The Central Indiana Corporate Partnership (CICP) is an alliance that includes the CEOs of many of our major employers and the presidents of our research universities, coming together to advance a common goal – growing our regional economy. 

I’m Mark Miles, CICP’s President & CEO, and this blog will offer our thoughts and perspectives on the latest economic news and other issues that affect the future of our region.  Thanks for visiting.

While issues like Right to Work have dominated the headlines and the fight for mass transit hits close to home in Central Indiana, another important debate in the General Assembly has the potential to contribute to Indiana's economic competitiveness - local government reform.  As we've written about extensively here, CICP believes that streamlining local government - particularly the outdated layer of township offices - can lead to a leaner, more effective, 'customer-friendly' public sector to serve individual taxpayers and businesses.

Here is an excellent editorial from the Anderson Herald-Tribune describing the state of reform in this session of the legislature and calling for much-needed progress on the issue.

Over the last few years, the voters have been called on to decide a number of important issues – whether to do away with township assessors, to put property tax caps in the state constitution, and to allow school districts to exceed those same caps on a case by case basis.

Mass transit legislation being considered by Indiana’s House Ways and Means Committee empowers voters in Marion and Hamilton Counties to similarly make their own decision on an expanded, multi-modal transit system (based on the proposal advanced by CICP’s Central Indiana Transit Task Force). The bill doesn’t ask lawmakers to support a tax increase or even declare their support for transit. It simply allows local officials (many of whom support the plan) to put the question before the voters this fall in a referendum.

Most surveys suggest widespread support for such a ballot question, for a number of reasons:

The current IndyGo system, underfunded and limited to Marion County, doesn’t meet the needs of our citizens or our economy. Nearly 20% of households in the region have either no car to get to work or have multiple workers in the household but only one vehicle. For these Hoosiers, access to job opportunities is limited to IndyGo routes, and a simple cross-town commute can take hours with multiple transfers.

Our mass transit plan recognizes that employment centers have shifted across the region. By doubling bus service in Marion County and extending it to Hamilton County, it helps employees and employers by connecting the two. But the economic benefits of transit go beyond helping Hoosiers get to work.

The construction and operation of a multi-modal system with light rail and bus rapid transit (BRT) routes will create a significant number of jobs. Mass transit has also been shown to attract private investment and build a broader tax base, as commercial and residential development grows along the transit lines. In Cleveland, more than $4 billion in private development is planned or in progress along the Euclid Avenue light rail corridor. In Dallas, another $4.2 billion in business and new housing sprang up around the Dallas Area Rapid Transit system between 1999 and 2007.

We see the same kind of potential to revitalize the neighborhoods along the proposed northeast corridor rail line, and along the BRT lines that may transition to light rail as demand and finances allow. 

Finally, mass transit is the kind of ‘quality of life’ infrastructure that helps the Indianapolis region compete for talent and business opportunities. The availability of a young educated workforce is a critical driver of economic development. The convenience of effective public transportation and the attraction of ‘walkable’ neighborhoods served by transit helps lure these workers. 

The arguments for regional transit are numerous and compelling. But the current debate at the Statehouse isn’t really about the merits of mass transit itself – it’s about trusting the elected officials and voters of Marion and Hamilton Counties to look at both sides of the issue and make their own choice.

This position is summed up nicely by this letter to the editor by CICP co-chair Denny Oklak in the Indianapolis Star, as well as the Star’s own editorial plea to legislators.

Around 2008, the U.S. manufacturing sector crossed an important rubicon – the percentage of its workforce with a college degree or some post-high school education exceeded the percentage with only a high school diploma or less.  When these high-skill workers became the majority, manufacturing had undeniably evolved – hence, the rise of the term ‘advanced manufacturing.’  Unfortunately, our education/workforce system has not evolved along with industry demands - hence Conexus' critical work in this arena.

Millions of Americans are looking for work, and thousands of U.S. manufacturers are looking for workers.

The numbers are startling. While unemployment and underemployment remain stuck near 20 percent, more than 600,000 good manufacturing jobs have gone unfilled, according to the National Association of Manufacturers. While personal income has stagnated, these jobs pay wages much higher than the national average.

Where's the disconnect?

There's a simple answer to a complex problem: The majority of manufacturing jobs now require education beyond high school, and our workforce doesn't make the grade.

As manufacturers have raced to be more productive and innovative over the last several decades, they've demanded more out of their workers -- the skills to operate advanced computerized equipment and robotic systems, teamwork and troubleshooting capabilities.

The manufacturing workforce got smarter, but it also got older. Back in 1980, 70 percent of the nation's manufacturing workers were younger than 45. Today, half the workers are older than 45, and the percentage age 25 to 34 has dropped by more than a third.

As the baby boomer generation retires, jobs open up. But young workers are ill-prepared to step into the shoes of their parents and grandparents. According to the Organization of Economic Cooperation and Development, the U.S. is the only industrialized country where educational attainment among those just entering the labor market (25 to 34 year olds) is less than those about to leave the labor market (55 to 64 year olds).

Even in Indiana, the most manufacturing-intensive state in the nation, we haven't changed our academic approach since the rise of the assembly line. Post-high school training will be mandatory for 60 percent of all new jobs in manufacturing and logistics over the next decade, but we remain stuck in a bygone era when a basic high school diploma was sufficient to earn long-term employment at the local factory.

Conexus Indiana represents companies in the automotive industry, aerospace and defense firms, logistics businesses -- a wide spectrum of high-tech manufacturing and supply chain fields. We convene groups of them regularly to discuss critical business issues. The consistent message is that they all need skilled workers, but that despite high unemployment, the right kind of labor is scarce.

That's why we act as a bridge between private industry and higher education partners such as Ivy Tech, Vincennes University and Harrison College to ensure that quality post-secondary programs are available to prepare young Hoosiers for these challenging (and high-paying) careers. But we must do more, catching the next generation of manufacturing and logistics workers even earlier -- in high school.

It's clear that students begin seriously thinking about their career choices while still in school. Research by the ACT confirms that high schoolers who were fairly certain about their occupational choices by their junior/senior years are more likely to succeed in college and ultimately earn positions in their chosen field.

Conexus is now working with Indiana employers and the state Department of Education to develop an advanced manufacturing and logistics (AML) high school-level curriculum, a mixture of online and hands-on courses that will expose students to these industries and give them a solid foundation of knowledge to carry on after they earn their diplomas.

The AML curriculum was created in alignment with state standards and with broad-based feedback from industry, ensuring that it carries real value for students. It has been endorsed and is eagerly anticipated by school superintendents and technical education directors across the state who see the need to prepare their students to participate in a sector that today employs one of every four Hoosiers.

Conexus is completing private fundraising to finalize the curriculum and provide it to school districts at no additional cost. The private sector has embraced the opportunity to invest in this effort, a concrete demonstration of the demand that exists for a revitalized workforce pipeline. For too long, employers have been disengaged from the educational system; now, companies are realizing that they must push for relevant programs, work with local schools and put money into training efforts to develop the human capital they need.

Without qualified employees, advanced manufacturing and logistics companies can't grow; without good job opportunities, young people can't become productive taxpayers. The process of closing our skills gap will begin in classrooms and technical education centers across Indiana -- and it has to start now. It's up to us to make sure local high schools have the tools to engage and educate our future workforce.

Dwyer is president and CEO of Conexus Indiana, the state's industry-led manufacturing and logistics initiative; he formerly served as chief operating officer of Rolls-Royce North America.

The story of downtown Indianapolis over the last 40 years is a narrative of self-determination, of a committed civic sector ambitious enough to believe they could make the mile-square into the vital heart of the region.

In the late ’60s, downtown was a hollowed-out core, under siege from more attractive suburban retail, with little business activity and just a few hundred hotel rooms. The area that is now IUPUI was acres of dilapidated neighborhoods and shuttered storefronts.

The city had one advantage—our corporate and community activists. In partnership with a string of strong mayors, they went about exploiting opportunities to build a vibrant downtown.

