Economic Development Strategic Plan - Chanute, KS
Transcription
Economic Development Strategic Plan - Chanute, KS
ECONOMIC DEVELOPMENT STRATEGIC PLAN July 21, 2011 Economic Development Strategic Plan Chanute, Kansas Acknowledgments The Chanute Economic Development Committee Planning Consultants Economic Development Strategic Plan Chanute, Kansas TABLE OF CONTENTS Existing Situation .................................................................................... 1 SWOT Analysis .................................................................................... 2 Community Engagement ...................................................................... 13 Labor Force Snapshot .......................................................................... 20 Destination Assessment ...................................................................... 26 Retail Market Analysis .......................................................................... 34 Organizational Structure ...................................................................... 43 Target Industry Analysis ...................................................................... 48 Economic Development Goals ............................................................ 64 Strengthen the Economic Development Structure ............................ 64 Promote Chanute ............................................................................... 67 Recruit New Businesses .................................................................... 69 Grow Existing Businesses .................................................................. 71 Build Tourism Industry ........................................................................ 75 Improve Neighborhood Conditions and Housing Options ................. 79 Improve Quality of Life........................................................................ 80 Create Competitive Economic Environment ...................................... 81 Increase Status as Regional Retail Hub ............................................ 83 Engage and Retain Youth .................................................................. 85 Implementation ...................................................................................... 86 Budget................................................................................................. 86 Timeline .............................................................................................. 87 Benchmarking..................................................................................... 98 Appendix .............................................................................................. 101 80924 7/21/11 1 Economic Development Strategic Plan Chanute, Kansas Chanute’s Existing Situation The City of Chanute is facing increasing competition in an increasingly competitive regional, national and global marketplace. Many nearby communities have established or growing economic development programs with a track record of recent successes. While Chanute is not at a “crisis point” or without its own successes, it is imperative that the City enhance its community and economic development efforts in order to effectively compete for residents, jobs, and industry. City and local stakeholders are committed to investing in the economic future of the city. Chanute is prepared to invest what personnel and financial resources it has at its disposal to promptly address such challenges, but recognizes the need to obtain assistance in formation of a strategy and action plan. Local leadership is optimistic for the future and confident in the ability of Chanute to succeed. The City has renewed its commitment to planned initiatives that will, over time, prove beneficial in improving the economy and quality of life. Purpose for Strategic Planning What is the future of economic development for Chanute, Kansas? The purpose of this Economic Development Strategic Plan is to set forth the mission, goals, strategic actions and tactical approaches for Chanute’s future economic development program. This strategic planning effort will produce a comprehensive set of specific actions, policies, and investments, based on the community’s strategic advantages and disadvantages, all designed to enhance Chanute’s “Our city is a great place to appeal as a better place in which to live, work, and raise a family. The raise a family” Economic Development Strategic Plan will set the vision, framework, and the boundaries for operational planning of the future economic -Focus Group Participant development program of Chanute. The Economic Development Strategic Plan represents the efforts of public and private sector leaders to assess the current start of Chanute and to frame a future vision for the continuing evolution of the community. The goals and strategies are the first steps in realizing a successful Chanute in the 21st Century. The Plan will set the vision, framework, and boundaries for Chanute’s revamped economic development program. Strategic Planning: A Definition Before embarking on the findings and subsequent recommendations of the Economic Development Strategic Plan for Chanute, a general explanation of strategic planning – its purpose, process and outcomes – seems in order. According to the International Economic Development Council (IEDC), strategic planning has to do with the grand design, the major directions for an organization or community. Strategic planning is designed to assist an entity to make the best use of its resources in order to respond effectively to change, to take full advantage of its opportunities, and to avert threats to its existence. 80924 7/21/11 1 Economic Development Strategic Plan Chanute, Kansas The essence of strategic planning lies in positioning the community to obtain a major advantage over its competitors. The ability of a community to improve its competitive position, and the subsequent wellbeing of its citizens, requires a more effective use of local resources. After careful assessment, strategic planning directs the community’s resources toward a limited number of strategic actions which will provide the maximum benefit. Strategic planning provides an organized way in which a consensus can be reached to implement effective strategies in the community. There are seven steps implemented in this strategic planning process: 1. Study the Chanute environment to identify the key factors and trends important to the future. 2. Select key issues that must be resolved before the City can successfully accomplish its aim. 3. Set mission statements on broad goals to provide overall direction in developing the Chanute strategy. 4. Analyze external and internal factors that affect the overall community of Chanute. 5. Develop strategies that move the City in the direction it wished to go while doing so within its operating constraints. 6. Develop an implementation plan that provides a specific timetable and assigns responsibility for accomplishing each action step in Chanute. 7. Monitor the plan and make adjustments as the local environment changes. In the final analysis, strategic planning gives Chanute a chance to truly understand the local economy fully and through that understanding, to determine the appropriate steps to improve its competitive position. Strategic planning is a process that is designed to produce the desired outcome: the long-term improvement of Chanute’s economic well-being. Strengths, Weaknesses, Opportunities, and Threats (SWOT) Analysis Communities benefit from a comprehensive, objective, competitive assessment or SWOT analysis. Today’s increasingly competitive economic development environment necessitates such an endeavor. In particular, the SWOT analysis is central to the process of identifying a community’s strategic advantages and disadvantages. Traditionally, economic development has focused on such factors as transportation, utility capacities/ rates, tax comparisons, other costs of doing business and industrial site availability. One of the results of today’s changing business environment is the need to focus on additional dynamics in the community assessment. These new factors include skill levels of employees, quality of life, community services, entrepreneurial potential, and various business retention issues. Not every factor is important to consider in great detail. However, it is important to consider whether each factor represents a significant advantage or disadvantage to the community. The information presented in the Chanute SWOT analysis was obtained from interviews, focus groups, surveys, publications, consultant expertise, group brainstorming and a review of existing data from the City, State and other private organizations. 80924 7/21/11 2 Economic Development Strategic Plan Chanute, Kansas Our analysis also identifies a few areas that are detractors to Chanute’s quality of life. These include: lack of community pride, affordable and available housing, and lack of retail shopping alternatives. These issues will be discussed further in the weaknesses section and strategies are presented herein to address these issues. By embarking on the strategic planning process, the City of Chanute has taken the steps necessary to prepare for development that will improve the local standard of living of Chanute’s residents and preserve the quality of life in the area for years to come. Strengths Overall Quality of Life While labor, transportation and other cost factors affecting the bottom line continue to be the dominant site location determinants for most industries, quality of life plays an increasingly important role. Executives want to live in pleasant communities, possessing a good quality of life. This also makes it easier to attract and retain the best employees. Quality of life means different things to different people; however, certain factors are widely valued, including reasonable cost of living, high quality health care services, low crime rates, cultural/recreational activities and overall community character. The quality of life in Chanute is a strength of the entire region. In our interviews of local employers and stakeholders, almost all individuals attested to the quality of life in the City and surrounding area. The quality of local schools and area higher educational and medical facilities, and abundant activities are among many factors that make Chanute a very desirable place to live. There are many institutional, cultural and historical assets that uphold the high quality of life in Chanute. Chanute provides many amenities of a large community with the manageability and friendliness of a small community. Businesses, as well as citizens, appreciate a good quality of life. Corporate decisionmakers assess quality of life factors not only from the perspective of executives making relocation decisions, but also from the perspective of their workforce. Companies want to minimize employee turnover and excessive recruitment costs; therefore, they prefer to draw from a labor pool that enjoys living locally and plans on staying in the area. “We have all the amenities of a bigger town, but smaller. Every kid knows every kid” -Focus Group Participant An important component to forming community pride, as well as predictor of success in community and economic development endeavors, is a track record of success and innovation when a community is confronted with challenges. During the community engagement for the development of this Plan, it was often mentioned that the community solves tough problems and challenges when confronted. While the community may not be at a crisis point currently, it is important that the ability to succeed during times of difficulty or importance exists. Additionally, these successes create an attractive storyline when recruiting businesses and employees. One recent example in Chanute was the community rallying to pass a bond issue in order to fund the construction of a municipal pool facility. Both residents and elected officials saw the need for such a facility and worked to get it approved. New recreation complex adjacent to the new high school. 80924 7/21/11 3 Economic Development Strategic Plan Chanute, Kansas The focus groups, interviews, and surveys revealed common perceptions shared by the community about the quality of life in Chanute. Factors identified as contributing to the quality of life in Chanute include: Good school district Long-term commitment to a strong community Abundant recreation and arts Strong public safety Family friendly Affordability History of success and innovation The quality of local education is one of the most highly weighted quality of life factors evaluated in the site selection process. Companies know that strong school systems make it easier to recruit and attract key management employees. They also contribute to improving the skill base of the local workforce. Corporate site selectors note the comments of local employers when evaluating the quality of public education. Generally speaking the City of Chanute’s school district scores are on par with the state averages. Additionally, when discussing public schools with local leaders and residents the schools are given high marks in academics, workforce training, responsiveness, and extracurricular activities. Telecommunications Infrastructure Business and industry are becoming increasingly information-based. Access to and flow of information are critical to future economic development initiatives. Communities with modern telecommunications infrastructure gain “Chanute is technology-rich for a competitive advantage in this business environment. a small community ” The City of Chanute invested in fiber optic telecommunications -Focus Group Participant infrastructure that provides a competitive advantage over other communities. While not a new technology, the expansion and adoption of fiber optic technology has been relatively slow in both rural and urban communities. The importance of this telecommunications infrastructure cannot be overstated. Fiber optic technology is attractive to both industry and household users. Communities such as Chattanooga, Tennessee have successfully developed their fiber optic infrastructure to attract residents and businesses. In regards to fiber optic, the difference between Chattanooga and Chanute was the expansion from a fiber optic backbone to the expansion of the network, bringing fiber optic to businesses and residents. In Chanute, the fiber optic technology is mainly used by governmental, educational, and other quasi-governmental organizations. Unfortunately, it has not effectively been used by the business community. While Chanute has an extensive Fiber Optic Backbone, TriValley Developmental Services is one of a few businesses in the industrial park that utilizes the connection. 80924 7/21/11 It is important that Chanute take advantage of its fiber optic infrastructure while the advantage is still there. Current efforts by the State of Kansas, with federal assistance, are expanding fiber optic technology to other 4 Economic Development Strategic Plan Chanute, Kansas competing rural communities. Once these communities are as “wired” as Chanute is, the competitive advantage will shift from accessibility to cost. This anticipated shift will take control of the competitive advantage from the City’s hands. Chanute is aware of the changing nature of informational technology and recently competed to have Google’s Google Fiber demonstration project constructed in Chanute. While Chanute did not win the demonstration project, the community is geographically between the community that did receive the project (Kansas City, Kansas) and Tulsa. Both Kansas City and Tulsa are important hubs for the proposed Internet2, a nationwide 100 Gbps-capable network and for the National LambdaRail fiber optic network. Utilities & General Infrastructure When evaluating the general infrastructure (water, wastewater/sewer, electric, gas, roads, etc.) of a community it is important to consider the existing demand, as well as the ability to handle potential future demand. As part of the development of the Plan, PGAV conducted a review of the mapped infrastructure, capacities and loading data, as provided the City. From this data, it is evident that the existing infrastructure is more than able to handle its current usage. Additionally, when evaluated against development trends and patterns of community growth, the City is well positioned to handle both its current demand as well as immediate future demand. The existence of solid infrastructure that is already built to accommodate future growth places the City in a competitive position when pursuing potential businesses vis-à-vis other communities. Nevertheless, the community must continue to monitor the loading and capacity and reliability of its infrastructure. In order for the City to continue to accommodate growth and the broad range of target industries, it is important to plan for future expansion in order to address future limitations before they negatively impact attracting prospective businesses. Weakness Economic Development Efforts The leadership and organization of an economic development program is critical to the long-term success of business growth in the community. Sound leadership and organizational structure provide the foundation essential for mobilizing support and developing fiscal responsibilities. The existing economic development efforts are largely centered on the City of Chanute with ad hoc assistance provided as needed. The advantage of this structure is that it provides the City with a measure of control over the economic development process. It is imperative that an existing or prospective business be able to easily identify the lead economic development organization and determine its roles and responsibilities. The City is 80924 7/21/11 Safari Industrial Park has sustained losses in the recent economic downturn. 5 Economic Development Strategic Plan Chanute, Kansas currently the default economic development organization; however, as the mission of the City is more varied than just economic development, the disadvantage to this arrangement is that the City can be placed in an awkward situation in regards to incentives, etc. An organization fully devoted to economic development, working closely with the City, Chamber, and other community organizations, is a much more preferable model. An economic development agency with a comprehensive mix of local businesses, government agencies, and stakeholders will not only ensure a direct line of communication to key decision-makers but remove some responsibilities from the City. This structure provides a reliable, centralized and efficient probusiness climate to address expansion and attraction activities. Today’s business climate demands quicker decisions by businesses to remain competitive. Likewise, communities must also promptly adapt and improve to become more efficient and competitive in the economic development arena. The complimentary role of having both public and private sectors enhances the economic development effort. Incentive and Business Assistance Programs The most effective incentives for a project are those that target a key area of competitive advantage for the company or offset a disadvantage for the community. In the best of all possible situations, the components of an incentive program are designed based on the needs or desires expressed by prospect companies and lead to a win-win situation for the community. In reality, incentives are heavily influenced by resource constraints. The strategic advantage of an incentive is that it may offset a marginal disadvantage of the community or provide additional benefits to a prospect in the community when compared to equal alternative locations. Both the City of Chanute and State of Kansas employ a variety of economic development incentive mechanisms and business assistance programs that may be used in efforts to attract, retain, and develop businesses. Interviews and surveys revealed a mixed bag regarding the overall use and effectiveness of said incentives. One of the main reasons given for the lack of use of incentives was businesses’ lack of knowledge about what incentives are available and how to access them. The state and local incentives and business assistance programs can be categorized into four primary categories; 1) Loans and Financing, 2) Local Assistance, 3) State Ash Grove is a good example of the appropriate and Assistance, and 4) Training Assistance. The necessary use of tax incentives. complexity and multiple levels of incentives requires the continued education of current and prospective business owners as to the incentives available for business retention, expansion, or creation. 