SWOT Analysis about Economic development.

[chrstnhsbndfthr]

There is a letter to the Editor on the Chatham Journal that contains a lot of important information that was discussed here on the BBS some time back.  The information is very important for the economic development of our county. Sure glad Larry typed in all this info.

http://www.chathamjournal.com/weekly/opinion/myopinion/chatham-swot-70119.shtml

Economic development for Chatham’s future

By Larry Hicks
Posted Friday, January 19, 2007



Chatham County, NC - Last December, the UNC Center for Competitive Economies presented an economic opportunity ‘SWOT’ analysis of Chatham County. This oft-used assessment tool provides a baseline assessment of the Strengths, Weaknesses, Opportunities, and Threats facing Chatham as it begins to establish a pro-active approach to attracting quality business to the County. In the words of the presenters, SWOT is the first step in creating an objective shared reference point for stakeholders as we move forward with the joint development of an economic vision plan.

For those who worked on the development of the now adopted Strategic Plan, and the adopted Land Conservation and Development Plan, and those who have been paying attention to the County’s current growth discussions, this assessment will seem oddly familiar.

Strengths - Positive characteristics, internally focused

· Good business climate with relatively low property taxes

· Residents have high median household income (6th) and per capita personal income (5th).

· Well-educated resident population (unfortunately, much of this workforce commutes elsewhere to work!)

· Strong community college presence, including small business/worker training support programs.

· An excellent transportation network with easy access to the Triad and RTP regions and two major airports

· Land in Chatham is less expensive than in the core counties of the Triad or RTP

· Designated economic development areas and industrial parks

Weaknesses - Negative characteristics, internally focused

Employment:

· Manufacturing employment has remained stagnant since 1990, yet it continues to be the largest private sector employment.

· Chatham’s employment concentrations are highest in the lowest paying sectors.

· Wage rates in Chatham are lower than the region and lower than the state average across most industry sectors. The wage disparity is large in some sectors.

· Planned areas for economic development are not served or are underserved by water and sewer infrastructure. This may limit the type of and location of future businesses

· Planned residential developments may strain infrastructure capacity

Commuting:

· Highest share of residents commuting outside of the county for employment within the region and the longest commute times in the region

· Commuters to regional counties earn considerably higher wages across a variety of business sectors

· This high commuting rate is detrimental to existing Chatham retail businesses and to the local government tax base.

· Chatham has the lowest retail sales per capita in the region.

· Chatham “leaked” approximately 55% of its proportional retail sales to other NC counties.

Opportunities - Positive characteristics, externally focused

Retail sales:

· Chatham is underserved by retail development. Chatham has the opportunity to be selective is its retail economy.

· Improving Chatham’s retail economy will increase the tax base to serve Chatham’s growing population

· The 55% leakage in retail sales accounts for approximately $550 million is lost local sales and $12 million in local option sales tax revenue collections.

Workforce:

· Chatham’s high level of commuting disguises the untapped workforce for higher wage companies.

· Chatham has both well-educated professionals and highly-skilled workers.

· This breadth of workforce will enable a diverse Chatham economy.

Immediate economic development opportunities:

· Expansion of existing firms - identify and serve existing firms seeking to expand

· Capture of RTP/Triad technology start-up companies - identify expanding firms seeking location of production facilities

· Tourism - utilize Chatham’s heritage and natural resources to build a stronger tourism economy

Threats - Negative characteristics, externally focused

· Residential development without economic development threatens Chatham’s quality of life. Residential tax base alone does not pay for itself.

· Current economy too concentrated in low-wage, declining sectors. Low-wage, low-skill employees are susceptible to economic downturns and lack competitive job skills.

· Lack of consensus on economic development priorities. This limits Chatham’s ability to develop and pursue a comprehensive economic development strategy

This is a good start, but only a start. There is much to accomplish, and it will take the energy of all of us. As with the multitudes of County assessments over the past 30 years, however, this preliminary assessment will have little impact if not incorporated into pro-active measures. I am hopeful that the entire County begins to take the long view … that of balanced growth which weighs the advantages of a strong economic plan, predicated on a strong educational system, infrastructure, and a community that recognizes and cherishes its heritage and character while seeking businesses that add to the County’s quality of life and opportunity.

[chrstnhsbndfthr]

There are a couple of inaccuracies in the SWOT.  One being the statement about residential development. Jason did correct this when i questioned him about it at the meeting. This should have been on AVERAGE residential development does not pay for itself. 

Obviously there is a break even point after which a given home will be profitable.  Margaret Pollard placed that number at $250k.  So houses worth $300k to $750K or more actually add more revenue to our county than they cost. 

Secondly, the statement "relatively low tax" may mean in relation to Orange and Wake counties, because our county is slightly above the average tax burden per citizen on a statewide level.