They used sports as a catalyst, luring the Pacers downtown, attracting the Colts and creating a prime destination for championship events. They supported the growth of the modern IUPUI campus and of White River State Park as an enormous urban renewal project. They also embraced a unique spirit of public-private partnership to bring investment of all kinds to the mile-square—corporate headquarters, Circle Centre mall, refurbished and new cultural attractions.

Today, we face a new challenge. Bill Hudnut famously proclaimed that Indianapolis couldn’t be a “donut city” with an empty downtown. Today, downtown thrives —the hole in the donut is solid. But now this core is constricted by a concentric circle of blight separating it from our robust suburbs.

While we were building up the downtown, Center Township overall lost 67 percent of its population.

The same energy and ingenuity that we devoted to building downtown must be applied to the surrounding neighborhoods, four to six miles outward. Failing to address their plight would pose a corrosive threat to the entire region. Here is a three-part prescription to start the rebuilding:

First, we must adopt an integrated strategy to reinvent promising urban neighborhoods into interesting places where people want to live. This means transforming housing, physical and social infrastructure, and creating neighborhood-serving commercial districts.

We have isolated examples of how this approach can work—the revitalization of Fall Creek Place, the effort underway in the Meadows led by Strategic Capital Partners, and the Near Eastside Legacy partnership between neighborhood groups and the Super Bowl Host Committee. The challenge is scaling up these best practices into a strategy that can be applied to other areas with the right mix of grassroots leadership and market activity.

Next, education. Failing schools are a primary reason for the flight of people and capital. We must reverse the status quo in urban education. The neighborhood schools of our future must educate current residents and attract new families to our urban core.

There are examples, in Indianapolis and nationally, of inner-city schools that are thriving. These great schools share common characteristics—school-level governance, leadership that embraces innovation and accountability. Our vision for rebuilding our urban core must set schools free to embrace this model and move urgently toward the creation of a broad portfolio of high-performing schools.

Mass transit is also a vital priority for rebuilding urban neighborhoods, giving residents the mobility to connect with jobs and their other daily needs. Dense residential and commercial development also grows along rail and bus rapid transit routes, attracting new people, investment and jobs.

The evolution of downtown took a generation, and this transformation will take the same long-term focus. Just as our sports strategy started with a few big wins that coalesced into a plan, we’re seeing progress in neighborhood redevelopment, education reform and transit planning.

Now is the time to harness this momentum and apply big thinking and sustained commitment to the tasks ahead. Decades ago we weren’t prepared to accept this city as a donut with downtown as the void in the middle. Looking forward, we have to broaden our focus to the next ring out by rebuilding and creating a truly prosperous region with a vibrant urban core.

Global trade paying off for Indiana manufacturers – and Hoosier economy

Two reports from last week show again how manufacturing is driving economic growth in Indiana – and why we must continue to look around the world seeking markets for Hoosier-made products.

The Bureau of Labor Statistics released a regional look at GDP growth in 2010, measuring economic activity by metropolitan area. For several Indiana cities, manufacturing continues to lead the recovery - durable goods manufacturing contributed 11.4 percentage points to the Elkhart-Goshen region, and more than 6 percentage points in Columbus and Kokomo. 

Nor was manufacturing’s effect confined to a few metropolitan districts. An earlier BLS study showed that Indiana’s overall GDP growth ranked third in the nation, behind only North Dakota (driven by its oil industry and the lack of a housing bubble to recover from) and New York (where a Wall Street rebound led the comeback). For Indiana, manufacturing was the catalyst – durable goods production contributed more to our GDP growth than any other state (2.3% of the 4.6% total increase).

These statistics confirm what we already know – Indiana is a manufacturing state, and we’ve ridden the sector out of the economic trough. Our annual Indiana Manufacturing and Logistics Report Card, released earlier this year, notes that Hoosier manufacturing employment has grown by 5% since the end of the recession, while the nation as a whole has suffered through a largely jobless recovery.

Another study, this one by the Indiana Business Research Center at IU, gives us some perspective on this manufacturing success. With the U.S. economy stagnant, Indiana set a new record in manufacturing exports in 2010. 

According to the IBRC analysis, Indiana exported nearly $29 billion in goods last year, up 25% from 2009. We outpaced the Midwest and the nation in export growth; manufactured products accounted for the vast majority of our exports, with vehicle parts, pharmaceuticals and industrial machinery leading the way.

Of course, this export boom was also made possible by a strong logistics sector supported by world-class infrastructure – international airports, maritime ports and unparalleled interstate access – creating a vital link in a global supply chain.

Hoosier manufacturers are exporting more than ever before, by choice and by necessity. Looking at the national economy, it’s hard not to sound pessimistic – job creation stuck in neutral, incomes flat, the real possibility of a double-dip recession. It adds up to sluggish domestic demand, as individuals are spending less and businesses are hesitant to invest. Looking abroad for opportunities is a must, and our trading relationships with Canada, the European Union and China are increasingly critical.

Conexus Indiana is generally focused on what Hoosier industry leaders, policymakers and educators need to do to make our manufacturing and logistics sector more productive and successful – working together to build a stronger workforce, collaborating to exploit market opportunities in areas like automotive and aerospace. But we do speak out occasionally on federal issues – for example, the need to repair failing locks and dams on the Ohio River and Lake Michigan.

Free trade is also a national priority worthy of support. Indiana’s manufacturers need more opportunities to compete in global markets to drive continued growth.

By concentrating on issues like human capital here at home, we’re making sure that when Congress does act on trade agreements with Columbia, Panama, South Korea and others – and we encourage them to do so – we’ll be ready.

Steve Dwyer is President & CEO of Conexus Indiana, an initiative focused on the workforce and other needs of the state’s manufacturing and logistics industries.

An excellent article in today’s Wall Street Journal about ‘hot spots’ for entrepreneurial activity in various economic sectors – validating the industry cluster approach that CICP has employed over the last decade in launching initiatives focused on particular industry opportunities.  And indeed, Central Indiana’s life sciences sector is recognized as a prime example of a growth cluster, supported by the activity of our BioCrossroads initiative.

See the full article here or read through the text below:

Where the Action Is

Across the country, new industry hubs are drawing entrepreneurs and investors—and offering start-ups support and safety in a turbulent economy

By EMILY MALTBY

Location matters.

·         Read the complete report .

It's a lesson that's all too easy to forget in a world driven by mobile devices, cloud computing and home offices. There are big benefits to setting up shop in the right spot—especially among lots of peers in the same field.

Just ask sports-gear makers in Ogden, Utah. Or health-care companies in Nashville. Or nanotechnology researchers in Albany, N.Y.

These cities, and others like them across the country, have become hubs for specific industries. Entrepreneurs are moving there and flourishing in the teeth of a bleak economy. The cities, in turn, are nurturing the entrepreneurs by giving them access to funding, mentors and facilities.

All in all, these clusters can be ideal spots for an entrepreneur in the field. Being there means getting access to a much wider range of suppliers, customers, employees and industry experts. What's more, industry peers are often willing to support each other as they get off the ground, sharing recommendations about staffers, potential sales leads and attractive office space, or giving each other guidance and insight about the industry.

Jeffrey Logsdon can attest to that. Five years ago, he moved his cybersecurity firm from Phoenix to San Antonio—a city that's seeing a surge in business for companies in the field. Company revenue doubled within three years of the move.

"I'd attribute a lot of our success to the location," he says. "I think the availability of cybersecurity talent and the low cost of doing business here has helped us. And because there are so many different cybersecurity companies, we have improved each other's business through partnerships."

As a hub grows, it brings other benefits to small firms. For one thing, even as businesses cooperate, they challenge each other to innovate—to come up with new ideas that make them stand out from the crowd. "Specialization in a region increases patents, business formation and higher wages," says Rich Bryden, director of information products at Harvard Business School, who's working with a team mapping industry hubs in the U.S.

Infomen

When businesses come together, they also catch the eye of big players with deep pockets—especially beneficial when the economy is weak and financing is limited.

"It's easier to be on the radar for investors when you're part of a critical mass," says John Fernandez, assistant secretary of commerce for economic development at the U.S. Economic Development Administration.

