EagleBay Auction Results

The online auction that I wrote about November 19th ended up raising $8,257 which will be used for Make-A-Wish and the local United Way. Great results from a tremendous local company (Paterson) helping some great charities.

Merry Christmas

I hope that all of my readers have a wonderful Christmas and great New Year.

I'm going to take some time off from blogging and be back next year.

Duck Stamps

One of my favorite movies is “Fargo”, the 1996 film about a car salesman who hires two men to kidnap his wife for an $80,000 ransom. The star of the show is the pregnant small-town police chief Marge Gunderson, played by Frances McDormand, a role that won her an Academy Award.

One of my favorite scenes in the movie is when Marge is lying in bed with her husband, Norm. Norm is a wildlife painter, who lacks a bit of confidence. Here is the dialog from that scene:

Norm Gunderson: They announced it.

Marge Gunderson: They announced it?

Norm Gunderson: Yeah.

Marge Gunderson: So?

Norm Gunderson: Three-cent stamp.

Marge Gunderson: Your mallard?

Norm Gunderson: Yeah.

Marge Gunderson: Oh, that's terrific.

Norm Gunderson: It's just a three-cent stamp.

Marge Gunderson: It's terrific.

Norm Gunderson: Hautman's blue-winged teal got the 29-cent. People don't much use the three-cent.

Marge Gunderson: Oh, for Pete's sake. Of course they do. Whenever they raise the postage, people need the little stamps.

Never in a million years, would I have believed that there actually is a Hautman painter, something that Norm mentioned several times in the film with his awe-shucks, “Oh the Hautmans will probably win.”

Turns out there really are the Hautman brothers. Bob, Jim and Joe have won the Federal Duck Stamp Contest, the most prestigious event in wildlife art, eight times since 1990. Brother Joe won the competition in 2007 and Jim placed second this year.

I’m learning all sorts of things out on the road. I’m just not certain that some of them are going to ever do me any good.

Small Town...Big High Tech Cluster

Warsaw, IN (population 12,415) has always amazed me. This town in NE IN is 45 miles west of Ft. Wayne. It is a stand-alone town that is the county seat of Kosciusko County, a county that has 42% of its jobs in manufacturing (35th highest percentage in the USA), paying an average of $55,974. And, what has brought on this prosperity?

Warsaw bills itself as the “Orthopedic Capital of the World” and with three of the top five international orthopedic firms headquartered here, it’s easy to understand why no one disputes its claim. These three (Zimmer, DePuy and Biomet) collectively produce over $10 billion in sales, hold 65% of the worldwide knee replacement market and 60% of the worldwide hip replacement market, and employ over 7,000 people in Kosciusko County.

This unique cluster started when Revra DePuy married the local sheriff’s daughter, taking her back to MI. When she grew homesick for Warsaw, he moved his young family to the town. There he invented the fiber splint to set a fracture, quickly replacing the wooden barrel staves that had been used up to then.

Later, the national sales manager for DePuy’s company suggested to Revra’s widow that the company add aluminum splints to the product line. When she refused, J. O. Zimmer left the company and started Zimmer Holdings, now the largest employer in the county with 2,800 employees.

Later a Zimmer employee, Dane Miller, left that company to set up Biomet along with local investors.

Recently, when Zimmer announced plans to invest another $19 million to expand its foundry operations, adding another 100 local jobs, Richard Stair, VP of Global Operations and Logistics told Inside Indiana Business, “Warsaw really is a jewel in the state of Indiana. It’s impressive that in the city of Warsaw several of the largest orthopedic companies in the world are selling devices globally to help people live a better quality of life.”

It started in Warsaw. It continues to grow in Warsaw. Do you have any potential clusters that you could exploit to create a cluster like Warsaw has done?

Tom Sawyer of Cattle Drives

For six generations the Kerns Family has been driving their cattle each spring up into the Big Horn Mountains in north central WY. About 15 years ago making a living raising cattle became much more difficult. So they decided to begin offering to let “wannabes cowboys” tag along on the ride.

This year’s ride back down occurred from September 6th to 13th, a 4000+ foot descent down to their Double Rafter Ranch in Ranchester, WY. The cowboys spend at least eight hours/day in the saddle, sleep on the ground and get roused out at 4 am for biscuits and gravy. And, for that privilege they each spend $2,000.

The Kerns refer to their drives each year as, “City Slickers (the movie) is just a pony ride!” You can see a video of one of their drives here.

That Famous Brain Bank

Many towns that I visit bemoan the fact that, “there aren’t any jobs here. Everyone moves away as soon as they can. We are down on our luck.”

If you are one of those towns, pay attention to my blog of yesterday and this one today. Bill Cook was born and raised in Canton, IL, and went onto great fame and fortune, starting his own medical equipment company. But, he did all of that in Bloomington, IN, where he went to college.

Mark Rothert, head of the Spoon River Partnership for Economic Development in Canton, wrote to Cook a year ago. Here is what the letter said:

Dear Mr. Cook:

My name is Mark Rothert and although we have never met we share a common bond of growing up in Canton, Illinois. I read an article about you in the Dec./Jan. 2007 issue of "Bloom Magazine" and thought I would write.

Canton has probably changed since you grew up here, but it was a great community then and still is today with much potential. However, Canton does face some major challenges. They include the former International Harvester Brownfield site, deteriorating housing, fewer employment opportunities, and a declining downtown.

I am the director of the Spoon River Partnership for Economic Development, a local 501(c)(3) charitable non-profit economic development organization for the Canton area, tasked with bringing new development, jobs, investment and business to the area, including revitalizing the downtown and the former IH site. I understand you played an integral role in the revitalization of Bloomington's downtown. I would be interested to come to Bloomington and meet with you to learn more about your past projects, talk about what we hope to achieve in Canton, and gauge your interest to help.

Basketball and music aside, I know you also deeply care about community, preservation, and producing results out of ideas. Your philanthropy in the Bloomington area to provide for the community, preserve historical sites and create results is truly admirable. It reminds me of what the Orendorffs and Ingersolls did in Canton so many years ago. Canton was once a booming town but has taken many hits over the past 30 years as I am sure you are aware. However with the support of successful Canton natives, we can become as proud of our city's future as we are of its past.

