by James DeChene
I’m still amazed at how Amazon decided to pack its virtual bags and abandon plans to build a headquarters in NYC. Not only does it showcase the hoops that businesses go through to relocate and bring jobs and development to a city or region, it’s staggering when you compare cost of living to other areas across the country.
Case in point comes from a WSJ opinion article (PDF version here) from a restauranteur who moved his business from California to Nashville. Comparing cost of living in Arlington (the site of the headquarters building Amazon will build) to NYC to Nashville shows that compared to living in Manhattan, a $150,000 salary there translates into a 51.8% increase in purchasing power in Arlington ($229K) and a whopping 171% increase in purchasing power in Tennessee, to the tune of almost $410,000.
All of this circles back to places like Delaware. We have a ton going for us—low cost of living, urban, suburban, rural and beach lifestyle choices, regionally located to all the places you want to visit but may not want to live, and access to a talented workforce that’s getting better by the day.
The story also reinforces messages that the State Chamber and other groups have been offering for years related to permits and places like Middletown that get that timing matters. As we’ve heard from site selectors, 6 months for permitting is the sweet spot to get noticed by companies looking to relocate. Efforts continue to track permit status, made easier by DELDOT and DNREC websites created to do just that, but more can and will be done to perfect the process.
Companies, and their C-suites, should be looking at what happened in NYC with Amazon, and should be making decisions based on how they’ll be received by local communities. The fact remains that Delaware is a bargain, and by continuing to make strides in making us more attractive, we’re in a better position to compete.
By Mark DiMaio
In 2017, we invited Chamber members to participate in a survey in part to gauge their view of obstacles to their business growth. Listed below are the top five, along with ways the Chamber is addressing them.
1. Cost of Employee Health Care
The Chamber recognizes the growing problem surrounding health care costs.
2. Lack of Qualified Applicants
We are actively engaged, along with many of our members, with the Pathways to Prosperity program. Delaware Pathways programs are a set of curriculum focused on a specific industry-based “pathway,” paired with opportunities to gain workplace experience while still in high school, graduate with a head start on a college degree, or gain qualifications needed to go to work immediately. The program is a unique collaboration of school districts, businesses, higher education, and national advisory partners that represent a new way to do school. The Delaware Manufacturing Association (a Chamber affiliate) members have actively participated in the Manufacturing Engineering Technology and Manufacturing Production & Logistics pathways.
Delaware Pathways will host its 4th Annual Conference on March 21.
3. Concerns with Crime & Safety
The Chamber supports the efforts of elected officials and their staffs to reduce crime in Wilmington and across the state.
4. Concerns About Local Schools
Improving education outcomes is a key factor in developing a skilled workforce and attracting new business to Delaware.
5. Cost of Permitting and Regulation Compliance
Contributed by DSCC Member Adesis
Adesis, Inc., a wholly-owned subsidiary of Universal Display Corporation (Nasdaq: OLED), today announced that it will open a new suite of state-of-the-art laboratories in Delaware and expand its organic chemistry team and R&D programs. This additional footprint is expected to help drive growth opportunities in areas including next-generation OLED (organic light emitting diode) emitter and host materials and meet the growing demand for the Company’s custom organic synthesis, research & development, and specialty manufacturing services. Adesis also announced that it became a sponsor of Delaware Innovation Space (DISI) and joined its entrepreneurial innovation community. Working with DISI, Adesis signed an agreement for approximately 7,000 square feet of laboratory space at the Experimental Station in Wilmington, Delaware. The new suite of laboratories, which includes additional ancillary work and meeting space, is expected to augment Adesis’ on-going operations and recently-purchased 47,500 square feet headquarter building in New Castle.
“Delaware is home to a number of great chemical and manufacturing companies like Adesis, who are committed to making a world-class product with a great local workforce,” said U.S. Senator Christopher Coons (D-Del.). “I am delighted to see Adesis and their parent company UDC grow in Delaware as they expand their market reach and product offerings to more users around the world.”
“We are pleased to announce our expanding footprint and increased investment to further boost research, innovation and job opportunities in Delaware,” said Andrew Cottone, President of Adesis, Inc. “As a leading organic synthesis CRO (contract research organization), we are adding to and extending our discovery services and process development capacity for customers across the pharmaceutical, chemical, biomaterials, and catalysts industries. We are enhancing our productivity and effectiveness by streamlining the technology transfer and optimizing the workflow from basic research to specialty manufacturing. Furthermore, by co-locating in our New Castle headquarters and the Experimental Station, we believe that we are building a world-class technology and manufacturing hub to support our customers from innovation to commercialization.”