Hubs also catch the eye of government, says Dan Carol, senior fellow at the New Policy Institute think tank in Washington, D.C. A concentration of small firms in the same field is more likely to be recognized on the municipal level, where funding programs and policies can be created to stimulate their growth.

Here's a look at seven up-and-coming innovative centers. All have solid partnerships between the public and private sectors, a growing work force to fuel the industry and long-term strategies for development. And entrepreneurs say being there is vital to their success.

INDIANAPOLIS

LIFE SCIENCES

Indianapolis used to be the quintessential Rust Belt city. Now it's at the center of a statewide boom in the life-sciences business.

Endocyte

The state has added 8,800 jobs in the life sciences in recent years, and today some 825 medical-device companies, drug manufacturers and research labs call Indiana home.

Indianapolis, which is home to big names in the field such as Eli Lilly & Co. and health insurer WellPoint Inc., is leading the transformation. Corporations like these have added the lion's share of the state's new life-sciences jobs. Now they're helping smaller companies get off the ground, too—by spinning off new businesses as well as by backing independent start-ups. Eli Lilly, for instance, has contributed roughly $60 million to seed and venture funds that are supporting entrepreneurs.

That isn't the only way big companies are easing the way for small ones. With new firms arriving to supply the large drug makers, start-ups are getting access to a range of services at competitive prices.

"We have access to companies in Indiana where we can outsource functions like toxicology, analytics and clinical supply," says Ron Ellis, president and CEO of Endocyte Inc., a 65-employee firm that's testing a cancer treatment.

Many small firms, meanwhile, are helping others get off to a good start. David Broecker, president and chief executive of BioCritica Inc., an Eli Lilly spinoff, says his peers have referred employees, suggested work space and given information on tax and financial incentives.

It's just the environment he hoped for when he left the East Coast to build a company. He considered other spots but settled on Indianapolis because "it's all new and exciting here for these folks, so there is a hunger for doing this type of thing."

SAN ANTONIO

CYBERSECURITY

Washington, D.C., has usually taken the lead in creating Internet-defense systems. But the Alamo City is poised to give the Beltway a run for its money. There are more than 80 information-technology and cyber-related businesses in San Antonio, and that figure is increasing rapidly, according to the city's Chamber of Commerce.

Andrew Watson

Many entrepreneurs are anticipating a flood of government contracts from the new Air Force Cyber Command headquarters in town. The military chose San Antonio in part because the armed forces have always had a strong presence there—and many of the city's workers have security clearances from the Defense Department and the National Security Agency. Another big plus: a stream of skilled graduates from the Institute for Cyber Security at the University of Texas at San Antonio.

But not all the firms in town are counting on government contracts. The city has a growing group of businesses that cater primarily to the private sector, like MainNerve Inc., the company Mr. Logsdon moved to San Antonio. The firm helps health-care companies secure digital records and servers. "The quantity of people here allowed us to show more discernment in our hiring," says Mr. Logsdon. "It was the best place for us to find qualified and certified cybersecurity professionals—and it doesn't hurt that they have military experience."

ALBANY, N.Y.

NANOTECHNOLOGY

The capital of New York state is becoming a big player in a field that deals with small things—nanotechnology. The city now boasts more than 4,000 people in the industry, centered on the College of Nanoscale Science and Engineering at the University at Albany.

Mia Ertas/CNSE

The school has doubled in size during the recession to its current 800,000-square-foot complex. Dozens of nanotechnology companies have established a presence there to take advantage of research facilities and business incubators; since 2008, nearly 50 new start-ups have launched within its walls.

The build-out was part of a state plan, formulated years earlier, to revive the economy in upstate New York. Financing came partly from the state and partly from corporations like International Business Machines Corp., which now have offices there alongside entrepreneurs. That means companies can share the cost of equipment and labor—and start-ups get to associate themselves with big names.

"The prestige of being here and the credibility is amazing, which helps when you are talking with VCs and investors and large companies," says Primal Fernando, CEO and chief technology officer of Resource Management Technology Systems Inc., which moved to Albany from La Junta, Colo., last year. "And the equipment available here is not available elsewhere."

Many companies are launching off-campus, as well, in laboratories that are opening in once-vacant buildings. And financiers and other vital players have been moving in to be a part of the action.

"Venture capital has been growing to feed the innovation," says Alain Kaloyeros, a physics professor and senior vice president of the college. "Suppliers and law firms are moving to the region to support this ecosystem, so it will be quite an exciting venture to watch."

KANSAS CITY

INFORMATION TECHNOLOGY

Welcome to "Silicon Prairie."

Kansas City, straddling the Kansas and Missouri state line, is home to tech giants like Sprint Nextel Corp. and Cerner Corp., but its industry ranks have been swelling with smaller firms. In 2009, the number of tech companies rose by 5% to 2,900, trumping the growth rates of well-known hubs like Silicon Valley, Boston and Austin, Texas, according to a 2010 study published by the TechAmerica Foundation.

Dataworks, Inc.

Part of the lure for entrepreneurs: a high-speed fiber network from Google Inc., which chose Kansas City over 1,100 other cities to set up the service. Expected to roll out next year, the network will run 100 times faster than current broadband, which will likely bolster cloud-based technologies and pave the way for high-definition streaming services that will be hard to find elsewhere.

The Google initiative will be "an excellent platform for innovation," says Bryan Richard, founder of iCode Inc., a Web start-up that posts profiles of software developers. "Everyone in the technology business is talking about it here in town, and everyone wants to do something with it and maximize it."

Entrepreneurs who have relocated from the coasts also tout the friendly business environment. It's far less expensive to build a firm and develop technology, they say, and there are fewer state and city regulations to worry about. And, as in other hubs, many entrepreneurs are helping each other. "Numerous times people have asked me for things I have expertise in and there are times where I call competitors…for specific problems," says Donald Rossberg, president of Dataworks Inc., a technology-support and consulting start-up. "In the end, we all benefit."

ASHEVILLE, N.C.

BEER BREWING

Craft beer is a small industry, but it has a devoted customer base. One Southern town is going after those fans with vigor.

John Warner

Asheville, a Blue Ridge Mountain town of 75,000, has 10 breweries, with two on the way. That can't compare with the 40 in Portland, Ore., but it stacks up to other beer havens like Milwaukee and Boulder, Colo., which both have fewer than a dozen. "Asheville is definitely on the map and well recognized in the craft-brewing industry," says Paul Gatza, director of the Brewers Association in Boulder.

Entrepreneurs new to the area seek mentoring from the established brewmasters and the Asheville Brewers Alliance, formed to exchange ideas and promote the industry. They also tap Blue Ridge Food Ventures, an incubator for developing and commercializing products.

Competition among the breweries is a key driver of growth. "Every time a new brewery opens, it has to create its own creative edge, and then the other breweries have to be creative to become relevant again," explains Bill Drew, owner and brewmaster at Craggie Brewing Co. "So it's good when the new guys come in; it keeps the old guys on their toes."

In fact, the beer culture has permeated the town, with a host of businesses cooking up beer-flavored edibles and artists making tap handles and bottle labels. The environment gives brewers a place to source ingredients and fuel creativity. "By local companies teaming together, it's pretty much a win-win," Mr. Drew says.

NASHVILLE, TENN.

HEALTH CARE

Early last year, the federal government passed legislation calling for a host of health-care reforms. And Nashville is poised to benefit from the overhaul.

There are more than 250 health-care companies in the city, and their numbers are rising. Employment in nursing, hospital and ambulatory services jumped 16% between 2004 and 2008, for instance. That, in turn, provides fertile ground for companies that create medical devices and patient-care systems.

Shareable Ink

The entrepreneurial spirit "is infectious," says Leon Dowling, founder and chief executive of IMI Health Inc., which collects and organizes health records to give insight into the best patient-care practices. "Within 10 miles of my office, I can have more potential clients than any other city in America."

Last August, the city launched an entrepreneur center to spur innovation; two-thirds of the firms that have sought mentoring and financing are related to health care. State programs have also helped propel the industry. Recently, some $180 million in public funds has been made available to burgeoning firms.

