Friday, September 28, 2007

Oil City

You’ve got to know that with a name like Oil City, there has to be a story behind the name of the town. And, I was not disappointed as I learned more about the town and its history during my tour.

Today Oil City, PA is home to 11,504 residents but its population soared to over 50,000 during its boom days in the 1860s and 1870s when oil was first discovered in nearby Titusville, changing the face of the earth forever. Colonel Edwin Drake discovered oil in August, 1859 and soon oil derricks dotted the countryside.

Stephen Kosak, one of my tour guides told me, “Back then the beautiful rolling hills that you see now were denuded of trees. It was one oil well on top of another.”

Today, most of those oil wells are long gone although there is one that is kept pumping each year as the longest continuously pumping oil well in the world.

Many oil fortunes and companies began in Oil City, PA. Kosak told me, “Three of the Rockefeller Standard Oil Trust Companies started here. The National Transit Building, which has been restored, was the center of oil commerce for decades. Both Quaker State Oil and Pennzoil (Penn Refining Company) had their corporate headquarters here until a few years ago.”

Oil City has probably taken more blows in the past twenty years than any other town I’ve been in. Pennzoil closed the last refinery in town in the early 2000s, taking some excellent paying blue-collar jobs with it. The moving of the corporate headquarters along with the consolidation of three local banks into larger, urban city banks in the mid 90s resulted in thousands of white-collar jobs being lost.

But, the industrial and financial base built upon oil for over a century is also paying dividends for the community and I feel will be the base upon which the next growth in entrepreneurship will take place. There are several specialized alloy steel manufacturers and users along with two of the three leaders in continuous casting technology located in the area.

The scenic river valleys and surrounding hills offer some spectacular outdoor possibilities. The majestic downtown with most of its old, solid buildings intact creates a very unique sense of place. The mayor elect hopes to turn the town’s view back toward the beautiful Allegheny River, a change from how the downtown was developed when the riverfront was primarily industrial. There are bike trails planned that will take you all the way to Washington, DC, a new birding festival and plans for a white water park.

Steve Kosak, who runs the Bridge Builders Community Foundation, a three county community foundation, also manages almost $60 million in permanent trusts set up by old oil families for the betterment of the community.

I was very impressed with the vision and passion of the people that I met in Oil City, in their desire to reinvent themselves as a community. I’m going to want to go back in a few years to see what they turn the community into.

Thursday, September 27, 2007

Visionary, Young Leadership

Two of the major deficiencies that I often observe in rural America is a leadership that is rapidly aging in place and an isolationship approach of trying to ‘do things on our own.’ I was pleased that I saw both being combated in the Oil Region of PA, a multi-county approach, on my trip to the region last week.

The Oil Region Alliance began 3 years ago when 20 different groups sat down to attempt to reinvent themselves as a region and to turn around a population and job loss. Billing itself as “The Region that Changed the World,” the region offers a rich history (more on that tomorrow), wonderful scenery, dramatic Victorian architecture (did I mention cheap?--$280,000 for a restored Victorian mansion), numerous museums, miles of trails, fishing, boating, hunting and many other outdoor activities.

The Venango Regional Leadership Institute is focused upon improving the leadership skills of its young citizens. I loved its motto of, “It only takes one good leader to make a difference….just imagine the power of a community filled with leaders.”

I spoke to several leadership classes from the region along with a number of engaged and interested local citizens in the Oil Region. One group from Warren, PA traveled over an hour to my program. This was their inaugural leadership class and I was honored to get my picture taken with them. They are doing a two day retreat this coming weekend and I wish them the best.

Wednesday, September 26, 2007

Bah Humbug!

When you drive rural roads as much as I get a chance to do, you see some very interesting sites and meet some incredible people. In driving through Pratt, KS I stopped when I saw this 60s neon sign for a local restaurant.

In nearby Mullinville, KS I was attracted by a half mile long series of sculptures, most with a political bent to them. When I stopped at M. T. Liggett’s nearby workshop, I quickly learned that I was meeting one of the most negative people that I’ve run into for quite some time.

It didn’t matter the subject; FEMA, national government, local government, internet, tourism, Greensburg’s tornado; M. T. was against it. Not that he had suggestions for improving any of those items, mind you. He was just against them.

It is a wonderful country in which we live. We’ve got all sorts of people. I’m blessed that I get to deal with some very positive ones as I travel around the country. It makes me appreciate them more after I spend a few minutes with people like Mr. Liggett.