Thank you for your time and consideration of my request.

Cordially yours,Mark A. RothertExecutive DirectorSpoon River Partnership for Economic Development

Two weeks later, Mark Rothert received the following letter back:

Dear Mark:

Thank you for your letter. As you know, Canton has always been a special place for me.You are more than welcome to visit Bloomington and discuss the problems I see in Canton. We can tour Bloomington and have a look at what has happened in the last 25 years to this city. Mrs. Aimee Hawkins-Mungle has my itinerary and she can set up a day we can be together.

Best regards,

William A. CookChief Executive OfficerCook Group Incorporated

From that letter and subsequent visits Cook has begun a major reinvestment into his hometown. Do you have any Bill Cooks that used to live in your hometown?

Write to them today!

I Gotta Meet this Guy!

I’ve written several times this year about Bill & Gayle Cook’s efforts to resurrect and restore two early 1900s resorts to their past glory in French Lick, IN. You can see those blogs in our archives (May 3, May 29 and October 16, 2008).

Now, he’s back home in Canton, IL, where he was born and raised (graduated Canton Senior High School, 1949), doing something similar. But, first let me tell you a bit about the Cooks.

They started their business, Cook Group, in 1963, in a spare bedroom of their apartment in Bloomington, IN. The company quickly became a leader in medical technologies and is still headquartered there. The Cook’s have done very well, landing on numerous lists of the wealthiest Americans.

Here is what Forbes said about Bill Cook in October in their Forbes 400 List:

Used blowtorch, soldering iron and plastic tubing to develop cardiovascular catheter. Now the world’s largest privately held medical device manufacturer. Products include stents, embolization coils, needles, vena cava filters. Sales now $1.5 billion. At work by 5 a.m.; eats in company cafeteria.

In June, Cook returned to Canton to purchase two historic downtown buildings that date from the 1880s. Already they have taken off the exterior façade, stabilized the buildings, and are beginning the meticulous restoration of buildings that Cook shopped in as a youth. When completed, the buildings will consist of retail space on the first floor and well-appointed apartments on the second.

And, then last week he was back again to announce plans to rehab an old International Harvester industrial site that has been unoccupied since the early 80s into a new manufacturing plant that will hire 100 jobs and help to bring added vitality to the adjacent downtown. The plant will produce high tech “vascular introducers” or tubes that go into blood vessels so that stents can be inserted.

Cook compared what he is doing to planting a seed, “Once it blossoms, we anticipate the roots will spread throughout the community and nourish further growth.”

And, he returned home with these projects, because, as he added, “My personality came from here.”

We need more Bill Cooks in this world!

Tomorrow: How Canton enticed Bill Cook back home.

Tool Crib of the North

“It was the most incredible operation that I’ve seen in my 30 plus years in the business,” was how Bill Brennan explained to Jeff Smith and me at a recent holiday bank party in Chesterfield, MO.

He was telling us about Acme Electric in Grand Forks, ND, a company that he had just visited that is part of his own tool buying cooperative that supplies his Brennan Tools. His enthusiasm was so great that I decided to research. Here is what I found.

George Kuhlman, who passed away in 1995, started the company in 1948 out of a garage in downtown Grand Forks. His son, Don, who runs the company, said of his dad, “He ran the business out of his wallet. At the end of the month, he’d empty the wallet and see who’d paid and who still owed him money. He had a very good sense of right and wrong that he passed on to me.”

From very humble beginnings (that is their second location on the right), the company has grown to nine retail stores in ND, MN and IA and a 177,000 sf distribution center. Two hundred families make their living at the company’s operations.

In 1999, Amazon came calling, looking to expand into internet tool sales. Acme sold them their Tool Crib of the North catalog division which Amazon renamed Amazon Home Improvement. It is still headquartered in Grand Forks.

In my travels, I’ve found some great examples of very innovative North Dakotans. I’m glad that Bill Brennan filled me in on another one.

Catch 'em Quick....Save 'em!

In 1969, a juvenile judge in Fort Lauderdale looked at a kid standing in front of him in court and knew that a sentence in standard juvenile justice would be the end of any bright future the young man might have. On a hunch, he called a friend who was the director of a marine research agency asking for a favor. He asked the friend to take this young man, put him on a boat, work with him as a marine biologist, give him responsibility and keep him away from his neighborhood. A month later, the friend called back asking for eight more kids.

From that first delinquent, Associated Marine Institutes (AMI) has grown into 57 programs in eight states. The programs have expanded beyond just marine to include environmental programs, farming, dog training for the handicapped, horse training and even programs for girls with babies.

To date, over 80,000 students have gone through the AMI Program, with 70% of them never having any more problems with the law.

Do you have an AMI type program in your town?

Will our Kids be Ready?

“Within the next six years, 89 percent of jobs in Illinois’ fastest-growing sectors will require some education or training beyond high school. Yet, we have 41,000 dropouts per year from our high schools. One out of every four students who start freshman year drop out; two of the four will graduate but not go on for much higher education; and only one of those four will get out of high school with the skills to really excel,” stated Robin Steans, Executive Director of Advance Illinois, who was in Effingham to explore ideas of what could be done in rural Illinois to help turn these alarming statistics around.

Advance Illinois is a non-partisan, non-profit that is focused upon improving the educational and resulting work experience of all Illinoisans. It is chaired by former Governor Jim Edgar, the best governor we’ve had in our state in my lifetime, and Bill Daley, former Secretary of Commerce and brother of Chicago Mayor Richard Daley. Joe Fatheree, last year’s IL Teacher of the Year and Effingham educator who I’ve written about in the past, is one of the fourteen directors of the organization.

The consensus of our group discussion was that most of the current problems begin at the lower grade levels when parental problems often lead to long term problems.

Mike McCollum, principal of Effingham High School said it best, “They might drop out when they are 17, but they give up in the third grade.”

Debbie Owens, Assistant Superintendent added, “We’ve seen a dramatic change at home. Today less than 25% of the students live in a two-parent home with their biological parents.”