It's an attractive spot for entrepreneurs like Stephen Hau, president and chief executive of Shareable Ink Corp. The company, whose digital pen records doctors' notes and transfers them to an electronic format, launched nearly three years ago in Boston and established a presence in Nashville last year. Today, 60% of the company is in Nashville.

"The community here is so well versed in health care that it keeps us plugged in to the key issues and how to resolve them," says Mr. Hau. "And in terms of the investment community today, people are careful about where they place their bets. Being here, [investors] see we are aligned with thought leaders."

OGDEN, UTAH

OUTDOOR SPORTS

Ogden, a small city some 40 miles north of the capital, packs a concentrated punch in the outdoor and recreation industry.

Goode Skis

Ogden made headlines in 2002, when it hosted events for the Salt Lake City Olympic Games. Those Olympic facilities, along with acres of pristine mountains, canyons and rivers, are the main reason outdoor-apparel and equipment companies have been moving to town: The site offers a perfect spot for testing new products, and it's easily accessible from a nearby airport that supports direct flights to Europe. What's more, business owners say, the growing base of competing companies in the area push each other to design the best equipment.

Utah has a relatively modest share of the industry; the state estimates it's home to about 5% of the outdoor-products firms in the U.S. Still, companies that expanded in or relocated to Utah have created at least 2,550 jobs in the past six years, according to the Economic Development Corporation of Utah.

Industry goliaths get partial credit for the surge in Ogden. Amer Sports Corp., the company behind Wilson, Atomic and other brands, consolidated its U.S. operations in 2007 and moved them to the town. Quality Bicycle Products Inc., a distributor based in Bloomington, Minn., set up its second location in Ogden in 2010.

Quality's founder, Steve Flagg, liked the growing retailer base, easy access to the West Coast and strong labor pool. But, he says, "the game changer was the transformation that the city was going through," as other companies moved in, and the local government actively recruited more.

Local leaders are also helping start-ups like Kahuna Creations Inc., a longboard, surfboard and landpaddle company, launch and grow. Kahuna founder Steve McBride says the mayor's office helped him land funding and find a low-rent facility in 2008. The company has grown 30% to 50% annually.

"You get a network of people who really want to help," Mr. McBride says. "We've been flourishing here."

Ms. Maltby is a small-business reporter in The Wall Street Journal's New York bureau. She can be reached at emily.maltby@wsj.com.

When it comes to small business, the Indianapolis region faces a good news/bad news scenario.

Usually, we feel slighted at being left out of an economic ranking of top metropolitan areas. But the region’s absence from a recent report by leading micro-lender Kiva and Visa Inc. (“Small Business Trouble Spots”) was cause for relief: As reported by Norm Heikens at the IBJ’s Small Biz Matters blog, the study ranked the large metros that saw the demise of 1% or more of its small enterprises (10 employees or less) during the recession (2006-2008).

Among our regional peers, Kansas City and Columbus, Ohio lost 2% of their small businesses, while Cincinnati, Cleveland, Detroit, Louisville, Milwaukee, Memphis and St. Louis all made the list of those losing at least 1%. Greater Indianapolis stayed roughly even, which was good enough to outperform much of the urban Midwest.

That’s the good news. But because small businesses have been our most reliable job creators in the recent economic past, treading water won’t drive our recovery going forward. Another recent report ("Starting Smaller, Staying Smaller: America's Slow Leak in Job Creation"), this one by the Kauffman Foundation, warns that smaller ventures aren’t producing new positions at the same rate as prior decades.

For the last thirty years, larger companies have created and eliminated jobs at roughly the same rate, accounting for a slight loss in total positions. Small companies have been responsible for all net job growth.   But the total jobs being created by small enterprises as a percentage of total U.S. employment has steadily shrunk – from 3.5% in the 1980s to an even 3% in the 90s, to 2.6% during the last decade (2000-2009), according to Kauffman. As seen in the Kiva-Visa report, the number of new employer businesses being created plummeted during the recession, as the survival rate for existing small firms dropped as well.

Though Indianapolis has fared reasonably well in terms of job growth and other measures of economic progress (i.e. population growth), it’s clear that we will have to continue to focus on the issues that are critical to small businesses – access to start-up capital, entrepreneurial support services and infrastructure, and continuing to encourage a risk-taking business culture.

Conexus President & CEO Steve Dwyer authored this piece on Inside Indiana Business last week on the need to upskill Indiana’s manufacturing and logistics workforce. A recent study from the Georgetown University Center on Education and the Workforce asserts that 60% of all U.S. jobs within the next decade will require some sort of post-secondary education – this trend certainly applies to manufacturing and logistics, an increasingly high-tech sector where advanced robotics and sophisticated supply chain management systems are now the norm. 

If Indiana fails to upgrade our educational pipeline to train the next generation of manufacturing and logistics employees, we’ll quickly find our position as the most manufacturing-intensive state, and the ‘Crossroads of America’ logistics hub, in serious jeopardy.

Indiana’s grade on manufacturing and logistics workforce: Incomplete.

Steve Dwyer – President & CEO, Conexus Indiana

Last month, Conexus Indiana and the Ball State Center for Business and Economic Research released our 2011 Manufacturing and Logistics Report Card. Each year, economists at Ball State pull together relevant economic data to ‘grade’ the vitality of Indiana’s manufacturing and logistics industries, analyzing a sector that collectively employ one of every four Hoosiers.

Manufacturing is leading Indiana’s economic recovery, and we score several A’s on this Report Card. We rank among the national leaders in per capita employment in both sectors. We benefit from a pro-growth tax climate, and are a winner in the global marketplace as measured by foreign investment and strong exports.

We’re barely average, however, in a critical area – Human Capital. The state’s ‘C’ grade is a step forward from last year’s C-, based on strong enrollment in community college programs and improved high school graduation rates. But Indiana’s adult population continues to rank among the least-educated in the nation, leaving Hoosier manufacturing and logistics firms struggling to find qualified applicants for available jobs as Baby Boomer workers leave the workforce in growing numbers.

This is especially troubling given the transition of manufacturing and logistics into the information-based economy. Once upon a time, employers grew their operations based on the availability of natural resources, proximity to other industrial centers and customers, and access to transportation infrastructure, with competitive tax and regulatory policies sweetening the pot. Indiana was well-positioned on all these, and prospered accordingly.

But global competition and market demands accelerated the push for productivity and innovation. The traditional assembly line (once a bold innovation in its own right) was gradually transformed by computerized equipment and robotic systems. Distribution centers evolved into modern supply chain operations, meeting the ‘just in time’ needs of customers around the world with track and trace technologies and enterprise management software.

As the industries changed, so did the jobs. And while location, infrastructure and business climate continue to be important factors, workforce readiness emerged as a top priority for growing companies. 

Manufacturing and logistics careers now demand advanced technical skills, technology savvy, troubleshooting and teamwork abilities. This means some education beyond high school – within the next decade, 60% of all jobs will require post-secondary education. The same trend holds true for manufacturing and logistics. Yet a recent study by Indiana University estimates that 60% of current Midwestern manufacturing workers have only a high school diploma, and Indiana’s plight is likely even worse.

So our ‘C’ grade in Human Capital does more than keep Indiana off the honor roll – it poses a direct threat to our competitiveness. We can (and do) have a great position as Crossroads of America, unparalleled access to highways, rail and maritime shipping, a strong manufacturing heritage, low taxes and an unprecedented hot streak on international investment. But if we aren’t preparing the next generation of Hoosier workers for high-tech manufacturing and logistics jobs, we’ll quickly lose our edge.

There’s a lot of good news in this year’s report. Indiana continues to rank among the most manufacturing and logistics-intensive states in the nation, helping us find our footing more quickly than many in this post-housing bubble, post-financial crisis economy. But it isn’t an exercise in self-congratulation – it’s a confirmation of the challenges we face in continuing to make and move products in the global knowledge economy.

The bottom line of this Report Card is clear – for Indiana’s younger workers, it’s time to head back to school and try to raise our manufacturing and logistics GPA.