80924 7/21/11 6 Economic Development Strategic Plan Chanute, Kansas Public Apathy – Lack of Community Pride Community pride is an important component of community development. Companies looking to relocate, tourists visiting the community and potential residents all gauge the general community pride when in the City. Community pride often begins at the first stop of a visit, which is a convenient store or restaurant, and can make a lasting impression. Beyond the first impression, community involvement is a necessary component of success for nearly all civic and public projects. While certain elements of the community are supportive of all things Chanute, there are other elements that appear not so inclined. Many comments made during interviews, focus groups, and public meetings showed signs of a community lacking involvement and pride. Lack of Housing Options While not considered traditional economic development, quality available housing is very important to the development of a community. In fact, the most significant factor necessary to create a desirable living environment is the availability of housing. A community needs a variety of quality housing types at various price levels in order to provide each socio-economic group with a housing opportunity. Without an ample supply of housing a community cannot meet its growth potential. Table 1: Age of Housing Stock Total housing units 3,705 Built 2005 or later 24 0.60% Built 2000 to 2004 98 2.60% Built 1990 to 1999 193 5.20% Built 1980 to 1989 182 4.90% Built 1970 to 1979 438 11.80% Built 1960 to 1969 252 6.80% 708 19.10% 386 10.40% 1,424 38.40% Built 1950 to 1959 Built 1940 to 1949 Built 1939 or earlier Source: US Census American Community Survey From 1900 to 1910, the City of Chanute doubled in population. Since that time, the City has grown slowly over time. The housing stock directly reflects this history, with half of homes being constructed before 1950. Consequently, the City is lacking a diversity of quality available housing in a few sectors that are vital to recruiting and retaining a complete workforce. The most notable areas of unmet housing demand are mid-range for-sale market rate homes (in the $75,000 - $150,000 range) and all ranges of market rate rental housing. It is very important that the City work to provide the opportunities for the creation of the housing necessary to successfully meet the needs of its existing and future housing demand. 80924 7/21/11 7 Economic Development Strategic Plan Chanute, Kansas Regional Presence Regional collaboration is an increasingly important component of a community’s ability to compete in the national and worldwide marketplace. In fact, in regards to rural communities it is often the only effective means of competing. Regional collaboration is not without its challenges as it consists of partnering with potentially competing communities. Often successful cities agree to compete together as a region and not against one other for economic development projects. An important factor to making regional collaboration worthwhile is to establish Chanute as a leader among the regional group. Currently Chanute is participating well in the region through such groups as SEK, Inc., but has not yet asserted itself as a regional leader. This will require Chanute becoming an information warehouse as well as networking champion in regards to regional and state economic development issues. Labor Availability Labor availability is critical to all site location projects since it influences labor cost, turnover, “Most companies who relocate or open new and productivity. Labor availability can be facilities at new locations make their site analyzed in several ways, including overall size of selection decisions based in large part on the the labor force, unemployment rates, commuting availability of and the costs of labor.” patterns of the area employment base and underemployment surveys. Most companies who relocate or open new facilities at new locations make their site selection decisions based in large part on the availability of and the costs of labor. Through surveys and demographic analysis we have found that the local labor market has ample labor available for unskilled production and support jobs. However, there is a shortage of the labor needed for certain skilled production and managerial jobs. Many of the employers interviewed stated that it was hard to attract new “white collar” talent to the area due to the perceived low quality of life and lack of available housing. Both of these issues are addressed in the action items and recommendations. Opportunities Location Location is important in the economic development arena for two reasons. First, it affects a company’s ability to ship and receive goods in a timely and cost-effective manner. Second, it influences a company’s ability to attract and retain employees. The ability of a company to broaden its employment base, by being located along central traffic corridors, ensures that a 80924 7/21/11 8 Economic Development Strategic Plan Chanute, Kansas company will have a larger labor pool from which to attract qualified and skilled employees. In our experience, most companies have a desire to be located immediately adjacent to, or very near, an interstate highway or well-maintained four-lane highway. The need for fast, reliable and cost effective transportation is driven by businesses operating in competitive global markets. Many manufacturers operate a ‘just in time’ supply and delivery process, which requires a highly efficient transportation infrastructure. Similarly, tourism and service industries also require access to major transportation links. The City of Chanute is centrally located and within many major markets in the center of the nation. A frequent comment from interviews and surveys was that Chanute is “located 2 hours from everywhere”. While Chanute’s location is central, it has not been a driving factor in its economic development success. In fact, there is opportunity to take better advantage of its location through improved highway access and marketing. Currently Chanute is not served by limited four-lane access, which is vital to many industries, including tourism. Available Building Space and Land/Potential Development As communities compete to attract industry and jobs, the availability of well-located and soundly constructed industrial buildings could mean the difference between a community being placed on the “short list” or being eliminated from the site selection process. A community with a diverse mix of available buildings provides potential prospects with the flexibility to evaluate the immediate physical needs as well as assess the long-term possibilities for expansion. Building vacancies, as long as there are not excessive vacancies, can be a positive advantage to the community. It provides readily available space for a business to locate and a history of data about its operating costs. Chanute has a number of vacant commercial and industrial buildings that offer opportunities for new and expanding businesses. Chanute’s current level of vacancies is not considered excessive, and in fact will compliment current economic development efforts. Upon absorption of the existing available buildings in the area, or if there are a number of recruitment failures due to lack of appropriate buildings, Chanute may consider the construction of a market-driven speculative industrial building in the industrial park, depending on the real potential for landing a major employer. The availability of speculative industrial buildings is an important economic development marketing tool. Chanute enjoys a competitive advantage over many communities due to the potential development opportunities created by Chanute’s proactive planning. The City has identified strategic locations within the community to invest in infrastructure, create incentive mechanisms, and implement favorable zoning for incoming businesses. Downtown As observed by Professor Kent Robinson in his 2001 book “Downtown Development: Key Trends and Practices” the overall health of a community is greatly influenced by the viability of its downtown. From a social standpoint, downtown is the “heart and soul” of the community and symbolizes the heritage of the 80924 7/21/11 9 Economic Development Strategic Plan Chanute, Kansas community and provides a sense of identity. A vital center city features unique shopping and dining opportunities, tourist attractions, employment possibilities and recreational outlets for residents and visitors. Downtown is very appealing and offers a great opportunity to create another destination for visitors. This translates into economic stability through higher property values and increased sales tax collections that benefit public budgets. Revitalizing downtown can stimulate business growth, maximize the utilization of public resources and provide tax diversification. In addition to symbolizing the entire locality’s perceived quality of life, downtown’s economic health directly affects the whole community. “Cities large and small see a healthy core as integral to their overall heritage, tax base, sense of community, identity, economic development appeal, and image” (Robertson, 2001). Accordingly, there is much to gain from a focused revitalization program. Small businesses, which create local jobs and tax revenue, traditionally locate downtown and are a significant force in a city’s economic vitality. In smaller towns, the benefits may be even more direct than in an urban setting. A 1986 study by the National Trust for Historic Preservation found that as many as two-thirds of all new jobs nationally occur in small businesses, which are likely to operate in smaller downtowns. Additionally, an important factor in site selection decision making is quality of life, of which the conditions of downtown are a major component. The quality of a community’s Downtown is also a factor in attracting the workforce necessary for economic growth. Chanute should continue to focus its resources to revitalize its Downtown. Downtown Chanute has has already seen concerted efforts toward revitalization, but still has room for improvement. It has a sustainable amount of retail and restaurant occupancy, attractive buildings and streetscape, significant historic buildings, numerous events and destination assets. However, there are still opportunities to create a more vibrant and economically viable Downtown. Threats National Economy The national economy has a significant impact on local economies and industries. Rural communities are impacted differently than metropolitan areas. The Federal Reserve notes that during this past recession, unemployment rates increased later in non-metropolitan communities than metropolitan. 80924 7/21/11 10 Economic Development Strategic Plan Chanute, Kansas Additionally, non-metropolitan employment will recover more slowly than metropolitan communities from the past recession. Much of the national impact is felt hardest in rural communities heavily dependent on manufacturing and business services. However, rural communities with employment concentrations in education, health services, and commodity based industries felt the recession less severely and will experience more rapid recovery. The financial crisis that began in August 2007 was the most severe of the post-World War II era and, very possibly – once one takes into account the global scope of the crisis, its broad effects on a range of markets and institutions, and the number of systemically critical financial institutions that failed or came close to failure – the worst in modern history. Although responses by policymakers around the world avoided an utter collapse of the global financial system in the fall of 2008, the crisis was nevertheless sufficiently intense to spark a deep global recession from which we are only now beginning to recover. While the financial crisis began in August 2007, the recession was not observed technically until December 2007. This recession, which appears to have ended in July 2009 based on information provided by the Bureau of Economic Analysis, lasted a total of 19 months, representing the longest economic contraction since the Great Depression. Recently the Federal Reserve Bank of Kansas City published The Midwest Economist which included an update on the Kansas economy detailing the signs of stabilization in Kansas entering into 2011. The article noted that total nonfarm employment increased modestly from the prior year, with the strongest job growth in energy, transportation, and manufacturing industries. These gains helped offset the declines in state employment in the local government sector and information sector. Employment growth was more significant in smaller cities and non-metro areas buoyed by strong farmrelated activity. Adding to a potential positive outlook for 2011 are the results of employer surveys which suggest that job growth could pick up throughout the year. The unemployment rate in Kansas has remained flat over the past year, although substantially lower than that of the nation. On the construction side, housing permits were still near historically low levels, and values remain well below pre-recession levels. Inventories of unsold homes were elevated, dampening activity. Additionally, commercial real estate has continued to be sluggish as values of construction contracts have declined over the last three years and office vacancy rates have remained elevated. Regional Competition As discussed previously, rural communities compete in the national and worldwide marketplace on a regional level. However, within the region, rural communities compete among each other for industry and investment. Often this competition, if combined with local and state incentives can result in no net gain for the region or state; however, without significant legislative changes, this counterproductive competition is not likely to cease in the near future. 80924 7/21/11 11 Economic Development Strategic Plan Chanute, Kansas Many communities in Southeast Kansas and neighboring regions are continually improving their economic development programs. For Chanute to continue to compete with these communities it will need to implement the recommendations in this report and remain dedicated to progressive future economic development efforts. Demographic Shifts The United States is undergoing a demographic shift, most significantly for non-metropolitan areas in the areas of age and migration. Nonmetropolitan areas have a larger share of the aging population than metropolitan areas and this disparity is projected to grow as a percentage of the population. Two factors driving this percentage growth in elderly populations are the in-migration of empty nesters and retirees to non-metropolitan areas and the outmigration of 20-30 year olds from these same areas to metropolitan areas. 80924 7/21/11 12 Economic Development Strategic Plan Chanute, Kansas Community Engagement The approach taken to this Economic Strategic Plan is a community development approach which is bigger than just economic development. This approach includes a broader set of activities aimed at building the capacity of the community. Communities that incorporate economic and broader, longerterm community development goals stand to gain more than small towns that take a piecemeal or narrow industry focused approach. Successful communities are guided by a broadly held local vision. Therefore, the community engagement process includes determining planning and visioning goals based on information obtained from a wide-ranging sample of the community including; local government, civic organizations, major industries and businesses, entrepreneurs, educators, and average citizens of the community. The community engagement process included focus groups and a web survey, in addition to numerous public meetings. Focus groups were used in an attempt to target sectors of the community that were deemed significant through public meetings in the beginning of the strategic plan development process. The web survey was used to test a broad range of topics important to the strategic plan with the general community. Focus Groups The focus groups that were conducted for the purpose of this strategic plan included leaders and stakeholders including; housing and real estate development, small business owners and entrepreneurs, young leaders, workforce development and education, and civic organizations. The topics covered general economic development issues, as well as issues specific to each of the groups. Due to the nature of how focus groups are conducted, which guarantee anonymity and confidentiality, full transcripts are not available. Therefore, listed below are paraphrased comments from each of the groups. Housing and Real Estate Development Economic development should focus on more than just creating jobs but include; infrastructure, hospitals, schools, restaurants, stores. An advantage that the community has is the existing fiber optic backbone, it needs to be better utilized. Chanute has lost many jobs over the last few years, that has had a noticeable affect on community pride. Rental rates are monitored and the demand has outpaced supply which drives up prices. Currently rental rates are higher than most mortgages. There is a large demand for mid-range priced homes, necessary for transition from rental to home ownership. Most homes in the community are over 50 years old and have maintenance issues that make them a liability to the housing market. There are programs that teach the building trades through the high school and community college but have not been as successful as other communities efforts. 80924 7/21/11 13 Economic Development Strategic Plan Chanute, Kansas City management and leaders are very pro-development but have to be careful about perceptions in the community in regards to incentives and business attraction efforts. Small Business Owners and Entrepreneurs The most important issues are accommodating existing businesses and building the local economy through the businesses already here. Businesses currently located here chose to be here for more than economic reasons. The City is a great place to raise a family and considered to be a very friendly community. The projects that are helping to build the community are working, but the debt and tax burden needs to be monitored in order to keep future costs in check. The City is for the most part business friendly but could have improvements to make it more business friendly. Boutique retailers have found that around 35% of their customers are from outside Chanute. The City needs a full-time economic development person, selling the community and being proactive. The industrial park is an asset and needs to be combined with incentives in order to promote it within the region as the best option. Lack of good affordable housing is a problem when recruiting employees. Customers are very loyal, but there are feelings that the City is not as loyal. The lack of a significant highway presence is hindering development and growth prospects. There is a lot of concern about the need to diversify the employment base, increasing the number of mid-to-large sized employers. There is a lack of qualified pool of job candidates. Younger people looking for someplace more exciting than Chanute. Older people have trouble finding housing. Improving the quality of life and housing options are the first starts of creating a more welcoming community to attract employees. Young Leaders The important part of economic development that Chanute is missing is the ability to retain its talent. Chanute is mainly an older community and is challenging for young professionals to move back. A lot of the good people left the community for lack of jobs and opportunity. Housing opportunities are the biggest obstacle to attracting and retaining educated youth. There are too many rental properties in town that are not well maintained and perceived as unsafe as well. Many young residents graduate high school and basically feel stuck in the community. 