As I’ve studied the educational system over the years, I’ve become more convinced that we’ve got to reach the very youngest students, making certain that we don’t have ANY that fall through the cracks. And, with falling enrollments and the resulting squeezing of budgets, we’ve got to do more with fewer resources. I’m convinced that using more volunteers and concentrating recourses in critical education-only programs is needed.

One such program started several years ago at two of our local schools, is a mentoring program that places a volunteer with at-risk students one-on-one each week. The program has grown to over 130 mentors-mentees. I participated until my travel schedule didn’t allow me to be certain that I would be with my mentee each week, something that is critical to the success in the program. During my short tenure, I had one student whose parent committed suicide during the school year and another whose mother was in jail for prostitution and drug dealing. Talk about at-risk!

The program costs the school district about $30,000 with over $150,000 donated in time, material and cash from the community. Yet, the school district is looking at cancelling the program in 2009/2010 because of funding problems. It seems like a very short sighted savings but a very long term cost.

Rainiest Town in LOwer 48....Twilight Mania!

Who would have thought that being known as the rainiest town in the lower 48 states, would lead to fame and fortune?

Forks, WA (population 3,120) has that distinction, although I didn’t know it at the time that I visited it in July 2005 on our way up the western slopes of the Olympic Peninsula on Route 101. I just knew that it seemed to rain all of the time on our visit. I only learned in researching this blog that they get over 120 inches per year.

The town was built upon logging and they still call themselves the Logging Capital of World. But, logging is for the most part, long gone. Like many other rural towns in the mountains of the west, Fork’s logging was killed off in the early 90s when the spotted owl became more important to some people than rural jobs. But, I digress!

In 2005, Stephenie Meyer decided to write a series of books about a young girl, Bella Swan, who moves to a small town and falls in love with a pretty boy, Edward Cullen, who turns out to be a vampire. Meyer chose Forks after doing an internet search of the rainiest spot in the USA.

The Twilight Saga, a series of four books and a new movie released last month, have grown into a mini-Harry Potter cult. The local Chamber has cultivated “Twilighters” who are beginning to flock to the town to see. They’ve put together maps, tours and even redone a 1953 Chevy pickup truck that Bella drove in the book. They’ve started an annual look-alike festival to commemorate Bella’s birthday on September 13th, the first one this year drew over 1,000 people.

Those efforts have resulted in more than 7,000 Twilighters visiting the town in 2008 with many more expected with the release of the first movie in the series.

I’m not sure what part of “fiction” these Twilighters don’t understand, but Forks is leveraging a very unique resource. I hope that they can leverage it for a long time.

Tween Craze Entrepreneur

Maddie Bradshaw, who is now 12, first got the idea for Snap Caps when she was 10. She started making necklaces out of bottlecaps that she decorated around the kitchen island in her home with her mom and six year old sister, Margot.

When her innovation started to become a craze, they set up M3 Girl Designs LLC. The M3 is for Maddie, Margot and Mom. The new company quickly outgrew their home and today has 15 employees, four sales reps and sells 30,000 bottlecaps per month in over 500 stores nationwide.

Maddie is now writing a book about her experience, “Beyond the Lemonade Stand,” which will focus on how to start a business from a kids’ perspective.

I keep preaching about these incredible Millennials who are going to be the most entrepreneurial generation in the history of the USA. Any Maddie’s in your town?

City Winery

I’m always looking for new ideas that might work in small towns, and today’s blog takes us to a big city, the very BIG city of New York City, where I found an interesting new business called City Winery.

The idea for City Winery is that it is a place that you can go to get assistance in making your own wine. The restaurant/winery ships in grapes from all over the country and then assists you in producing your own special vintage.

The operation started in September when a refrigerated truck delivered 10 tons of wine grapes from Napa Valley. About 200 New Yorkers are now making their own wine from those grapes, each producing their own barrel of wine (about 250 bottles) at a cost of around $7,000. While a bit pricey for most, it is an idea that could possibly work in certain agurbs®.

But, even if you have no interest in doing anything, get onto their website and sign up for their updates. The City Winery does an excellent job of promoting their offerings with frequent emails, something that every business in our towns should be doing.

Mr. Agracel 2008

Each year at Agracel we try to raise money in different ways to help support the very needy charities of our local United Way. This year Lynn Higgs, our own fundraising dynamo, decided to hold a competition with myself, Agracel’s president Dean Bingham and CFO Mike Mumm competing for the very prestigious title of being known as Mr. Agracel for the rest of this year.

Votes were collected in donations for the favorite candidate throughout the month of November with a total of over $3,000 raised in the effort.

I am very pleased to report that Dean Bingham is the new Mr. Agracel. He was honored on Thursday with an outfit chosen by Lynn and her “dress the guy” committee. Dean is shown in the photo receiving congratulations from Linda Hemmen, head of United Way, and Tina Schwinke, the campaign chair for 2008.

A complimentary lunch was given by Chuck Keller at his elegant Hilton Garden Inn to Dean and our team, along with a complimentary manicure, pedicure and hair cut given by Desiree Wasser of The Beauty Shop and also a pair of the famous Sarah Palin glasses donated by Eric Zeller of Visionary Eyewear.

I can’t wait to see Dean’s manicure on Monday!

Your Own Dollars

In today’s economy, I’ve heard of more people putting their money under the mattress. Well, if they are going to do that, why not have it be your community’s currency?

Several towns have developed their own currency, something that was common in the Wild West of yesteryear and made a comeback during the Great Depression, as a way to encourage local purchases. It is perfectly legal to do, as long as you don’t make it look like the real thing and you do the project as a not for profit organization.

Communities can print up their own currency, with serial numbers, anti-counterfeiting details and even pictures of local landmarks or famous (or not so famous) local citizens. The local residents benefit through an advantageous exchange system, say for example a hundred traditional dollars that can be converted into 150 or 200 local dollars.

Ithaca, NY has been doing it since 1991. That’s their currency on the right. Berkshire County, MA started theirs in 2006 and has had about $2 million exchanged for BerkShares.

Looking for something new to do in your community? You might want to research this idea.

The Cure for High Prices? Why, It's High Prices!

An old commodity adage is, “The cure for high prices, is high prices.” And, we’ve seen that in the oil market in 2008.