(View the entire 2011 Manufacturing and Logistics Report Card at www.ConexusIndiana.com.)

Steve Dwyer is President & CEO of Conexus Indiana, an initiative focused on the workforce and other needs of the state’s manufacturing and logistics industries. He formerly served as Chief Operating Officer of Rolls-Royce North America.

Ivy Tech Community College President Tom Snyder penned this editorial in today’s Indianapolis Star about Hoosier manufacturing powerhouse (and CICP member) Cummins – a company has that continued to invest and create jobs in Indiana, while at the same time dominating its global market and generating handsome returns for its shareholders.

Cummins helps power Indiana's economy

It may be a function of Hoosier modesty, or the old adage that admiration and familiarity are strangers, but it often takes an outsider's perspective to remind us about what's truly exceptional in our everyday lives. I was struck by this feeling leafing through Fortune magazine's latest annual Fortune 500 list.

At No. 186 was Cummins, the Columbus-based engine-maker. That's no surprise; Most of us are familiar with Cummins, and have some idea of its size and recent success. We regard Cummins as a valued partner in our effort at Ivy Tech Community College, as well as other organizations I'm involved with, like the Energy Systems Network and Conexus Indiana.

But as I read further, I was amazed by how this Indiana manufacturing stalwart stacks up against its peers.

From 2009 to 2010, Cummins climbed from No. 218 to No. 186 on the list of the nation's 500 biggest companies, boasting more than 22 percent growth in revenues. And that's just the beginning.

Over the past decade, Cummins boasts the best growth in profits of any U.S. company. An automotive manufacturer, outpacing dot-com juggernauts like eBay and Apple, insurance and health-care giants, biotech pioneers. It beats its nearest competitor by more than 10 percent in annual earnings-per-share growth. So it's no surprise that Cummins also represents the second-best investment for shareholders over the past five years.

Clearly, Cummins' growth is due to successive generations of visionary management willing to make aggressive moves. Cummins was a pioneer in exploring overseas markets in the 1960s, and today thrives in places like China, India and Brazil. The company also is on the cutting edge of green technologies: A Cummins engine powered the first diesel-electric hybrid truck in 2005; the company is a leader in putting hybrid busses on our streets, and a partner in the Energy Systems Network initiative to bring new energy innovations to market here in Indiana.

Through it all, Cummins has been unwavering in its commitment to southeastern Indiana. Over the past six years, the company has invested more than $300 million into new facilities and expansions in the region, projects that will account for more than 2,000 jobs.

Manufacturing is leading Indiana's economic recovery. While the nation as a whole suffers through a largely jobless recovery, manufacturing employment in Indiana has grown nearly 5 percent since the end of the recession. Clean technologies and renewable energy offer promising economic opportunities for our state. It's easy to forget that these macro-economic trends are based on the collective efforts of thousands of firms across the state, led by extraordinary businesses like Cummins.

Cummins has been a valued corporate citizen and a steady contributor to our state's economic growth, engaged in critical issues like workforce development. But even so, it sometimes takes a moment like reading the Fortune report to remind us of how fortunate we truly are to count Cummins among our home state headquarters.

In 1919, 40 years after Col. Eli Lilly decided to launch his own medical wholesale company 45 miles north in Indianapolis, a businessman named W.G. Irwin decided to help a self-taught mechanic named Clessie Cummins start his own diesel engine business. Out of such historical footnotes, economies are built -- and Cummins continues to support the vitality of Indiana's economy today.

Snyder is president of Ivy Tech Community College.

Energy Systems Network President & CEO Paul Mitchell pens this editorial in today’s Indianapolis Star on Indiana’s position at the front of the pack when it comes to developing and deploying electric vehicles. 

CICP’s BioCrossroads initiative released a report this morning detailing the remarkable growth of Indiana’s life sciences industry over the last decade.  “Indiana’s Life Sciences Industry: 2002-2010” was authored by Dr. Walt Plosila, who also led the development of CICP’s original economic cluster strategy with the Battelle Memorial Institute in 2000.

The study places Indiana’s $44 billion life sciences economy among a handful of national leaders in its concentration of jobs and diversity across a number of growing sub-sectors – pharmaceuticals, medical devices, and agricultural chemicals (with our medical testing and research sector poised to join the top tier as well).  This economic powerhouse is putting lifesaving medicines and devices into the global market at a rapid pace – Indiana ranks third, behind only California and Texas, in life sciences exports.

And during a decade of relatively flat job growth capped by a deep recession, Indiana’s life sciences sector continued to create thousands of new jobs – the state’s life sciences employment has grown an amazing 21% since 2002.  (And notably, the average wage of these jobs, at more than $80,000 a year, is nearly twice the average private sector job earnings for Hoosiers.)

In short, the life sciences continues to be a driver of economic growth for Indiana, and certainly BioCrossroads has contributed to this momentum over the last decade as the initiative has raised nearly $250M in venture capital and other funding to support promising life sciences ventures and partnerships across the state.  We encourage you to check out the report at www.biocrossroads.com or by clicking the image to the left.

While economists worry about a ‘jobless recovery’ nationally, here in Indiana manufacturing employment has risen nearly 5% since the end of the recession – but how do we keep this momentum going?

On Friday, CICP's Conexus Indiana initiative and the Ball State Center for Business and Economic Research released the 2011 Manufacturing and Logistics Report Card, an annual analysis of the strengths, challenges and opportunities from two of the state’s most critical industries.

The Report Card predicts a ‘record year’ for Indiana manufacturing, noting that the state ranks among the national leaders in per capita employment in both manufacturing (2^nd among states) and logistics (9^th).  It credits strong export growth and foreign investment, a competitive tax climate and big productivity gains, but warns that our weakness in education/workforce readiness along with rising healthcare costs could jeopardize future success.

Download the 2011 Report Card here, and check out the press release below:

Indiana scores ‘A’s on 2011 Manufacturing & Logistics Report Card, but poor showing on workforce threatens future growth

(INDIANAPOLIS, Ind., June 10, 2011)  Conexus Indiana and the Ball State Center for Business and Economic Research today released the 2011 Indiana Manufacturing and Logistics Report Card, an annual “grading” of the strengths, challenges and opportunities impacting the two industries that collectively employ nearly one of every four Hoosiers.

This year’s Report Card confirms that Indiana’s strengths in ‘making and moving’ products have buoyed the state’s economic recovery.  Indiana continues to rank among the top tier of states in manufacturing and logistics employment, and Ball State economists predict that the next 12 months will be a “record year” for manufacturing in the state.  Indiana's manufacturing employment has risen by 4.6% since the end of the recession.

The Report Card gives Indiana overall ‘A’ grades in Manufacturing Industry (ranking first among states in share of the economy focused on manufacturing), Logistics Industry, Global Position (measuring manufacturing exports and foreign investment) and Tax Climate.  The educational attainment of the Hoosier workforce, however, continues to be a long-term concern.

The state’s ‘C’ grade in Human Capital is a step forward from last year’s C-, based on strong enrollment in community college programs and improved high school graduation rates.  But Indiana’s adult population continues to rank among the least-educated in the nation, leaving Hoosier manufacturing and logistics firms struggling to find qualified applicants for jobs that demand increasingly advanced skills.

“This year’s Report Card reiterates that Indiana must do a better preparing the next generation of manufacturing and logistics workers,” said Steve Dwyer, Conexus Indiana’s President & CEO.  “Today’s jobs aren’t about standing at assembly lines – they’re about running computerized equipment and robotic systems, about teamwork and problem-solving.

“We have to give introduce young Hoosiers to these careers early on, and give them opportunities to acquire the skills they need at all levels to create the pipeline of talent that manufacturing and logistics employers need to grow.”

As the state’s manufacturing and logistics initiative, Conexus Indiana is working with its corporate and academic partners to develop industry-endorsed educational programs, and marketing the careers to young people through its ‘Dream It. Do It.’ marketing campaign (at www.DreamItDoItIndiana.com).

