5 Notable Things about Economy in October

Running out of steam?  Our first note is the US economic expansion continued this past summer, but only at a 1.5% increase according to a report released by the BEA last week.  Down sharply from 3.9 % growth this past spring.

Second note is Congress did extend the debt ceiling as the month closed out.  This prevents another standoff between the White House and the Congress, and gives the government and additional 80 billion dollars to play with ( ooops – sorry) to be able to borrow and keep the government working.   For the most part both sides of the aisle said it was a bad deal, but necessary to keep the government operating effectively.

Third note another month where the FED did not raise interest rates.  After almost ten years,  eight of which  included speculation that an interest rate rise was right on the horizon the Fed Open Market Committee said a 0 to .25 funds rate seems appropriate . See our first note as to why they may have kicked the can again.  This policy hurts the elderly, the retired, non profits who want to generate income with safety.  Don’t be surprised if it continues through the end of the year, and then doesn’t go anywhere very fast. Fed

Fourth note new home sales really fell off the cliff in September dropping 11.5 per cent.  This could be from low inventories, or it could be traced back to first note again.  Home prices have generally been climbing about 4 per cent in value over the past couple years.

Fifth note, Office building construction totaled $44.9 billion for the 12 months ending in August up 27.4% from one year ago.  Office vacancy is declining and rents are rising.  Expect this growth to peak in late 2015 and slow as we move into 2016.  Commercial Real Estate industry expects another solid year in 2016.

Vancouver Chamber Small Business Resource Committee

Tuesday the Vancouver Chamber kicked off their first public event aimed to bring more awareness, more access and more effective application of the numerous resources that are in place to support and nurture small business .  This effort actually began way back in 2013 when the GVCC and the City of Vancouver  coalesced around creating a website where entreprenuers can go to see the wide array of resources

SBZ@n

Here is a fantastic page if your considering starting a business http://www.cityofvancouver.us/ced/page/starting-business-start-here .  You’ll find links to the State of Washington, and a bundle of other sites.  The City is working hard at all times to be a good partner and make the start-up or expansion process for small companies as smooth as possible

In the spring of 2014 the GVCC Board decided to repurpose the Membership Services committee, to bring greater focus and attention to the Small Business Resources effort. So for the past six months meeting have been built around creating a framework, and seeking to become knowledgeable about all  potential partners and resource providers.   In addition the City put out an RFP to actually formal name and fund a provider for a Small Business Resource Center.

One step the new SBRC committee settled on was a monthly open house where providers would be gathered, for a two hour session to make access easy, but also put the very human touch that the Chamber can bring by face to face introductions and an actual person to be able to ask questions.

It was announced by GVCC President Kelly Love that the Chamber had been formally  awarded  as one of two  partner agencies  by the City to provide the Small Business Resource Center Services.  Keep an eye on their website as the schedule of open houses gets formalized and announcements made on upcoming providers.

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Hazel Dell the next Hot Bed for Restaurants ?

If there is one complaint common to almost all Hazel Dell or Salmon Creel residents or shoppers it is the question why aren’t there more good restaurants in that part of town. For years the  myth was that the System Development Charges (SDC) by the Clark Regional Waste Water District were too expensive.  These costs are generally based on the per seat capacity of each project and were reputed to add $100,000 to the cost of any project.

Members of the CRWW district staff and Commissioners have always stated that this was an urban legend.  Historically sewer rates in the CRWWD service area have been some of the lowest in the region, and they have worked diligently to keep those SDC charges as reasonably as possible.

CRRWD

With that as back drop – here are some excepts from a recent press release from CRWWD that talks about two new restaurants that recently opened in Hazel Dell.

Clark Regional Wastewater District ready to serve another new restaurant in Hazel Dell Restaurants in south Hazel Dell benefit from lowest sewer charges
in Clark County.

Having just welcomed Chipotle to the area, residents in Hazel Dell are poised to celebrate the opening of Panera Bread.  Scheduled to begin operation before Christmas, Panera Bread will open on the former site of the iconic Steakburger restaurant and miniature golf. 
 