Tuesday, September 25, 2007

Transforming Dodge City

Just the name ‘Dodge City’ conjures up images of a wild west town. I was there to do a tour of the town with Mike Stevens, CEO of Centera Bank, a $175 million community bank that Mike and a few other local citizens in nearby Sublette, KS (population 1,592) bought in the mid 80s when rural America was going thru a major recession. It took a lot of guts and vision for them to do that purchase.

Dodge City was founded in 1872 when the Santa Fe Railroad reached the town. Nearby Fort Dodge had been established in 1865 to protect wagon trains that were making their trek west on the old Santa Fe Trail. Millions of buffalo roamed the nearby plains and a new tanning process allowed their hides to be turned into usable leather for shipment to the east and onto Europe. The slaughter was on with a good hunter able to make more than $100 per day.

The next boom was when the cattle drives from Texas began. From 1875 until 1886 over 5 million head of cattle were driven to the rail yards of the town. During these early wild and wooly days, Dodge City was the home to notable lawmen and gunfighters such as Wyatt Earp, Doc Holliday, Bill Tilghman, Bat Masterson and many others. Its famous Boot Hill Cemetery (now a wonderful museum) was only used 1872 to 1878, but is firmly established in cowboy lore as where the cowboys were buried with their boots on.

Dodge City has had a number of wonderful titles over the years, including: Buffalo Capital of the World, Cowboy Capital, Queen of the Cowtowns, Wickedest Little City in America and others.

Today it is a town of 25,176 that is going through a transformation. Two major packing plants that process over 15,000 head of cattle each day give the city and region a strong industrial base but one that is dominated by this one industry. Of the 16,022 jobs in Ford County, 36.7% (120th highest rank in the USA) are in the manufacturing sector.

Most of those jobs are held by recent immigrants, with 37% of the county of Hispanic decent. The downtown is dominated by Spanish language signs and Mike Stevens estimated that over 70% of the children in the school system spoke Spanish at home. These new immigrants have created some very unique issues but I’m convinced that Dodge City will be a hotbed of entrepreneurial activity in the future as a result.

Dodge City will be an interesting town to keep track of in the future.

Monday, September 24, 2007

Greensburg Green

I hate it when I’m running late, but mechanical problems on the plane from Memphis to Wichita delayed me an hour and a half. I pushed the accelerator probably a bit more than I should have as I sped to make up lost time, trying to squeeze in a tour of Greensburg, KS prior to my talk in nearby Dodge City. I made up quite a bit of time on my 100 miles trip from Wichita, but lost it all when one of Greensburg’s finest pulled me over for speeding. But this blog isn’t going to be a rant on hub-and-spoke plane systems or speeding tickets. Rather, it is on the process of rebuilding a small town after a catastrophe.

Greensburg was the town that was devastated by a EF-5 tornado on May 4, 2007 with winds of over 200 mph. I had been there in July to give a talk and tour the town and was anxious to see the changes taking place in the two months since my last visit.

Steve Kirk, the local Centera banker who brought me in initially told me of the progress being made, “We’ve now developed a long-term plan with the help of FEMA. One of the more visionary, but controversial parts of the plan, is the development of a town square park that would allow us to tie the downtown together with our one tourist attraction, the largest hand dug well in the world. We’ve gotten a lot of help from the USDA which is helping us to do a business incubator, rebuild our water tower and get a grocery store going again.”

When I was last there I had been impressed with the governmental recovery workers from FEMA, USDA and others. The interest that they displayed and their monetary help are going to allow Greensburg to rebuild itself, better than it ever was.

The town is looking at redoing itself as a ‘Green’ town, something that I believe that it could capitalize upon. While there is some resistance to rebuilding with new 2003 codes, if the local residents can continue to take a long-term approach I believe that they will look back with pride on what they have accomplished.

I was pleased to see a number of new buildings already built or under construction. Greensburg is coming back. You’ll be able to watch their progress as the Discovery Channel is planning to do a 13 episode series on the town later this year.

Friday, September 21, 2007

Ponca’s Take on Jobs

I’ve observed that one of the keys to maintaining a good economic development organization is communication with the various stakeholders in the community. An ED group obviously can’t share confidential information on who they are talking with, changes within companies in town, who’s expanding, etc. However, they can let citizens know about more general information. Ponca City and Duncan, OK both have very similar weekly emails that are some of the best that I’ve seen.

Last week’s Ponca City newsletter had an interesting take on their looming job shortage, in light of the announcement earlier this month that the U. S. Economy had shed 4,000 jobs in August despite having added over 600,000 in the past six months. Here is what they had to say.