The state’s ‘A’ in Logistics Industry was a first in the four-year history of the Report Card, up from a B+ in 2010 based on stronger infrastructure investment relative to other states.  Conexus Indiana has prioritized and advocated for critical investments through its Indiana Logistics Council, an industry forum that gathers input from logistics employers across the state.

“Indiana starts with a competitive advantage in logistics based on our position as the ‘Crossroads of America,’” Dwyer noted.  “But we have to keep making smart choices to keep our edge.”

Other key findings from the 2011 Indiana Manufacturing and Logistics Report Card:

·         Indiana ranks second among states in per capita manufacturing employment and 9^th in logistics employment;

·         Indiana ranks first in per capita income derived from foreign-owned manufacturing operations, 9^th in manufacturing exports per capita and 13^th in export growth;

·         Indiana scored a ‘C-’ in Benefit Costs, based on poor rankings in healthcare and fringe benefit costs;

·         Indiana generally ranks in the top tier of states in terms of tax rates – and the recently-enacted corporate income tax cut should bolster the state’s current ranking of 21^st in corporate taxes;

·         The state’s ‘C’ grade in Productivity and Innovation represents a mixed-bag of indicators, with strong rankings in manufacturing productivity (9^th) and R&D investment (15^th) offset by poor performance in patents-per-capita (32^nd);

·         With rankings of 31^st in percentage of the workforce with a high school diploma or greater, 42^nd in college-educated workers, and 26^th in younger workers with a two-year degree, human capital remains Indiana’s biggest long-term hurdle to future manufacturing and logistics growth.

“This year’s analysis shows that Indiana is clearly still a manufacturing state that is taking advantage of its central location and pro-growth business climate,” said Michael Hicks, Director of the Ball State Center for Business and Economic Research and primary author of the Report Card.  “But I’d echo the warning that every investor has heard – ‘Past performance is no guarantee of future results.’ Policymakers need to focus on areas like workforce development and healthcare costs to maintain our competitiveness.”

Launched by the Central Indiana Corporate Partnership, Conexus Indiana is the state’s advanced manufacturing and logistics initiative, dedicated to making Indiana a global leader.  Conexus is focused on strategic priorities like workforce development, creating new industry partnerships and promoting Indiana’s advantages in manufacturing and logistics.  Learn more at www.ConexusIndiana.com.

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Commencement Address – IUPUI School of Public & Environmental Affairs

Mark Miles, May 15, 2011

Thank you, Dean Graham, Associate Dean Baumer, and the graduates and their families.  I take away two things from that gracious introduction – first, I’m getting old.  Two, I never really figured out what I was going to do to make a living.

That’s why, when I was approached about speaking at your commencement today, I must admit that my first reaction was to decline – though I have at least my share of gray hair, I don’t feel qualified to give career and life counseling, which is normally the topic of the day on occasions like this.

But then, I thought about SPEA.  I thought about what the school stands for – informing a smarter, better future for our society – and what it teaches – how to serve others and make a difference.  Most of all, I thought about what brought you here today – your desire to serve, to make our community and the world a better place.

I am also mindful that for many of you, the completion of your academic goals represents particularly significant sacrifices.  Many of you are already working and some of you already have families to support.  For you, earning this degree is a special achievement, and you deserve special congratulations from your loved ones and from all of us.

I’d offer a tip of my hat, but I don’t think I can get this back on, so let’s just offer applause to show our appreciation for these extraordinary accomplishments.

So, It was thinking about SPEA, and you, and that changed my mind.

I understand that SPEA has a motto that says, “Better You, Better World.”

I’d be inclined to reverse that. To me, it means that working to make a better world makes a better you, because public service makes your life better, more enriched, more fulfilled than a life based mainly on self-interest or private gain. You get more out of this work than you put into it.  Certainly, I have always found that to be the case, so it’s in that spirit I am happy to be here to offer words of congratulations and encouragement, and to share a few thoughts with you today.

On the topics of service and leadership…

I came across the thoughts of two great American leaders whom I admire very much, two men who have improved and are shaping our world….

Harry Truman and Mitch Daniels.

Coincidentally, they share similar sentiments about leadership…and they are equally vertically and folically challenged.

Truman said, “Men make history and not the other way around. In periods where there is no leadership, society stands still. Progress occurs when courageous, skillful leaders seize the opportunity to change things for the better.”

Governor Daniels once noted in another commencement address – “Many generations fail miserably at the challenges they confront, and their societies take steps backwards as a consequence.  Consider Japan before World War II, or Americans in the decades before the Civil War. 

“And yet in both those instances and many others, the people who followed did great things, not only redeemed all the failings but built better, fairer societies than their nations had seen before.  In fact, true greatness can only be revealed by large challenges, by tough circumstances.  And your opportunities for greatness will be large.”

With these thoughts in mind, I’d suggest that it is incredibly fitting that you are celebrating your commencement in this particular place today.  The Governor talked about the broad sweep of history, but I’d like to focus more locally: Right here, in this building, in the heart of this downtown, we’re reminded of one such example of great things, and  great leadership.

Let’s think for a minute about what’s happened at the heart of this city over the last forty years.  I must admit I’m horrified that this summer I’ll attend my 40^th high school reunion. So while I can claim no credit for this history, I do feel like I’ve been fortunate enough to have had a birds-eye view as these events actually unfolded…

You probably can’t imagine what downtown Indianapolis was like the year I graduated from high school.  (Candles for street lights, horse-drawn wagons instead of cars…well, it wasn’t that far back, but still…)

Young people called it Naptown, outsiders called it Indy-a-no-place.  We felt like there was nothing exciting to do.  Our aspiration was to go to college, then start our careers somewhere else.

A few other differences to add some perspective:

-        There was nothing resembling IUPUI.

-        The so-called Purdue extension was an ugly brick building on West 38^th Street.

-        The Med School and the other paltry academic buildings that made up the campus here were surrounded by very challenged neighborhoods.

-        Just south of campus – there was no White River State Park, no Indianapolis Zoo, no NCAA or Eiteljorg Museum; there was no Natatorium or Track and Field Stadium…you get the picture.

-        Downtown Indianapolis had 475 hotel rooms – and no respectable person would stay in most of them. (This year we added the new JW Marriott to get to the current total of 6,500 rooms, allowing us to host events like the Super Bowl and to pursue a whole new market of conventions and tourism.)

-        There was no Convention Center, and look what we have today.

-        There was no downtown mall.

-        I’m not sure anyone has an accurate count, but the number of people who actually lived downtown numbered in the hundreds.  Riley Towers was about the only market-rate option.  (Today more than 25,000 live downtown, and we will hit 40,000 before we know it with a vibrant mix of apartments, condos, new and historic homes.)

-        The Pacers played at the State Fairgrounds, in the Coliseum.  There was no Market Square Arena, no Conseco Fieldhouse.

-        There were no Indianapolis Colts – no Hoosier Dome or Lucas Oil Stadium. 

-        There was a theater on the Circle and one where the IRT now sits, but they were tired and beginning to crumble

-        Certainly, there was no Cultural Trail.

Fast forward 40 years later, and  Indianapolis is a much different place.  We tend to take it all for granted and sometimes even criticize aspects of it, but the development of Indianapolis didn’t have to happen – look at Detroit or Cleveland. People made it happen, and Indianapolis is one of America’s few, unique urban success stories.

Our city had the benefit of a remarkable generation of leaders, and they inspired and led our community to do great things. 

-        They came from the private sector.  It was expected that CEOs would be deeply engaged.

-        They came from the philanthropic sector…wealth was organized for philanthropy, and the Lilly Endowment and Lilly Foundation led the way in investing in Indianapolis.

-        We also had terrific government leadership: Lugar, Hudnut, Goldsmith, Peterson and now Mayor Ballard.

This was our special sauce.  Before anyone invented the term ‘public-private partnership’ – the leadership of our community was already working closely together.

These civic leaders had a bold vision. They embraced a huge challenge:  They were determined to do nothing less than make an ordinary city into an extraordinary city.