80924 7/21/11 14 Economic Development Strategic Plan Chanute, Kansas Chanute has a location advantage that it has not yet taken advantage of, it’s 1.5 hours away from many larger metropolitan areas. The community must be involved in economic development starting with an educational outreach to explain how incentives work and why they are necessary. The idea of an incubator is getting a lot of people excited, offer assistance to get them started and then we get the benefits when they succeed. We need some small successes to get some momentum going and to continue celebrating the successes moving forward. There seems to be a decline in the amount and quality of recreation and entertainment opportunities. There is a great demand for such activities, at a recent outdoor music event many people showed up and volunteered to continue holding the event. The outreach of local organizations to the high school is insufficient, they need to have some meaningful involvement, not just invited to lunch. There is a lot of need for additional social activities, those that help to bring different classes and education levels together and focus on improving the community. Workforce and Education Leaders Recruiting potential employees to the area is difficult due to the lack of housing and that it is a small, rural community. The community is technology rich, which has really aided the schools which are a great selling point.. Chanute is halfway to anywhere, but middle of nowhere. Small town, great big life. If we can get through this current downturn we are poised for growth in the future due to our schools, hospital, etc. Enrollment at the community college has almost doubled. The college has created opportunity for area high school kids to work on skills that make them employable. The college also works with other communities to create programs for adults to improve their employment options as well. You won’t find similarly sized schools in other communities that offer the same quality of education or extent of extracurricular programs. Filling traditional blue collar positions is easier than white collar positions. Recruiting families to Chanute has been easier than recruiting single recent college graduates. There aren’t a lot of youths who stay, a major problem for the community. We are looking at trying to grow our own. Basically, trying to match potential high school students to local companies that they would return to work for after college. There may be better opportunity for people with 2-year and technical degrees as opposed to full 4year degrees. There are a lot of unemployed college graduates in Chanute. 80924 7/21/11 15 Economic Development Strategic Plan Chanute, Kansas Civic Organizations There has been a noticeable increase in the challenge of getting donors and volunteers in the recent economic downturn. It’s time to change the way we’ve done things, move beyond doing things the same way because we’ve always done it that way. It’s time to team up and work together as organizations where we can and spread our resources for the greatest impact. The largest hindrance to our economic growth is the lack of transportation infrastructure, we need 4lane highways. Also, the fiber optic network needs to be expanded, it’s only useful if it’s connected to everything. We need to find a spokesman to rally the community and speak positively, stick together and stamp out the negatives we have from within. The large industrial and business community needs to be a part of the plan and participate in outreach to competitors, suppliers, and colleagues to sell the community. Community Web Survey Methodology As part of the process of creating Chanute’s Economic Development Plan, an online survey of residents, including business owners, was conducted. Survey provider, Zoomerang, hosted the survey online in Fall 2010. Zoomerang received a total of 111 responses. The survey format consisted of 69 questions. The majority of questions were multiple-choice, with several open-ended questions. Question topics included satisfaction with city services, perceptions of quality of life in Chanute, pace of economic development, spending habits and preferences, and demographic information. Respondent Demographics The vast majority of respondents were long-time residents of Chanute, with 72% having lived in the City for more than 20 years. Most were middle-aged, with 78% being between the ages of 35 and 64. Of those who worked outside of the home, 88% worked in Chanute and most of the remainder in nearby smaller towns. A slight majority of respondents were male. Sixty-two percent of respondents made over $50,000, which when compared with the Chanute median household income of $39,232, is substantially higher than the average resident in the City of Chanute. Key Points The purpose of the survey was to gauge the level of satisfaction of current residents with the City’s provision of services as well as the current economic development climate. The opinions gathered directly informed the drafting of goals and strategies for economic development in Chanute. The ten goals and supporting strategies generated by the planning process are detailed in the Economic Development Plan. The following sections detail each of the key findings from the survey, specifically as they relate to future economic development in Chanute. 80924 7/21/11 16 Economic Development Strategic Plan Chanute, Kansas Provision of City Services Overall, respondents rated their satisfaction with City services as good or excellent (83% total); however, when asked to rate individual categories of services they identified some areas with less satisfaction. A large majority (80%) of respondents rated the overall flow of traffic and congestion management in the City as good or excellent. Residents felt that the city did a generally good to fair job of enforcing codes and ordinances and of communicating with the public. Respondents had a fairly negative view of the City’s planning and management of growth, with 63% asserting that the City was doing a fair or poor job of planning for growth and 60% managing growth. Coinciding with these views, 61% felt that planning for growth should receive the most emphasis from City leaders over the next two years and 35% felt managing for growth should receive the most emphasis. Other choices, such as enforcement of codes and congestion management, were selected considerably less frequently. Perceptions of Chanute While 56% rated the image of Chanute as good, a shockingly few number (4%) rated it as excellent. Similarly, only 6% rated the overall appearance as excellent. There is an opportunity for the City to work toward more residents perceiving their community as one exhibiting excellence. A strong majority (69%) rated the quality of life in the City as good or excellent, while very few (6%) rated it as poor. While a large majority felt the City was safe, a place to raise a family, and had a good or excellent overall quality of life (85%, 71%, and 71%, respectively), only 56% rated it as a good or excellent place to retire. In addition, 56% rated the availability of affordable housing as poor or fair. Affordable housing, and potentially that for seniors, in particular, is a concern. A very high percentage (92%) rated the availability of jobs in the City as poor or fair, with a majority rating it as poor (56%). Similarly, 68% rated the ability to open a business in the City as fair or poor. Finally, 72% rated the overall quality of new development in the City as fair or poor. This corresponds to the feeling that the City is not managing growth in the way residents would prefer. City Parks and Recreation Respondents rated city parks favorably, with 83% rating the maintenance of parks good or excellent and 93% rating the number of parks as good or excellent. A high percentage of respondents also rated the number of walking and biking trails and number and quality of athletic fields as good or excellent. A slight majority rated the availability of information about the City’s parks and recreation programs and quality of youth athletic programs as good or excellent. Conversely, nearly half rated the City’s adult athletic programs as either fair or poor. Three quarters of residents surveyed rated the City’s special events and festivals as good or excellent. However, over half rated the City’s cultural arts programs as fair or poor. 80924 7/21/11 17 Economic Development Strategic Plan Chanute, Kansas Factors for Choosing Chanute When given a series of possible reasons for determining where they live, approximately three quarters of respondents identified employment opportunities (79%), quality of public schools (73%), safety and security (72%), and quality of health services (71%) as very important to their decision. The availability of jobs within the City of Chanute appears to be the number one determining factor for potential residents considering Chanute. While also important to the majority of respondents, sense of belonging, types and affordability of housing, access to quality shopping, availability of parks and recreation, proximity of family or friends, and access to restaurants and entertainment were less important. The availability of transportation options and of cultural activities and the arts were the least important reasons for respondents choosing Chanute. City Communication While the majority of residents responding felt the availability of information about City programs and services and efforts to keep them informed about local issues/events were good, very few felt that they were excellent. There is room for the City to improve its communication to achieve an excellent level of service. Conversely, over half considered the City’s website to be excellent or good. A slight majority of respondents felt that the City’s openness to involvement and input was either poor or fair. The perception, at least for a majority of respondents, was that that the City is closed to receiving community input. Future Economic Development When asked about the pace of development in the City, most said that all types of development listed in the survey were occurring too slowly or much too slowly. A strong majority (80%) felt this way about retail development. Sixty-five percent felt that a redeveloped downtown is an important part of the City’s economic development strategy. When asked for their support of the City using incentives to attract and expand retail, manufacturing, science and technology, and/or regional office companies, 93% said they were very supportive or supportive. When presented with a list of capital improvements, respondents gave the following as their most important: Street reconstruction (61%) Public facilities (45%) Stormwater system improvements (40%) Sidewalk construction (38%) Shopping Habits Of those surveyed, 19% indicated that they leave Chanute for shopping at least once a week. An additional 45% indicated that they leave a few times per month. This level of retail leakage should be of significant concern to the City. 80924 7/21/11 18 Economic Development Strategic Plan Chanute, Kansas Of those who leave Chanute to shop elsewhere, the following were the most common destinations: Kansas City (54%) Joplin (43%) Wichita (17%) Tulsa (12%) For those leaving Chanute for shopping, the following were the most common items being purchased: Clothes (83%) Shoes (17%) Sporting goods (13%) Hardware (8%) Electronics (7%) Businesses residents most wanted to see in Chanute were as follows: Clothing stores (56%) Family or casual style dining (43%) Ice cream shop (29%) Fine dining (25%) Lodging (23%) Arcade or other attraction aimed at youth (23%) Outdoor equipment store (20%) The full web survey, complete with responses and tables can be found in the appendix. 80924 7/21/11 19 Economic Development Strategic Plan Chanute, Kansas Labor Force Snapshot The following data and demographics are intended to be an overview of the City of Chanute’s labor market. The City of Chanute is located in Neosho County in Southeast Kansas. According to the recently available 2010 Census numbers, the population of Chanute has risen to 9,119, while Neosho County’s population is 16,512. For the purpose of this report, the labor basin for Chanute, Kansas includes those individuals and communities located within a 40 minute drive of the City of Chanute. The labor basin population totals 31,484. From the years 2000 to 2010, the labor basin population decreased by 5.7%. This percentage change was higher than Neosho County’s decrease of 2.9% but lower than the State of Kansas’ increase of 6.1%. Population projections for 2015 show a continued decrease in population for both the labor basin and county. State population growth is expected to increase, but also at a slower rate than previous years. Table 2: Population Change 2000—2015 2000 2010 2015 Labor Basin 33,286 31,484 30,582 Neosho County 16,997 16,512 15,944 State of Kansas 2,688,418 2,853,118 2,909,698 Source: US Census Bureau The Civilian Labor Force represents “the civilian non-institutional population, 16 years of age and over classified as employed or unemployed.” The Bureau of Labor Statistics defines “non-institutional civilians” as those individual who are not inmates in institutions and who are not on active duty in the Armed Forces. “Unemployed civilians” are defined as civilians available for work and who had “made specific efforts to find employment” in the previous four weeks. As of 2010, the Civilian Labor Force for the labor basin area totals 15,335. Approximately 36% of the labor basin’s Civilian Labor Force is employed in the Services industry followed by Manufacturing at close to 23% and Retail at about 11%. Traditional service-related occupations include customer service workers, receptionists, food service workers, administrative assistants, semi-professional social services and health workers, and office managers. While the Service industry is the largest for the Labor Basin, the total percentage is less than that of the State of Kansas. The sectors of Information and Finance/Insurance/Real Estate are also significantly lower than the State. Conversely, Manufacturing and Agriculture/Mining are a much higher percentage of employment than the State average. Chanute has not seen its labor force transition from manufacturing to service jobs to the extent seen across the State and Nation. This reflects the region’s historic strength in resource extraction, transport and related manufacturing sectors. While positive in the way of providing relatively well-paying jobs, the regional reliance on the manufacturing sector is also a negative in that this sector has seen significant decreases over the last few decades from automation and overseas production. The City will likely need to diversify beyond the Manufacturing sector in order to maintain a healthy job market. 80924 7/21/11 20 Economic Development Strategic Plan Chanute, Kansas Table 3: Employment by Industry, 2010 Labor Basin County State Total 15,335 7,876 1,372,243 Agriculture/Mining 5.4% 4.1% 3.3% Construction 7.3% 8.0% 6.8% Manufacturing 22.6% 21.7% 13.3% Wholesale Trade 2.4% 2.3% 3.3% Retail Trade 10.7% 10.6% 10.5% Transportation/Utilities 5.3% 4.9% 5.0% Information 1.1% 1.0% 2.4% Finance/Insurance/Real Estate 4.0% 3.8% 7.2% Services 36.3% 38.9% 42.8% Public Administration 4.6% 4.6% 5.4% Source: Bureau of Labor Statistics White collar jobs are the highest within occupations at 47.2%, with blue collar jobs Professionals make up the greatest amount of white collar jobs with Production making up amount of blue collar jobs. The Labor Basin has a significantly higher percentage of Blue than the State, specifically in the areas of Production and Transportation/Material Moving. at 35.7%. the largest Collar jobs There is a Table 4: Employment by Occupation, 2010 Labor Basin County State Total 15,335 7,876 1,372,243 White Collar 47.2% 47.5% 59.6% Management/Business/Financial 10.8% 10.7% 13.4% Professional 15.3% 16.4% 20.7% 9.1% 8.9% 11.4% 12.1% 11.5% 14.2% Services 17.1% 16.8% 15.9% Blue Collar 35.7% 35.7% 24.5% Farming/Forestry/Fishing 1.0% 0.8% 0.9% Construction/Extraction 7.3% 7.8% 6.0% Installation/Maintenance/Repair 3.7% 4.1% 3.8% 15.3% 15.0% 7.9% 8.3% 8.0% 5.9% Sales Administrative Support Production Transportation/Material Moving Source: Bureau of Labor Statistics 80924 7/21/11 21 Economic Development Strategic Plan Chanute, Kansas much lower percentage of White Collar jobs than the State, primarily Professional jobs. Professional occupations represent government and business professionals, sales operatives, teachers, social workers, doctors and attorneys. Production occupations represent those individuals engaged in fabrication, assembly and related activities, janitorial and guard services, and auxiliary production (such as power plants). Working supervisors are generally included within the Production category. Service industry establishments are the largest number of establishments located within the Labor Basin, supporting the above percentage of Service trade employees. While the total amount of manufacturing establishments is significantly lower than Service or Retail establishments, these operations typically employ a greater number of individuals per site than a Service or Retail operation employ. Interestingly, the percentages of business establishments by industry are nearly identical to those of the State of Kansas. This implies that a relatively fewer number of manufacturing businesses are employing a relatively larger number of individuals. This situation presents a potential threat should one or more of these large manufacturing employers close or relocate. Table 5: Business Establishments by Industry, 2010 Labor Basin Neosho County State of Kansas Agriculture & Mining 80 5% 46 5% 5,512 4% Construction 84 6% 4% 9,153 42 5% 3% 50 Manufacturing 7% 3% Transportation 51 27 14 Utility 14 95 55 3% 0% 0% 6% 4,481 Communication 3% 1% 1% 6% 6,025 4% 1% 1% 5% 310 20% 168 20% 23,758 19% Finance, Insurance & Real Estate 119 309 8% 36% 12,463 570 8% 37% 69 Services Trade 46,695 10% 38% Government 159 10% 88 10% 7,813 6% 8 1% 4 0% 1,904 2% Wholesale Trade Retail Trade Other TOTAL 1,546 31 4 3 854 4,239 1,056 716 123,815 Source: Bureau of Labor Statistics The current unemployment rate for the labor basin area is 8.5% which is similar to the county rate of 8.9%, but greater than the state rate of 7.1%. These figures have all significantly increased since 2000 and are all expected to decrease by 2015, assuming the economic recovery remains on track. Table 6: Unemployment Rate Trends, 2000—2015 2000 2010 2015 Labor Basin 3.0% 8.5% 7.2% Neosho County 3.1% 8.9% 7.6% State of Kansas 2.8% 7.1% 6.8% Source: ESRI Business Analyst 80924 7/21/11 22 Economic Development Strategic Plan Chanute, Kansas Educational attainment in Neosho County, and labor basin closely mirror each other, but differ from the State of Kansas in key areas. The percentage of the population with at least a high school degree in the State is 89.5% and 84.5% in the labor basin. The percentage of the population with at least an associate’s degree in the State is 37.2% and 24.3% in the labor basin. The percentage of the population with at least a college degree in the State is 29.6% and 15.2% in the labor basin. These differences are significant and reflect the breakdown of the types of occupations in each area. That is, there is not the educated labor force in the area for an increased percentage of Professional jobs. Figure 1: Comparison of Educational Attainment, 2010 100.0% Less than 9th Grade 90.0% 80.0% 9th ‐ 12th Grade, No Diploma 70.0% High School Graduate 60.0% Some College, No Degree 50.0% 40.0% Associate Degree 30.0% Bachelor's Degree 20.0% 10.0% Graduate/Professional Degree 0.0% Neosho County Labor Basin State of Kansas There is a fair amount of diversity within the city of Chanute’s largest employers, as illustrated in Table 7 on the following page. Chanute’s Public School District is the largest employer with approximately 350 