THE CHANGING FOCUS OF ECONOMIC DEVELOPMENT…it used to be called industrial recruitment back in the day but it changed around 1990 when growing the economy became about a lot more than just recruiting companies. Here’s an interesting tidbit: Last week, the labor department reported that the nation, as in the United States of America, cut 4,000 jobs. At the same time, the estimate of available jobs in the Ponca City area was about 1,400 open jobs. Put another way, there are enough open jobs in Ponca City for one third of all of the people laid off last week in the whole country. Sounds simple enough. The challenge is that the open jobs here are not unskilled jobs. The alignment of the right skills and education with the right jobs is not easy. There is also the matter of having someplace they can live and someplace they want to live, (do not underestimate the importance of the latter). Finally, they have to know about us and have the resources to come here. Lots to do.

If you aren’t doing a weekly or monthly newsletter to your constituents, you should be.

You probably didn’t see it reported in the press, but did you see that the teenage unemployment rate rose by 6% in August. Do you think that this is possibly tied to the $0.70 increase in the minimum wage? I’m sure that Congress didn’t foresee this when they increased the wage, but these are the ramifications that I often find, labeled under the Law of Unintended Consequences. What do you think?

Thursday, September 20, 2007

Labor Crunch Near Crisis Stage

Increasingly in my travels around the country I’m encountering more and more signs of an increasing labor shortage which will become more acute with the looming retirement of baby boomers. The major headline in last week’s Journal newspaper from Crosby, ND (population 1,089) major headline was, “Labor crunch near crisis stage.”

Crosby is the county seat for Divide County (population 2,086) in the very northwestern part of the state. The county has lost 50% of its population since 1970, putting it as one of the 100 least populated counties in the entire country (out of 3,141 counties). At 1.7 people per square mile, Divide County is very sparsely populated, but I also found them to be some of the friendliest that I’ve found in my travels.

The Journal has over a half page of help wanted ads, some offering sign-on bonuses of $1,000 to $2,000. The local restaurant has had to close early on Saturday evenings due to lack of help. The local jobs developer David Olson spent one day the week before helping to change diapers at the local daycare because they were short of workers.

The McDonalds restaurant just across the state border in Sidney, MT was featured last month in an AP article for outsourcing their drive-up window orders to a company in Utah. Offers of $10/hour couldn’t entice enough workers to keep the drive-up window local.

I hope that you are working on improving the skills of your local workforce. It is going to become increasingly important.

Wednesday, September 19, 2007

When the Sun Goes Down, We Shine!

New Castle, PA is home to Zambelli Fireworks Internationale, the largest and most famous fireworks company in the USA. The company started in 1893 when Antonio Zambelli chose the rolling hills surrounding New Castle because it reminded him of his hometown of Caserta, Italy where he had learned the artistry of fireworks.

The company was later run by his son George, Sr. who ran the company until his death in 2003. Today the company is run by the third and fourth generations of the family. They put on about 3,500 fireworks shows per year with about half of them occurring on the Fourth of July.

I picked up a wonderful book about the family titled, “Zambelli: The First Family of Fireworks.” It is chock full of pictures and a wonderful history of the family business. The company motto is “When the Sun Goes Down, We Shine!”

At one time dozens of companies in the fireworks business were located in New Castle, which billed itself the Fireworks Capital of the World, but today only Zambelli is still located there.

Tuesday, September 18, 2007

From CA to Inc 500

One of the biggest thrills I get in touring towns and giving talks around the country is being able to visit the many entrepreneurial companies that are creating jobs in small towns. When I was in New Castle, PA, Linda Nitch, head of the local ED, took me by Vortex Recycling.

She told me, “Don KIeine had the idea for Vortex when he was living in California. He searched the country for a central location and came to New Castle in 2001. He’s been growing ever since.”

Don was out of town but John Greer, Vortex’s Marketing and Sales Manager, gave me a tour of the company. He told me, “We bring in used oil filters from all over the country. We do about ten thousand 55-gallon drums of them a month. We squeeze the oil out and sell about 75,000 to 85,000 gallons/month to waste oil users and 1200 tons/month of scrap steel.”

The business has been good as Inc Magazine ranked them the #608 fastest growing small business in a recent edition and the #7th fastest growing environmental company. The company’s business car bills it as The World’s Largest Oil Filter Recycler.

A company brochure touts the following stats about used oil filters, “Every month, nationally 31,250 tons or 2,253 semi truck loads of used oil filters are generated consuming massive land fill space. These filters contain 2,250,000 gallons or 375 semi-tankers of waste oil. There is enough steel in these used oil filters to manufacture 2.7% of the new cars in the United States.”

