. Product application: Includes dorms, luxury condos. Company HQ: Columbia Gross revenue: $192,766,476 No. of employees: 26

Synalloy Corp. 2155 W. Croft Circle, Spartanburg, SC 29302 www.synalloy.com Line of business: Manufactures steel pipe and tubes, synthetic organic dyes, industrial organic chemicals. Product application: Includes pipe and piping systems for various industries. Company HQ: Spartanburg Gross revenue: $192,476,072 No. of employees: 150

CMC Steel South Carolina / Owen Electric Steel Co. of S.C. 310 New State Road, Cayce, SC 29033 www.cmcsteel-sc.com Line of business: Manufactures steel and iron rods made in steel mills, other metalwork. Product application: Includes rebar for highway construction. Company HQ: Irving, Texas Gross revenue: $155,494,800 No. of employees: 400

Jacobs Applied Technology Inc. 2040 Bushy Park Road, Goose Creek, SC 29445 www.jacobs.com Line of business: Manufactures petroleum refinery equipment; industrial plant construction; Product application: Includes professional, technical and construction services for the industrial, commercial and government sectors. Company HQ: Pasadena, Calif. Gross revenue: $82,703,000 No. of employees: 500

Industry Analysis The U.S. construction industry is expected to struggle for several more years. One part of the industry that is expected to recover early is the public construction sector, where stimulus money will help pave roads, build bridges and rework ports.

w w w. s c b i z m a g . c o m | S p r i n g 2 0 1 0 2 9

Made in S.C.

TOP FIVE 1

2

Household products

3

R

adios, cleaning solutions and tea, everyday pants. It’s listed as one of Aiken County’s largest items like these — and many more — are employers with more than 1,300 employees. made in South Carolina. USCOA LLC operates a state-of-the-art manuBose Corp. manufactures audio systems and facturing facility in St. George where coconut fiber accessories at its plant in Blythewood and in 2008 bristles are used to make welcome mats. was listed as one of Richland County’s major Alice Manufacturing Co. Inc. in Easley has employers, with more than 960 workers. been owned and operated by the McKissick famHeadquartered in Dallas, Kimberly-Clark ily since 1923. More than 500 employees at two opened its Beech Island plant in facilities manufacture spun yarns 1968. The facility produces family and woven fabric that are used to care products that include facial make percale sheeting, broadcloth, The direct and indirect and bath tissue, paper towels, print cloth, twills, sateens, poplins, impacts of the manufacturnapkins and moist wipes, as well as and other customized fabrics. Their ing sector total more than several infant and child care prodend-use markets focus on home $141 billion a year. ucts, such as diapers and training furnishings, apparel and career apSource: Miley Gallo & Associates LLC parel, pocketing, industrial applications and institutional bedding. Nestle Prepared Foods operates a plant in Gaffney that processes and packages food for Stouffer’s and Lean Cuisine dinners. The variety of household goods manufactured in South Carolina is seemingly endless. Other South Carolina-made products include solar screen fabrics, carpets, aluminum siding, hardwood floors, upholstery, architectural glass and computers. (Photo/Courtesy Bose Corp.)

4

FACT:

5

HHousehold products R Ranked by Gross Revenue G

Sonoco Products Co. 1 N. Second St., Hartsville, SC 29550 www.sonoco.com Line of business: Corrugated and solid fiber containers, wooden reels, paper packaging and finished injection molded plastic products. Product application: Includes plastic components and fasteners for BMW and bags for vacuumpacked coffee. Corporate HQ: Hartsville Gross revenue: $4,122,385,000 No. of employees: 2,000

AtibitiBowater Inc. 55 E. Camperdown Way, Greenville, SC 29601 www.bowater.com Line of business: Manufactures newsprint; coated paper; rough, sawed or planed lumber. Product application: Includes commercial printing paper and market pulp. Corporate HQ: Canada Gross revenue: $3,211,000,000 No. of employees: 125

Milliken & Co. P.O. Box 1926, Spartanburg, SC 29304 www.milliken.com Line of business: Manufactures inorganic chemicals, textile fiber carpets, pressed fiber and molded pulp products, coated and laminated paper. Product application: Includes carpets, flameretardant fabrics, specialty packaging, table linens. Corporate HQ: Spartanburg Gross revenue: $490,555,101 No. of employees: 3,000

Bose Corp. 2000 Carolina Pines Drive, Blythewood, SC 29016 www.bose.com Line of business: Manufactures household audio components. Product application: Includes home theater systems, headphones and speakers. Corporate HQ: Framingham, Mass. Gross revenue: $255,278,250 No. of employees: 750

Cox Industries Inc. 860 Cannon Bridge Road, Orangeburg, SC 29115 www.coxwood.com Line of business: Treats wood structural lumber and timber; manufactures outdoor wooden furniture. Product application: Includes residential building materials and outdoor furniture. Corporate HQ: Orangeburg Gross revenue: $140,075,162 No. of employees: 145

Industry Analysis The future for household products in terms of global markets is in the developing world, where population growth, higher incomes and access to water are combining to produce immense consumer markets. The U.S., by contrast, is a mature and stable market but not a high-growth market. 30 SC BIZ | w w w. s c b i z m a g . c o m

Made in S.C.