In my travels around the USA this year, I’ve been amazed at the number of times that I’ve spotted oil rigs along the road drilling for oil and gas, something that I’ve not seen as much of in past years. Was it a coincidence, or were there more rigs operating in the country? Here’s what I found out.

Baker Hughes does a weekly count of the number of oil rigs operating in the USA. It hit an all-time low in 1999 when oil dipped below $20/barrel (Do you remember those days of $1 gasoline?). In July, when oil peaked at $146/barrel, the rig count had quadrupled to over 2,000, the first time that it had shot across that threshold since 1985. Now that oil is falling in price, so is the rig count, which was down to 1,941 in the latest report.

The peak for rigs was in 1981 when they very briefly topped 4,500 rigs operating. The fall-off in drilling in the 80s was caused by falling oil prices and the high cost of credit. The joke in oil towns back then was, “Open a bank account and get a free oil rig.”

The other side of the supply-demand equation is that we are driving much less this year than in 2007. The U. S. Department of Transportation reports that we drove 78 billion fewer miles in the first 10 months of this year when compared to the previous one, about 5% less.

It’s supply-demand at work! And, the cure for high prices, is just that, high prices.

Shop the Region

One of the key drivers of attitude in a community or region is the local newspaper. Some take an approach of “if it bleeds, it leads” and try to sensationalize controversy. Others still report those negative and sensational stories, but do so further back in the paper. A few others go the step further to take a very proactive role in helping to positively shape their community and region for the better. I’ve run into many in my travels around the country.

I was with one such newspaper publisher in Carbondale, IL, where I was taking part in their innovative quarterly Southern Illinois Community Leader’s Breakfast, which brings together communities from throughout the broad expanse of southern Illinois. Dennis DeRossett set the breakfasts up four years ago and they’ve grown into a Who’s Who of Southern IL.

I’ve known Dennis for about ten years, dating back to a short period of time when he was publisher of our local newspaper. He’s stayed in touch and follows where I’m speaking. I’ve been amazed at the number of times that he has been a publisher in one of the towns that I’m going to visit, calling me with tips on what and whom to see when I’m there touring and speaking.

A particular passion of Dennis’ this year is his “Shop Southern Illinois” this Christmas season. The Southern Illinoisan Newspaper has taken it on as a cause and Dennis spoke of it at the Community Leader’s Breakfast, “We need to help promote the unique things that each of us has in our communities and shop where we live rather than just automatically driving to the big city to do our shopping. We’ve got some very unique and wonderful shops scattered throughout southern Illinois.”

And, Dennis is putting his money where his mouth is, giving away $5,000 in shopping money to be spent in the region.

We need more Dennis DeRossetts in this world.

$25/Hour to Walk Dogs?

I was talking with one of my “city slicker” CA cousins recently about life out west. This cousin related that her 24 year old daughter was making $25/hour as a professional dog walker and babysitter in San Francisco. And, that was her take-home pay! The company she worked for obviously had to charge some type of premium over her wage.

HUH!!! Is this world crazy or what?

The theme song for the classic TV Show “Green Acres” started bouncing around in my head as she was talking….

Green acres is the place to be
Farm Livin’ is the life for me
Land spreadin’ out so far and wide
Keep Manhattan…just give me that countryside

I hope that your dog doesn’t mind finding its own way around the neighborhood, out here in the agurbs®!

Small Bank Says NO!

I first reported on Evergreen Federal Bank in Grants Pass, OR on September 13, 2005 after a tour and talk there (you can see the pictures and article in our archive) after a visit. The bank was making a huge difference in the community with its reinvestment into the town’s art programs and downtown redevelopment.

Brady Adams, president of the $300 million bank, has spoken out against the bailout of banks saying, “We don’t have people coming to us and saying we got them into trouble. We kept them out of trouble.”

Evergreen made loans to people that it thought would pay them back, the typical risk/return calculation that bankers have been making for centuries. It didn’t get involved in the euphoria of Wall Street securitization of loans like many other banks in OR and other places, not making exotic negative amortization mortgages with no money down that today can’t be repaid. Instead, Brady made loans that, “required people to put real equity into a home purchase and to have the amount of income to pay it off”.

Today, Evergreen, which owns no foreclosed properties, has only foreclosed on one home in the past 10 years and has only four delinquent loans out of 2,000 on its books. Its capital continues to grow, it is making money and its liquidity is good because its borrowers are making their loan payments like clockwork.

Brady and Evergreen are not an anomaly. I see it in virtually every small town I visit in America today. Rural American banks are,5 for the most part, doing just fine today just like they’ve been doing for the past decades.

Black Friday Madness!

I knew that I had to go see for myself, when my son James kept talking about today’s Black Friday sales that were going on at Kohl’s, where he works. James, the night owl of the family, was excited about having to go into work at 3:30 am. James!

So, when I woke up at 4:30 this morning, I slipped on my clothes and drove into Effingham. I had expected to see several cars on the Kohl’s parking lot but not full! And, so full cars had overflowed onto the grass in all directions! Sunrise was still 2 hours away.

The line to check out snaked from the front to the back of the store, with at least 200 people in line. Theresa Schackmann and her daughters Erin & Nichole who were close to the cash registers had been in line for over 30 minutes and my cousin Janie Schultz was at the back, holding a place for her daughter-in-law Michelle who was still out finding bargains. It was “old home week” in the checkout line as I met a host of friends who I hadn’t seen in awhile.

By now my curiosity was piqued so it was over to Wal-Mart. After driving the parking lot for 15 minutes, unable to find a parking spot, I opted for a grassy lot across the road. Absolute bedlam, were the two words that came to my mind as I tried to navigate my way in the store. I gave up trying to get to the electronics department, and judging from the dozens of abandoned shopping carts in the aisles, so had a number of other people. It was difficult enough to get through the aisles just walking!

Menards hadn’t opened yet but the line outside the store of over 100 people obviously wasn’t letting that stand in their way. Stocking hats and camouflage hunting jackets were the fashion choice of those shoppers waiting for the “door busting” bargains.