It’s nice to see something being done about that in New Castle, PA.

Monday, September 17, 2007

Warner Brothers First Theater Town

“In the early 1900’s we were growing faster than Pittsburg. We were the Tin Plate Capital of the World,” Linda Nitch, Executive Director of the Lawrence County, PA Economic Development Corporation was explaining to me about New Castle, PA. New Castle (population 26,309) is the largest city in Lawrence County about an hour north of Pittsburg. New Castle sits in a beautiful valley at the confluence of the Shenango River and Neshannock Creek.

Linda went on, “But tin got passed by steel and our population peeked in the mid 30s at around 50,000. Our factories ran full out during WWII but we’ve been on a population decline since then.”

But, the ED group is fighting back and has a number of projects in the works that could have the community back on a growth path. They are building a new Millennium Technology Park, a 533 acre high-tech park, a project that will require moving over 1 million cubic yards of dirt at a cost of $1 million. The park already has its first building under construction. Steelite International USA, a British company, is establishing its USA headquarters in the park.

Two weeks ago Bedford Downs, a one mile long harness racing track and slots casino was announced for the county. The county’s take from this project is estimated to be over $15 million per year with the funds earmarked for economic development projects within the county.

The real undiscovered gem that I saw was the downtown area which sits along the river and has a river walk. Having once been a city of over 50,000 gives a town like New Castle a much larger downtown than what it needs today. But, those underutilized buildings offer the potential to develop a special “sense of place” that can’t be easily duplicated.

John Dimuccio, who was the city manger for 20 years, first envisioned a renovated downtown in 1995 and was able to break ground in 2000. He told me, “We’ve got some wonderful history in the downtown area. The Warner Brothers, who grew up in nearby Youngstown, OH came to the fastest growing city in the USA to build their first theater in 1907. We were able to save it as part of our downtown revitalization.”

The work is still ongoing but New Castle’s downtown has some wonderful potential.

Tuesday, September 11, 2007

Sprucing Up Empty Storefronts

One of the challenges of many small towns, is how to keep the downtown looking vibrant when you’ve got a few vacancies. I’ve seen several towns try to keep the big downtown display windows full with promos for other stores, high school boosterism and other demonstrations.

But, I recently learned of a company in England that is taking the idea of filling those empty storefronts to a new level. It sounds to me like an idea that could make sense to explore.

Motomedia has developed a “Street Level Billboard” that uses cutting edge technology, motion sensors and rear projection screens to present animated visuals complete with sound. Adding Bluetooth-enabled software allows additional information to be transmitted to a viewer’s cell phone. Future technology will allow a viewer to move blocks of information on the screen, just like the Apple iPhone.

Keep your eye on this new technology application.

Monday, September 10, 2007

World's Largest Corn Maze

I’m guessing that Robert Richardson, who homesteaded 160 acres in Spring Grove, IL (population 3,880) in 1840 would be amazed at how his family farm has transformed over the years. Spring Grove is located about 60 miles NW of Chicago, on the outskirts of its rapidly growing suburbs and just south of the WI border. The farm, still owned, run and worked on by three generations of the family has grown into two farmsteads and 450 acres.

In 1982 Owen Richardson decided to try diversifying away from his traditional crops of corn and soybeans, planting a few Christmas trees. When weeds overran his young seedlings, he almost gave up that effort, but stuck with it adding 3,000 trees per year.

In 2001, the family decided to put in a corn maze….not just a corn maze….but the world’s largest corn maze. This year’s maze, built with a Chicago Bears theme is 28 acres in size, the size of 10 city blocks! They’ve also added a smaller corn maze that celebrates the University of Illinois Chief, which was retired this year by the university. In 2007, they added a 50’ tall observation tower for viewing the corn mazes.

The Richardson’s are a trend that I’m seeing of farm families diversifying their farming activities and more fully utilizing all of their natural assets, rather than being caught up in a dependency upon the fickleness of commodity prices.

Friday, September 07, 2007

Life After Maytag

Next month the last vestiges of Maytag will disappear from Newton, IA (population 15,579), a wonderful town midway between Des Moines and Iowa City. When I drove through the town last week, I wondered what changes will occur in Newton with the closing of the last Maytag plant on October 26th.

Newton has been a manufacturing mecca and headquarters for Maytag ever since local farmer Fred L. Maytag built his first mechanical washing machine in 1907. The washing machine was initially intended to help solve seasonal slumps in Maytag’s farm equipment business but quickly became the main business for Maytag. By 1927 Maytag had sold its millionth washing machine.