While sewer may not be your first thought when you hear of a new place to get your morning coffee or to grab a sandwich at lunch, development fees (commonly called SDCs – system development charges) are a key consideration when establishing a new business in any area. Knowing this, the District has worked to reduce the initial cost of sewer connections as much as possible. South Hazel Dell is the most affordable place in Clark County to develop a restaurant; the District’s “Tier 1” SDCs in the south Hazel Dell area are the lowest in Clark County and Panera also was eligible for Clark County’s development fee waiver program.  In addition, Panera received credits for building on a previously developed site, keeping the total sewer fee to less than $750.  

 

You may recall I wrote about developer Mike Jenkins who owns MAJ Development, whose focus is redeveloping and reinvigorating strategic high traffic locations here locally.  This project is going to be the spark that changes the face of Highway 99.

The press release touted how-  the CRWWD  partnered with the developer to restore and relocate the aging sewer line on site while they completed underground work for the new development.  This forward thinking approach was a win-win for the developer, the District and ratepayers in general.  The initiative optimized the location of the line while completing necessary utility work in the most cost-effective and efficient way possible by digging up the site once.  

My understanding is the SDC for Chipotle is just under $2,000. In the scope of one million dollar building, or half a million tenant improvement these development charges are a very minimal impact on a project such as these.  Expect to see more activity along the Highway 99 corridor, and up in Salmon Creek.

By the way I checked out Panera the Friday night after Christmas after catching a movie.  Very warm inviting interior with a fireplace where you can sit either inside or outside. They are  going to create a lot of fans.

873816_Panera_03_tx495

 

Vision Translated to Reality

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My big chance for a question to the panel

The Columbia River Economic Development Council held their final  quarterly luncheon of 2014 at the Heathman Lodge Monday January 15th.   The topic was how strategic planning is vitally important to creating a vital economic future.

This is topic is important because the effects of the 2008 Great Recession set our economic development base back about four years, and brought economic hardship on a wide range of Clark County residents.  The panelists presented examples of recent planning efforts that have born great fruit, or were started  well before those economic hard times and will provide a foundation to surge us forward.

The panel was moderated by John White recently retired from Berger Abam, who built his career around cajoling  public agencies to peer into the future to create a vision and a work plan to get there.

Todd Coleman of the Port of Vancouver shared thoughts on how in 2005 the Port realized they needed to revamp their rail access to ensure they were able to  compete in the global economy.  Chad Eiken of the City of Vancouver took us back through the foundational stages of Esther Short Park’s  rebirth and how that has led over roughly  thirty years to the commencement  of the Water Front project that will finally rise in 2015.

Scott Higgins Mayor of  Camas spoke of a 35 year effort to diversify Camas’s economic base away from a single industry – paper to more modern high tech employers. Steve Stuart reminded us how we all literally stand on the shoulders of predecessors who were willing to take the time to envision an ever brighter future.  In the case of Ridgefield, an old mill that manufactured railroad ties left a legacy of pollution and creosote that was  barrier to the city being able to access it’s own water front. A twenty year effort by the Port of Ridgefield and many partners has cleaned up that “disaster” and laid a new foundation for a new hub of residential and retail activity that will be a magnet for growth.

Todd Coleman sharing how the Port envisioned  2015 in 2005.

Todd Coleman sharing how the Port envisioned 2015 in 2005.

My 5 biggest takeaways:

1. Economic development is a team sport – it takes many agencies working together.

2. Government agencies are best at laying the foundation – the private sector then brings the capital and the jobs.

3.  While there is competition – success is usually maximized with cooperation :an example Clark Regional Wastewater District and Ridgefield working together with Clark County to increase sewer capacity

4. Significant additional work needs to be done to get parcels of  land prepared for use. There are companies every month who don’t locate here because we are not ready.

5. Watch for the Port of Vancouver to play an even larger role in partnering with several other agencies – particularly Clark  County to find a solution to revitalizing the railroad lines through the heart of the county.

I would describe the feeling in the room as quite upbeat, with expectations for 2015 being very positive.