If you aren’t a “true shopper” and consider Black Friday a day to catch up on projects like I do, take a few minutes to experience the incredible buying power of the American consumer. It is alive and well in Effingham!

Water, Water, Water!

One of my fondest memories of being out on the road, traveling this great country of ours, was a breakfast I had with Leland Speed in January 2005. Leland, a young thinking 70 year old, was head of the MS Development Authority, having taken the job for 2 years at a salary of $1. He had founded and was still chairman of two public REITs headquartered in Jackson, MS, but was asked by Governor Haley Barbour, one of the best governors I’ve seen in creating new jobs for his state, to head up economic development activities in MS.

At that breakfast, Leland laid out a vision of creating multiple lakes in rural MS to serve as an economic development tool for those communities. His thought was that not only would the lakes help to create jobs and tax revenue in these communities, but they would also help to attract entrepreneurs looking for second home locations who might decide to open new businesses. Leland had an “out of the box” idea that was brilliant with little downside.

Jack Moody, who is in charge of developing this lake program in MS, is planning a symposium on the subject in Jackson, MS, on February 4, 2009, that I plan to attend. He is going to have demographers, developers, contractors and economic developers in to lay out Leland’s vision. A PowerPoint on the subject and its economic impact for a community can be seen here.

Moody was also my tour guide of several lakes in the Hattiesburg, MS area. Our first lake was Canebrake, a 250 acre lake that was developed by Dr. Bennett York, a local oral surgeon. Moody called it, “the nicest such development in the state,” and after seeing the clubhouses, golf course, infrastructure and houses, it was easy to see why he saw it as the best.

With Canebrake almost completely built out, York has moved onto Big Bay, a 1,100 acre lake that he hopes to have dammed up by early in 2009.

With 83,500 miles of potential streams that could be developed and five feet of rain each year, most of which flows out of the state, the potential for lakes in MS is incredible. I can’t wait to get back there in February to learn more.

Perseverance or Luck?

Thomas Edison once said, “Genius is 1 percent inspiration and 99 percent perspiration.” He was known for both, often laboring for months on an idea for a new product or process. What I learned in Laurel, MS, is that sometimes that 1 percent can also be luck.

Laurel, MS, (population 18,393) was started as a lumber town in 1882 and became known as the Yellow Pine Capital of the World by the 1920s. Numerous sawmills dominated the industrial base of the community and the piles of sawdust grew into small mountains in the town. One of those sawmill owners wrote to Thomas Edison asking for his assistance in finding a use for those piles. Edison sent a young assistant, William H. Mason, to try to find some use for this sawdust.

Mason set up a small laboratory and began experimenting with the product, but was unable to find any solution. Fortunately, he didn’t give up and he discovered Masonite by accident when the stove in his laboratory exploded when he was at lunch. When he returned he found that the pile of sawdust next to the stove had been transformed by the heat. He soon found that by heating the sawdust and then blasting it with steam, he could form them into boards that had a high bending and tensile strength. And, unlike other similar products which used formaldehyde and glues, Masonite, which used only natural products, was also an environmentally friendly “green” product. Although I’m not sure that being “green” was considered a huge plus in 1924.

Mason set up manufacturing operations in the town, eventually hiring over 6,000. The company, now owned by an LBO outfit, still has operations in Laurel.

Do you have any “piles of sawdust” in your town that a young William Mason might be working on?

Millennials Redeveloping a Town

“When we took it over it was a Bill’s Dollar Store that looked like the metal clad building across the street. Before that it was the post office and a theater that dated back to 1901,” Blane Carpenter and Joshua Miller, both 29 years of age, were telling me about the history of the main building in downtown Ellisville, MS, (population 3,900) that they had redone over the past two years.

They went on, “We bought it for $120,000 and now have about $650,000 in it without counting our labor. It took us about six months just to demo and clean it up before we even started doing any build-out.”

Adding a balcony to the building really enhanced its appearance. Blane and Joshua ended up with six commercial units on the first floor and six apartments (4 with 2 bedrooms and 2 with one bedroom) in the 12,600 sf building.

As I toured the building with them, they pointed out that most of the apartments are rented out to 20 year olds, just like them, who are all on entrepreneurial career tracks. It is exactly these young entrepreneurs and professionals that a downtown redevelopment like this can bring to a town like Ellisville.

Dropouts! What are you doing?

“We are losing 14,000 students/year who are dropping out of our schools in Mississippi!” Dr. Hank Bounds, State Superintendent of Education in MS, told the Education Summit in Ellisville, MS. “That is a school bus full of students, each and every day of the year!”

The math on that number of students is staggering. According to the MS Department of Education, the lost lifetime earnings for one year’s worth of dropouts is $4 billion; MS would save more than $121 million in health care costs/class; and an additional $117 million annually in Medicaid savings.

I’m seeing a few communities that are starting to more fully understand the long term impact of the increasing numbers of dropouts, setting up ‘dropout swat teams’ that are both mentoring and intervening to prevent dropouts in their schools. They’ve found that if they can get a dropout back into school within days of dropping out, they have a much better chance of keeping them in school.

Colin Powell’s foundation, America’s Promise Alliance, has taken on dropouts as a major initiative. Earlier this month they developed a 90 page guidebook on what you can do to prevent dropouts in your hometown. You can download this guidebook here.

Are you making plans to prevent your dropout rate from increasing and improving your schools like Jones County, MS? Your economic future depends upon it.

Education--From Good to Great!

“When people think of Mississippi, the first thing that comes to mind is not our educational system. When you look at all of the data, we rank at or near the bottom in virtually every metric that relates to education. But the steps that you are taking here today are excellent ones that can help to turn it around for your children,” stated Dr. Hank Bounds, State Superintendent of Education for MS, as he addressed the Education Summit 2008 in Ellisville, MS.

This eight county summit grew out of the strategic planning process for Jones County, the largest of the eight counties in southeastern MS. According to that plan, “Challenges with education was the biggest obstacle standing in the way of positive economic development in our area.”