In recent years Maytag struggled, with a procession of new CEOs unable to turn it around, culminating in the sale of the company to rival Whirlpool in the spring of 2006. The 1,200 white-collar and 1,000+ manufacturing workers in Newton were the casualties of that sale when Whirlpool quickly announced that it would close all facilities in Newton.

I applaud Newton’s efforts to reinvent themselves as a community. They have established the Newton Promise, which will pay for four years of college for anyone who graduates from Newton High School. They also worked to build the Iowa Speedway, Iowa’s only NASCAR track, in the community. And the town is assisting in the retraining of former Maytag employees, many of which are starting their own businesses.

It will be interesting to study the transformation of Newton from a one-company dependent town into a more diversified one. There will be much pain and suffering in the process but I’m impressed with the steps that Newton has already made in their journey.

Thursday, September 06, 2007

Losing Our Competitive Edge?

Mike Harvey writes a wonderful weekly newsletter called “Flourishing.” I got to know Mike when he coordinated a couple of my talks in his hometown of Winfield, KS (population 12,206).

Last week’s edition had this thought from Mike:

This unique map ought to give pause to those who imagine that the U. S. is losing its competitive position in the world economy. The structure of our economy is changing, but America is not losing its strength. Thanks to huge increases in productivity, which in turn are the result of lower tax rates on capital (thank you Ronald Reagan and George W. Bush), American manufacturing output is at a record high—both absolutely, and as a percentage of Gross Domestic Product.

It amazed me that the economy of TN is equivalent to that of Saudi Arabia; GA to Switzerland; TX to Canada; CA to Italy and ND to Ecuador.

Sometimes, I think that we beat up on ourselves too much and don’t sit back and look at what a wonderful country we live in. Nor, reflect upon the many benefits we have as Americans. Mike does a great job each week of pointing those benefits out.

Wednesday, September 05, 2007

Super Bowl of Farming

The Farm Progress Show, billed as the Super Bowl of Farming, is held every two years in nearby Decatur, IL. I spent an afternoon there this past week seeing the newest agricultural technology and meeting a few old friends from my days in the seed business.

My observation is that while the show has gotten much larger, there didn’t seem to be as many people attending as when we were exhibiting in the early 80s. But, then again, there aren’t as many farmers today as there were then. However, the technology revolution in agriculture is simply astounding.

I got a chance to tour Monsanto’s research exhibit to see what technologies are in the pipeline for the leader in seed technology. They continue to “push the envelop” with higher yields; gene traits for herbicides, insects and diseases; and food quality improvement. Nitrogen fixation in corn looks like their next big winner, but the one that really catches my fancy, is their drought tolerant gene for corn.

This new technology, which won’t be released for at least five years, has the potential to dramatically expand where corn is grown while also giving farmers more assurance of being able to raise a crop without worry of a complete failure due to drought. It also will dramatically cut the need for irrigation water, allowing that water to be used for human consumption.

Right after my tour, a group which included the CEO of ADM was touring the Monsanto research plot. Some of her entourage didn’t look too comfortable in the 98 degree heat. They really should have lost their suits prior to the tour.

Tuesday, September 04, 2007

John Q.

I was back in Springfield, MO for the Governor’s Conference on Economic Development last week. When I toured the community a year ago, I was struck by the number of entrepreneurs who had positively impacted the community, but none more than John Q. Hammons who had built a $32 million minor league stadium, museum and many other improvements to the quality of life in Springfield. I had been inspired when I read his biography after that trip.

As I was walking thru the hotel lobby, on my way to dinner, I was pleasantly surprised to see Mr. Hammons sitting in the lobby. I was thrilled to get a chance to chat with him for a few minutes and to invite him to my talk the next morning. Unfortunately, he was flying out of town and couldn’t attend but I used him as an example several times in my talk.

Here is his story. John Q. Hammons was born in Fairview, MO (population 395), 60 miles south and west of Springfield. He was one of only 12 students in his high school graduating class. After two years of college he became a teacher at a salary of $40 per month. During WWII he helped to build the Alaskan-Canadian Highway, nicknamed the Road to Tokyo, and served in the Merchant Marines in the Pacific Campaign.

Mr Hammons told me, “I’ve built 187 hotels during my career and have $360 million in new construction going on right now, so we’re rapidly closing in on 200 hotels.”

Today he owns hotels in 23 states, including the award winning Chateau on the Lake Resort and Conference Center in Branson, MO.

One of his employees at the hotel told me, “He lives here in the hotel and works every day of the week. He is a real joy to work for.”

It’s been an amazing journey of 88 years from tiny Fairview, MO for John Q. Hammons.