employees. Other large employers of professional occupations include Neosho Memorial Regional Medical Center, the City of Chanute, and Neosho County Community College. In terms of wages, the community faces an opportunity and a weakness. The average annual wage in Neosho County is $31,431 which is below state and national averages of $38,147 and $38,990, respectively. While low wages relative to other areas are useful for business attraction, they do reflect a less competitive labor market. Neosho County Community College The Neosho County Community College (NCCC) is a full-service community college focusing on business and industry training through various degree and certification programs, as well as customized training. The most popular vocational programs are nursing and medical assisting. The majority of students attend NCCC with the intention of transferring to a four-year college or 80924 7/21/11 “Our enrollment at the community college almost doubled. This has created an opportunity for area high school students to work on employable skills and college credit .” -Focus Group Participant 23 Economic Development Strategic Plan Chanute, Kansas Table 7: Largest Employers in Chanute Business Business Type Employees Unified School District 413 Education 350 Hi Lo Industries Cabinets and Furniture 325 Wal-Mart Department Store 300 Chanute Manufacturing Power Generation Systems 214 Kustom Signal Electronic Safety Equipment 195 Quest Natural Gas Exploration 190 Neosho Memorial Regional Medical Center Healthcare 180 City of Chanute Local Government 150 Neosho County Community College Education 150 Ash Grove Cement Cement 144 Young’s Welding Steel Fabrication 112 Source: City of Chanute university upon completion of their associate's degree. NCCC was founded in 1936 as Chanute Junior College. NCCC has two main locations: a residential campus in Chanute, Kansas, and a campus serving Ottawa, Kansas. Approximately 3,500 students were enrolled at NCCC during the ’09-’10 school year. Approximately 33% of their students attend fulltime, a large majority (85%) are Caucasian and approximately 68% are female. Ninety-three (93%) of the students are Kansas residents with over one-quarter being from Neosho County. The other 7% come from all across the United States and the world. Approximately 750 students attend the Chanute campus, 750 attend the Ottawa campus, and over 400 students take classes on-line. The remaining students take courses at one of NCCC’s outreach sites. In addition, Neosho County Community College (NCCC) has developed an employment skills program, called “Partners in Change” through the guidance and direction of local business leaders, the City of Chanute and State agencies to assist local business with their employment and training needs. “Partners in Change” is a series of courses designed to provide individuals the basic skills required to become successful workforce employees. Since its inception in 1999, this program has graduated over 300 students. Neosho Memorial Regional Medical Center Neosho Memorial Regional Medical Center is a not-for-profit, county-owned critical access hospital governed by a county commission appointed Board of Trustees. Originally opened in 1903 as a private hospital, Neosho Memorial’s current 99-bed facility employs approximately 180 individuals, making it one of the largest employers in Chanute, KS. Neosho Memorial just completed a $20 million renovation project creating all new patient care areas including a new Emergency Department, Inpatient Unit, Intensive Care Unit, Outpatient Observation Unit, and Nutrition Services Department. In addition, the 80924 7/21/11 24 Economic Development Strategic Plan Chanute, Kansas Laboratory and Imaging Services Departments are to be renovated and expanded. Neosho Memorial also serves as a rural teaching facility for seven college programs including future physicians undergoing medical training. Medical Center staff work to teach new doctors, nurses and allied health professionals how to become the BEST ("Bring Excellence and Service Together") providers. In addition to Neosho Memorial, three other hospitals are located within a 30-mile radius of the City of Chanute. Allen County Hospital is a 49-bed facility located in Iola, KS and employs approximately 165 individuals. Wilson County Hospital is a 25-bed facility employing approximately 75 employees in Neodesha, KS. Finally, Fredonia Regional Hospital is a 42-bed facility located in Fredonia, KS with approximately 55 employees. Labor Market Trends As globalization continues, US manufacturing jobs will continue to relocate to other nations where labor is less expensive. Nationwide, attention should be given to develop more service related jobs that are higher paid and higher skilled. Jobs associated with health care are a natural as the baby boomer population ages, requiring an increase in such services. The labor basin area has a high percentage of service related industries and white collar, professional jobs. However, the area’s average wage is below that of county and state wages. In addition, only 15% of the labor basin’s population earned a bachelor’s degree or higher. Given the labor basin’s proximity to medical centers and the large number of health-related programs available, the labor basin can capitalize on its medical and related industries. Focus should be given on creating and supporting medical and service related jobs requiring an associate’s degree or certification. In addition, privatepublic partnerships which include both Neosho County Community College and Neosho Memorial Regional Medical Center should continue to create job programs to assist displaced manufacturing workers transitioning to service related jobs. Attraction or development of service-related or higher tech jobs should remain a high priority; however, developing a more educated workforce for these companies will be critical. Partnerships with NCCC, including the creation of a business incubator program are potential opportunities. 80924 7/21/11 25 Economic Development Strategic Plan Chanute, Kansas Destination Assessment The Importance of Tourism A vibrant tourism trade offers many potential benefits to a community. Tourism can help enhance the image of an area, increase local pride, and improve quality of life. As an industry, tourism is recognized as an important component of a diverse economy providing employment, redevelopment, and investment opportunity. Altogether, tourism can help to build a distinctive, unique, and productive community. The economic benefits of tourism include job creation, as well as increased retail sales generation, essentially bringing new money into the community. The potential new retail sales from tourism can help to counter the changing nature of the retail environment, which has generally favored big box retail to the detriment of unique local retail. While this effect is felt community-wide, it has had a particularly strong impact on many small Downtowns. The attraction of new money to the community through tourism is an effective strategy to deal with the negative impact of these trends as new money travels into and circulates throughout the community. The positive effects of a successful tourism industry resonates through many business sectors, including non tourism related businesses and the local community. The positive impacts will be felt by local businesses and residents alike. Local residents will benefit from added or improved visitor services and infrastructure, increased employment and entrepreneurial opportunities, and improved shopping convenience and increased choice. A well balanced mix of retail and services will make Chanute a destination, attractive to residents, visitors, and investors. In light of the far-reaching impacts of a successful tourism industry, and the size of the local industry, tourism should be viewed as a strategic sector in Chanute’s economic future. Any Economic Development strategy for Chanute should specifically address the tourism industry and its importance to the local economy. Assessment Methodology The Destination Assessment provides a snapshot of the tourism industry operating community-wide. The “rapid assessment” process employed consists of reviewing existing data and marketing materials, as well as, conducting field work, visiting the community, its key destinations, and meeting with tourism leaders. This report and the recommendations contained herein should serve as a foundation, providing strategic direction for Chanute as it moves toward destination success. Understanding the framework used to evaluate Chanute’s destination potential will provide a useful context for the recommendations and suggestions for improvement. The Destination Assessment will identify areas in need of improvement that will overlap with other Economic Development Strategic Plan recommendations. Those recommendations will be noted and addressed in greater detail in their corresponding analyses. Development of a tourism enhancement strategy, just as any business or product development strategy, begins with an evaluation of the relationship between product and customer in a competitive marketplace. The analysis of these relationships results in the development or identification of a competitive advantage. A competitive advantage gives a community an edge over its rivals and an ability to generate greater success. The more sustainable the competitive advantage, the more difficult it 80924 7/21/11 26 Economic Development Strategic Plan Chanute, Kansas is for competitors to neutralize the advantage. Competitors in this scenario are other communities that are attempting to attract in whole, or large part, the same target market. Product For the purposes of this analysis the product is the City of Chanute, its amenities and environ including: businesses, restaurants, museums, infrastructure, people, streets, sidewalks, parks, events, etc. Chanute is evaluated in terms of a theme park or resort, striving to provide the same level of services. The City needs a balance of businesses and amenities that address, at a minimum, the basic needs of customers. A key to a successful product is maintaining focus on the primary product, service, or destination strengths, while at the same time adapting to changes and taking advantage of opportunities. Customer The customer, in this evaluation, is the visitor or patron including neighboring areas, traditional tourists, etc. The community must understand who their current customers are, who is currently visiting the community and why, as well as who, they might be able to target and how. To understand and target customers, it is helpful to categorize visitors. A common categorization of visitors is by the reason for their visit: residents of the community, “When we first came, we missed the first exit. Driving south, you can’t tell this is Chanute ” -Resident response Business Travelers—Most likely to travel during the week, driven by businesses, primarily basic needs of lodging, restaurants, services, gift shopping, and evening entertainment, potential to impress and return for pleasure. Family Travelers—Most likely to travel during the weekend, driven by relatives, less likely to need lodging, potential needs of services and restaurants, general shopping. Ethnic and Cultural Seekers—Looking for exposure to new experiences, development, and education. Interested in the areas ‘way of life’ and people. Adventuresome and looking for more than basic needs. Museums, galleries, concerts, festivals, and performances. Likely to shop for unique items. Heritage and Passive Recreation Enthusiasts—This visitor enjoys the scenery and feel of the area more than the interaction with the people. They are more inwardly focused and reflective. Their needs are similar to the culture seeker, but are just as likely to enjoy a drive through town to look at architecture or a walk in the local parks. Active Outdoor Adventurers—Intense enjoyers of the parks and natural areas. These sportsmen enjoy a wide variety and are not always young. Outdoorsmen, boaters, hikers, or golfers; they are on the move. They are devoted and spend money on their chosen sport. Urban Entertainment—The shoppers, team sport spectators, college visitors, night owls, or amusement park attendees. They tend to travel in groups and have a higher expendable income. Internet connectivity and cell phone access is important to them. 80924 7/21/11 27 Economic Development Strategic Plan Chanute, Kansas Market Positioning and Brand Once an understanding is reached on exactly what the product is and who the customers or target markets are, the focus turns to identifying the market positioning. An important component of a competitive advantage is a distinct market positioning and brand—something that draws on the strengths of the destination, its authenticity, and leverages customers’ desire for unique experiences. It is essential to understand how customers currently perceive the destination, especially relative to competitors. This perception is the community’s image or brand. The destination must craft a strategy that builds on the positive aspects of its current image and, if necessary, repositions it to a more advantageous and competitive position. Repositioning takes time, patience and persistence as it typically involves modifying previously held perceptions about your destination. Customers carry a preconceived idea of the destination’s brand. The brand represents what people REALM ONE—PLACE: If you visit the Empire State Building, you go to a building with the city surrounding it. Up at the observation tower, the place becomes an oasis high above bustling Manhattan. What benefits does the place provide for the guest? Some people like the high energy feeling of being in the city, but they may also like taking a break from the intensity. People go to a destination. It exists in a physical place. A destination should try to get the most out of the power of its place. REALM TWO—EXPERIENCE: Hike in the canyon. Ride the coaster. Attend a show. People want to do something at a destination—something unique, something to brag about, or something to share. The experience of a destination can provide key benefits to guests and a fundamental part of its brand. A destination can reach its full potential when it promotes the benefits of a unique experience and delivers. REALM THREE—MINDSET: Sometimes a destination epitomizes or evokes an attitude, value, or mindset that has meaning beyond the physical limits of the site. Colonial Williamsburg set out to “own” the concept of Colonial America, and people might feel more patriotic just thinking about it. When a destination can symbolize an aspirational concept, it can form a powerful connection with its guests. The destination becomes a touchstone for the concept and people return to renew their connection with it. REALM FOUR—ORGANIZATION: What role does the organization behind the destination play in the brand? The Niagara Parks emblem conveys tremendous trust among regional guests who want to spend their money with the organization that helps preserve the nature and heritage of Niagara Falls. The organizational dimension of a destination may also make a big difference to future employees, donors, business partners, granting agencies, or other organizations. People want to associate with a cause or organization they feel good about, one that expresses their own values and aspirations. 80924 7/21/11 28 Economic Development Strategic Plan Chanute, Kansas think of you—your image. The destination’s brand is important as it is essentially a promise to provide a product or service in a consistent way. Destination brands have four distinct components that make up brand image in the mind of the customer. Each component represents an opportunity to differentiate from competition and offer a unique consumer benefit. Destinations can reach their maximum potential by leveraging all four components. When people think of your destination, do they long to be in the place, get excited by the experience, aspire to the values represented, and trust the organization behind it? When you can answer ‘yes’ to all four, people will attribute a high value to your destination brand. That value is your destinations’ competitive advantage, which relates directly to attendance and financial success. Destinations are basically customer-oriented businesses and therefore should always take the customer point-of-view. As stated earlier, when destinations conduct product development and determine marketing decisions they must address what the customer wants and needs. The concept of a destination consumer “Hierarchy of Needs,” hypothesizes that customers must have their most basic needs met before they can attain higher levels of fulfillment. This customer-focused theme will recur throughout the recommendations for each community. There are a great number of reasons or desires that drive an individual consumer’s decision to travel and their choice of destination. The “Hierarchy of Needs” describes the requirements a typical visitor has to have met in order for them to have a fulfilling destination experience. Questions a destination community may ask themselves regarding whether or not their community’s destination assets meet these needs are: Functional—Does the City provide adequate wayfinding to make travel throughout the area easy and somewhat intuitive? Do visitors know when they have “arrived”? Does the City adequately provide 80924 7/21/11 29 Economic Development Strategic Plan Chanute, Kansas basic comforts, such as parking, bathrooms, and a place to rest? Is information about destinations and events easily attainable? Comfortable—Are destinations pedestrian friendly and well lit? Are the buildings and streetscape designs aesthetically pleasing? Are numerous lodging and dining options present throughout the City? Does the City provide adequate comforts so that the visitor can relax and get away from home? Motivational—Does the City provide visitors with activities in which to participate? What will move the visitor to get out of their car and get involved? Does the City and attractions provide a chance to learn, interact with others, and an opportunity for adventure or escape? Memorable—Does the City and destinations leave the visitor with positive memories? Do visitors repeatedly return to the City and Downtown? Do visitors recommend a visit to Chanute to others? Is there positive word-of-mouth about Chanute? Transformational—If the City meets the aforementioned needs, then they’ve created a fulfilling experience to the visitor, which, hopefully, will positively change the visitor; thus imbuing the visitor with not only a valuable “I think we have a great rejuvenative experience, but also a new and positive outlook on downtown. We need to life. The visitor will want to return to and reconnect with the make it more of a destinadestination to renew that positive outlook in the future. The visitor tion downtown, with outwill actively seek to bring others and share the rejuvenative door shopping. ” experience. -Resident response In the case of a visit to a destination like a resort, zoo, or theme park, a single organization manages the tourist experience to ensure a “seamless” experience; one that flows smoothly and consistently from parking and restrooms to attractions, food and shopping without breaks in the “brand.” People have come to expect this level of product and service. Destination communities would benefit from emulating this model to the degree they can considering the complexity of their destination environment (i.e. multiple tourism product owners and interests). For example, Destination communities can develop organizational structures that support a coordinated aesthetic presentation of Downtown; manage a consistent and unified marketing plan; administer special event planning; and guide businesses towards consistent business standards (i.e. uniform business hours). Assessment Visits Summary and Current Positioning Our assessment team visited Chanute and its attractions numerous times during the development of the Economic Development Strategic Plan. During these visits Chanute was evaluated using the criteria discussed previously. Chanute and the surrounding area have many of the features we look for in a successful destination – natural beauty, unique attractions, historic architecture, numerous events, reasonable 80924 7/21/11 Most signage advertising Chanute and its destinations is utilitarian. 