When looking at the data for the State of MS, you can see the challenge. The state ranks as the lowest in % of adults over 25 with a high school diploma (72.9%); third lowest in bachelor’s degree or more for adults over 25 (16.9%); and highest in poverty at 21.0%. Dr. Bounds pointed out the direct correlation between high poverty rates and high school dropout rates adding, “And, there are states that are making determinations on how many prisons they are going to need to build by looking at reading scores in the third grade. It all ties back to education.”

The goals of the summit were fairly simple:

1. Celebrate our many accomplishments in education.

2. Learn why it is essential that ‘together’ we build on those successes NOW!

3. Leave with a sense of purpose and a mission to join together with a goal to helping make our schools second to none.

I related to the summit our own experiences in doing site selection projects for new manufacturing plants in rural America. The educational system and attainment are critical factors that we look at in our many searches. A trend we are seeing is that many new factories require that everyone in the plant have at least a two year, associates degree, and in some cases, a four year degree. Education is becoming the big differentiator and the competition is not just with neighboring towns and states, but rather with countries like China, Korea and others.

My travels around the USA have left me with a very favorable impression of MS. Our company has made multi-million dollar investments in three buildings in the state and I see their future as a very bright one, especially with the passion and enthusiasm that I saw at the summit on education.

Local EBay Auction

Today starts the bidding for a locally run E-Bay auction by one of our local businesses in Effingham. The ‘e’ in this auction stands for ‘eagle’ as in Eaglesoft, a local start-up dental software company which is now part of Patterson Dental. All of the items are donated from local merchants and Patterson suppliers. The proceeds of the auction will go to our local United Way and the Make a Wish Foundation.

This is the third year that they’ve done this auction. Last year they raised over $8,000. This year’s auction will run through December 12th.

If you have a need for an ice cream maker, GPS system, iPod, gift certificates or many other items be sure to get online and bid, bid, bid.

What a great idea to help raise funds for those in need, from a great innovative company here in my hometown.

Housing Off the Grid

The first and only time that I heard of towns being “off the grid” was at a talk in Alaska, to an association of the Aleutian Islands. They told me of their problems with trying to run towns that were “off the grid” of not only highways but also all other services like electricity, water, sewer, etc. Imagine having to have all necessities flown in during half of the year because ships can’t dock because of the weather.

In my talk in Gila County, AZ I met a group that is developing homes “off the grid” in rural AZ. Yes, there are roads that go there and the sun shines all year round there. In fact, sunshine is going to be the key driver for the Climbing Rock Estates, a 204 home subdivision 25 miles south of Globe, AZ.

Randy Gross, the developer of these homes told me, “These homes will be completely solar powered with propane backup to power the swamp coolers and to power the appliances in the house.”

When I go back to Globe in two years, I’m going to go visit this new development to see what it is like to live “off the grid” in AZ.

Why City Folk Shouldn't Move to the Country!

Click to enlarge!

Copper Mining Center

From meeting with young agribusiness leaders of the future, I flew to Globe, AZ (population 7,486), a town up in the mountains an hour and a half east of Phoenix. It was very similar to Elko County, NV where I had been earlier in the week, in that it is largely a mining area (in this case copper) that is looking at how they diversify their economic base at a time when mining is booming.

Chris Martin is head of the South Gila County EDC. Gila is pronounced Heela, not Giila, like I mistakenly did. Unfortunately, I seem to make one mispronunciation in every talk that I do. It goes with the territory. I did check out how to pronounce Miami, AZ, a neighboring town in the county, learning that the older folks pronounce it Mi-am-a, whereas the young people pronounce it Mi-am-ee.

Martin has energized his board and has initiatives working on broadband in the rural towns, has helped to set up a tool lending library and is setting up industrial parks and working on cooperative tourism efforts.

One of the projects applauded at the 4th Annual Southern Gila County EDC Summit was how two local women, Sylvia Kerlock and Gloria Ruiz, put together a partnership with the Phoenix Suns and Arizona Power Systems (APS) within a week to build a $60,000 basketball court in Winkelman (population 443). Winkelman last had a basketball court in 1993. The picture on the right is the inauguration of that court earlier this year.

During the past three months we’ve seen copper prices fall from over $4/pound by half. Copper is probably one of the most cyclical commodities and the work of groups like Martin’s are so important in helping to build a stronger, more stable base for the future. They’ve already invited me to come back in two years to see how they are doing on their goals.

Agricultural Future

I had a great time with the Agricultural Future of America (AFA) geared toward college students focused upon careers in agriculture and the Agricultural Future of America’s Alliance (AFA Alliance), made up of former AFA students who are employed in agriculture and related businesses. It is a dynamic group of young millennials (ages 12 to 27) who are going to transform this country for the better. They’ve got an incredible amount of energy, enthusiasm and vision for people so young.

Both AFA and the AFA Alliance are supported by the main players in the ag sector, the input suppliers, end users, financial partners and commodity associations. They provide a forum and meeting area for young people in a dynamic and critical industry for the USA.

In my presentation to them, I talked about the great things happening in the agricultural sector with niche products, alternative energy and improving worldwide diets. However, I also talked about the Achilles Heal of ag, which is the rapidly increasing aging of farmers in this country. Only draw bridge operators are older in age than farmers. When your average age is 60+ years, you are not as likely to take as much risk and get a bit set in your ways.

That’s why I’m so excited to see young people engaged in agriculture. Groups like AFA and the Alliance are critical to helping make transitions to this newest generation.

Bonneville Salt Flats

As a kid I was enthralled with stories of the Bonneville Salt Flats. I finally got to visit them last week when I was in West Wendover, NV. I remembered the incredible speeds that were attained on the Salt Flats but learned some new things about them on this trip.

Abe Jenkins was the first one to set a new speed record on the Salt Flats in 1910 when he zoomed at 60 mph on a Yale Motorcycle. The next year, a car was finally driven over 50 mph there. Within only three years the new record for a car was set at 141.73 mph!

Records continued to fall until 1970 when Gary Gabelich piloted The Blue Flame at a speed of 622.40 mph, and didn’t leave the ground!

The salt flats were formed on the floor of an ancient lake, which was once over 1,050 feet deep. The lake was 145 miles wide and 346 miles long but has now retreated to what is the Great Salt Lake near Salt Lake City, a hundred miles to the east.

