Granite State Business ParkEconomic Development Case Study

Economic Development Academy – October 10, 2014Karen Pollard, CEcD, EDP

Who Am I? Karen Pollard CEcD, International Economic Development

Council (IEDC)EDP, Northeast Economic Developers

AssociationEconomic Development Manager, Rochester, NHDevelopment Services, Inc., Ivanhoe, MNPipestone County Economic Development Corp.,

Pipestone, MN Warren County Economic Development Corp.,

Queensbury, NY 14 years in Retail Operations and Site Selection

for: The Limited Companies, Ralph Lauren, Maidenform, Ames Dept. Stores

Passionate about education & training standards for economic development practitioners!

Business Park Development 1989

Howard Katz, Developer– Phase 1 – 97 Ac– Phase 2 – 55 Ac– No Access to Phase 2

• Off to a Great Start!– Prime Tanning 1994– Salmon Falls Precision

1994– Techniweave 1999– Frisbie Hospital Secure

Storage 1999• Pease International

Tradeport 1992

Former Prime Tanning BuildingCirca 2000

Granite State Business Park 2010

• 62.2% of Phase 1 is developed

• 421,500 sq ft/ 5bldg• 425 Employees• Assessed for Taxes

$15,740,000• Payroll $19 MM

• Manufacturing Changes – Prime Tanning closed,

Rand-Whitney Corp. – Salmon Falls Precision

closed, Multi-Tenant– Techniweave acquired

by Albany International, bldg expansion in 2007

– Industrial Condos 2006 & 2009

• Still owned by same developer

Aerial View

Economic Challenges (Obstacles)• Great Recession• Thompson Center

Arms announces relocation to MA – INCENTIVES!

• Lack of available Capital, increased underwriting standards

• Lots of available real estate – CHEAP!

• Transition in required mfg skills

• Existing Companies with Unique Products– Advanced

Manufacturing– Composite Materials

• Developer willing to sell @ discount

• Expansion opportunities

Safran/Albany LEAP Facility

This Albany & Safran project will create:– 689 FT jobs– $41MM Annual Payroll– 911 indirect jobs– $27.5MM Payroll– Total Economic Output

(NH) $232,781,044

Tax Increment pledged for ~15 years to debt service of $9 MM343,000 ft2 facility + 90,000 ft2 exp

$150MM CAPEX55 acres under agreement for exp

Critical Deal Components• Internationally

Competitive RFPs• Two Partners• Incentives - on-site and

off-site +$9 M– “blighted” location– RSA 205 never used

• City investment in BIG infrastructure +$5 Million– Access to Site– Wetland mitigation

package– Utilities, relocation of PSNH

transmission lines• Critical Timing of

Construction

• Collaborative Partnerships– City Staff & Elected Officials– DRED, DES (EPA, Army

Corp)– Governor Lynch– NH Northcoast RR– PSNH, Unitil, FairPoint

• Labor availability & cost– Skills shortfall

• Training program for 20+ years worth of employees– Great Bay Community

College– Creteau Technology Center– Advanced programs

• $4 M NH, $19.9 M US

TIF District & Program Plan

Financing & Development Program Plan:• Defines district, budget, use of funds, etc.• Adopt by public hearing. See RSA 162-K:6 and 162-

K:9.

Plans must “contain a complete statement as to the public facilities to be constructed, the open space to be created, the environmental controls to be applied, the proposed reuse of private property, and the proposed operations of the district after the capital improvements within the district have been completed.”

Important Features! Multiple TIF Districts are

allowed, HOWEVER:• Do not exceed 8% of

Assessed Value for community (or

• 16% for all combined with districts that have outstanding bonds);

OR,• 5% of total acreage! (or

10% of total acreage for bonds outstanding)

• Increment only accrues after date district is established!

• Values as of April 1.• Bonds – First payment

must be within 5 years.• Last payment no later

than 30 years.• Bonds are NOT to be

included when computing the municipality's net debt under RSA 33.

TIF ExamplePre-construction or “Original” value = $1,000,000Post Construction Value = $50,000,000• Increment or “Captured Value” = $49,000,000• Tax revenue on $1,000,000 “Original” value =• $25,000 ($25 / $1,000 A.V. Tax Rate)• Tax revenue on increment = $1,225,000• $25,000 to General Fund• $1,225,000 to TIF for debt service, operating

costs, maintenance & reserves. Increment Value is based on April 1st each year

Granite State Business Park 2014Development District

– +$5M City Infrastructure– +$4M BFA Loan

Incentives– TIF District – ERZ Tax Credits (NH)– R&D Tax Credit (NH)

Recent Development– 50 Acres Under Contract – Lot #35: LOI -5 acres

– Lot #1: NCS Global • 30,000 ft2 $1,698,900

– Lot #33, 34 Avail Add’l Acres under

Investigation

GSBP expanded to 252 Acres2003 Value $5,128,800 330,865 ft2

2014 Value $41,894,120 +819% inc 803,168 ft2 Revenue $969,134

Economic Impact Modeling

CONNECT Northern New England Economic Model

• Total Jobs: 1,694– Direct: 911– Indirect: 689– Induced: 94

• Total Earnings: $68,545,391– Direct: 41,111,901– Indirect: 24,152,920– Induced: 3,281,110

• GDP $121,769,963 • Total Economic Output

$232,781,044

REMI – Policy Insight Model• Total Jobs:• Total Earnings: • GDP: $725,600,000

~2020– 13.7% of Strafford Cty GDP

• Total Economic Output:

“If it’s happening in NH, it’s happening in Rochester!”

Community Development Division

- Economic Development- Planning, Zoning

- Code Enforcement- Building Safety

@RochesterEDCwww.thinkrochester.biz

Karen Pollard, CEcD, EDPEconomic Development

Manager Karen.pollard@rochesternh.net