TOP FIVE 1

2

3

Textiles

T

extile companies in South Carolina have ing the materials that are turned into a product shed thousands of jobs in the past decade as elsewhere. a result of economic conditions and offshore For example, AGY Holding Corp. manufaccompetition. But they’ve also invested time and tures fiberglass fabric that is used in helicopter resources to change what and how they manufac- blades, snowboards and cockpit door armor for ture so that they might rise to meet the needs of commercial aircraft. Glen Raven Inc. manufacthe end-user. tures organic fiber and fiber products that are used Technology advancement has to make awnings, liners for shipbeen a big part of this transformaping containers, and military duffel tion, and Milliken & Co., headbags, flags and hammocks. It is estimated that before quartered in Spartanburg, has led And DAK Americas LLC manthe current recession hit the way. Milliken has accumulated ufactures organic fiber and fiber the state, the manufacturmore than 2,000 patents and has used in moisture-wicking apparel ing sector supported more the largest textile research center in and wrinkle-resistant fabrics. than 585,000 jobs directly the world. Its developments include Many of the state’s textile and indirectly. fabrics that keep soldiers warm, companies support the growing Source: Miley Gallo & Associates LLC astronauts safe and major league automotive industry. Suminoe baseball players comfortable. Textile of America Corp., which “It’s not your father’s textile mill produces fabrics and a carpet that anymore,” said Lewis Gossett, president of the incorporates its patented sound absorption techS.C. Manufacturers Alliance. “Very sophisticated nology, announced it will expand its operations products are being made in South Carolina by a in Cherokee County, investing $6.5 million and sophisticated work force.” creating as many as 50 jobs. Gossett added that many of the mills aren’t It’s estimated the textile industry had a specializing in finished products — shirts and $5.2 billion impact on the state’s economy in 2008, sheets — like they used to. Instead, they are creat- according to Dun & Bradstreet.

FACT:

4

5

TTextiles R Ranked by Gross Revenue G

AGY Holding Corp. 2556 Wagener Road, Aiken, SC 29801 www.agy.com Line of business: Manufactures fiberglass fabric. Product application: Includes helicopter blades, snowboards and cockpit door armor for commercial aircraft. Corporate HQ: Aiken Gross revenue: $236,487,000 No. of employees: 700

Tietex International Ltd. 160 Lincoln School Road, Spartanburg, SC 29301 www.tietex.com Line of business: Nonwoven fabric mill. Product application: Includes athletic footwear, mattress coverings and fire-resistant fabrics. Corporate HQ: Spartanburg Gross revenue: $124,194,600 No. of employees: 600

Glen Raven Inc. 4665 Liberty Highway, Anderson, SC 29621 www.glenraven.com Line of business: Manufactures organic fiber and fiber products; yarn processing mill; man-made broadwoven fabric mill; broadwoven cotton fabric mill. Product application: Includes awnings; shipping container liners; and duffel bags, flags and hammocks for the military. Corporate HQ: Glen Raven, N.C. Gross revenue: $122,061,700 No. of employees: 380

DAK Americas LLC 3350 Cypress Gardens Road Moncks Corner, SC 29461 www.dakamericas.com Line of business: Manufactures organic fiber and fiber products, plastics materials and resins. Product application: Includes bottles for the water and soft drink industry, moisture-wicking apparel and wrinkle-resistant fabrics. Corporate HQ: Charlotte Gross revenue: $80,303,750 No. of employees: 250

Mount Vernon Mills Inc. 1559 S. Main St., McCormick, SC 29835 www.mvmills.com Line of business: Wholesales woven upholstery fabrics; manufactures household furnishings. Product application: Includes sheets and towels for hospitality markets, as well as surgical towels and receiving blankets. Corporate HQ: Mauldin Gross revenue: $75,172,125 No. of employees: 125

Industry Analysis The textile industry has been in a state of overall decline for decades. However, there are large pockets of highly competitive product offerings. The focus will be on high-technology products, including nonwoven products, high-fashion fabric, automobile upholstery and specialty woolen products. w w w. s c b i z m a g . c o m | S p r i n g 2 0 1 0 3 1

Made in S.C. Overview of Employment in Manufacturing Industry

Number of employing units

% of total

Total annual wages

115,220

100.00%

$54,524,872,250

Total, Private Goods – Producing

% of total

Average monthly employment

% of total

Average annual wages

100.00%

1,538,996

100.00%

$35,429

20,796

18.00%

$16,059,880,126

29.50%

366,431

23.80%

$43,828

Manufacturing

5,167

4.50%

$11,185,775,278

20.50%

242,158

15.70%

$46,192

Durable Goods Manufacturing

3,160

2.70%

$6,384,697,578

11.70%

135,462

8.80%

$47,133

Nondurable Goods Manufacturing

2,007

1.70%

$4,801,077,700

8.80%

106,696

6.90%

$44,998

Source: S.C. Employment Security Commission, 2008

Manufacturing’s Share of Property Taxes FY 1997

% of total

FY 2008

$2,142,427,074

$4,064,343,235

89.70%

$293,630,514

13.70%

$936,460,043

$18,744,926

0.90%

$25,109,927

0.60%

34%

$5,781,668

0.30%

$5,078,485

0.10%

-12.20%

Commercial/Rental

$623,317,477

29.10%

$1,538,629,716

37.90%

146.80%

Personal Property (Vehicles)

$440,242,442

20.50%

$437,914,884

10.80%

-0.50%

$0

0%

$69,519,786

1.70%

NA

$390,094,425

18.20%

$329,682,277

8.10%

-15.50%

Total Property Tax Revenues Owner Occupied Agricultural (Private) Agricultural (Corporate)

Other Personal Property County Manufacturing Fee-in-Lieu and Joint Industrial Park