I knew about all of the land speed records that had been set at Bonneville, but wasn’t aware of all of the movies that have been filmed there. The Salt Flats act as a natural “green screen” which allows any background to be added to a film. Blockbuster films like Con Air, Independence Day, Pirates of the Caribbean 3, The Hulk and many others were filmed here.

The old Westover Air Base has been used for several of these films as well, the most memorable of which were Con Air, staring Nicholas Cage, where the concluding scenes were filmed, and Independence Day. That’s a picture of the Con Air plane that still sits on the base and the old hanger is the one that Will Smith as Captain Steven Hiller and Bill Pullman as President Thomas J. Whitmore, use in the last battle with the aliens to save the earth. Both are some of my favorite movies!

Can you tell that I’m having a ball traveling around this great country of ours?

Wendover Will

The first thing that grabs you when you drive into West Wendover, NV (population 4,721) is Wendover Will, a 90 foot high mechanical cowboy, the tallest in the world. With over ¼ of mile in neon lighting tubes, I wish that I had been there at night to see him lit up. Will came into existence in 1952 to help pull people off of the Lincoln Highway which ran through town.

As we drove over the Silver Zone Pass at 5,940 feet, the town of West Wendover, NV and Wendover, UT began to come into view. And, just beyond the twin cities lies the Bonneville Salt Flats. More on them tomorrow but what was an incredible site was how the nature of the Great Basin Desert combined with the Salt Flats; one can actually see the curvature of earth. I was told, that the phenomenon is even more pronounced at night when you can see the lineal trail of headlights travelling west on I-80. I’ll have to get back to see that!

West Wendover is a gambling town with charter flights from the Midwest helping to fill its 1,800 motel rooms and six casinos. Recently a 1,000 seat concert hall was constructed at a cost of $21 million, bringing in such acts as Gretchen Wilson, REO, Randy Travis, America, Amy Grant, Bill Engvall, Lee Ann Womack, Smash Mouth, The Guess Who, Sawyer Brown, Gary Allan, David Spade and Willie Nelson.

West Wendover has made history a number of times. On June 17, 1914, AT&T erected the last of 130,000 telephone poles that finally allowed a transcontinental telephone conversation. In the first call ever, Alexander Graham Bell was in NYC, his one-time assistant Thomas Watson was in San Francisco, the president of AT&T was on Jekyll Island, GA and President Woodrow Wilson was at the White House. Bell picked up the phone and asked Watson, “Mr. Watson, come here. I want you,” repeating his very first phone call. Watson, in SF, responded, “It would take me a week now.”

The Wendover Air Base was constructed at the start of WWII and trained over 1,000 bomber crews during the war. The most famous of those was the crew of the Engola Gay and Bock’s Car which dropped the only nuclear bombs in history. That’s my tour guides in Elko County, Elaine Barkdull Spencer and Stacy Sawyer in front of a replica of that first atomic bomb.

Rebuilding After a 6.0!

“I was down in the basement working on the computer and thought that my husband Zach was dribbling a basketball upstairs very quickly. Then the room started to move and I knew that it couldn’t possibly be a basketball.” Elaine Barkdull Spencer was explaining to me her initial reaction to the 6.0 earthquake that hit Northeast Nevada on February 21, 2008.

Even though Nevada is in a seismic area, it is uncommon for them to have earthquakes of this magnitude. The epicenter was six miles outside of Wells, NV, an oasis of water wells on the California trail. The town dates from Christmas Day, 1869 and the old historic downtown still has most of its buildings standing, or at least they were until the 6.0er hit the town.

We stopped by Wells (population 1,346) on our way to West Wendover, NV (tomorrow’s blog) to survey the damage. I was hoping that several of the residents from Wells would make the trek to my talk in West Wendover, because I told several stories of the revitalization of towns like Greensburg, KS which was wiped out by an EF-5 tornado and the MS Gulf Coast which suffered from the incredible force of Hurricane Katrina.

But Elko County is a B-I-G county, with over 17,000 square miles of land area. You could fit the states of MA, DE, CT and RI within the borders of the county and still have room left over to put in all of the Florida Keys. And, no one from Wells made the 60 mile trip over to West Wendover.

Wells has some incredibly historical buildings in its old downtown area. I hope that they find the funds and the will to rebuild them to their past glory.

Diversifying Elko

“I’m Jack Schultz and I approve this message,” was how I started my talk after the introduction. I was in Elko County, NV (population 47,010) the day after the election and the response to my intro got a good laugh. The good citizens of Elko were glad that the election was over. Being a battleground state, they got inundated with advertising and campaigning. I was amazed when I learned that during the presidential campaign season this rural Northeast NV county had three visits from Sen. Obama, one from Sen. McCain and a late visit the night before the election from Gov. Palin. Talk about the critical importance of certain regions and states!

I had been in Elko two years ago today, when I was there to help them inaugurate Frontier Telephone’s first-in-the-nation wireless broadband service in the town of Elko (population 16,708). Elko had immediately jumped at the chance to install the new technology as a way to help diversify their economy. They also were in the early stages of setting up a major rail-park as part of that diversification strategy. At that time, Elaine Barkdull Spencer, the dynamic Executive Director of the Elko County Economic Diversification Authority (ECEDA), passionately told me of her desire to diversify away from its dependence upon the notoriously cyclical mining industry.

Frontier’s broadband service has resulted in a number of new businesses starting up and the rail-park is almost operational. The county purchased an 810-acre ranch that ran along the main line of the UP Railroad from San Francisco to Chicago, turning 60 acres of into a multimodal transload facility and warehousing yard and industrial park. Already land has been sold in the park to Pacific Steel, SAS Global, Spirit Minerals and Ormaza Group. Pacific’s project is now under construction.

Elaine told me of ECEDA’s goals, “Even though we’ve got 37 mines here in northeastern Nevada that pay incredibly well, we know that we’ve got to look at how we diversify. We’ve identified five areas for development: Small manufacturing to use our skilled workforce; food processing for our abundant water; distribution with our rail and road assets; construction companies; and mining support companies.”