[checkthefacts]

I think overall the analysis is fairly accurate, and it reinforces the work of the Strategic Plan Development Committee (SPDC) which helped craft the now adopted Strategic Plan, the basis for the Land Conservation and Development Plan. Although we could argue specific points, e.g. when residential development begins to pay for itself, we need to build on the strengths and opportunities, while mitigating the weaknesses and threats.

I am encouraged by the assessment of the community college presence, the workforce, business climate, and so forth. I also note that the issues of commuting, retail, and loss of good workers to other counties are symptomatic of the lack of true economic opportunity in Chatham. Most notable in the assessment was the final bullet, "Lack of consensus on economic development priorities. This limits Chatham’s ability to develop and pursue a comprehensive economic development strategy". This is where the rubber hits the road.

I have always believed that, as the Strategic Plan encourages, we need to have a comprehensive approach to economic planning. Currently Chatham's approach is non-existent, and I hope the changes to the EDC and the hiring of a new Director will move us forward. But it cannot be a one-sided approach. The integration of all the important pieces in decision making, i.e. utility infrastructure, schools, community college, County heritage and natural resources, recreation, community building, transportation, tourism, marketing ... all play a part in us being successful.

The challenge is that you cannot focus on one area without taking the other areas into consideration. For example, residential growth is important, but it must be paced with economic growth and cannot overtax our resources (natural and financial) and overburden our schools (strong schools attract strong businesses), and it must be developed in conjunction with protecting the water (health, sustainability and tourism). Retail growth is important, but if it develops into strip malls, congestion, and the lowering of our quality of life, it loses its attractiveness and appeal. Chatham is a beautiful County ... another attraction to quality businesses.

Bottom line, it comes down to balance and leveraging our advantages. I know I've beat this drum before, but it seems to me that if we measured our actions against the guide of the Strategic Plan, we would find ourselves aligning towards a positive future.

Most importantly, though, we need to have vision ... Chatham does not have to settle for being average or below average ... it does not have to look at every opportunity as our last chance for salvation ... rather it can look at every opportunity, issue, and decision in how it aligns with our vision of the future ... that we indeed can be better than we are ... on our own terms. We still are untamed ... we still have a chance to do this right ... we need to be visionary ... we need not settle, but rather encourage growth (economic, retail, residential, agriculture, etc.) on our own terms.

http://www.co.chatham.nc.us/dept/planning/planning_dept/ordinances/documents/Strategic_Plan.pdf

[Stargazer]

Most importantly, though, we need to have vision ... Chatham does not have to settle for being average or below average ... it does not have to look at every opportunity as our last chance for salvation ... rather it can look at every opportunity, issue, and decision in how it aligns with our vision of the future ... that we indeed can be better than we are ... on our own terms. We still are untamed ... we still have a chance to do this right ... we need to be visionary ... we need not settle, but rather encourage growth (economic, retail, residential, agriculture, etc.) on our own terms.

Amen!
That's it in a nutshell.

[Wahoo]

With all that said ,what businesses do we need to attract?  Whats left to bring to chatham. Winery is just Agriculture,ag jobs are low paying. Where do we look for the high paying jobs?  We can not afford to pay the incentives other counties are paying. 

It appears to me that we want chatham just to be a place to live an not work. Thats OK if you live close to Raleigh,Durham,Chapel Hill and Burlington. For those living in the NE and East you are the lucky ones to have jobs just across the county line, but for those who live in the west and south west you are out of luck. All you are going to get are Ag jobs that are low paying.

[keith_moon]

Obviously there is a break even point after which a given home will be profitable.  Margaret Pollard placed that number at $250k.  So houses worth $300k to $750K or more actually add more revenue to our county than they cost. 

I'd really like to see data that supports this.

[flossiesmom]

What are the incentives of bringing business to Chatham County?  We can talk about smart growth through businesses rather than residences all we want but if business owners don't want to come to Chatham, we can't make them.

I'd like to hear some thoughts about why non-box stores SHOULD come to Chatham, other than Chatham is a great place to be.  

[WolfpackFan]

Obviously there is a break even point after which a given home will be profitable.  Margaret Pollard placed that number at $250k.  So houses worth $300k to $750K or more actually add more revenue to our county than they cost. 

I'd really like to see data that supports this.

Contact Margaret and ask for it.

[checkthefacts]

Incentives to bring business to Chatham include ...

Strengths - Positive characteristics, internally focused
· Good business climate with relatively low property taxes
· Residents have high median household income (6th) and per capita personal income (5th).
· Well-educated resident population (unfortunately, much of this workforce commutes elsewhere to work!)
· Strong community college presence, including small business/worker training support programs.
· An excellent transportation network with easy access to the Triad and RTP regions and two major airports
· Land in Chatham is less expensive than in the core counties of the Triad or RTP
· Designated economic development areas and industrial parks

Workforce:
· Chatham’s high level of commuting disguises the untapped workforce for higher wage companies.
· Chatham has both well-educated professionals and highly-skilled workers.
· This breadth of workforce will enable a diverse Chatham economy.