30 Economic Development Strategic Plan Chanute, Kansas transportation access, and a sense of place. Located within a short drive from key feeder markets in Kansas and border states, we found the City with little trouble. However, arrival to the City of Chanute lacks a sense of entry from the highway with signage for the City provided by KDOT and is utilitarian at best. This is the first opportunity for the City to provide a “welcome” to visitors and establish its brand and unified wayfinding. When exiting the highway onto Cherry Street the approach to Downtown or other destination assets is mostly commercial or light industrial with little unique appeal. However, the overpass approach provides a pleasant entrance to Downtown and the destination assets it contains. When exiting the highway onto 35th Street the high school is an impressive asset. Following 35th to Santa Fe Avenue the approach is a unique mix of residential, commercial, institutional, park space, and industrial uses. Santa Fe Avenue between Downtown and 35th Street is a mix of retail, commercial and residential and has little unique appeal. Locating destinations in town was somewhat challenging. Existing wayfinding signage was small and hard to identify. Additionally, it appears there are numerous destinations that were not included in wayfinding and rely on their own signage. While this is not necessarily a negative, it does not create the Example of private billboard that is in poor condition unified system that is desirable. We found that and does not effectively carry Chanute’s message. several area attractions have national or international appeal, particularly the Martin and Osa Johnson Museum. It is important to note that many of the area attractions and natural features would appeal to residents as well as visitors, an important component of successful tourist destinations for smaller communities. In order to develop a plan for Chanute’s future we need to establish Chanute’s current position in the marketplace. Through our surveys, site visits, and marketing research a number of different market positions were found. Chanute currently has a mix of brand positions in the marketplace including: Chanute is a historic community with a rail heritage Chanute’s namesake is often associated with: 80924 7/21/11 Rail Engineering Inventions Flying and the Air Force Martin and Osa Johnson which are often associated with: Safari and adventure Film Documentaries 31 Economic Development Strategic Plan Chanute, Kansas Chanute’s destination success will be enhanced by unifying its brand in the marketplace. The combination of assets provide Chanute with its unique competitive advantage, however a unique and consistent brand will allow Chanute to successfully market itself. Chanute should focus on positioning itself as “Adventure in the Midwest”. This brand captures the most unique and hard to replicate advantages of Chanute’s tourism assets. Adventure in the Midwest represents the spirit of the Martin and Osa Johnson attributes and brings into play Octave Chanute’s spirit of innovation and discovery. It also opens the opportunity to expand into additional avenues of adventure some of which exist currently to a degree, but can be better capitalized on and expanded. Ascending the Hierarchy to Reach Destination Potential There are various levels of recommendations that Chanute can follow in order to reach its destination potential. Efforts should focus on improving basic needs first, essentially climbing the ladder to the next level. However, all actions should be completed working towards the goal and unified vision for achieving Chanute’s position in the market. Detailed recommendations for improvement are included in the Economic Development Goals section of this report, but are briefly addressed below in relation to the hierarchy levels. FUNCTIONAL Develop a wayfinding system that announces to visitors that they have arrived to Chanute and subsequently guides them through the community from destination to destination Chanute’s RV park is highly used and well maintained. Provide improved access to information via the internet about destinations, events, and tourism amenities Increase the amount and quality of hotel options to better meet travelers' needs Package trips and bundle experiences to make planning a trip to Chanute easier Increase highway presence in order to better market the community and create the entrance gateways and a positive first impression COMFORTABLE Improve connections and appearance of commercial corridors and continue to create an inviting entrance and positive first impression Implement commercial and retail design standards to improve the appearance shopping areas outside of downtown Attract new retail stores to better satisfy the needs of visitors, as well as, create a shopping destination 80924 7/21/11 32 Economic Development Strategic Plan Chanute, Kansas MOTIVATIONAL Improve park facilities and recreation programs to become an additional component of the tourism industry Create new attractions that complement existing attractions and assets, to build a critical mass and extend the stay of visitors Continue revitalizing downtown into a destination for shopping, events, and lodging MEMORABLE Expand and improve existing attractions by adding new physical space, exhibits, and events with a focus on interaction as opposed to passive activities Continuously strive to improve attractions and the area in general to be a leader within the region, and the most memorable place to visit among competitors TRANSFORMATIONAL When the City completes the above recommendations it will be able to provide visitors with a rich and full experience. An experience which will be continuously thought of, recommended to others, and repeated. Moreover, these steps will reinforce Chanute’s position and “Adventure in the Midwest” brand and allow Chanute to climb to the top of the hierarchy. 80924 7/21/11 33 Economic Development Strategic Plan Chanute, Kansas Retail Market Analysis Background and Methodology This analysis takes a comprehensive approach to quantify the retail demand and supply for the trade areas in order to identify potential retail services that would be successful in Chanute, Kansas. This section consists generally of four parts: 1. Review of the trade area demographics and trends to create a market profile. 2. Perform “gap analysis” of the trade area retail sectors. 3. Identification of potential retail sectors to target. 4. Recommend specific retail nodes and development opportunities. As a component of the community engagement portion of the Economic Development Strategic Plan development, we conducted a community survey and focus groups consisting of business owners, City staff, residents and visitors which provide key insights into available retail services and preferences for additional services. A physical examination of the trade area and surrounding region provided insight into traffic and accessibility issues (including ingress, egress and overall traffic patterns), as well as identifying the current mix of retail businesses and occupancy rates. Also, the regional retail market was examined to gauge the City’s competitive standing. The retail demand, or spending power of the trade area, is compared to the retail supply, or the retail sales of the area, in order to quantify potential unmet demand in the trade areas. Retail categories with unmet demand are evaluated against the community survey results and economic and physical conditions in order to develop a retail strategy. The Retail Market Analysis is intended to provide a general forecast of the amount and types of retail development that could be supported in the trade areas. The assumptions and projections used in the analysis are valid and likely supported through the year 2015. The analysis is meant to provide general strategic direction for developing retail in the City of Chanute. This study is not intended to be the sole basis for development decisions. Trade Area Profile The “trade area” refers to the geographic area from which a majority of customers for a given business originate. Retail businesses categories have different trade areas. The trade area for a convenience store or barbershop might be quite small, whereas a car dealership or sporting goods retailer’s trade area would be much larger. To determine the trade area of an entire retail district, an average of the individual business trade areas must be used to balance differences between types of businesses. The concept of trade areas is an important part of evaluating the “Thirty-five percent of my shoppers performance of a retail district and determining the potential of are from outside Chanute.” expanding retail activity within a geographic area. -Local business owner This retail market analysis often evaluates two different geographic trade areas: a Primary Trade Area (PTA) and a Secondary Trade Area (STA). For the purposes of this study, the PTA is the City of Chanute. The STA 80924 7/21/11 34 Economic Development Strategic Plan Chanute, Kansas includes any point within a 40-minute drive of Downtown Chanute. The 40-minute drive boundary presents an acceptable catch-basin of consumers likely to make a shopping trip to the City. The 40minute drive time also represents a likely maximum commute time for the PTA’s labor pool. Finally, for comparison purposes, an analysis of the Neosho County is included. A map of each area is included in the Appendix. The three areas of analysis are summarized below. Primary Trade Area (PTA): The focus of the analysis is to determine the current level of retail activity captured by the City of Chanute and the amount of additional retail activity that could be captured. The PTA is defined as the boundary of the City of Chanute. Secondary Trade Area (STA): For the STA, the study utilizes a 40-minute drive-time “catch-basin” around Downtown Chanute. From this area, the City attracts approximately the majority of all retail dollars. Neosho County: While this study classifies the boundary of City of Chanute as the PTA, for analysis and planning purposes it is useful to show the relationship between City retail activity and countywide retail activity. It is important to note that the vast majority of consumers will typically shop at a location most convenient for them to travel to, regardless of jurisdiction, thus jurisdictional boundaries are only included for the sake of data comparison. Trade Areas Demographic Snapshot In order to understand the Trade Areas that are the focus of this study it is important to understand their demographic composition. When evaluating the demographics of a particular place, it is helpful to use a baseline with which to compare the data. In this case, the baseline comparison used is the State of Kansas. Data for Neosho County is similarly provided for comparison purposes. Comparing demographic trends from the Trade areas with the State of Kansas provides an indication of positive or negative performance. The following table highlights the estimated demographic data from 2010 for the City of Chanute (Primary Trade Area), Neosho County, the Secondary Trade Area (40-minute drive time from the center of Chanute), the State of Kansas, and the 66720 ZIP Code area. The data for these four areas was obtained using ESRI forecasts and US Census data. TABLE 8: 2010 DEMOGRAHIC SNAPSHOT Population Median Household Income Housing Units Owner Occupied Renter Occupied Vacant Units Median Age 80924 7/21/11 Primary Trade Area Neosho County Secondary Trade Area State of Kansas 66720 ZIP Code (Chanute) 9,119 $39,232 16,512 $40,690 31,484 $39,365 2,853,118 $52,386 10,456 $39,871 122 60% 7,516 64% 14,892 64% 1,248,652 61% $4,909 62% 27% 13% 23% 13% 22% 14% 28% 11% 26% 13% 38.8 40.5 41.0 36.4 $40 35 Economic Development Strategic Plan Chanute, Kansas The PTA and STA have a significantly lower median household income, older population and higher vacancy rates than the State of Kansas. The PTA has a lower level of home ownership than the STA. This demographic comparison highlights a series of weaknesses impacting Chanute’s retail market. The following table illustrates, in further detail, current demographics and future demographic trends for the Primary Trade Area. TABLE 9: PRIMARY TRADE AREA Population Median Household Income Housing Units Owner Occupied Renter Occupied Vacant Units Median Age % Change % Change '00-'10 '10-'15 2000 2010 2015 9,411 $29,897 9,119 $39,232 8,767 $44,650 -3.1% 31.2% -3.9% 13.8% 4,262 62% 4,269 60% 4,268 59% 0.2% -2.8% 0.0% -1.8% 29% 9% 27% 13% 26% 15% -7.2% 41.9% -3.0% 14.4% 37.3 38.8 38.9 4.0% 0.3% Chanute’s population continues to decline as its population ages. Homeownership is also decreasing, while the number of vacant units is increasing. These trends give cause for concern for the long term health of the community. The City needs to retain and attract younger workers who are willing to reinvest in the community. On the positive side, the median household income has been steadily increasing, at a minimum keeping pace with inflation. As previously mentioned, the Secondary Trade Area represents a 40-minute drive from the center of Chanute. This area is essentially the area likely to, and currently attracting consumers to the City’s retailers. The STA also consists of a declining and aging population. A concerning trend is the decline in home ownership, corresponding to the increase in the number of vacant units. Interestingly, this pool of households tends to have a larger median income than the PTA. TABLE 10: SECONDARY TRADE AREA Population Median Household Income Housing Units Owner Occupied Renter Occupied Vacant Units Median Age % Change % Change '00-'10 '10-'15 2000 2010 2015 33,286 $31,604 31,484 $39,365 30,582 $44,736 -5.4% 24.6% -2.9% 13.6% 14,812 68% 14,892 64% 14,895 63% 0.5% -5.7% 0.0% -2.5% 22% 10% 22% 14% 21% 17% -2.3% 42.6% -2.8% 15.3% 38.8 41.0 41.3 5.7% 0.7% For purposes of benchmarking and general comparison, the tables below provides demographic trend data for Neosho County and for the Chanute ZIP Code (66720). While varying slightly, the County 80924 7/21/11 36 Economic Development Strategic Plan Chanute, Kansas follows much the same demographic patterns as does the ZIP Code area for Chanute. TABLE 11: NEOSHO COUNTY Population Median Household Income Housing Units Owner Occupied Renter Occupied Vacant Units Median Age % Change % Change '00-'10 '10-'15 2000 2010 2015 16,997 $32,168 16,512 $40,690 15,944 $46,565 -2.9% 26.5% -3.4% 14.4% 7,461 67% 7,516 64% 7,516 63% 0.7% -4.7% 0.0% -1.9% 23% 10% 23% 13% 22% 15% -2.2% 38.1% -2.7% 12.7% 38.3 40.5 40.7 5.7% 0.5% TABLE 12: CHANUTE ZIP CODE 66720 Population Median Household Income Housing Units Owner Occupied Renter Occupied Vacant Units Median Age % Change % Change '00-'10 '10-'15 2000 2010 2015 10,947 10,456 10,223 -4.5% -2.2% $31,276 4,899 $39,871 4,909 $45,500 4,907 27.5% 0.2% 14.1% 0.0% 64% 62% 61% -4.3% -1.8% 26% 9% 26% 13% 25% 14% -2.3% 38.5% -3.1% 14.3% 38.0 39.6 39.6 4.2% 0.0% The State of Kansas represents a standard benchmark with which to compare both the STA and the PTA. The State has a healthy growth rate and increase in median household income over the past decade. Similarly to the trade areas, the state is aging and has seen a substantial increase in the number of vacant units, while home ownership has declined. As detailed in the table below, these trends are expected to continue through 2015. TABLE 13: STATE OF KANSAS 2000 Population Median Household Income Housing Units Owner Occupied Renter Occupied Vacant Units Median Age 80924 7/21/11 2010 2015 % Change % Change '00-'10 '10-'15 2,688,418 2,853,118 2,909,698 $40,634 $52,386 $59,604 6.1% 28.9% 2.0% 13.8% 1,131,200 1,248,652 1,297,292 64% 61% 60% 10.4% -3.9% 3.9% -1.1% 28% 8% 28% 11% 27% 12% -1.4% 36.6% -1.4% 8.9% 35.2 36.4 36.6 3.4% 0.5% 37 Economic Development Strategic Plan Chanute, Kansas A demographic comparison shows that the Primary and Secondary Trade areas lost population (see following page). While the average household income continued to grow and the number of housing units increased, the number vacant units increased rapidly. In addition, the average age of the population is expected to increase for all areas. For the next five years, the average household income is predicted to increase slightly in the Primary and Secondary Trade Areas. The growth in incomes indicates that all areas are improving in their viability; however the rapid increase in vacant housing units and overall aging populations are long-term impediments to the long-term economic growth of the area. TABLE 14: DEMOGRAPHIC COMPARISON Population % Change 00-'10 10-'15 PTA Average HHI % Change 00-'10 10-'15 Median Age Change (in years) 00-'10 10-'15 Neosho County STA -3.1% -2.9% -5.4% -3.9% -3.4% -2.9% 31.2% 26.5% 24.6% 13.8% 14.4% 13.6% 1.5 2.2 2.2 0.1 0.2 0.3 State ZIP Code 6.1% -4.5% 2.0% -2.2% 28.9% 27.5% 13.8% 14.1% 1.2 1.6 0.2 0.0 The number of housing units in the PTA and STA grew over the past decade; however this trend is not forecasted to continue over the next five years. The number of vacant units in the trade areas is forecasted to increase, as it has in the State. Without improvement in Chanute’s employer base, these trends are likely to continue. TABLE 15: DEMOGRAPHIC HOUSING UNITS Housing Units Change 00-'10 10-'15 PTA Neosho County STA State ZIP Code 80924 7/21/11 7 55 80 117,452 10 -1 0 3 48,640 -2 Owner Occupied Change 00-'10 10-'15 -2% -3% -4% -3% -3% -1% -1% -2% -1% -1% Renter Occupied Change 00-'10 10-'15 -2% -1% -1% 0% -1% -1% -1% -1% 0% -1% 38 Economic Development Strategic Plan Chanute, Kansas Retail Gap Analysis A review of the total number of businesses and employees in retail and selected services within both the PTA and STA provides an idea of the possible new and existing business potential for the trade areas. As outlined in Table 15, the total number of existing businesses in the PTA is 516 and 1546 for the STA. The number of employees within the PTA for all businesses is 6,363 and 14,140 for the STA. When compared with the number of residents, the ratio is 0.7 for the PTA, but only 0.45 for the STA. These ratios indicate that Chanute is an employment center for the region, with both higher numbers of businesses and employees per capita than the rest of its region. Retail and selected related service businesses (such a theaters and automotive repair businesses) account for nearly a third of all businesses in the City of Chanute and for a quarter of workers. While less of a percentage in the region (due to the concentration in Chanute itself), the region has a sizable percentage of businesses and workers engaged in the retail industry. The gap analysis demonstrates the trade area’s competitive position as a center for retail activity. Table 16 shows the gap in “I leave Chanute to buy what demand versus supply of particular goods and services within the cannot be found in at a reasontrade area. The competitive position is determined by calculating able cost...” the total amount of demand within the trade area for each industry -Resident response category. This is done utilizing the total median income and the disposable income by income level groups to get the total dollar amount of demand for the trade area. The supply is calculated using reported sales data from industry NAICS codes as provided by data companies ESRI and Infogroup. The supply is then subtracted from TABLE 15: RETAIL ESTABLISHMENTS Total Businesses: Total Employees: Total Residential Population: Employee/Residential Population Ratio: PTA STA 516 6,363 9,119 0.70 1,546 14,140 31,484 0.45 BUSINESSES Number Percent EMPLOYEES Number Percent BUSINESSES Number Percent EMPLOYEES Number Percent Retail Trade Summary Home Improvement General Merchandise Stores Food Stores Auto Dealers, Gas Stations, Auto Aftermarket Apparel & Accessory Stores Furniture & Home Furnishings Eating & Drinking Places Miscellaneous Retail Selected Related Services Hotels & Lodging Automotive Services Motion Pictures & Amusements 122 3 7 6 