% of Total % Change ‘97-‘08 23%

218.90%

$0

0.00%

$191,499,702

4.70%

N/A

Manufacturing + FILOT

$390,094,425

18.20%

$521,181,979

12.80%

33.60%

Utility

$254,201,202

11.90%

$346,504,937

8.50%

36.30%

Business Personal

$116,409,272

5.40%

$168,189,739

4.10%

44.50%

$0

0%

$15,753,739

0.40%

N/A

Motor Carrier

Source: S.C. Budget and Control Board, Local Government Finance Report, 2009

Selected Wage Rates in South Carolina, 2009 Q2 Industry ...................................................... Average Annual Wages South Carolina Average .................................................................$35,620 Aircraft manufacturing ................................................................$135,148 Nuclear electric power generation.................................................$83,980 Petrochemical manufacturing .......................................................$78,780 Motor vehicle body manufacturing ................................................$78,312 Industrial building construction .....................................................$77,844 Research and Development in Biotechnology US...........................$73,008 Basic chemical manufacturing ......................................................$71,084 Power generation and supply ........................................................$70,668 Pulp, paper, and paperboard mills .................................................$69,680 Other biological product manufacturing ........................................$69,628 Paperboard mills...........................................................................$68,588 Utilities .........................................................................................$68,432 Turbine and power transmission equipment mfg. ..........................$68,016 Pipeline transportation of natural gas ............................................$65,676 Electromedical apparatus manufacturing ......................................$62,348

Industry ...................................................... Average Annual Wages Nonresidential building construction .............................................$62,036 Plastics material and resin manufacturing ....................................$61,204 Natural gas distribution .................................................................$60,008 Federal Government Average ........................................................$59,124 Rolled steel shape manufacturing .................................................$58,188 Iron and steel mills .......................................................................$54,184 All Manufacturing Average ............................................................$44,876 State Government Average............................................................$40,092 Local Government Average ...........................................................$38,948 Textile machinery manufacturing ..................................................$37,336 Textile mills ..................................................................................$34,996 Retail Trade...................................................................................$23,862 Grocery stores ..............................................................................$21,001 Department stores ........................................................................$17,732 Full-service restaurants ................................................................$14,404 Accommodation and Food Services ..............................................$14,357 Source: S.C. Employment Security Commission, 2009 Q2

32 SC BIZ | w w w. s c b i z m a g . c o m

Made in S.C. Contribution to State Gross Domestic Product, 2000-2008, by industry (in millions of chained 2000 dollars) 2000 Contribution to GDP

% of Total GDP, 2000

2008 Contribution to GDP

% of Total, 2008

Manufacturing

$23,522

20.91%

$23,531

18.52%

Government

$17,449

15.51%

$18,948

14.91%

Real estate and rental and leasing

$12,321

10.95%

$13,273

10.45%

Retail trade

$9,234

8.21%

$12,803

10.08%

Health care and social assistance

$5,617

4.99%

$7,734

6.09%

Wholesale trade

$6,025

5.35%

$7,560

5.95%

Industry

Professional and technical services

$4,506

4.00%

$7,107

5.59%

Finance and insurance

$4,877

4.33%

$5,933

4.67%

Information

$2,827

2.51%

$5,095

4.01%

Administrative and waste services

$4,169

3.71%

$4,748

3.74%

Construction

$6,291

5.59%

$4,466

3.51%

Accommodation and food services

$3,715

3.30%

$4,370

3.44%

Utilities

$2,934

2.61%

$3,202

2.52%

Transportation and warehousing, excluding Postal Service

$2,800

2.49%

$2,985

2.35%

Other services, except government

$2,757

2.45%

$2,858

2.25%

Arts, entertainment, and recreation Agriculture, forestry, fishing, and hunting Management of companies and enterprises

$965

0.86%

$959

0.75%

$1,080

0.96%

$913

0.72%

$706

0.63%

$853

0.67%

Educational services

$518

0.46%

$611

0.48%

Mining

$201

0.18%

$127

0.10%

Source: Gross Domestic Product by state, U.S. Bureau of Economic Analysis

The ‘Made in South Carolina’ campaign

T

he mission of “Made in South Carolina” is to showcase and promote products manufactured in South Carolina. Under the leadership of the S.C. Manufacturers Alliance, this marketing campaign strives to inform South Carolinians of the diverse manufacturing sector within the state; provide educational outreach efforts to bring the science of manufacturing into the classroom; and accentuate the significant contributions these companies make to the economy and quality of life in South Carolina. Inspired by a desire to raise the profile of S.C. manufacturing and its people, plants and products — the Made in South Carolina public awareness campaign has become an important part of the S.C. Manufacturers Alliance’s mission to promote and serve the manufacturing community in the Palmetto State.

Similar in concept to the Made in the USA campaign of the 1980s and 1990s, Made in South Carolina strives to educate South Carolinians about the importance of manufacturing for our state and at the same time showcase products produced by our friends and neighbors. For almost a century, manufacturing in South Carolina has been a staple for the state’s economy. Made in South Carolina is a marketing campaign not only to recognize the contributions of these companies and their employees, who work hard to supply the world with wonderful products, but also to accentuate the importance manufacturing has in our daily lives. For more information, visit www.madeinSC.org or www.myscma.com.

w w w. s c b i z m a g . c o m | S p r i n g 2 0 1 0 3 3

10 20 1, E SU IS

S.C. Delivers

PORTS, LOGISTICS & DISTRIBUTION IN S.C.

S.C. Delivers PORTS, LOGISTICS & DISTRIBUTION IN S.C. | ISSUE 1, 2010

First in the U.S.