-        They marshaled resources;

-        They were innovative;

-        They had courage – Mayor Hudnut made the decision to build the Hoosier Dome before the Colts had even agreed to move here – a bold move with the potential of political suicide that proved visionary.

-        They brought people together to build bridges between Republicans and Democrats, between the races…

They built the kind of place where 38,000 people volunteer to help stage the Pan American Games. And where, now, when we host the Super Bowl, we raise $25 million in private contribution to meet our obligations to the NFL, but we also raise five times that (more than $125 million) for the Super Bowl Legacy initiative to meet the needs of the people of the Near East side.

Today, the leaders who made all this possible are getting a little long in the tooth; what’s left is largely gray hair.

And yet there’s much to be done to fulfill our city’s promise. Here are a few for you all to sink your teeth into – in my view, the defining priorities:

-        We must find a way to develop a workable multi-modal mass transit system.

-        We must rebuild our center city neighborhoods to create the kind of inspiring, livable places our City must have if we are going to improve everyone’s quality of life and keep and attract talented people.

-        We must create schools and a system of public education that are the envy of urban America.

Already, these goals are work in progress, but they will need your help and leadership if they are going to happen. More importantly, some of you will need to set our future course, and figure out what will define our community for your generation.

I suspect Dean Baumer is about to give me the hook, so let me just conclude by saying congratulations for attaining your academic goals at SPEA.  Congratulations for choosing a life of public service.

You’ve chosen a life that will be personally fulfilling because it will be dedicated to helping others.

I hope you will set your sights on doing great things – and I hope you’ll do them here in this community.

We are counting on you.

Various think-tanks, foundations and economic development groups release a steady stream of state rankings based on various criteria – assessing their tax climates, classifying them as high-tech hot spots or manufacturing meccas, attempting to measure their attractiveness to college grads or creating other assorted indices of economic vitality.

It would be easy to be overwhelmed by the volume of these reports, or driven to distraction by their ‘horserace’ aspect.  There are often valuable data included in these studies, the challenge is finding them and putting them in proper analytical context.

Having said all that, it may be appropriate to give special weight to the opinions of those who actually make business relocation decisions and have the authority to bring new jobs and investment to a location.  That’s why it was noteworthy that Indiana was ranked as the best place to do business in the Midwest, and sixth best nationwide, in a survey of more than 500 CEOs by Chief Executive magazine.

The magazine’s seventh annual “Best & Worst States” survey asks these corporate leaders to evaluate states based on business tax policies, regulation, workforce and livability factors. Indiana’s 2011 ranking is up from 16th place in 2010, making us one of the fastest-moving states in the survey.

Read the press release lauding the state’s performance from the Indiana Economic Development Corporation here, and view the full rankings here. 

The 2011 session of the Indiana General Assembly will likely be remembered best for the passage of far-reaching education reforms – more options for parents, the expansion of charter schools, and an emphasis on teacher quality and accountability. 

On a less positive note, however, local government reform again stalled at the Statehouse – another defeat for taxpayers and the cause of accountability at the expense of entrenched political interests.  Legislators refused to take any significant steps towards streamlining an outdated system of local government (designed during the Civil War-era) that includes a layer of township offices that provide services in an inefficient patchwork while making taxing-and-spending decisions largely outside of public scrutiny.

Proposals to eliminate township advisory boards (and providing for the complete elimination of township government by countywide referenda) were derailed by the vehement opposition of rural lawmakers and ultimately sidelined by the month-long legislative walkout. 

Two more modest bills passed both chambers but ultimately failed after conference committees.  HB1022, a proposal that curbed nepotism and conflicts of interest in local government offices, emerged from conference committee only to be rejected by the House of Representatives by a 31-64 vote.  SB526 focused on Marion County reforms, including the elimination of the county’s nine township advisory boards and transferring fiscal oversight to the City-County Council; the conference report passed the House but was defeated in the Senate by a narrow 24-26 margin.

The defeat of even these incremental reforms demonstrates the General Assembly’s continuing reluctance to disturb the status quo, which comprises a potent statewide network of local elected officials and patronage workers.  While some legislators may still believe the outdated trope that township government represents government ‘closest to the people,’ it has become clear to most (thanks to the tireless reporting of the Indianapolis Star and other media across the state) that these offices represent a drain on our tax base and an affront to transparency. 

The partnership between CICP and the Indy Partnership has served Indianapolis and the region well, connecting the regional business attraction and marketing aspects of economic development with the expertise of our industry-specific initiatives - this synergy will continue.  

But we’ve also never lost sight of our mandate to maximize every dollar we receive from our investors.  Since its launch four years ago, Develop Indy has grown into a robust and aggressive organization in its own right. So today we have two mature organizations with nearly identical structures and complementary missions – one bringing new business to the region as a whole, one focused on Indianapolis, the core of the region.

It simply makes sense to merge their  operations – marketing communications, accounting and administration, certain business development and research functions. In doing so, we’ll achieve significant financial efficiencies and drive a greater share of resources towards promoting ourselves as a destination for economic opportunities.  Simply put, the move allows us to be more competitive, even as we are outspent by many of our competitor regions (on a per capita basis) in economic development.

Here's the press release with additional detail:

Develop Indy, Indy Partnership to consolidate operations for more efficient, effective economic development effort

(INDIANAPOLIS, Ind – February 15, 2011)  Two of Central Indiana’s leading economic development organizations will formally join forces to create a more streamlined effort to maximize business attraction and marketing for Indianapolis and the greater region. 

 Indy Partnership, the regional group representing the nine-county Indianapolis metro area, and Develop Indy, the local economic development engine for Indianapolis/Marion County, will consolidate their marketing, fundraising and administrative operations to create a more efficient and effective enterprise.   The two groups will maintain their separate brand identities while pursuing their respective economic development missions.

Since 2001, Indy Partnership has promoted the Indianapolis region in partnership with local economic development organizations (known as “LEDOs”) in each of the metro counties.  Indy Partnership works to attract new businesses to the region, and provides research and project management support to the LEDOs for their local business development efforts.

Develop Indy was launched in 2007 as the stand-alone LEDO for Indianapolis/Marion County, and works primarily to help existing businesses grow and expand in Marion County.  It has grown its organizational capacity significantly over the last three years.

“We have two organizations pursuing similar missions – one representing the region, one representing Indianapolis, the core of the region,” said current Indy Partnership President and CEO Ron Gifford.  “It makes sense to bring them together in a more formal fashion to achieve our strategic goals, realize financial efficiencies, and give investors more ‘bang for their buck.’”

“We’re in a very tough competition for new opportunities, often going up against cities and regions that can’t match our business climate but do have more money to tell their stories,” said Scott Miller, Develop Indy’s President and CEO.  “This new model will allow us to maximize every dollar spent so we can aggressively pursue new job opportunities and investment from around the globe.”

The two organizations will combine operations in areas like marketing, fundraising, accounting, human resources, and IT.   Develop Indy will continue to focus on local Indianapolis business development issues, while Indy Partnership will continue focusing its marketing and business attraction efforts on behalf of the entire region. 

A new Indy Partnership Executive Committee, made up of private sector business leaders and representatives from each of the county LEDO partners, will oversee the regional effort.  The Develop Indy Board of Directors will serve as the legal governing entity for fiscal and administrative matters for both entities and will continue to oversee matters related specifically to Indianapolis/Marion County. 

Veteran economic development professional Scott Fulford will become the Executive Director of Indy Partnership, as current CEO Ron Gifford assumes the position of Executive Vice President for Policy for the Central Indiana Corporate Partnership (CICP), the regional alliance of CEOs and university presidents.  Gifford will also become a member of the Develop Indy Board of Directors.  Scott Miller will remain as CEO of Develop Indy.

“Since 2007, Indy Partnership has been part of CICP, and that relationship has fostered collaboration with CICP’s industry-specific initiatives – BioCrossroads [life sciences], Conexus [manufacturing and logistics], TechPoint [technology] and the Energy Systems Network [energy and clean technologies],” said Mark Miles, CICP’s President and CEO.  “We see this new alignment between Indy Partnership and Develop Indy as creating an even stronger regional platform to promote these clusters to new business prospects.  