“Adesis continues to invest in Delaware, and we are thrilled that the company will bring its long track record of innovation to the Delaware Innovation Space,” said Governor John Carney. “We partnered with DuPont and the University of Delaware to create the Innovation Space to foster growth of early-stage scientific-based companies, and encourage collaboration among Delaware’s most talented innovators. The addition of Adesis will support that mission, and we’re thankful for the company’s continued partnership.”
This recent expansion by Adesis was rapidly enabled by the seamless cooperation of the Delaware government and business leaders who have fostered a robust scientific ecosystem.
“The Delaware Innovation Space is pleased to be able to support the growing needs of Adesis and accelerate its business forward right here in Delaware,” said Bill Provine, CEO of the Delaware Innovation Space. “Adesis will be a great new member of our science-based innovation community, and we look forward to working with them to further capitalize on the strengths of our new entrepreneurial ecosystem.”
Adesis has also been assisted by the newly formed Delaware Prosperity Partnership (DPP). The DPP was recently created by Delaware as a public/private partnership to accelerate economic development efforts.
“It has been a pleasure working with Andrew Cottone and Adesis to help facilitate their Delaware expansion, both in New Castle and at the Delaware Innovation Space,” said John Riley, Interim CEO of the DPP. “This would have been difficult to accomplish had the State, DuPont, and the University of Delaware not set the foundation for success with the formation of the Delaware Innovation Space earlier this year.”
The General Assembly returns next Tuesday with a full plate. Work will commence stemming from taskforces that met over the summer and fall, which include school district redistricting and changes in funding models, and the legalization of recreational marijuana. Thrown into the mix will be legislation to raise money to invest in clean water infrastructure, incentivize angel investors to provide capital to small startups in Delaware, and the fight on minimum wage legislation will no doubt continue. These bills, and ones to come, will be the focus of the Chamber this legislative session, along with continuing to implement legislation passed last year—namely the Delaware Prosperity Partnership and the regulations surrounding modernizing the Coastal Zone Act.
In addition, the Chamber will be involved in ongoing budget discussions as the Administration and General Assembly continue to search for ways to address Delaware’s long term economic growth and sustainability. What will be interesting to see this year, is how the Federal tax plan will impact Delaware. Much of what was contained at the Federal level was proposed at the end of last year’s session to help fill a $350 million budget gap, including increasing the standard deduction, reducing itemized deductions, and modifying personal income tax bracket levels. If the projections the state Department of Finance provided last year hold true, that could mean big money for Delaware coffers, and reduce the chances for last minute budget battles this year.
All this, and more, to come. Stay tuned.
The Delaware Prosperity Partnership (DPP) held its first board meeting on October 20, 2017, at the new CSC® global headquarters in Wilmington. A 501c3 partnership created by legislation and signed into law by Governor Carney this past summer, the DPP combines the resources of the private sector and government to further economic growth in The First State. The board is co-chaired by Governor Carney and Rod Ward, CEO of CSC. John Riley was elected by the board as Interim CEO of the DPP, and a temporary office has been set up at One Commerce Center in Wilmington. John will focus on launching the initiative and recruiting a permanent CEO through a national search process. As the state’s primary resource for recruiting new business to Delaware, John will also work with the Delaware Office of Small Business, Development and Tourism under Cerron Cade’s direction to ensure a smooth transition of current projects and new opportunities.
As plans were being made to launch the DPP, the Amazon HQ2 project was announced. While the state government took the lead in responding to the proposal, it presented the opportunity to bring in people and resources from the private sector to support the project, and to closely examine Delaware’s location and workforce advantages, not just for Amazon, but for other prospects going forward. One of the exciting digital marketing tools that came out of the project was the “Options in Delaware” video. As you can see, while it was developed as part of the Amazon response, it is a great representation of Delaware, and suitable for use in other ways, including recruiting talent to the state.
In addition to setting up an office, the DPP has launched an initial website, deprosperitypartnership.com, that includes basic information about the partnership and Delaware. In the coming weeks the site will be populated with additional information and ultimately become a resource for current Delaware businesses, as well as for those outside the state looking for a great place to expand or relocate.
James DeChene is the Chamber's Senior Vice President of Government Affairs.