Georgetown

Clock’s ticking

Manufacturer achieves zero

Leaders assess the Port

State seeks Lowcountry

waste-to-landfill status

of Georgetown’s status

rail agreement

Page 40

Page 42

Page 45

A P U B L I C AT I O N O F S C B I Z N E W S

BRIEFS Greenville airport marketing land for development

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36 | S.C. DELIVERS

Company to ship 5,000 BMWs out of Charleston

CHARLESTON – The S.C. State Ports Authority has taken some business from an East Coast competitor that will result in two ships docking in Charleston each month. Hoegh Autoliners, based in Oslo, Norway, expects to load more than 5,000 vehicles each year. Hoegh, one of the world’s largest operators in rolling stock and vehicle transportation, related companies, the announced it will bring the ships airport said. to the Port of Charleston as part “Some of the sites have of its Middle East service. runway access. That’s one of the The company’s very unique features that this land has to offer,” said Tyson Smoak of NAI Earle Furman. “The plots have flexible zoning and are available for long-term lease.” This is the first time these parcels have been listed on the commercial real estate market, the airport said.

first vessel, the Hoegh Bangkok, arrived at the Union Pier Terminal Jan. 29 to load export BMWs made at the manufacturer’s S.C. plant, according to the S.C. State Ports Authority. The service is expected to load more than 5,000 vehicles annually that Hoegh previously moved through a competing South Atlantic port, the news release said, without specifically naming the port. The Hoegh Bangkok was built in 2007 and can carry 7,800 car equivalent units, according to Hoegh Autoliners. Hoegh’s Middle East service offers port coverage from Mediterranean ports into the Red Sea and to the Persian Gulf and India. Trans-shipment onto other Hoegh vessels offers access into other ports in the Middle East, Africa and Asia.

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BRIEFS S offers SPA e e-mail alert of cruise ship arrivals CHARLESTON – Charleston businesses and residents can now get a heads-up via e-mail when a cruise ship is headed to town. S.C. State Ports Authority officials announced a new e-mail service through which they’ll send advance notice when cruise ships are to be docked at the Union Pier Cruise Terminal on Concord Street. The ports authority already posts annual schedules of cruise ship dockings and embarkations on its Web site. Some business owners, however, have said they do not track that schedule regularly and are sometimes surprised by the flood of tourists the ships bring to downtown streets. The new e-mail service also will inform subscribers of any street closures or rerouting of traffic as a result of the cruise ships. To sign up for the e-mails on-

Number of cruise ships in Charleston, 2001-2010

line and see a public calendar of originate from the city’s port. The all planned cruise ship events, combined 69 cruise ships is up visit www.scspa.com and click on from 33 last year and 49 in 2008. As the port’s cruise business Charleston Cruises. grows to new highs, the S.C. State Ports Authority is working on a master plan for redesigning the aging downtown terminal where cruise passengers enter and leave Cruise ships embarking from their ships. and stopping for a day at the Port The ports authority commisof Charleston will have a $37 mil- sioned College of Charleston lion economic impact on the re- professors John Crotts and Frank gion this year, according to a new Hefner to study the ships’ impact study by two College of Charles- because it had no reliable estimate ton professors. of how cruises affect the local This year, 16 cruise ships will economy, State Ports Authority make one-day port-of-call stops CEO Jim Newsome said recently in Charleston and 53 cruises will at a presentation of the study’s

Port’s cruise ship business worth $37M, study says

findings. The study found that the cruise business in 2010 will generate 407 jobs that have average annual earnings of $39,786. Of those 407 jobs, about 118 are in the transportation sector, 66 are in retail, 40 are in wholesale trade, 33 are in the food and beverage industry, and about 19 are in grocery stores. Related state sales and income taxes are estimated to be $3.5 million. The last time a cruise ship economic impact study was performed was 2003. That year, the port’s 47 cruise ships made an impact of $9.8 million.

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At Regal we know what makes a proÀtable and efÀcient supply chain: product delivered to market just-in-time with the most cost-effective methods available. At Regal Logistics we say, “Let us help you make the sale.” The retailers our customers supply want orders shipped completely, accurately, just-in-time and exactly as they require. Manufacturers want to meet customer demand. Regal Logistics improves our customers’ supply chains by delivering faster replenishment cycles, higher sales, better store shelf stock rates, lower logistics costs and superior customer service. With a combined total of more than 1.2 million square feet of high velocity distribution space in the PaciÀc Northwest and the U.S. Southeast, Regal Logistics offers a superior way to accelerate product to market, while reducing costs and offering better access to important markets throughout the world. Regal distributes customer product to major retailers including Wal-Mart, Target, Kmart, Kohl’s and Toys R Us. Consistent service and signiÀcant volume with Wal-Mart earned Regal Logistics Preferred Provider distinction. In particular, our Charleston warehouse offers up to 200,000 square feet of capacity, small and large space options, competitive rates and short and long terms. Constructed of modern tilt concrete panels, the facility features a fully-fenced, gated yard with closed circuit security cameras and advanced technology infrastructure. Strategically located within four miles of the Port of Charleston’s main Wando Welch Terminal and Interstate 526, and within 10 miles of the North Charleston Terminal, I-26 and Charleston International Airport, the

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TRUCKING

Gaffney manufacturer achieves zero waste-to-landfill status By Allison Cooke Oliverius, Special Projects Editor

B

ill Harris admits he was skeptical when corporate officials approached him in 2007 about helping his company, Freightliner Custom Chassis Corp., achieve zero waste-tolandfill status. At that time, the company, which manufactures chassis for commercial bus, school bus, motor home and van markets, was disposing of about 250,000 pounds of solid waste per month. “I thought it was a little bit of a stretch,” said Harris, environmental and facilities engineering supervisor at Freightliner’s Gaffney facility. “Drastically reduce what was going to the landfill, yes. But I thought going to zero was a little far-fetched.” But in less than three years, Freightliner became the first chassis manufacturer and the first company within the trucking industry in the United States to achieve this status.