Mining is still in a boom phase, even though the main product of gold (Elko County is the largest producer of gold in the USA and fourth largest in the world!) has fallen from over $1,000/ounce earlier this year to $700. It will have to fall a great deal more to fall below the estimated break-even price of $400/ounce and even then production would not stop because of the ten year time period to re-permit a mine that is closed down. The “Carlin Trend” gold vein which runs from Carlin, NV (population 2,161) where I did my talk, over to Elko, is 50 miles long and about five miles wide. There is plenty of gold in “them thar hills!”

Elaine spoke of her own two sons, both of whom work in the mining industry, “I never wanted them to go into the industry because of its notorious boom and bust cycles. However, the money is so good that they both ended up there. My oldest son who is 27 makes over $100,000 per year as an electrician in the mines and the other is 26 making just shy of $100,000 per year, supervising a crew of 32, all of whom are older than him.”

I was impressed with her efforts to find other jobs for the communities in Elko County.

Top Historic Destination in the USA!

One of the agurbs® that I probably write about more than any other is Columbus, IN (population 39,059), a very unique, well-diversified community in southern IN. Imagine my surprise when I picked up National Geographic’s Traveler magazine and found Columbus ranked as the top historical destination in the USA and eleventh in the world out of the 109 ranked.

Here’s what they said about Columbus:

Although it’s surprising to see a Midwestern burg (wish they had used the term agurb®!) in the company of Dijon and Stockholm, this “jewel in the region” boasts “world-class” mid-century modern architecture. The “charming downtown historic district” adds to the attraction, but the countryside’s “unchecked growth” makes for a “terrible gateway.”

Other towns and agurbs® that I’ve visited and are mentioned in the Traveler article are:

Ashland, OH (19); Red Wing, MN (23); Port Townsend, WA (24); Asheville, NC (33); Natchez, MS (40); Galena, IL (45); Lexington, KY (46); Sitka, AK (48); and Santa Fe, NM (75).

Small Banks Thrive

There was a great article in the NY Times yesterday on the advantages of small banks. Cited as an example is the First National Bank of Orwell, a $36 million bank in Orwell, VT. Founded in 1832, it is Vermont’s smallest bank. Loans are up 22.6% from last year while deposits are up 7%. The picture on the right is Mark Young, president of the bank, with a customer.

The Federal Reserve wants small banks like this to go away, hoping that their TARP program will help to eliminate over 1,000 small banks. Bad decision!

Look at the graphic below which shows returns and charge-offs for banks in the USA by size. Returns are highest and charge-offs lowest for small banks! Why would you want to eliminate them? What are the Feds thinking?

Football Helmets

If you watch football this weekend and pay particular attention to the backs of the football helmets, you’ll see the name Schutt. Schutt Sports makes helmets along with other athletic equipment in Litchfield, IL (population 6,815). The company dates to 1918 when Bill Schutt started making basketball goals in his hometown. From very modest beginnings, the company has grown to several hundred jobs in the town, with other plants in IL and PA.

I was in Montgomery County, IL (population 29,810) for their first ever Summit to discuss economic development last week. Litchfield is the largest town in the county.

Schutt is looking at consolidating their various operations in Litchfield, wanting to do a 100,000 sf expansion onto their main plant. Litchfield is looking at various options on how to assist Schutt in their expansion. One of the graphics that they asked me to send was the following, which shows the impact of a 100 manufacturing jobs like Schutt on a community:

The Impact of 100 Manufacturing Jobs

* 415 more jobs
* $12,700,000 more personal income/year
* $5,000,000 more bank deposits
* 7 more retail establishments
* $7,700,000 more retail sales
* $540,000 increased tax revenue
* $2,000,000 more service receipts

Information provided by Illinois Chamber of Commerce

You can’t have enough good paying manufacturing jobs in a town. I hope that Schutt expands and continues to grow in Litchfield.

Miner to Publisher

Some people and many athletes have an incredible desire to succeed/win. I met one of those people at my talk in Sesser. “I want you to meet Jim Muir,” Mayor Mitchell introduced, “one of those miners I told you about who lost their job when all of the mines here closed their doors. Unlike a lot of them, Jim went back to college got a degree in journalism and started his own magazine last year.”

After Jim and I chatted for a few minutes, he went out to his car and returned with three of his latest issues of Southern Illinois Sports Connection, a four-color 50 to 60 page monthly magazine that is chock full of interesting information on high school, college and community sports in the southern ¼ of IL. From his first issue in August, 2007 it looks as though the magazine has grown each month.

It continues to inspire me, when I meet new entrepreneurs like the Jim Muir’s of the world who when are handed lemons of losing their job, take those lemons and make something better for themselves.

Rebuilding, Diversifying

One of the most painful changes that I’ve reported on in my travels around the country, is the gut-wrenching changes that towns which are virtually dependent upon one firm or industry for their jobs goes through when structural changes occur wiping out those jobs. I was in such a town last week.

Mayor Ned Mitchell, of Sesser, IL (population 2,128) was telling me a bit about the history of his community, “We had five coal mines in the county and had 12 within 25 miles of Sesser. Each employed between 500 and 800 miners who got not only great wages but excellent benefits because all of them were United Mine Workers mines. They all shut down soon after the passage of the Clean Air Act.”

One of his aldermen, an ex-miner piped up, “When I went to the mines in 1964 I was taking home $24.25/shift and when I was let go in 1992 I was up to $135/shift.”

Sesser has yet to recover from that downturn with unemployment still topping 12%, but Mayor Mitchell and the town aren’t giving up. They are hoping to develop more amenities to lure more visitors from nearby Rend Lake, which has 3 million people visit each year. And, they are improving the community in many ways. Four new baseball fields, one of which is being done by the St. Louis Cardinals at a cost of over $200,000, are in the works along with a new soccer field. A new 2007 TIF district is facilitating the tearing down of old, abandoned houses, replacing them with modern ones. And an old 1914 Vaudeville Theater/Opera House and adjacent café where I did my talk, is helping to revitalize the downtown.

New scrubber technology is leading to a resurgence of Illinois coal and several of the old mines are slowly reopening, but coal is probably never going to be the economic powerhouse that it was in the past. Towns like Sesser realize that and are getting on with a new, more diversified future.