Miss.: Energy, Health Care and FDI Gain Ground

19 Feb, 2014

By Rachel Duran

In 2013, Mississippi welcomed more than 6,200 new jobs and $1.03 billion in private sector investment, which was double the jobs and investment generated in 2012. “We are of the mindset that what is good for business is good for Mississippi,” says Brent Christensen, executive director, Mississippi Development Authority (MDA). “We continue to rise up on the lists of top states to conduct business. That is because we put significant emphasis on making sure this is the best environment in the world for business.”

Christensen says Gov. Phil Bryant understands his No. 1 job is creating new job opportunities for citizens. “You see it in the health care and energy legislation,” he says.

In 2012, state officials passed the Mississippi Health Care Industry Zone Act, which created health care industry zones. The zones provide incentives to support the creation of health care and biotech industry jobs, be they in manufacturing, R&D, or in some cases, service providers.

One of the zones is located in the Oxford and Lafayette County area. The area’s assets include a pharmacy school at the university, and the National Center for Natural Products Research.

Officials in Oxford are concentrating on growing startup operations, with a focus on health care and IT operations. Officials are working with a venture capital organization from Texas to identify and develop the strategy.

“We offer a great place to live, access to talent, and access to capital,” says Jon Maynard, president, Oxford-Lafayette County Economic Development Foundation. “We have a number of high net worth individuals with ties to Ole Miss. We will work this year to bring everyone to the table at the right time with the right deals.”

In regard to energy legislation, in 2013, state officials passed landmark legislation, which features several components, including a law to reduce the severance tax on horizontally drilled wells to 1.3 percent for a period of 30 months. “It is a significant reduction to encourage and incentivize oil and gas extraction in our state,” Christensen says.

When addressing noteworthy expansion projects in 2013, Christensen says the announcements are exciting and important to building the state’s economy; however, he adds the growth of existing businesses is critical to the state’s overall health and industry diversity.

Industries and Innovations

Among those announcements was one from Yokohama Tire Corp. for a commercial truck tire plant it will build in West Point. The company selected the Prairie Belt Power site, and expects to invest $300 million and create 500 jobs in its first phase of development. The company’s four-phase investment could total $1.2 billion and create 2,000 jobs.

West Point is marketed by the Golden Triangle Development Link, a three-county effort. The Yokohama project was a competitive site selection project focused on the Southeast United States. “People thought the workforce and availability might be our challenge but when the consultant started working with the community college and Mississippi State University, they saw these groups work together well,” says Joe Max Higgins, CEO, Golden Triangle Development Link. “We held an informational job fair on December 21 and 1,500 people attended.” Christensen says the state is committed to ensuring Yokohama has a skilled and trained workforce from day one.

Christensen also notes that in addition to reliable, quality and available power, Yokohama’s officials felt welcomed with open arms by the people of the region and the state. Another factor was the long-term advantages of the location. “They looked at not only start up costs of this facility but also a 20-year horizon,” he says.

In other auto industry related project activity, Nissan, which builds eight models at its Canton location, announced a supplier business park. The company will build on land across the street from its assembly plant. Nissan has operated with suppliers co-located in the manufacturing plant and decided to move the suppliers from the operation to a facility nearby. The supplier park is the company’s first, and if all goes well, it will be the model for establishing similar facilities throughout the world.

Feuer Powertrain GmbH, a German company, has announced its first manufacturing operation in the United States in Tunica, where it will build crankshafts for companies, initially focused on engines for Cummins. The company is investing $140 million and will create 300 jobs.

In other news, Toyota Boshoku Mississippi announced an expansion in Mantachie to increase component production for the new Corolla.

The auto industry receives support from the Center for Advanced Vehicular Systems, which is located at Mississippi State University.

The university also oversees the Raspet Flight Research Laboratory, which partners with the state’s aerospace cluster, which includes companies such as Aurora Flight Sciences, Stark Aerospace and American Eurocopter in Columbus, and Northrop Grumman in Moss Point. Raspet, located at the municipal airport in Starkville, offers a 5,500-foot runway and includes a complete aircraft manufacturing facility.

GE Aviation has two facilities in Mississippi; in Batesville and a newer facility in Ellisville. The newer facility produces advanced composite components for aircraft engines and systems.

Rolls-Royce tests jet engines from a facility located at the Stennis Space Center. The center is located in Hancock County and is one of 10 field centers for NASA.

Down To Business

*Mississippi has more than 13,000 miles of natural gas pipelines, and the state is ranked No. 2 in the world for investments in the oil and gas sector.

*The state’s energy costs are 20 percent lower than the national average.

*Mississippi is the gateway to all major United States, Canadian and Latin American markets and is within a day’s drive of 55 percent of U.S. businesses and major population centers.