What they did The zero waste-to-landfill directive was initiated by Freightliner’s parent company, Daimler Trucks North America, to reduce the carbon footprint of manufacturing facilities under the Daim-

User-friendly

Freightliner employees gather for a ceremony at which officials announced the company’s zero waste to landfill status. (Photo provided)

ler umbrella. The Gaffney facility was chosen as the pilot site for the program, and because of its success, it will serve as the blueprint for other facilities. Harris said they started by assembling a “green team” of employees from various departments who met monthly. The team selected a pilot area on the production floor in which to reduce waste to zero. Within a few months, the plan was expanded to other areas in the facility. One member of the team, environmental technician Ryan Pennington, created a link on the company’s intranet where he posted progress updates and ways the facility’s 450 workers could reduce, reuse and recycle. Employees quickly embraced the initiatives, and by mid-2009,

the company was recycling 97% of its waste. It then entered into an agreement with a recycling company to take the remaining 3% — collected from production and the break area — and convert that waste into energy. “Freightliner Custom Chassis Corp. easily surpassed our corporate goal by realizing zero waste-to-landfill status three months earlier than our original January 2010 target date,” said Roger Nielsen, COO of Daimler Trucks North America. “FCCC was able to achieve these results by the continued efforts and diligence of all employees within the company, and we continue to seek ways to reduce our environmental impact in our facility and through our products and alternative-fuel efforts.”

In addition to the green team’s efforts, Daimler has implemented an environmental check sheet companywide that employees are expected to complete weekly. It helps them realize the impact they can make on a personal level, Pennington said. Now that Freightliner has a solid plan in place, Harris and Pennington believe maintaining the status will be relatively easy. “The goal was to make a recycling program that was sustainable and we did that by making it user-friendly,” Harris said. It’s also a plan that could easily be shared with and duplicated by others. “Even though we’ve done a lot of things here, we’ve tried to keep it simple,” Harris added. “It’s not rocket science. We did have a learning curve and hit a couple minor roadblocks, but it progressed really well. Once we got into it and employees got involved, the thing developed itself. Just getting it started was the biggest mountain we climbed.” The next goal, Pennington said, is for all of Daimler Corp. to achieve zero waste-to-landfill status by 2012. It’s already 87% there.

•

PARTNERSHIPS, ROI AND SHARING IDEAS Partnerships and programs Harris and Pennington attribute the success of Freightliner’s program to companywide buy-in “from the top down,” as well as the support of programs like the Environmental Protection Agency’s WasteWise, which helped them find solutions for recycling of plastic, paper, aluminum, cardboard, metals, wood and nylon.

40 | S.C. DELIVERS

Freightliner also formed partnerships with Cherokee County for on-site recycling removal and with the S.C. Vocational Rehabilitation Department to have students who needed job training segregate plastics for recycling.

waste disposal costs upon beginning its zero-waste efforts in 2007, the company was $60,000 in the red. In 2008, it was just $12,000 in the red. By 2009, the company was making “a couple thousand dollars off of recycling,” Harris said. “Our investReturn on investment ment on recycling containers has When Freightliner began track- been $30,000. We’re never going ing its recycling recoupment versus to get rich off of recycling, but we

are being able to recoup some of our costs.” Passing along the knowledge As part of the EPA’s WasteWise partnership, Freightliner is required to mentor others who are interested in achieving zero waste-to-landfill status. It is currently assisting other companies in the industry as well as the local school system.

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PORT

Georgetown’s struggle Leaders assess the port’s status and what’s needed to help it regain strength By Marsha Guerard, Contributing Writer

A

Georgetown County group wants to begin the process of rebuilding the county’s port after a storm of negative economic factors has left the port a shell of the vital business it once was. “We want to kick up some dust about our port” and its importance to the local economy, said Dan Stacy, a lawyer and a member of the 25-year-old Georgetown Alliance for Economic Improvement. Having a port is “one of the things that makes us unique.” Although there is plenty of data concerning the impact of the state’s ports on the statewide economy, there’s not enough information about how the port in Georgetown affects that area financially, Stacy said. The alliance has asked economists at Coastal Carolina University to study the port’s impact. Stacy said he’s seen a first draft of the study, which should

The Port of Georgetown. (Photo courtesy S.C. State Ports Authority)

cargo tonnage since the year 2000. Some of the contributing factors include last year’s indefinite closure of the Georgetown steel mill. But the bad news for the port began before the mill closed. The ArcelorMittal USA mill had changed the way it obtained Damage assessment How bad has the last decade the ore it needed as a raw material. been for the port of Georgetown? Rather than coming in through The port has seen an 84% decline in Georgetown’s port, ore was brought be released publicly in February. He was not surprised by the findings, except to the extent that they showed the port is probably more important to the area’s economy than even he had realized.

PORT OF GEORGETOWN BY THE NUMBERS Port Activity 2000 - 2009 in tons 2,000,000

Port statistics

• Four berths totaling 1,800 feet. • 139,800 square feet of covered storage. 1,600,000 • Two transit warehouses totaling 103,000 square feet. 1,200,000 • Three enclosed sheds totaling 36,800 square feet. 800,000 • 27.9 acres of open storage. • Covered and open storage rail access. 400,000 • Up to 200-ton mobile crane available. • Specialty handling facilities on terminal 0 for metals, cement, chemicals, aggre2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 gates, forest products and ore. 2007: Ranked 91st among U.S. ports for imports, with 276,478 tons • Fleet of cargo-handling equipment. of cargo. • Direct on-terminal CSX rail connection. 2007: Was not among the top 130 U.S. ports ranked for exports or • Channel depth: 27 feet at mean low total domestic trade. water. (In some places it’s 21 feet.) 2007: Ranked 111th among U.S. ports for total foreign trade. • 27 feet at mean low water at dockside. 2009: Georgetown, a dedicated break bulk and bulk facility, handled • 13.5 miles from the ocean. 286,254 tons of cargo. Steel, petroleum coke and wood • Harbor pilot required. briquettes are top cargoes. • Tugboat services required. Source: Army Corps of Engineers, Waterborne Commerce Statistics Center