23 6 13 25 39 23.6% 0.6% 1.4% 1.2% 4.5% 1.2% 2.5% 4.8% 7.6% 1,471 19 308 85 202 19 380 309 149 23.1% 0.3% 4.8% 1.3% 3.2% 0.3% 6.0% 4.9% 2.3% 310 21 13 21 57 10 35 69 84 20.1% 1.4% 0.8% 1.4% 3.7% 0.6% 2.3% 4.5% 5.4% 2,713 150 439 263 380 32 466 700 283 19.2% 1.1% 3.1% 1.9% 2.7% 0.2% 3.3% 5.0% 2.0% 4 12 14 0.8% 2.3% 2.7% 11 30 122 0.2% 0.5% 1.9% 11 54 37 0.7% 3.5% 2.4% 77 162 234 0.5% 1.1% 1.7% Total Retail and Related Businesses 152 30% 1,634 26% 412 27% 3,186 23% Total Businesses (not just retail) 516 100.0% 6,363 100.0% 1,546 100.0% 14,140 100.0% 80924 7/21/11 39 Economic Development Strategic Plan Chanute, Kansas the demand to estimate either the total surplus amount of the service provided within the trade area, or the total amount of demand for services being met outside the trade area (“leakage”). This comparison analysis provides estimates of the consumer and retail sales activity that a trade area draws from outside its boundaries. For the purposes of this analysis, the higher the leakage factor, the more the trade area is losing consumers and retail expenditures to the surrounding area. This methodology not only illustrates the number of shoppers drawn to Chanute and the region, but also reveals retail sectors which currently do not pull in consumers due to a lack of service provision. The latter represents a gap, which may be an indication to the city of how to plan for future retail and business service activities. The gap analysis reveals that nearly every retail sector is experiencing leakage. Notable exceptions are the categories of Motor Vehicle & Parts Dealers (NAICS 441), Furniture & Home Furnishings Stores (442), and General Merchandise Stores (NAICS 452). The extremely high levels of furniture sales is likely attributable to the presence of Hi Lo Industries, which is located in the trade areas and manufactures furniture for RVs and other uses. Excluding these three categories, reveals a consistent TABLE 16: GAP ANALYSIS PTA Industry Summary Total Retail Trade and Food & Drink (NAICS 44-45, 722) Total Retail Trade (NAICS 44-45) Total Food & Drink (NAICS 722) Industry Group Motor Vehicle & Parts Dealers (NAICS 441) Automobile Dealers (NAICS 4411) Other Motor Vehicle Dealers (NAICS 4412) Auto Parts, Accessories, and Tire Stores (NAICS 4413) Furniture & Home Furnishings Stores (NAICS 442)1 Furniture Stores (NAICS 4421) Home Furnishings Stores (NAICS 4422) Electronics & Appliance Stores (NAICS 443/NAICS 4431) Bldg Materials, Garden Equip. & Supply Stores (NAICS 444) Building Material and Supplies Dealers (NAICS 4441) Lawn and Garden Equipment and Supplies Stores (NAICS 4442) Food & Beverage Stores (NAICS 445) Grocery Stores (NAICS 4451) Specialty Food Stores (NAICS 4452) Beer, Wine, and Liquor Stores (NAICS 4453) Health & Personal Care Stores (NAICS 446/NAICS 4461) Gasoline Stations (NAICS 447/NAICS 4471) Clothing and Clothing Accessories Stores (NAICS 448) Clothing Stores (NAICS 4481) Shoe Stores (NAICS 4482) Jewelry, Luggage, and Leather Goods Stores (NAICS 4483) Sporting Goods, Hobby, Book, and Music Stores (NAICS 451) Sporting Goods/Hobby/Musical Instrument Stores (NAICS 4511) Book, Periodical, and Music Stores (NAICS 4512) General Merchandise Stores (NAICS 452) Department Stores Excluding Leased Depts. (NAICS 4521) Other General Merchandise Stores (NAICS 4529) Miscellaneous Store Retailers (NAICS 453) Florists (NAICS 4531) Office Supplies, Stationery, and Gift Stores (NAICS 4532) Used Merchandise Stores (NAICS 4533) Other Miscellaneous Store Retailers (NAICS 4539) Nonstore Retailers (NAICS 454) Electronic Shopping and Mail-Order Houses (NAICS 4541) Vending Machine Operators (NAICS 4542) Direct Selling Establishments (NAICS 4543) Food Services & Drinking Places (NAICS 722) Full-Service Restaurants (NAICS 7221) Limited-Service Eating Places (NAICS 7222) Special Food Services (NAICS 7223) Drinking Places - Alcoholic Beverages (NAICS 7224) 1 Demand (Retail Potential) $69,468,365 $60,076,447 $9,391,918 Supply (Retail Sales) $115,695,387 $107,641,714 $8,053,673 Retail Gap (Demand - Supply) -$46,227,022 -$47,565,267 $1,338,245 Surplus / Leakage Factor -25.0 -28.4 7.7 Number of Businesses 116 92 24 Demand (Retail Potential) $218,201,935 $190,604,687 $27,597,248 Supply (Retail Sales) $225,558,697 $209,399,348 $16,159,349 Demand (Retail Potential) $14,102,438 $11,878,650 $1,005,206 $1,218,582 $2,847,364 $2,597,967 $249,397 $1,150,858 $2,196,668 $1,930,451 $266,217 $10,198,131 $9,300,113 $103,602 $794,416 $2,282,858 $12,984,510 $941,233 $594,226 $177,488 $169,519 $470,794 $175,036 $295,758 $11,344,132 $8,037,447 $3,306,685 $1,031,621 $87,466 $360,444 $122,521 $461,190 $525,840 $10,638 $235,708 $279,494 $9,391,918 $4,729,710 $4,278,562 $16,198 $367,448 Supply (Retail Sales) $20,399,583 $16,948,620 $473,779 $2,977,184 $35,117,577 $34,467,920 $649,657 $1,321,937 $610,225 $610,225 $0 $9,116,343 $7,728,751 $0 $1,387,592 $1,942,180 $8,734,110 $785,003 $525,022 $144,599 $115,382 $303,881 $136,531 $167,350 $27,999,042 $24,872,178 $3,126,864 $1,065,172 $109,517 $646,819 $37,405 $271,431 $246,661 $0 $246,661 $0 $8,053,673 $3,577,500 $4,321,188 $0 $154,985 Retail Gap -$6,297,145 -$5,069,970 $531,427 -$1,758,602 -$32,270,213 -$31,869,953 -$400,260 -$171,079 $1,586,443 $1,320,226 $266,217 $1,081,788 $1,571,362 $103,602 -$593,176 $340,678 $4,250,400 $156,230 $69,204 $32,889 $54,137 $166,913 $38,505 $128,408 -$16,654,910 -$16,834,731 $179,821 -$33,551 -$22,051 -$286,375 $85,116 $189,759 $279,179 $10,638 -$10,953 $279,494 $1,338,245 $1,152,210 -$42,626 $16,198 $212,463 Surplus / Leakage Factor -18.3 -17.6 35.9 -41.9 -85.0 -86.0 -44.5 -6.9 56.5 52.0 100.0 5.6 9.2 100.0 -27.2 8.1 19.6 9.1 6.2 10.2 19.0 21.5 12.4 27.7 -42.3 -51.2 2.8 -1.6 -11.2 -28.4 53.2 25.9 36.1 100.0 -2.3 100.0 7.7 13.9 -0.5 100.0 40.7 Number of Businesses 19 8 2 9 5 3 2 7 5 5 0 10 5 0 5 8 4 7 5 1 1 3 2 1 6 4 2 17 2 8 2 5 1 0 1 0 24 12 8 0 4 Demand (Retail Potential) $44,950,269 $38,230,403 $3,155,897 $3,563,969 $6,700,727 $5,897,264 $803,463 $4,860,994 $7,219,803 $6,290,750 $929,053 $35,525,979 $32,952,853 $332,495 $2,240,631 $7,142,945 $40,738,011 $3,243,401 $2,345,588 $312,406 $585,407 $1,176,448 $541,915 $634,533 $34,530,262 $21,281,734 $13,248,528 $3,110,192 $420,467 $920,202 $515,856 $1,253,667 $1,405,656 $30,407 $555,811 $819,438 $27,597,248 $13,018,035 $12,575,203 $614,446 $1,389,564 Supply (Retail Sales) $37,630,558 $31,744,582 $544,750 $5,341,226 $37,753,074 $36,636,980 $1,116,094 $4,656,140 $3,823,171 $2,908,470 $914,701 $30,561,561 $27,152,339 $290,249 $3,118,973 $5,122,090 $34,928,522 $1,594,842 $1,170,259 $154,239 $270,344 $492,792 $269,253 $223,539 $50,500,668 $38,100,895 $12,399,773 $2,089,269 $445,388 $933,874 $306,074 $403,933 $246,661 $0 $246,661 $0 $16,159,349 $7,056,850 $7,615,586 $583,468 $903,445 T he Furniture & Home Furnishings Stores industry category (NAICS 442) has a substantial surplus, likely due to sales occurring from Hi Lo Industries, located in the trade area. 80924 7/21/11 40 Economic Development Strategic Plan Chanute, Kansas leakage of sales outside of the trade area. As identified in the gap analysis, a significant amount of retail sales demand is leaving Chanute and the surrounding area and likely being met in nearby regional centers such “We need more places to as Kansas City, Pittsburg, or Joplin. These regional centers typically eat and shop that everyone have specialty discount stores, such as Lowes, Dick’s Sporting Goods, can afford” and Best Buy as well as regional malls with major department stores such as Sears. These specialty, nonessential items are the retail -Resident response categories showing significant leakage in the gap analysis. Target Retail Sectors As identified in the gap analysis, the following retail sectors have a lack of service provision currently within Chanute. These sectors should be considered primarily by the City as it considers future development and attempts to attract additional retailers. The filling of the identified gaps is most likely to be successful in making Chanute a stronger regional shopping destination. Building materials (NAICS 4441) Lawn and garden (NAICS 4442) Major clothing and clothing accessories (NAICS 448) Sporting goods (NAICS 4511) Hobby (NAICS 4511) Full-service restaurants (NAICS 7221) The closest destination for many of these kinds of specialty retailers is an hour and a half to two hours away for residents of Chanute and the surrounding communities. Due to Chanute’s central location away from other regional centers, an opportunity exists to attract regional retailers. Retail Nodes and Development Opportunities As part of the development of the Strategic Plan, a community engagement process was undertaken. This process included hold focus groups and meetings with community stakeholders, including members of the business community and community leaders. In addition, a community survey was conducted to gauge community preferences. When asked to identify what businesses they would like to see in Chanute, the follow were the top responses given by residents: 80924 7/21/11 Clothing Stores (61%) Family or Casual Style Dining (43%) Ice Cream Shop (29%) Fine Dining (25%) Lodging (23%) Arcade or Other Attraction Aimed at Youth (23%) 41 Economic Development Strategic Plan Chanute, Kansas This survey as well as that of business leaders and groups informed the creation of a development opportunities map, found in the Appendix. This map designates a number of opportunity areas for future commercial and industrial development in Chanute. As identified in the Gap Analysis, there are retail opportunities not currently being met by the existing retail businesses. As identified in the map, there are several locations for commercial development, to locate retailers as they are attracted to Chanute. These areas are generally described below: Downtown / Existing Neighborhood Preservation The historic Downtown and existing neighborhoods have identified for preservation and revitalization. Retail development and activities for Chanute’s historic core should complement its unique character. Small specialty stores, boutiques, attractions, and fine dining are most likely to succeed and to enhance the Downtown areas. Northwest Commercial Due to its location at the intersection of highway 39 and 169, the Northwest commercial node is a prime location for future commercial development. Large retailers with a regional clientele as well as major convenience shopping destination would be ideal for the location. Southwest Commercial The intersection of 35th and highway 169 near the high school is another opportunity for major retailers. There is plenty of vacant land surrounding the major intersection providing the possibility for the development of major hotels to serve the area. 80924 7/21/11 42 Economic Development Strategic Plan Chanute, Kansas Organizational Structure Over the past several months, PGAV and Chuck Banks Associates have taken a comprehensive look at the Economic Development Structure that currently exists. Numerous one-on-one interviews, focus groups, and public meetings have been held towards that end. Additionally, e-questionnaires and an online survey provided the opportunity for the community to respond to various questions regarding Chanute’s future economic and community development plans. Well over 200 Chanute residents have been engaged during this process, providing valuable information and insight. As a result of this community engagement effort, the following information has been collected which directly impacts the economic development organization recommendation: Community leaders want an organized economic development effort to happen in Chanute (and many would like this effort to extend beyond the City to include the County and/or region); Community leaders believe that the City has made a commitment to support economic development (by hiring a person to do economic development), yet has not delivered on that commitment (that hired person is not delivering economic development services); Community leaders want the economic development operations to be funded in part by the City, yet the day-to-day operations be located outside of City government and administered by a public-private partnership; Community leaders believe that to establish broad-based support of all Chanute sectors of the economic development initiative, the community needs to be re-engaged in the planning process and directly involved in the decision-making efforts; The City of Chanute has set aside $150,000 annually for at least two years to provide ‘seed funds’ to establish an economic development entity, with possibly more funding available in future years depending on the progress of the effort; and Community leaders are divided regarding how the private sector should financially support the economic development effort; some are willing to provide such support after they have evaluated the strategic plan while others are unwilling/unable to provide such financial support. Given the feedback received from Chanute leaders during this information gathering process, it is clear that to create a sustainable economic development effort the community needs to be involved in the planning and decision-making process. This strategic plan process incorporates community engagement to establish key components of the recommendations. The primary recommendation is to establish a new economic development entity to spearhead future efforts. The City of Chanute and economic development committee should support the creation of a new economic development entity to establish and allow on-going economic development services. Said economic development entity will directly offer the following economic development services including but not limited to: 80924 7/21/11 Existing business retention, development & expansion New business marketing & recruitment Housing development Improvement of the quality of life 43 Economic Development Strategic Plan Chanute, Kansas The new Chanute economic development entity (EDE) should be structured as a non-profit organization; three possible non-profit classifications were considered: 1. 501(c)(3)- this tax-exempt organization has a distinct advantage over other tax-exempt organizations when it comes to fund raising as donations qualify as tax-deductible for the donors. This fund-raising advantage makes obtaining 501(c)(3) status very attractive to an economic development organization. That said, not all economic development organizations qualify as tax-exempt under 501(c)(3). Often, certain activities of an economic development organization qualify, as others may not. 501(c)(3) is also restricted on its lobbying efforts and must take this into account when determining its organizational structure. Lobbying activity of a 501(c)(3): Can appeal directly to state legislatures regarding public policy they’d like to see happen or legislation they’d like to see defeated or repealed. The organization can write letters, make phone calls, or meet face-to-face with the legislator. Can lobby for issues-based initiatives. For instance, half of the states in the U.S. allow citizens to take ballot initiatives directly to the voters, and 501(c)(3) nonprofits can campaign in those instances. Cannot support specific candidates or parties in races for elected office, known in IRSspeak as “political campaign activity”. More specifically, the organization cannot endorse a candidate or contribute to a campaign with money or time. (Employees can, of course, donate or volunteer on their own time). Can sponsor an educational event such as candidates forum, so long as all candidates running for the same office have a chance to participate. Must notify the IRS of the intent to lobby by filing Form 5768 and abide by any additional state laws regarding lobbying. May have an affiliated 501(c)(4) organization to carry out unrestricted lobbying. 2. 501(c)(4)-this tax-exempt organization operates similar to a 501(c)(3) but cannot offer deductible donations unless it is a state or local political subdivision (e.g. volunteer fire department). This type of organization can do an unlimited amount of lobbying but then becomes ineligible to receive federal monies such as grants. 3. 501(c)(6)- this tax-exempt organization, is primarily supported through memberships and generally orientated towards improvement of business conditions. Typically, 501(c)(6) organizations work to improve the business conditions of their members. While the organization is tax exempt it also does not offer tax-deductible contributions. The recommended structure is a combination of two of the above structures. Combining a 501(c)(3) and a 501(c)(4) combines the benefits of a tax deductible organization with limited lobbying capabilities with another non-profit organization with unlimited lobbying capabilities. Considering the limited lobbying activities anticipated in the first year or two of operation the 501(c)(3) organization should be created first. The 501(c)(4) should be created second after the 501(c)(3) organization is up and running. Additionally, upon completion of the Strategic Planning process it was discovered that a Port Authority exists that includes Chanute as well as other communities in the area. A Port Authority has statutory powers for development purposes and is a completely separate entity that can own property and levy a 80924 7/21/11 44 Economic Development Strategic Plan Chanute, Kansas tax to fund its activities. This Port Authority should be reestablished and utilized in the new organizational structure as economic development activities grow. Qualifying the Chanute EDE for any of the above recommended legal structures requires expert legal assistance. The EDE Board should secure qualified legal counsel to make a final determination regarding how the new EDE should be legally structured, and prepare the appropriate legal documents. General Structure Recommendations The new Chanute economic development entity will be, in partnership with other economic development organizations, a business information clearinghouse for important economic development related tools including (but not limited to): Commercial Development & Redevelopment Properties Financing & other funding opportunities (local, county, regional, state and federal) Laws & regulations (local, county and state) Local business technical assistance providers Chanute EDE’s partnering organizations will include: Chanute Chamber of Commerce Chanute Main Street City of Chanute NCCC Small Business Development Center SEK, Inc. Kansas Department of Commerce USDA Rural Development Other entities to be indentified As an additional option to begin implementing the strategic plan recommendations immediately, it is possible that other certain economic development related services be initially delivered by currently existing/established local/regional partnering organizations. Some of these other services (and service partnering entities) would include: Business Advocacy – Chanute Chamber of Commerce Business Finance Advisory Services – SBDC Entrepreneurship Training – SBDC, Chanute High School, NCCC Technical Assistance – SBDC Workforce Development/Enhancement – NCCC, State of Kansas As Chanute’s EDE becomes established and permanent staff is hired, this organization can consider expanding its services subject to demand and funding considerations. 