Columbia Economic Notes

[krazeeboi]

With news that Charlotte-based Duke Energy is acquiring Raleigh-based Progress Energy, does this mean that Duke's sights will be set southward towards SCANA next?

[vicupstate]

My thoughts exactly krazee. I wonder if Greenville (and other cities) negotiate some help with burying lines underground in order to support the merger? I'd rather see that than an $2 a month rate reduction myself.

[Spartan]

Ugh, I hope not. SC companies need to stay in SC.

[krazeeboi]

Well there was already speculation that SCANA's CEO (who lives in Charlotte) was helping the company to look more attractive by moving it from downtown to a brand-new suburban campus. Plus there's already a history of Charlotte-based companies acquiring SC-based companies in the banking field so this would really be no different.

[Spartan]

If that happens, let's just go ahead and merge the Carolinas back together. There's really no point in having two if all of our businesses are going to be operated out of Charlotte. [/bitterness]

[krazeeboi]

Back at the end of October, state commerce secretary Joe Taylor ran an editorial in The State about why he though the proposed penny transportation tax was bad for business in Columbia and Richland County. I'm posting the link here instead of in the other thread because he directly relates the tax to economic development potential.

Although I know it's beyond his sphere of influence, I don't think one can talk about high(er) taxes in the city of Columbia in particular without taking into account how the state's restrictive annexation laws hamstring the city. Columbia may have a population of ~125K, but it has a tax base about the size of Rock Hill's, which is half its size. That's what having tons of tax-exempt properties (state offices, USC, Ft. Jackson, hospitals, etc.) within a city that can't reasonably expand its borders will do.

I moved this post from the general economic developments thread to this thread, mainly because I wanted to discuss the above in conjunction with a recent article in The State about this issue. Essentially, it asks whether the city of Columbia and Richland County are expensive places to do business, particularly compared to neighboring counties and in-state peer jurisdictions. The article begins with:

Property tax rates, coupled with business license fees, sales taxes and expensive delays in the permitting process, make Columbia and Richland County arguably the most expensive places in the state to do business, critics say.

It’s why big job announcements, like Boeing and Amazon.com, have not come their way.

Instead, they go to Charleston or Greenville, which have slightly lower taxes and fees and still offer the amenities of a city. Or they go to Lexington County, where taxes and fees are a lot lower. Since 2009, four major companies have invested nearly $80 million in Lexington County, just across the Congaree River from Columbia’s amenities, with promises of 1,600 new jobs.

While I do think there is a valid point to be made here (and the article goes on to make it), I don't think the entire story is necessarily being told here. Even with a comparable tax structure, why would Boeing come to the Midlands when there is already a burgeoning aerospace cluster in the Lowcountry? As far as Amazon.com goes, officials from that company outlined their reasons for choosing Lexington County which seemed to revolve around the availability of construction-ready land on a certified site more than anything else. Also, it's important to note that large economic developments in the state, which tend to be of the manufacturing or warehouse/distribution sort, very rarely occur in the city proper of the larger cities. They typically go to unincorporated parts of the county. Companies that locate within the city proper usually have specific reasons for doing so and they also tend to be office-type jobs, and Columbia gets its fair share of those. However, I do think that it's imperative that Richland County have more industrial sites available for companies that might want to locate large-scale developments within the county or partner with neighboring counties for joint industrial parks.

[CorgiMatt]

When you look at a map of metro Columbia, it's obvious that we would have a very lopsided situation if just as many manufacturing sites weren't being developed in Lexington County as in Richland County. The beltway that Columbia sits in the middle of extends equally into Richland and Lexington counties. The local media have been guilty of making the region's recent economic development an "us versus them" thing instead of thinking of the recent Lexington County developments as being metro Columbia developments. If they were Lexington County developments first and foremost, wouldn't more of the big ones be locating closer to the town of Lexington than on sites with quick access to the highway system surrounding Columbia? I realize the reader has to bear with me to get through this post. I'm tired. Good night.

[krazeeboi]

You have a point Corgi. Obviously Lexington County doesn't exist in a vacuum and attributes much of its economic success to being a core county within the Columbia metro area. But local media highlighting such issues certainly isn't unique to Columbia; you'll hear occasional ballyhooing in the Charlotte Observer when certain companies chose the panhandle of Lancaster County or York County in which to locate as opposed to Charlotte proper or Mecklenburg County. Here in the Atlanta metro, it's the same thing with Gwinnett and Cobb counties vs. Atlanta and Fulton County.

[krazeeboi]

To add to the discussion, the article is mainly talking about large-scale economic developments like manufacturing and warehousing/distribution, which, to be honest, isn't Columbia's forte anyway. A big project here and there is well and good, but I don't think it's the most effective strategy for Columbia to hang its hat on primarily luring those sorts of developments anyway. The article said it best:

Columbia and Richland County leaders don’t dispute the assertion of how expensive they are. They admit they have a hard time competing for large manufacturing jobs with less-urbanized areas that offer lower taxes.