Immediate economic development opportunities:
· Expansion of existing firms - identify and serve existing firms seeking to expand
· Capture of RTP/Triad technology start-up companies - identify expanding firms seeking location of production facilities

If we believe business will simply show up at our doorstep, we will be wrong. We have to sell Chatham. This is not a passive game. We should have an economic development corporation that is out in the trenches talking up the County, seeking to attract businesses, putting the value of quality of life in the forefront. We need to support small businesses and seek startups. Not all new business has landed. We need to implement a utilities infrastructure to bring the basic utility needs to the identified areas for economic and commercial development. We need to encourage more tourism and those services that feed into that industry. We need to think outside the box.

Western Chatham could be focusing on agriculture but also the Triad ... a short distance from Siler City along a four lane highway. They have been booming. They have been active in attracting quality business.

This isn't always about a financial incentive program, nor about large corporations that follow the money. It is about building a diverse economy.

[chrstnhsbndfthr]

If we believe business will simply show up at our doorstep, we will be wrong. We have to sell Chatham. This is not a passive game. We should have an economic development corporation that is out in the trenches talking up the County, seeking to attract businesses, putting the value of quality of life in the forefront. We need to support small businesses and seek startups.

I actually agree with George on this. But one link is missing. The anti-business rhtoric needs to stop. Businesses that see this sort of thing on a regular basis know better than to waste their money trying to come here.  We are losing so much money ($550,000,000.00 in retail sales and $12 million in sales tax revenues) that we cannot afford to turn them off up front. I have worked in sales before. Yes, we need to SELL companies on our county, but you do not start selling someone on ANYTHING, by insulting them right off the bat.  You need to encourage them. Be kind and open to what they have to say. Listen to one another.  The knee-jerk NO reaction does not help us.  The idea of seeking high paying jobs is not new. But things come in order. You do not start at the top of the stairs, you climb one step at a time.  The retail imbalance is an obvious next step on the stairway to success.  But this requires a change in attitude of the community. 

Every time one of us has to go to Wake, Orange, Durham, Lee, or Guilford counties to buy our goods, we are taking our money out of the county.  This is something that it should be easy to get agreement on.  We need to shop at home.  We need to allow those stores that we go there to shop at to build here.  Keep our money home and support our own county.  It just makes sense.

[Wahoo]

No one yet has stated what type of businesses we need to lure .  No body wants to commute 1 hour or more each way to and from work. If you have to drive 45 miles to work then you need to make allot more per hour for gas an wear an tear on your vehicle.

If we spent our money here in chatham an pay a sales tax doesn't a percentage of the sales tax come back to chatham from the state?

[chrstnhsbndfthr]

If we spent our money here in chatham an pay a sales tax doesn't a percentage of the sales tax come back to chatham from the state?

You are absolutely correct Wahoo. That is where the $12 MILLLION in sales tax revenues for the county comes from.  Some have disputed this figure, but both the County Manager and the SWOT analysis agree pretty closely.  Dawgonit, says it is less than $6 million. Still quite a chunk of change. Analist says it is $3-$4 million.  I have spoken to Charlie Horne about it again, since the SWOT meeting and he stands behind his number. And the SWOT document put that number in writing too.  My own math based on a ratio of what we are getting now shows it to be an increase of $13,444,444.00  Charlie says the method would give a reasonable estimate of the increased revenue available to us.  This increased revenue would not come from a tax rate increase, or a new tax, but from shopping at home, in our own county.  This is big money no matter whose figures you use.  ( I personally figure the professionals should be listened to on this and they both agree on the $12 million number.)

But this requires a change in our attitude toward business, particularly toward retail.  We have to get retail stores in convenient locations to the people that are shopping outside the county. We have to make it easier to shop at home than travel to Chapel HIll/Durham or Raleigh, or Greensboro, or Sanford.   

This would require leadership from our Commissioners.  I hope they will step up to this task. Some of the new committees they are setting up seem to be headed in the opposite direction.  But responsibility still rests with the Commissioners. The could solve this problem if they chose to, instead of concentrating on new taxes as sources of revenue.

[keith_moon]

Obviously there is a break even point after which a given home will be profitable.  Margaret Pollard placed that number at $250k.  So houses worth $300k to $750K or more actually add more revenue to our county than they cost. 

I'd really like to see data that supports this.

Contact Margaret and ask for it.

If you don't care about getting the data, then what you're saying is you're willing to go on hearsay.

If this development DOES pay for itself, then why didn't it do so under the Bunkey Board?  It doesn't make sense.

[keith_moon]

The anti-business rhtoric needs to stop.

I reject the notion that there is actually any anti-business rhetoric being propgated in Chatham.

CHF, who is actually making anti-business statements?

Can you come up with even one person?

[keith_moon]

Winery is just Agriculture,ag jobs are low paying.

You're forgetting wine tourism.

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