80924 7/21/11 45 Economic Development Strategic Plan Chanute, Kansas The new Chanute EDE will work closely with the City of Chanute (and other appropriate organizations) on other important economic development related issues, including: Infrastructure Improvements Real Estate Development & Redevelopment Brownfield Redevelopment (if any) The new Chanute EDE will work closely with the Chanute Chamber of Commerce and Chanute Main Street to coordinate business support and economic development in the community. It is encouraged that representatives of these three entities (Chanute’s EDE, the Chanute Chamber of Commerce and Chanute Main Street) be invited to each other’s respective board meetings, and the each other’s respective representatives serve as ex-officio members of each other’s boards. The current Chanute economic development committee will select the new ‘Chanute EDE board of directors’, whose membership (full-voting status) will be drawn from across the community and will be represented from the following sectors: Co-Chairs of the Chanute Economic Development Committee (will only serve one 2-year term, then these two positions will be dropped from the EDE board)) Banking- two representatives (initial term served split between 2/3 year terms) Manufacturing – two representatives (initial term served split between 2/3 year terms) Retail- two representatives (initial term served split between 2/3 year terms) Education- one representative (3 year term) Faith Community- one representative (2 year term) Youth – one representative (1 year term) At Large – two representatives (initial term served split between 2/3 year terms) Chanute EDE Board of Directors’ terms should only be renewed for a single second term, and directors must have at least a two year break in service if they can return to the Board. Additionally, ex-officio non-voting EDE Board membership will include a representative from the following entities: Chanute Chamber of Commerce, Chanute Main Street, and City of Chanute. It is recommended that representatives for SEK, Inc., Neosho County Commission, the Kansas Department of Commerce, USDA Rural Development and local staff from the Kansas Congressional delegation be invited to the EDE regular meetings. 80924 7/21/11 46 Economic Development Strategic Plan Chanute, Kansas The following action items represent the next steps towards creation of the new Economic Development Entity: 1. Establish committee to form the Board of Directors 2. Determine organization name 3. File Articles of Incorporation (fictitious name) 4. Develop by-laws and board policies 5. Apply for EIN 6. Open bank account and establish financial procedures 7. Establish open records policy 8. File for federal tax exempt status 9. Develop start-up budget 10. Develop operating budget 11. Develop activities budget 12. Hire staff 13. Establish payroll system 14. Conduct organization strategic planning 80924 7/21/11 47 Economic Development Strategic Plan Chanute, Kansas Target Industry Analysis No community can compete successfully against the rest of the world for every business location – including Chanute. On most economic development budgets, marketing to everyone in every industry means not making an impression on any business in any industry. Intuitively, we realize that some industries are better prospects than others, and this is where efforts should be focused. What are the best prospects? This is not a new question. In fact, it is a question searching for a market in which the community can promote itself. Economic Development markets are more diversified than those for most companies; therefore, it is important to develop strategies clearly and carefully to define markets. These strategies center around two primary themes: the media and the message. Communications media aimed at target markets are more efficient than those aimed broadly. By minimizing the “reach” of a communications effort, an economic development program can increase the frequency with which prospects can be contacted. In addition, increasing the variety of communications within vertical channels, like direct mail, trade shows, web site marketing, and industry journals reinforces the community’s message in a way that broad mass communication efforts cannot. Another reason focused marketing strategies are more effective is message content. The community can present itself in terms of issues of importance to that particular market. This is particularly powerful when the community has tailored its product to the interests of a particular industry niche. This requires a current understanding of the problems faced by the industry in general and specific terms (i.e. labor availability, transportation costs, international competition, infrastructure demands, etc.) Target industry programs are not a substitute for basic or broader community and economic development prospecting initiatives. However, target industries provide a much needed focus to allocate limited time and financial resources toward attractive markets where the community has the best competitive advantage. Target Industries for Chanute A primary objective of the Economic Development Strategic Plan is to identify key community data and assess its application in determining future actions of the economic development program. This approach is no less critical in its application to identifying strategically attractive industries for which Chanute has a unique competitive advantage. There are various criteria that can be used in selecting industries to be included in a targeted marketing program. These relate to the goals and objectives of the region or community. Some communities choose to target certain sectors because they are consistent with overall strategic goals, others because of location suitability. PGAV combines a few of the most common methods for identifying target industries in order to create a comprehensive and reliable list of industries. The analysis begins with identifying potential industrial clusters that exist in the Chanute area, identifying strengths in those clusters through a location quotient 80924 7/21/11 48 Economic Development Strategic Plan Chanute, Kansas analysis, and finally complementing the results with local input from stakeholders and the business leaders. Clusters are a key driver of regional economic growth. Michael Porter, one of our nation’s leading experts in business and regional competitiveness, explains: “Clusters are a striking feature of virtually every national, regional, state and even metropolitan economy, especially in more economically advanced nations…Clusters are not unique, however; they are highly typical – and herein lies the paradox: the enduring competitive advantages in a global economy lie increasingly in local things – knowledge, relationships, motivation – that distant rivals cannot match.” Clusters are a powerful means for organizing a region’s economic development efforts. Pursuing cluster development provides more than just a focus for regional economic development efforts, they provide an organizing framework. Rather than assisting one firm at a time, cluster development efforts require solving related problems and addressing common needs of groups and firms. Cluster development makes it essential that a region define its identity, which can be a powerful tool for outreach marketing and attraction efforts. Because of its broad reach within a community, cluster development calls for the importance of public-private partnerships that in turn can leverage resources and bring the community together for a common purpose. Most important, cluster development brings a new level of accountability to economic development that requires having an impact at a broad scale that can advance the economic well-being and quality of life in a community. The following industries have been identified and selected as top priorities for the City of Chanute: Transportation and Warehousing Healthcare and Social Assistance Manufacturing Call Center Operations Retail The profiles described herein identify the industries and key subsectors in the respective industries. Retail services is also a target for the City of Chanute; however, this is the focus of the Retail Market Analysis section of this report. Manufacturing Manufacturing is defined as the mechanical, physical or chemical transformation of materials or substances into new products. The assembly of components into new products is also considered manufacturing, except when appropriately classified as construction. There a many sub sectors within the manufacturing industry. Chanute should focus its attention to the largest manufacturing sub sectors and those that present cluster opportunities consisting of; Food Manufacturing (311), Petroleum and Coal Products Manufacturing (324), Chemical Manufacturing (325), Plastic and Rubber Products Manufacturing (326), Nonmetallic Mineral Product Manufacturing (327), 80924 7/21/11 49 Economic Development Strategic Plan Chanute, Kansas Fabricated Metal Product Manufacturing (332), Machinery Manufacturing (333), Computer and Electronic Product Manufacturing (334), Electrical Equipment, Appliance, and Component Manufacturing (335), Transportation Equipment Manufacturing (336), and Furniture and Related Product Manufacturing (337). In general, the manufacturing sector has seen a decline in total employment over the past several decades. Overseas competition, the movement toward a knowledge-based economy, and more efficient production technologies have been influential in this downward manufacturing trend. However, manufacturing production and output is still the fundamental measure of the nation’s economic health and provides significant benefits to local, state, and national economies. Manufacturing is considered the most prized of all business classifications by communities, primarily because of the secondary, indirect, or spin-off benefits. The multiplier or economic impact of manufacturing jobs is 3.2. That is, one job in manufacturing creates 3.2 support jobs. This secondary effect is felt more in bank deposits, retail purchases, tax revenue, service receipts, etc. There has been a recent influx of global business investment in manufacturing within the U.S. as multinational companies enter the U.S. market or try to reduce the costs of transporting to the U.S. market. Emerging technologies create new manufacturing opportunities, particularly in advanced manufacturing areas such as equipment manufacturing. In summary, a local economy should seek to diversify its business mix much like the changes and trends in the national economy. The manufacturing industry should not be the sole provider of employment in a community. Yet, manufacturing is still the foundation of any economy and opportunities abound for future investment in existing and new manufacturing industries. Location Considerations Clearly the U.S. manufacturing industry is subject to increasing competition from global markets that can provide less expensive labor and tax structures and less bureaucratic controls or regulations. The success of U.S. manufacturing lies in its highly trained and educated workforce, its direct access to the U.S. consumer marketplace, and its accessibility to raw goods and products. Four critical factors used in determining manufacturing location are: competitiveness with global locations (cost), labor quality and price, proximity to markets, and transportation accessibility. For local communities, the ability to attract manufacturing is a reflection of national trends in global business competition. A local community not only competes with overseas locations, but also competes with other U.S. communities. Therefore, it is imperative that local communities invest in the quality of labor and the transportation infrastructure. The community must also evaluate its location in relation to specific consumer and business markets to clarify which manufacturing industries align with the community’s assets. And finally, Chanute must be willing to offset cost disadvantages between itself and the competition via financial incentives and business assistance. Transportation and Warehousing The transportation and logistics industry spans a wide range of business activities and services. For the purpose of this analysis, and for the future economic development efforts of Chanute, the primary subsectors of interest include: Truck Transportation (484), Support Activities for Transportation (488), and Warehousing and Storage (493). 80924 7/21/11 50 Economic Development Strategic Plan Chanute, Kansas Advances in technical innovation have profoundly affected the geographic orientation of the distribution and warehousing industry during the past decade, and will continue to do so in the future. The invention of bar-coding and the sophisticated handling of packages have allowed companies to track packages with a greater amount of precision and accuracy. Improved air transportation and highways enable companies to move products more quickly. Just-in-time inventory management has altered the way companies manage their real estate portfolio, thereby, structurally changing certain segments of the real estate market. Technical innovation has also changed the necessary job skills needed to perform job responsibilities effectively within this industry. The transportation and warehousing industry is no longer just warehousing or the storage of objects to be shipped at a later date. Instead, technical and software innovation has changed this industry into a value added process. Distribution or logistics centers perform many functions including re-packaging, labeling, sorting, printing, and filling customized orders. The skills to perform these more complex operations in coordination with technology and software, demand increasingly higher levels or educational success, prior experience, and work ethic from the local workforce. As a result of this evolution, the transportation and warehousing industry pays mediumto-high wage rates for employees who perform value added logistical services. The transportation and warehousing industry is currently undergoing two divergent shifts in physical and operational planning. One is a movement toward “super” regional distribution centers ranging from 600,000 to 1,200,000 square feet in size. Second, is the decentralization of mid-sized distribution centers to smaller local facilities ranging in size from 100,000 to 150,000 square feet. The type and size of a distribution center is dictated by its stated operating purpose, the markets to be served by the center, the overall size of the company, and the amount of growth occurring in the company’s specific industry. Location Considerations Transportation and warehousing centers operate on very competitive and cost-effective practices. Therefore, the cost and availability of labor, accessibility to the transportation network, the price of fixed operating costs, and geographic placement influences the final location of these operations. Because transportation and warehousing operations are extremely diverse in size and function, it is difficult to generalize a prototype of the ideal location. However, preferred locations are situated on or near major interstates and have direct access to suppliers and final points of shipment. The more centrally located a transportation and warehousing center is in relation to its final point of shipment, and the less expensive the costs of shipping to that location, the more attractive a particular site becomes in the site selection process. These types of centers require significant acres of land in which to construct a facility and they need sizable buildings with available space. The existence of affordable and available labor is an additional consideration. Customer Service and Call Center Operations Customer service and call center operations are defined as processing and transaction functions, such as claims processing, data processing, customer service, and technical support and inbound and 80924 7/21/11 51 Economic Development Strategic Plan Chanute, Kansas outbound centers. Primary sub sectors with activity in the operation of customer service centers include the following: Information Services and Data Processing Services (514), Insurance Carriers and Related Activities (524), Credit Intermediation and Related Activities (522), Administrative Support Services (561), Data Processing Services (514), and Credit Intermediation and Related Activities (522). Customer service operations or back office operations are the processes within a company that do not require face-to-face customer interaction, and generally require a large clerical labor force. Industries and businesses with customer service operations include banking, insurance, credit agencies, mail order businesses, service organizations, and government and membership organizations. The advance in telecommunications and the use of computers has facilitated the decentralization of many corporate office functions. Customer service operations can now be a distinct entity, physically separated from other unrelated office functions. The following factors and business needs are influencing the decentralized customer service operations: Cost Reduction Space Payroll Consolidation Technical Innovation Labor Availability Greater Geographic Mobility Better and Quicker Customer Service Future Resource Deployment Flexibility Risk Avoidance Companies are currently moving toward the consolidation of customer support centers in order to improve efficiencies created by economies of scale. Companies have found that by consolidating dispersed customer support centers into large centers, they experience increased efficiency, lower costs, the ability to provide more reliable services, and improved competitiveness. The following customer service functions are geographically mobile and ripe for consolidation: Credit Authorization Credit Collection Check Processing Accounting Payroll Data Processing Order Fulfillment Insurance Claims Processing Customer Service Reservations Payment Processing In addition, recent trends suggest that companies are increasingly willing to outsource certain customer service support functions to companies providing third-party services in this industry. Many companies must also create redundancies in operations to offset the effects of natural or man-made disasters. 80924 7/21/11 52 Economic Development Strategic Plan Chanute, Kansas These third-part businesses should also be considered as targets within this industry sector. Location Considerations Customer service operations have several location concerns: the availability of a large labor pool at low to moderate wages; the availability of inexpensive space, and the condition of the telecommunication infrastructure. In addition, the labor-intensive nature of customer service operations makes the quality of labor an extremely important consideration as well. The quality of local educational or training programs is a well-recognized indicator of labor quality for customer service operations. Companies with a high sensitivity to cost but low face-to-face needs are more likely to move to small cities. Similarly, congestion in primary markets and the upward pressure on wages and worker supplies in secondary markets have encouraged smart companies to look into ever-smaller communities to satisfy their operating needs. Customer service operations typically locate in business parks, large retail spaces, or even attractive industrial parks rather than office parks. These types of operations require a reliable and high-capacity telecommunications network because the facilities transfer large volumes of data over telephone systems. Therefore, it is desirable that a chosen location be served by the most up-to-date telecommunications system as readily available. A reliable electric utility system with redundant services is also essential. Additionally, the Midwest is generally advantaged against other regions of the U.S. for customer service operations due to its central time zone, Midwestern “accent free” dialect, and work ethic of the employment base. Healthcare and Social Assistance The healthcare and social assistance industry involves combining medical technology and the human touch. The healthcare industry includes establishments ranging from small-town private practices of physicians to busy hospitals that provide hundreds, even thousands, of diverse jobs. For the purpose of this analysis, and for the future economic development efforts of Chanute, the primary subsectors of interest include: Ambulatory Healthcare Services (621), Hospitals (622), Nursing and Residential Care Facilities (623), and Professional, Scientific, and Technical Services. Ten of the twenty fastest growing occupations in the state are healthcare related. Employment in healthcare will continue to grow due to many contributing factors. Advances in technology have increased life expectancy, federal expansion programs may ultimately increase access, and the aging population is increasing demand for services. In the rapidly changing healthcare industry, advances in information technology have a perceived improvement on patient care and worker efficiency. In fact, healthcare technology is a growth industry in itself. Creating technology for the digitization of medical transcripts and records is a growing industry. A wide variety of people with various educational backgrounds are necessary for the healthcare industry to function. The healthcare industry employs some highly educated occupations that often require many years of training beyond graduate school. However, most of the occupations in the healthcare industry require less than four years of college. 