“At the same time, we are committed to maintaining the synergies among these groups focused on economic growth in Central Indiana,” Miles continued.  “Ron’s new roles with CICP and Develop Indy will help ensure that industry expertise from the private sector is available on call to support economic development for the entire region.”

The new structure will also enhance regional efforts by giving the county LEDO partners a larger role in the expanded Indy Partnership Executive Committee, and by encouraging more direct participation in the region’s marketing and business attraction efforts.  A formal agreement on regional cooperation will also ensure that each member county has a fair chance to make its case to new companies looking at the region. 

“To companies located around the country, ‘Indianapolis’ is the brand that we’re all selling, whether we live in Marion County or not,” said Dax Norton, Executive Director of the Boone County Economic Development Corporation.  “By combining the marketing efforts of these two organizations, we can more effectively promote the region while giving every county a seat at the table.”

A joint fundraising campaign will take place for both organizations, ensuring that corporate supporters will not face multiple solicitations on behalf of the area’s business attraction efforts.

The consolidation of operations will become effective at the end of February.  Indy Partnership will share office space with Develop Indy in the Chase Tower in downtown Indianapolis.

Another member of our CICP Board of Directors, Collina Ventures’ Mark Hill, has penned a compelling piece on the need to reform local government – part of an ongoing editorial push on the part of the Indianapolis Star and a network of other Indiana newspapers to raise awareness of the need to streamline and consolidate the thousands of political offices that form a haphazard patchwork of bureaucracies across the state.

As someone who’s spent his career in the tech sector, Hill understands the power of technology to cut costs and enhance productivity.  A tech pundit once estimated that if progress in the rest of the economy matched progress in the computer sector, a Cadillac would cost $5.91, while ten minutes’ labor would buy a year’s worth of groceries.

Unfortunately, Indiana’s system of local government is anti-innovation – instead of becoming more efficient, it’s grown increasingly outdated and cumbersome.

Here is Hill’s op-ed:

Power of innovation can fix local government

Last week, the Indiana General Assembly convened at the statehouse to face the most daunting fiscal situation in a generation or more – a billion dollar deficit. 

But budget problems aren’t confined to the state level, and our lawmakers’ responsibilities don’t stop there either.  Across Indiana, local communities are dealing with the dual effects of the recession and property tax caps; Indianapolis alone faced a $50 million shortfall for its 2011 budget. 

The state legislature can help our cities and counties do more with less, by mustering the political courage to reform our broken system of local government. 

My career has been spent in the technology sector, a field that thrives on new ideas and change.  The power of high-tech innovation tends to cut costs and increase productivity.  My experience tells me that the big gains from technology actually come using the technology to change the process.

Unfortunately, our system of local government has not materially changed for more than a century-and-a-half; so instead of evolving to become more efficient and less costly, it’s done just the opposite.  It’s grown into a cumbersome and confusing maze of bureaucracy, notable for the quantity of political offices rather than the quality of public services provided.

An entire layer of government – the townships – exists to deliver services that could be more efficiently managed by counties.  And at the county level, too many elected officials perform purely administrative tasks – like coroner, recorder, or surveyor – that should have nothing to do with partisan politics. 

Township government is a perfect example of what’s wrong with the system.  The major responsibility of township trustees is delivering poor relief.  But there’s no common standard or procedure for doing so.  Half the townships report serving less than twenty households, and the average trustee spends eight times more in overhead to deliver every dollar in direct assistance than a typical private charity (using the United Way of Central Indiana as a baseline).  I know at United Way we work very hard to keep our overhead down so that we can deliver resources to those in need.

The situation cries out for change.  But the lack of visibility of these offices insulates them from public scrutiny – most township officials run unopposed in general elections, attracting little attention from the citizens they profess to serve. 

Township government should be abolished altogether, or at the very least have their budgets overseen and approved by county councils to bring some accountability to their taxing and spending decisions.  Counties should have the option to consolidate administrative offices and adopt a single executive form of government.

Defenders of the status quo have defeated these proposals during the last two legislative sessions.  But this year could be different.  Governor Daniels is a strong advocate of reform, and the new majority in the House of Representatives may be willing to put their belief in smaller government into action.

These changes represent their own kind of innovation, the kind of change that’s long-overdue for a system designed in an age of travel by horseback rather than broadband communications.

Hill, managing partner of Collina Ventures, chairs the Central Indiana Corporate Partnership's TechPoint technology and entrepreneurship initiative.

Let's shed a layer, join the 21st Century

Last fall, voters of Indiana approved an amendment to the Indiana Constitution “capping” the amount of property tax dollars that can be raised from individual properties. In effect, this placed a ceiling on the revenues available to local governments – a long-term limitation that’s even more severe now as local communities work through the aftermath of the national recession.  

It is now time to look for ways to provide the necessary services by local government in the most efficient manner. Local government structure was developed in a different age: Townships used to operate the schools, the roads, poor relief, care for cemeteries and other services closest to the citizens.  This role has changed over the decades, reducing the need for townships. 

Just a few examples from my home county of Monroe: a) the city (Bloomington), smaller surrounding towns and Monroe County all have park departments, b) city, towns and county have street departments, c) city, towns and county have planning and zoning departments, d) city, towns and townships have fire departments, e) city, towns, county have law enforcement agencies,  and f) county and townships both have roles assisting those in need.

In Orange County, we see two town police agencies within a mile of one another, plus two other towns and the county sheriff; two fire departments within one mile plus a township department; and two street departments plus the county highway department.  These examples are duplicated across Indiana.

We need a more streamlined system of local government at all functions. Some units – like townships – should be abolished altogether. In other cases, where many units are providing the same service, they should be combined to be operated without duplicating administrative overhead. Local governments have been given the authority to consolidate services. The leadership of all units should look at ways to consolidate the administration and delivery those services more effectively in the new era of limited resources. Historically local government had more freedom to raise revenue to provide services but this has now changed with the amendment to the Indiana Constitution.

Some changes have to be adopted by the Indiana General Assembly.  This subject has been debated since I was in the legislature (1966-‘74). It is now time to act.

Indiana has 1,008 townships that spend 400 million dollars a year. The Townships are also holding more than two hundred million in surpluses. The township should be eliminated, to avoid duplication of administration and the abuses we see across the state – more than two-thirds of the trustees hire employees with the same last name (nepotism), improper expenditure of funds, fights over who is in charge of the delivery of service, and over half of the townships providing poor relief to less than 20 families per year.

In the  latter part of the 1960’s when I was serving in the Indiana House of Representatives, UniGov was adopted for Indianapolis and Marion County. Changes in the township system were started, authority for local reorganization was given to local government from delivery of services to the consolidation of purchasing.  Recently, Vanderburgh County and Evansville have been leading discussions of about merging the delivery of city and county services. 

It is time to move forward with a long-overdue reorganization of a government whose structure was developed in the days before the Civil War.

Steve Ferguson

Chairman – Cook Group Inc.

While tough times are forcing state and local government generally to find ways to do more with less, township government is apparently doing less with more.  Townships continue to overtax their way to huge surpluses, despite serving fewer disadvantaged Hoosiers.

A feature in the Indianapolis Star over the weekend demonstrates yet again the pressing need for reform of township government:  The Star reports that the state’s 1,008 townships are holding collective budget surpluses close to (or exceeding) $300 million, as of the end of 2009 (the latest data available). 

That represents an increase of nearly $90 million since 2007, despite providing direct emergency relief (their primary responsibility) to 92,000 fewer Hoosiers.

This startling news comes as state lawmakers begin to struggle with a billion dollar deficit, and as city and county governments across Indiana contemplate deep cuts in public services – laying off police and firefighters, closing parks, deferring roadwork and other infrastructure improvements.  The effects of the recession, as well as the implementation of property tax caps, are forcing the public sector to tighten its belt.

But in the townships, it’s business as usual.  Indiana taxpayers can’t afford to allow such an inefficient and antiquated status quo continue – the time for reform is now.

Click below for a helpful database from the Star on township surpluses and spending in Central Indiana: