How the coast can attract business

By Jane Stebbins, Pilot staff writer July 17, 2012 11:27 pm

 

Poach or perish.

That’s basically what small towns like Brookings need to do to become economically vibrant, attracting businesses that can relocate wherever they like.

 

And working by itself won’t work, as even larger cities like Grants Pass and Roseburg have learned.

Those were two lessons economic development officials in Josephine and Jackson counties have gleaned over the 25 years they have been striving to lure small business to their area, Southern Oregon Economic Development, Inc. (SOREDI) Executive Director Ron Fox said at a special work session Monday afternoon in Brookings.

Attendees included officials from the cities of Brookings, Gold Beach, Port Orford, Crescent City; county officials from Del Norte and Curry counties; and representatives from chambers of commerce, the Brookings Merchants Association, Southwestern Oregon Community College and budget committees.

They were there to learn how Jackson and Josephine counties –  that despite facing dire economic conditions – successfully attract small businesses that keep those areas alive. Brookings City Manager Gary Milliman is curious if those from Curry and Del Norte counties are interested in working together to promote the area from an economic development standpoint.

“We do cooperate on a number of initiatives,” he said, listing such things as the airport, the Tri-Agency Economic Development Commission and the Wild Rivers Coast. “It seems the two counties have a lot in common, separated only by a state border.”

SOREDI is a Medford-based, non-profit organization that spends about 80 percent of its efforts advocating on behalf of existing businesses, much like chambers of commerce. The rest of its mission is to provide financial assistance for startup businesses and actively recruit new businesses to the area.

One of the first steps, Fox said, was to determine what made the two counties marketable. They are getting its north-to-south railroad back, a major interstate bisects the area, it has a nice climate, cultural and recreational amenities and a cost-efficient workforce. And that it’s worked beyond the county borders benefits all, as far as Fox is concerned.

“If a business is interested and eventually ends up in Klamath Falls, hallelujah,” he said. “If they eventually end up in Roseburg, hallelujah. If they end up in Jackson or Josephine counties? SOREDI has a celebration.”

The way to get those businesses here is multifold.

“Everyone has grocery stores,” he said of communities big and small. “Everyone has restaurants, hospitals beauty salons. Build on your strengths. Start off with small businesses, one or two employees. Help them grow, to 10 or 12 employees.”

Josephine and Jackson counties fit into the retail and service niches, supporting wood products, transportation, electronics, Internet commerce and tourism industries. SOREDI aims to capitalize and grow on those existing ventures.

Among the businesses it has recently attracted include Esquire Piano, a firm it lured from California and that has refurbished Elton John’s pianos; Marzi Sinks, a high-end bathroom sink manufacturer that relocated after falling in love with the area during Ashland’s Oregon Shakespeare festival; the now-owners of the Rogue River Lodge who thought it would be great to refurbish the lodge; and Encore Ceramics – referred to the area by the owners of Marzi Sinks – that uprooted and moved to Grants Pass. SOREDI was even able to coax Bauer Fly Reels from picking Gold Beach over Ashland.

“Sorry, Gold Beach,” he said. “This family loved to fish the Rogue River. And after visiting for awhile, they realized they didn’t have to go back and forth (from headquarters in Monterey) First they were tourists, then they became business owners. They said, ‘We keep coming here (Ashland); why can’t we bring our business here?’ That is a common question.”

He said he was fishing on the Rogue River recently and estimated there were 100 boats going up and down the river. There were maybe two or three people on board each boat, he guessed, for a total of 200 to 300 boaters – and probably two or three of those were wondering what it would take to relocate here.

The appeal of southern Oregon is vastly underrated.

“We look different than Sacramento, Portland, Denver, Colo.,” Fox said. “The key is getting people here. That’s how Oregon and California can work together.”

What has worked for Jackson and Josephine counties, however, might have to be tweaked to work for Curry and Del Norte counties.

Winding Highway 101 isn’t conducive to major, constant truck traffic. The average age of the workforce here will present “a challenge,” Fox said. Relocating a corporation – with the exception of a service or call center – is probably not going to work.

“A business looks for what’s right for them,” he said. “A corporation looks at the bottom line. “You don’t have an organization that has a singular, laser focus on trade sector businesses.”

Population and expendable money also come into play, Fox said, citing say, a storefront women’s clothing boutique. Its success will be determined by the number of people willing to purchase women’s clothing and the money people are willing to spend.

But take away that storefront and go into the “traded sector” and it could be a different story.

A good example of a local, traded-sector company is Freeman Marine, which sells its goods worldwide.

“Find another Freeman Marine,” Fox said. “Find someone who would like to live here, who can find the employees. They can send everything (they sell) in FedEx boxes. What comes back to the community is wealth.”

According to the Bureau of Economic Statistics, Jackson County has six times as many jobs in the forest products industry than the national average. It has 1.5 times as many in the hospital industry.

And the Internet commerce industry there?

“To have two times the national average is unusual,” Fox said. “To have five times is off the charts. We have 10 ½ the times the national average in Internet commerce.”

Another unique challenge stems from the fact that Curry and Del Norte counties, while separated by a line in the forest, have vastly different laws governing business. Creating an economic development model that will work for both could be complex – but not impossible.

Oregon, by law, has enterprise zones: designated areas in which businesses can receive incentives to get started. There are certain criteria by which those in the zone must comply and certain goals they must attain. Inside some of those zones are designated e-commerce zones, specifically set aside for e-commerce. Josephine and Jackson counties have two such e-commerce zones of 10 permitted in the state, and hopes to secure a third in the near future.

California works with entirely different laws, but that doesn’t preclude the two from working together, said Brookings City Manager Gary Milliman.

“It takes awhile to navigate the difference,” he said, citing the vast difference in public meeting laws in the two states. “You apply the one that is the broadest. You overcome them.”

That Curry and Del Norte counties are “quite a distance from the free world,” Fox said, avails itself to Internet commerce – creating and selling products over the Internet.

“The Internet is today’s version of the 1860s railroad,” he said.

The best pool from which to obtain these business owners and entrepreneurs, Fox said, is the tourists – the wealthy ones – who visit the area.

SOREDI has done this by attending small-business conventions and conferences, collecting business cards and inputting that information into its database. Curry and Del Norte counties could do the same, but with information it gleans from tourists.

“Visitors to Tu Tu’ Tun Lodge (in Gold Beach) are people from all over the world. And hundreds of thousands of people come through this area,” he said. “Sometimes they’re retirees, sometimes they’re kids, sometimes they’re business owners. Some say, ‘I’d love to live here in Curry County, Del Norte.’

“To our friends in LA, we are cherry picking your businesses. We’ve got something to offer, and you can’t match it.”

“They have a broad range of activities,” Milliman said of the ideas Fox presented at the meeting. “Some are certainly not applicable. We can borrow some of the programmatic ideas they have, but we need to develop our own strategy.”

Perhaps, he said, it would involve enticing more boutique or entrepreneurial-based businesses.

“Or maybe we can address the entitlement community,” he said of retirees to the area. “Their job is being retired, and they bring their income with them. That income is spent in the community. There are all kinds of things we may be looking at.”

Fox said SOREDI operates on the premise that rising seas raise all ships.

But before area officials begin a recruiting campaign, they must make sure they’re doing a good job promoting existing businesses.

“We help communities be successful,” Fox said. “If you understand what it takes an existing business to be successful, you’ll be much more successful recruiting. And if they’re successful, they’ll attract others.”