Clusters Continue to Thrive

Moving to the IT cluster, General Dynamics Information Technology has located a customer support center to Hattiesburg. The company plans to hire 1,250 people. “With facilities like that the key is being able to find a quality labor force,” Christensen says. “You have the opportunity to hire the best and brightest out of the University of Southern Mississippi, and also have a number of folks in Hattiesburg that are qualified for these jobs.”

In Starkville, C Spire Wireless has announced it will build a $22 million data center.

Christensen also points out the emerging bioenergy cluster taking shape in Mississippi. Green Circle Bioenergy and others are taking pine trees, one of the state’s leading natural resources, and breaking them down to produce wood pellets for use in energy markets, both domestic and abroad. The Port of Pascagoula is underway with efforts to support the movement of the pellets to international markets, primarily to Europe.

In the Golden Triangle region, KiOR Inc. in Columbus announced an expansion of its operation, which converts wood chips to biocrude and an onsite refinery converts the crude to jet and diesel fuel, Higgins says.

In regard to the state’s advanced manufacturing sector, the sector is important in the Greenwood-Leflore area, which is home to Viking Range, which employs 700 people. Milwaukee Electric Tool employs 400 people. The John-Richard Co., a homegrown firm, which makes home décor, is headquartered in the community.

In the Golden Triangle area, Mississippi Steel Processing LLC will double its footprint and job count at its facility in Columbus. CalStar Products Inc., a brick and paver company, will move into a shell facility in Columbus and start production in the summer.

In other activity, Mississippi is a leader in composite and polymer research. The University of Southern Mississippi is home to the Mississippi Polymer Institute. The University of Mississippi is home to the Composite Materials Research Group.

In recent sector announcements, in January, Mississippi Silicon announced it would build a manufacturing facility in Burnsville. The company will invest $200 million and create 200 jobs. The lead partner on the project is RIMA, a company from Brazil.

International investments continue to fuel activity in Mississippi. “We have seen a lot of FDI in the state, with international auto suppliers from Japan and Germany,” Christensen says. In April, the MDA will lead a trade delegation to South America.

Talent and Education

In other initiatives, the University of Mississippi has a new Center for Manufacturing Excellence that is pairing engineering and business students so they understand each other’s disciplines. “These students understand what it means to do services and what it means to be on the floor producing product,” Maynard says. “It is a more well-rounded approach to manufacturing.”

Oxford also offers facilities and access to researchers to support young companies, including the Innovation Hub at Insight Park, which is a 62,000-square-foot building with wet lab space. The Oxford Enterprise Center assists in efforts ranging from IT to manufacturing. At the center, Winchester trains the adjusters for their machines in this center; the company employs 1,000 people and is expanding again, Maynard adds.

Outdoors and Recreation

Mississippi’s national parks provide visitors with a wide range of unique experiences, such as those found at the historic Vicksburg National Military Park. In contrast, the Gulf Islands National Seashore combines the natural beauty of three islands situated off the Mississippi Gulf Coast. The famed Natchez Trace offers opportunities for family fun and rediscovery of impressive events in America’s past. Source: www.mississippi.org.

Assets

Oxford also features Oxford Commons, a mixed-use development located near an industrial park, allowing companies to set up offices in the commons and manufacturing activities at the industrial park. Space will be available in the next 18 months to 24 months at the commons.

In the Three Rivers region, officials are involved in a campaign to push site preparation in three counties: Pontotoc, Union and Chickasaw. The communities want to grow the supplier base for the auto industry; Toyota has an assembly plant in Union County, says Josh West, regional economic planner, Three Rivers Planning and Development District Inc. The region is also home to a large furniture-making cluster, which has stabilized since the recession.

A new development in Chickasaw County, the Hopewell Project, is a 1,200-acre site on Highway 45, which would be ideal for large users, primarily auto suppliers. “It is in a rural area but near high capacity utilities,” West says. “You can spread out and build a buffer zone.”

Back at the state level, Christensen says the pro-business climate in Mississippi is fostered through strong partnerships with local economic development partners. “If we are not taking care of our businesses locally, we will not be able to compete globally,” he says.

Adds Angela Curry, executive director, Greenwood-Leflore Industrial Board, “Economic development is a team effort and we could not be successful without our local allies. We partner with many agencies throughout the state and region to help with our mission.”

Lifestyle

In the past, the Oxford community worked to attract retirees to the area, which resulted in 1,000 retiree households in the area. A niche of these retirees includes those with the ambition to write; there are nearly 25 active publishers in town, inspired by working in famed author William Faulkner’s home town.

Statewide, according to www.mississippi.org, the quality of place assets range from dancing to the Delta Blues to hitting a perfect hole-in-one on one of the state’s many golf courses to trying your luck at a dockside casino or touring a grand antebellum mansion.