As an alternative, they are developing a long-term strategy to encourage more small businesses and attract corporate offices for larger companies, such as insurance giant Aflac, which last week announced plans to hire 100 more people at its Columbia offices...

Benjamin knows landing “an elephant,” or a large industrial employer, is unlikely for the city because the taxes are too high and the city can’t provide a big enough building.

Instead, Benjamin prefers to focus on the city’s “sweet spot.”

“Office developments, regional headquarters, national headquarters — and make sure we have good A and B office space to accommodate them,” he said.

These are the types of developments--more white-collar and knowledge-based--that tend to propel a city into the next tier and generate wealth (e.g., Raleigh, Austin). Columbia would definitely do well to go this route instead and harness the power of its educational institutions to do so.

[krazeeboi]

Here's a more detailed rendering of the parking garage to be built at Sumter and Taylor (which is supposed to begin construction this quarter). I think it's a pretty solid design:

[growingup15]

Here's a more detailed rendering of the parking garage to be built at Sumter and Taylor (which is supposed to begin construction this quarter). I think it's a pretty solid design:

I Saw the rendering at the site the other day i never got around to taking a picture of the picture

[gman430]

Bids for the project went out Feb 10 so it should be starting construction fairly soon.

[krazeeboi]

Is the garage under construction yet?

[CorgiMatt]

No.

[krazeeboi]

Two of the six or eight companies seeking regulatory review and licenses for their small modular reactor designs told Columbia leaders Tuesday that if they build a factory to manufacture the small-scale nuclear power units, Columbia would be at the top of their list for such a facility.

The Obama administration is proposing a demonstration project funded with $450 million that would be divided between two reactors, with matching funds from private investors. That would put the minimum investment for an operational demonstration project at $450 million.

S.C. Electric and Gas Co., the Savannah River National Laboratory near Aiken and several small modular reactor designers are interested in bringing one of the demonstration projects to the region. Potential sites for such a project include the Savannah River Site, the Parr site owned by SCE&G at Jenkinsville, or a major military base in the region, such as Fort Jackson.

[krazeeboi]

About 400-450 people will assemble in Columbia this weekend to discuss and learn about ultrasound medical technology. Ultrasound images give doctors and nurses a noninvasive look at organs, vascular systems, bones and other tissues that previously could be seen only through surgery.

The World Congress on Ultrasound in Medical Education has attracted registrations from more than 20 countries and holds the prospect of making Columbia and the University of South Carolina’s School of Medicine a world center for ultrasound education, research and development, said Dr. Richard Hoppmann, dean of the USC School of Medicine and one of the hosts of the conference. Hoppmann also said that the USC School of Medicine is fast becoming a center of ultrasound excellence.

Hoppmann hopes that having top executives of major medical equipment manufacturers such as GE and Siemens in attendance could lead to economic development opportunities for South Carolina. “This is why it is so important to have a first-class world conference here,” he said. “I think the time is right. The handheld devices alone are projected to become a $1 billion-per-year business in just a few years.”

[krazeeboi]

In celebration of the centennial of Maxcy Gregg Park, a couple of improvements are planned which are detailed here.

While those are good, it would be nice if there were also plans to make the park less passive; it has too much plain greenspace. The design should be upgraded to encourage more active uses.

[CorgiMatt]

Here's a more detailed rendering of the parking garage to be built at Sumter and Taylor (which is supposed to begin construction this quarter). I think it's a pretty solid design:

Construction started on this a couple of weeks ago.

[krazeeboi]

The parking garage hasn't gone vertical yet, but dirt is being turned. From the Columbia Business Journal:

[krazeeboi]

How's construction on the parking garage going? Can anyone go out and snap some pics of the progress?

[CorgiMatt]

There's still just a fence with a green tarp surrounding the site. They are working every day, but they haven't gone vertical.

[krazeeboi]

OK, thanks for the update.

[krazeeboi]

Discussion about the proposed Walmart/shopping center on Assembly has been moved to the Olympia Mill Village thread.

[krazeeboi]

The Columbia region's insurance technology and services industry generates more than $4.9 billion in annual sales with a nearly $6.7 billion total annual economic impact for the state of South Carolina, according to a study released today.

Regional employment in the industry is approximately 15,000, at an average salary of $62,000, according to the report.

iTsSC is currently working to promote Columbia's leadership in the industry at a national level. The group will recruit new talent to the area and address the short-term shortage of IT workers in the region, the organization said in announcing the impact study.

The report can be accessed here.

[CorgiMatt]

I think it's safe to say Columbia isn't just USC, Fort Jackson and state government.