42 | S.C. DELIVERS

down from the Port of Wilmington, N.C. That helped soothe complaints in town about the dust that was kicked up from the mill, but it took a major chunk out of the Georgetown port’s business. In addition, International Paper Co., which had been producing kraft paper in Georgetown since the 1930s, shifted its emphasis to making the fluff pulp that’s used in diapers, tissues and other products. Kraft paper, which is tough and durable, can be shipped through the port as break bulk cargo. But fluff pulp, by nature an absorbent material, must be shipped in containers to maintain quality. The Port of Georgetown handles break bulk cargo, so the paper company’s containerized products now run through the Port of Charleston. An International Paper spokesman said the company no longer

Georgetown County UNEMPLOYMENT December 2009: 14.9% 21st-highest jobless rate in the state. November 2009: 13.9%. Number unemployed in the county rose 7.2% in one month, and nearly 32% compared with December 2008. The state’s unemployment rate was 12.6% in December 2009. POPULATION: 60,731 Population between 18 and 65 years old: 60.2%. 2008 estimates

ships any materials through the port in Georgetown. Couple the loss in shipping demand from those two companies — combined, they accounted for about 1 million tons of cargo annually — with the national economic downturn, and the port’s cargo volume no longer meets the Army Corps of Engineers’ cost-benefit ratio for port dredging funds.

Business down, silt building up Although the port’s cargo business climbed 8% in fiscal 2009 to 286,254 tons, the figure wasn’t enough to move the dial much on the Army Corps’ funding formula, which uses 1 million tons as its threshold. About $9 million is what’s needed to dredge the silt out of the shipping channel and maintain the dikes on the spoil site, but only about $1.1 million has been allocated for the work, said Joe Wilson, project manager for

navigation in the local division of the Army Corps. What was a 27foot channel at the mean low water mark is now only 21 feet in places, Wilson said. Harbor pilots guided six ships into the port through all of last year, he said. “We have very little control over the money” for dredging and maintenance, Wilson said. All the ports in this region, including Charleston and Savannah, must fight over the funds appropriated by Congress. The Georgetown port rated only a single mention in the executive summary of the S.C. State Ports Authority Strategic Plan, released in October. While the plan outlined action steps for the facilities of the Port of Charleston and the port under development in Jasper County, it included no plan of action for Georgetown. SPA President and CEO Jim Newsome said in his 2009 State of the Port address that a subcommittee of the state ports board was working on securing money for dredging

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of the Georgetown port. But that money hasn’t turned up, said Byron Miller, spokesman for the State Ports Authority. “We’re certainly not throwing in the towel,” Miller said. The SPA is trying to obtain funding by working with the state’s congressional delegation, he said. Miller said the responsibility for channel maintenance is 100% federal. “But we can take the entrepreneurial leap” and kick in some funds if a significant pot of federal money can be identified to get the dredging project off the ground.

Pushing 300 years Georgetown’s economic history has been a mix of wealth and poverty, and those fortunes have been tied to the port. Georgetown became an official port of entry in 1732. Local merchants and planters bypassed the port of Charleston, and its fees, and dealt directly with the world’s ports. Shipbuilders set up shop on

Cargo ships are docked at the Port of Georgetown. (Photo/S.C. State Ports Authority)

the Sampit River during that era, and by 1775 they had constructed at least 33 vessels. Around this industry grew the necessary supporting lumber businesses. The growing and shipping of indigo and rice also generated tremendous wealth, and, as of 1840, Georgetown exported more rice than any other seaport worldwide. But the start of the Continued on Page 44 ➤

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PORT DEVELOPMENT ANNOUNCEMENTS

By September, Georgetown County saw $37 million in new industrial projects that generated a total of 162 jobs. The first announcement, made in January by MetalTech Systems, was a $4 million investment expected to create 60 jobs. The company is located on County Line Road in an area of Andrews that’s known for a concentration of metalworking manufacturers. MetalTech makes conveyor systems for recycling plants. In March, Renewed World Energies announced a $30 million project expected to generate 60 jobs making biodiesel by extracting oil

Continued from Page 43 ➤

from algae. The company is located south of Georgetown on Industrial Drive, off U.S. Highway 17. Trinity Iron Works, a company providing structural steel fabrication and erection, announced a $500,000 capital investment in May that was to create 15 jobs. The company is located on Choppee Road north of the city of Georgetown. One investment tied directly to Georgetown’s port came in August. Carolina-Pacific, which makes “clean power” biomass pellets and briquettes from wood to sell to European utilities, said it plans to invest $2 million and is expected to generate 15 jobs. The company secured a long-term operating license on the Port of Georgetown. According to the company’s Web site, it is working with the port to increase the channel depth to a level sufficient to deliver handymax ships in 2010. The briquette production arm of the firm operates from a 103,000-square-foot production and storage facility in Georgetown.

Civil War in 1861 and the end of slavery brought down that laborintensive rice economy. It wasn’t until the 1880s that the area began to bounce back. Plentiful lumber again became a center of commerce, this time for use in the building of structures across the country, rather than ships. By 1914, the city’s Atlantic Coast Lumber Co. was the largest mill on the East Coast, and both the port and rail lines supported it. Again, however, the bottom dropped out, this time with the Great Depression. The lumber mill closed. An economic savior arrived in 1936 in the form of International Paper Co. and its new kraft paper mill. Within six years, the plant was the largest of its kind in the world. In 1942, International Paper expanded to manufacture weatherproof boxes used to ship supplies overseas during World War II. The Georgetown mill continues today as the county’s third-

largest employer. Molten steel began to run in Georgetown’s veins in 1969, when Korf Industries opened a mill on the banks of the Sampit River. The mill changed hands several times in the next four decades. Today, ArcelorMittal owns the site, which has been shuttered since May because of the global economic meltdown.

Next steps Stacy said he’s encouraged the SPA is taking a strong marketing approach to try to lure new industry to the area. The concept is that if new business that depends on the port can be attracted, money for dredging will follow. Meanwhile, the report commissioned by Stacy’s economic development group was expected to be released by the end of February, providing some new ammunition to convince Congress that the port in Georgetown should count in the fight for federal dredging funds.

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RAIL

State seeks Lowcountry rail agreement By Scott Miller, Staff Writer

S

ome lawmakers are losing patience with the Lowcountry’s inability to negotiate dual rail access to accommodate a new port terminal slated to open in 2014. Delays have largely been tied to an attempt to protect a yearslong effort to revitalize residential areas around the former Navy base in North Charleston. But in the Upstate, where a substantial portion of port cargo either originates or ends up, a dual access rail system is seen as a substantial driver of economic development. “We wanted to try to let the region work it out first, before we have to approach it heavy-handedly,” said House Speaker Pro Tempore Harry Cato, a Republican from Travelers Rest. “We’re all trying to be sensitive to the region

and allow them to work it out, but there is some discomfort.” At this point, lawmakers outside of the Lowcountry have remained largely silent on the issue, but that could change this year, said Cato, the No. 2 ranking Republican in the House. He believes the issue will end up in the court system sometime in 2010. Lowcountry leaders don’t think it will get to that point. Negotiations are ongoing to develop rail access at the terminal that will satisfy all parties involved, said Sen. Larry Grooms, R-Berkeley, who leads the Senate Transportation Committee. He thinks a plan will surface by April. “I wouldn’t want the General Assembly to try to run over the city of North Charleston, just as I would not want the General

Assembly to run over the city of Greenville when it comes to quality-of-life issues,” Grooms said. “The city of North Charleston needs to be comfortable with what happens.” The issue, though more complex, centers largely on providing Norfolk Southern and CSX with equal access to the container terminal the State Ports Authority is building on the north end of the former Navy base. CSX already has access from the south end. North Charleston Mayor Keith Summey has fought efforts to provide access at the northern end of the former Navy base. Such access could disrupt a years-long attempt to develop and revitalize residential neighborhoods in the area. Additionally, the State Ports Authority and city of North

Charleston signed a memorandum of understanding in 2002 in which the state agency agreed that any rail access would come exclusively from the southern end. Others, including Norfolk Southern, have said access at the southern end would not provide equal rail access and is not an option. The Legislature took steps last year to force the issue. Leading Senate lawmakers offered Veterans Terminal to Summey in exchange for his allowing the rail lines. Summey declined. Lawmakers also adopted an amendment naming S.C. Public Railways, a division of the Commerce Department, as the property owner of the railroad that runs onto the former Navy base, Continued on Page 46 ➤

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RAIL Continued from Page 45 ➤ thus limiting the city’s options in fighting plans for rail. Gov. Mark Sanford vetoed the measure, saying all interested parties needed to work on a compromise, not circumvent the process. Summey’s office confirmed that negotiations are ongoing but had nothing new to report on the matter. That compromise is close, Grooms said. The current rail route proposed would steer clear of residential areas and run closer to Virginia Avenue, he said. The plan would require CSX and Norfolk Southern to concede some track rights, and the state or some independent contractor would need to take over switching operations to make sure both railroads receive equal access, Grooms said. But Clemson University’s receipt of a federal grant to build a wind turbine drivetrain testing facility at its campus on the former Navy base has thrown anoth-

er wrench into the negotiations, Grooms said. The rail plan now must be sensitive to that facility, Grooms said, and the state needs to preserve land around the facility. “That, I believe, will be as big as Boeing,” Grooms said. “We’re looking at Veterans Terminal to map out what the best use is for this property. It all has to be considered at the same time.” John Kelly, executive director of the Clemson University Restoration Institute and the school’s vice president for public service and agriculture, said Clemson is involved in the discussions. Under one scenario pitched, rail could interfere with Clemson’s plans, he said. The university has 11 acres for the wind turbine testing facility, and much of that space needs to be preserved in order to attract private manufacturing operations to complement Clemson’s operations, he said. Unlike Grooms, Kelly thinks negotiations are far from fruitful.

Lawmakers say the clock is ticking on efforts to reach a compromise over rail access to the new port terminal under construction in North Charleston. (Photo/File)

“I don’t think the port will need dual rail access for quite some time anyway,” he said. The goal is to open the new terminal in 2014, coinciding with the targeted completion of the Panama Canal expansion. Cato agreed that the construction timeline has given leaders a chance to

negotiate a railway plan. Because the terminal isn’t open, the lack of a dual access rail system is not impeding the Upstate’s economic development efforts, he said. But time is running out, Cato said. “We’re reaching that magic mark where we need to assert a little pressure,” Cato said. “There’s never been any doubt, at least in my mind, that we’re going to end up in court over this northern rail access because of that prior agreement with the port and the city.” Especially if leaders in the Lowcountry don’t reach a compromise soon, Cato expects court action within the year. That’s exactly what Grooms does not want to happen. “If there’s an attempt to run over the city of North Charleston, we’re going to wind up in the courts,” he said, “and if you wind up in the courts, there’s no telling how long it’s going to take to get this done.” Andy Owens contributed to this report.

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People in the News The Riley Institute at Furman announces graduates of Diversity Leaders Initiative classes The Riley Institute at Furman is pleased to announce the commencement of Upstate and Lowcountry Diversity Leaders Initiative classes. Chosen by nomination and application, participants in the DLI are leaders from all demographic groups and sectors: corporate, nonprofit, faith-based, education and public officials, chosen to build leadership skills while also examining and pursuing solutions to challenges and opportunities most pressing to our communities. Congratulations to graduates of the Diversity Leaders Initiative:

Upstate Class VIII graduates

Lowcountry Class IV graduates

Wendy Anthony, International Center of the Upstate Russell Booker, Spartanburg School District Seven J.T. Boseman, AnMed Health Tony Boyce, Mount Emmanuel Missionary Baptist Church Bruce Cannon, Michelin North America Renee Cariveau, Spartanburg City Council Connie Carson, Furman University Dianne Clarke-Kudless, Enterprise Services LLC Viviane Cohen, Michelin Mexico Leesa Cooper, Tire Centers LLC Delcia Corbitt, Michelin North America Cynthia Davis, Erwin-Penland Rick Davis, Elliot Davis LLC Marsha Dowell, University of South Carolina - Upstate Jim Dunbaugh, Michelin North America Frances Ellison, Greenville Hospital System University Medical Center Alan Ethridge, Metropolitan Arts Council Jim Evers, AT&T Lillian Flemming, Greenville City Council/Greenville County Schools Marchele Garrett, Spartanburg Regional Hospital System Eric Graben, Wyche, Burgess, Freeman & Parham P.A. Malcolm Isley, Greenville Hospital System University Medical Center Jennifer Johnsen, Gallivan, White & Boyd P.A. Charles Johnson Sr., United Methodist Church - Greenville District Office Karen Knuckles, Express Employment Professionals Julie Anne Kozlow, Congregations Beth Israel Rebecca Lambert, United Way of Greenville County Mark Loukides, Greenville Hospital System University Medical Center John Mateka, Greenville Hospital System University Medical Center Charles McDonald III, Ogletree, Deakins, Nash, Smoak & Stewart P.C. Tim McLaughlin, Tire Centers LLC Adela Mendoza, Alliance for Collaboration with the Hispanic Community Keith Miller, Greenville Technical College Terrell Mills, Wyche, Burgess, Freeman & Parham P.A. Rich Morris, BMW Manufacturing Co. LLC Susan Mullinax, Greenville Hospital System University Medical Center Carson Rogerson, Spartanburg Regional Hospital System T.E. Simmons, Greenville Hospital System University Medical Center Ray Shingler, Spartanburg Regional Hospital System Ava Smith, HR Specialties Dana Souza, City of Greenville - Park and Recreation Brenda Thames, Greenville Hospital System University Medical Center Quenton Tompkins, United Way of Anderson Randall Trigg, BMW Manufacturing Co. LLC Maxim Williams, Bon Secours St. Francis Health System Michael Wilson, Duke Energy

Constance Anastopoulo, Charleston School of Law Julie Armstrong, Charleston County Clerk of Court Mark Aukamp, S.C. Research Authority Cassie Barber, S.C. School Improvement Council LaSonya Berry, McPherson, Berry & Associates Inc. Pennie Bingham, Charleston Metro Chamber of Commerce Mark Andrew Bounds, S.C. Department of Education Paul Campbell, S.C. Senate Cynthia Cash-Greene, Orangeburg Consolidated School District Three Sharon Chellis, Independent Consulting Kelli Cochran-Seabrook, Center for Heirs’ Property Preservation Stacey Denaux, Crisis Ministries Jennifer DeWitt, Lowcountry Manufacturers Council Steve Dudash, Design Works David Dunlap, Roper St. Francis Healthcare Stephanie Eames, Nexsen Pruet Debra Gammons, Charleston School of Law Toya Green, McNair Law Firm P.A. John Hagerty, Nelson, Mullins, Riley & Scarborough LLP Ben Hagood, Hagood & Kerr P.A. Teresa Hannibal, Bamberg City Council Richard Harkness, Moncks Corner AME Church Julie Hussey, Civic Communications Inc. Grady Johnson, SC Biz News LLC Dinos Liollio, Liollio Architecture Joe McKeown, Charleston County Council Jamal Middleton, New York Life Insurance Co. Victoria Middleton, ACLU South Carolina National Office Byron Miller, S.C. State Ports Authority John Mitchell, AT&T - State Legislative and Regulatory Affairs Bill New Jr., Charleston County Aviation Authority Adam Parker, The Post and Courier Anne Peterson Hutto, S.C. House of Representatives Joe Pye, Dorchester School District Warren Redman-Gress, Alliance for Full Acceptance Harry Sewell, Mount Pleasant Police Department Sarah Penick Smith, Waccamaw Regional Council of Governments Bill Tuten, Office of Sen. Lindsey Graham Laura Varn, Santee Cooper John Wallace, TCC of South Carolina James Ward, Richardson, Patrick, Westbrook & Brickman LLC Herbert Weldon, Weldon Management Associates Leila Williams, Colleton County School District Chris Van Metre, Advanced Technology Institute

The Riley Institute Diversity Leaders Initiative is made possible through the generous support of Wachovia/Wells Fargo, Michelin NA, AnMed Health, the S.C. Research Authority, the Greenville Hospital System, Spartanburg Regional Hospital System, SC Biz News LLC and Palmetto Health. w w w. s c b i z m a g . c o m | S p r i n g 2 0 1 0

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Above the clouds Caesars Head State Park. (Photo/Kevin Greene)

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