80924 7/21/11 53 Economic Development Strategic Plan Chanute, Kansas Location Considerations Healthcare and social assistance companies are concerned with five essential business factors; labor force availability, cost of doing business, regulatory and tax environment, transportation network, and community quality of life. Competition for healthcare and social assistance companies is fierce and communities must address all business factors in order to successfully recruit and grow the industry. A highly skilled and growing workforce is essential for growing the healthcare and social assistance industry. Availability of job training and workforce development assistance will help foster growth and enhance site selection appeal. Average wage of the healthcare and social service industry workforce is directly tied to the cost of doing business and a significant consideration as well. Other cost of doing business costs that will be evaluated are utility costs, specifically electric costs. Issues focus on: availability of electricity to the site, availability or temporary power during construction, regional generating sources, hookup fees, and cost per kilowatt hour. Areas served by municipally owned electric generators, or their own water and sewer operation, can significantly lower utility costs and make an area more desirable. Other important issues are the cost and availability of buildings. The tax environment can vary significantly from state-to-state, and businesses will seek areas that have tax structures designed to reward investment and innovation. Areas competitive in corporate income tax, sales and use taxes, unemployment tax, workers’ compensation tax, and inventory taxes or that offer incentives to offset those taxes will be more attractive sites. Additionally, local environmental regulations will greatly impact location decisions. Providing assistance in coordinating permitting processes can help new or relocating companies address environmental laws. Transportation is also an important factor in healthcare and social assistance, particularly in the medical device industry which operates much as a manufacturing company. Access to convenient and continually improving transportation infrastructure in proximity to major trade areas with access to major markets and suppliers is critical. Finally, community attitude and quality of life is a very important location consideration for this industry. While this is not the primary determinant of a location decision, often this is what will “break a tie” in regards to the other factors. Retail Trade A significant component of a successful and vital community is a complete and unique shopping experience. The retail trade industry involves retailing merchandise, generally without transformation, and rendering services incidental to the sale of merchandise. For the purpose of this analysis and for the future economic development efforts of Chanute the primary subsectors of interest include: Full Service Restaurants (7221), Electronics and Appliance Stores (4431), Building Material and Garden Equipment and Supplies Dealers (444), Food and Beverage Stores (445), Clothing Stores (4481), Shoe Stores (4482), Sporting Goods, Hobby, and Musical Instrument Stores (4511), and Book, Periodical and Music Stores (4512). 80924 7/21/11 54 Economic Development Strategic Plan Chanute, Kansas Identifying targeted retail sectors involved calculating the retail demand, or spending power of the trade area, compared to the retail supply, or the retail sales of the area, in order to quantify potential unmet demand in the trade areas. Retail categories with unmet demand are evaluated against the community survey results and economic and physical conditions in order to develop a list of retail stores to target. A short summary of stores that should be targeted based upon the demand found in Chanute and the future expansion plans of retailers include: Dress Barn Casual Corner Petite Sophisticate Old Navy Ross Dress for Less Marshall’s TJ Maxx Kohl’s Payless Shoe Source Famous Footwear Burlington Coat Factory Ashley Furniture Dollar Tree Chipotle Best Buy Mobile Crazy 8 (Gymboree) Rue21 Foot Locker Urban Outfitters Lumber Liquidators Lowe’s Hibbett Sports Hobby Lobby Fastenal Deal$ Shoe Carnival Location Considerations Each retail sector has specific location considerations with respect to average daily traffic counts, store layouts, parking ratios, and co-location desires. The retail trade sectors listed have the most important criteria for retail stores, unmet demand, and limited competition. 80924 7/21/11 55 Economic Development Strategic Plan Chanute, Kansas Site Selection Process In order to fully utilize the targeted industry list and conduct effective business attraction and expansion, it is important to understand the site selection process itself. There are basically two sides to the process: the community’s side and the business’s side. Both sides of the site selection process have undergone a large amount of change over the last few years. Major factors that have affected these changes are the consolidation of business operations, both internally and externally, globalization, and new systems of information access. Consolidation of businesses contributes to corporate real estate departments consolidating and/or disposing of properties in order to cut costs. Globalization has applied pressure to companies to move fast in an increasingly competitive market. New systems of information access have changed the way that site selectors and businesses access information in order to make decisions. All of these factors have impacted site selection by creating a shortened time frame for a site selection search (typically lasting 4 to 8 weeks), increased community competition for initial screening, and currently the number one tool for conducting site selection research is over the web. The location decision from a company perspective includes many economic and noneconomic factors. Economic factors are made up of mainly financial aspects of the companies operations including production costs, procurement costs, distribution costs, wage rates, occupancy costs, etc. Noneconomic factors or non-financial factors, which include quality of life, business climate, and the location preferences of the decision makers, are of increasing importance in the site selection process and can be the tie-breaker when financial factors are equal. The following Exhibits 1-7 are taken from a study titled “Corporate Real Estate Site Selection: A Community-Specific Information Framework” published in the Journal of Real Estate Research. Exhibit 1 identifies the phases of the site selection process and the accompanying information sources and decision-makers. 80924 7/21/11 56 Economic Development Strategic Plan Chanute, Kansas Exhibit 1 - Site Selection Process Incremental Decision Supporting Decision Decision Agents Information Needs Selection of regional Phase I: Selection of communities or geographic location or geographic areas areas for plan location Develop locational criteria ("must" and "wants" lists), establish site selection criteria CEO / Board of Directors Market data and regional Regional / state industrial with real estate and division economics, business personnel environment, taxes, transportation site selection Phase II: Identify alternative sites Determination of acceptable sites in target areas Real estate / facility Identification of sites for planning personnel examination, assess political, social and economic characteristics of communities or jurisdictions Phase III: Evaluate alternative sites Evaluation of alternatives and determination of candidate sites Site visits and evaluations, Community-specific evaluations, identification of financial and tax incentives to be employed Corporate and division Site-specific data, executives with real estate / community specific data, facility planning and key assistance programs with operating personnel financial and tax data Site evaluations, business climate, quality of life, employee relocation, property tax and assessment, inducements and incentives Phase IV: Site selection Final Site Selection and Acquisition Negotiations between division and corporate, option / acquire site, set tolerance limits, financial approval of capital acquisition request CEO / Board of Directors with real estate / facility planning and division personnel Site suitability, economic impact, fiscal impact, market value impact, infrastructure and environmental impact Phase V: Funding and construction Decision to fund and undertake construction Approval of capital budget, CEO / Board of Directors with real estate / facility approval of final planning personnel construction plans, approval of construction contracts Real estate market data, community tax and service, community attitudes, housing conditions, transportation Comparative site acquisition problems and costs, financial feasibility and compatibility with corporate goals, impact data Information Sources Real estate market surveys, business climate studies, quality of life studies Construction plans, capital Facility planning / budget for construction engineering personnel, construction cost estimates, internal budgets, financial plans When evaluating potential site selection prospects, it is important to consider that both companies and the community share a common economic foundation. “Cash solvency” is the common interest of the parties involved. Companies are interested in profits, and communities are interested in a break-even as a result of the site selection decision. It is very important that both parties look beyond the initial capital costs and study the long-term financial sustainability of the decision. Companies will conduct a variety of community-based evaluations, with much information coming from the community, to inform their decision-making process. It is essential that communities conduct company-based evaluations, with information from the company, to inform their decision-making process. Exhibits 2 thru 4 identify the non-economic and economic factors that company oriented evaluations consider and how those evaluations result into a capstone study that summarizes the factors into an overall direction for comparison and decision-making. 80924 7/21/11 57 Economic Development Strategic Plan Chanute, Kansas EXHIBIT 2 - Non-Economic Company-Oriented Studies PART A: Business Climate Study Objective: Determine attitudes exhibited by government officials, busines s leaders and the public toward the firm and its key personnel. Major Topics: Existing property tax as sessment policies. Existing public service and utility provision. Acceptance of similar firms and their management staff in the community. Judgment concerning c ommunity acceptance of the specific firm and its personnel in the community. Uses: Evaluate the impact of tax assessment policies as well as utility and public service provision on the cost struc ture. Evaluate community attitudes on the ability to retain key personnel. PART B: Quality of Life Study Objective: Determine the differential in personal satisfaction that current key personnel will experience by making the move with the firm. Major Topics: Analysis of managerial and k ey employee housing options - quality, price and availability. Analysis of non-housing cost of living differentials. Analysis of housing related factors such as neighborhoods, public services, school system quality, etc. Analysis of journey to work costs. Analysis of employee preferences for cultural, entertainment and recreational amenities. Uses: Evaluate the relative attractiveness of the new location to key personnel and thereby assess their willingness to move. Assist in determining the effect on the wage / salary structure of the firm. 80924 7/21/11 58 Economic Development Strategic Plan Chanute, Kansas Exhibit 3 - Economic Company-Based Community Studies PART A: The Property Tax and Special Assessments Study Objectives: Determine the differential for property taxes and special assessments among communities being evaluated as a location for a corporate facility. Determine the property tax bill and the amount of special assessments the company will experienc e by locating a corporate facility in a particular community. Major Topics: Analyze assessment procedures and the assessed value for corporate facilities. Analyze the community property tax base. Identify the amount and impact of property taxes and special as sessments on the firm. Identify methods and level of difficulty of appealing unfair or unwarranted tax charges. Uses: Provide information for comparing and evaluating taxes in communities being considered as potential locations for corporate facilities. Ascertain property tax information used in determining the financial feasibility of a new or expanded corporate facility. PART B: The Planning and Regulatory Environment Study Objectives: Determine the planning procedures used to evaluate and forecast community needs and to prepare plans. Identify specific plans for providing public services and facilities as well as public amenities. Identify types of regulatory measures in force, standards for compliance and enforcement procedures. Major Topics: Analyze the planning process and provisions of the comprehensive plan utilized in the community. Evaluate specific plans and proposals that affect that location and operation of corporate facilities in the c ommunity. Analyze the requirements and costs of compliance with the community's site-specific regulations, including zoning, subdivision regulations and construction and occupancy codes. Uses: Provide information about c osts and benefits of the community's comprehensive plans and development regulations as an input to community selection. Provide specific information about costs of compliance as an input to financial feasibility. PART C: Employee Relocation Study Objectives: Determine the cost of moving key personnel but not including wages, salaries and cost of living. Major Topics: Analysis of home equity loss caused by a necessary sale of the employee's principal residence. Analysis of the direct cost of moving the family and its belongings. Uses: Evaluate the full costs of moving key personnel. Quantify the c ost of replacement personnel in the event of employee turn-over. 80924 7/21/11 59 Economic Development Strategic Plan Chanute, Kansas EXHIBIT 4- Total Cost Of Business Capstone Studies Objectives: Estimate the total cost of operating a business in a community. Quantify the revenue enhancement potential of locating in a particular community. Major Topics: Labor force availability, costs and productivity. Gross business tax burden; income, inventory, real estate, employee-related. Availability, eligibility and implications of incentive and economic inducement programs. Revenue potential for additional sales and services due to B2B and B2C link ages. Availability, reliability and costs of services; infrastructure and other service support. Uses: Development of model of total costs of business to feed discounted cash flow-like tradeoffs. Business planning, budgeting and forecasting models. Demonstrate value-add of real estate decision to Wall Street and investor community to increase and / or stabilize shareholder values. A sample Cost of Doing Business Comparison comparing the State of Kansas and surrounding states is located in the Appendix. 80924 7/21/11 60 Economic Development Strategic Plan Chanute, Kansas Exhibits 5 thru 7 indentify the non-economic and economic factors that community oriented evaluations consider and how those evaluations result into a capstone study that summarizes the factors into an overall direction for comparison and decision-making. EXHIBIT 5 - Non-Economic Community-Oriented Studies PART A: The Infrastructure Impact Study Objectives: Determine the effects of a new production facility on the physical c apacities and service levels of public services and facilities. Major Topics: Identify and describe types of public services and facilities available and quantify the capacity of each. Analyze operating conditions, standards, requirements and excess capacity for each public service and facility. Identify existing service level and expansion needs and costs for each public service or facility impacted by the corporate facility. Uses: Estimate the impact on service levels of existing public services and facilities and the amount of improvements and costs to meet needs of the new corporate facility. Generate information on impacts and potential benefits the new corporate facility will have on public services and facilities in the community to use as a public relations tool to overcome public concerns about negative impacts. PART B: The Environmental Impact Study Objectives: Determine potential environmental impacts of the new corporate development when needed for compliance with environmental standards or regulations. Determine actions required to avoid, ameliorate or resolve advers e environmental impacts. Major Topics: Describe in a checklist fashion current environmental conditions in the community. Identify probable environmental impacts on each environmental element from the development of the corporate facility. Analyze alternatives, if any, to the project along with short-term versus long-term costs and benefits of each alternative. Identify mitigation measures that can be taken to resolve adverse impacts. Identify any growth inducing impacts of the new corporate facility. Uses: Comply with any legal or regulatory requirements for environmental analysis or identification of mitigating actions. Potentially useful as a public relations tool to show compliance with environmental standards and corporate attitude toward environmental goals. 80924 7/21/11 61 Economic Development Strategic Plan Chanute, Kansas EXHIBIT 6 - Community-Oriented Economic Studies PART A: Economic Impact Study Objectives: Determine the increase in total jobs and total income caused by the operation of the facility. Allocate the increase in total income to the local retail activity. Estimate the effect of the increased employment on the demand for housing. Major Topics: Analyze the direct employment of the facility. Estimate the magnitude of the local economy's multiplier. Calculate the total change in local employment and inc ome. Determine the percentage of the household budget spent on various categories of retail goods and services. Uses: Estimate the economic benefits that can ac crue to the local economy from the operation of the corporate facility. Generate information that can be used in a public relations campaign in the local community to overcome negative impressions about the facility. PART B: Fiscal Impact Study Objectives: Determine the increase in property tax revenues generated by the facility for the local jurisdiction(s) in which it is located. Determine the increase in public service cost generated by the facility for the local jurisdiction(s). Major Topics: Analyze the historic and current tax assessment practices and the assessments on comparable properties. Determine the current mileage rate that would apply to the facility and estimate its future levels. Determine the use of public services / facilities by the corporation. Calculate the direct net cost / benefit to the local jurisdiction's operating budget from the operation of the facility. Calculate the indirect and induced net cost / benefit to the local jurisdiction's operating budget from the facility's effect on the housing stock and retail establishments. Uses: Estimate the economic benefits that can ac crue to the local economy from the operation of the corporate facility. Generate information that can be used in a public relations campaign in the local community to overcome negative impressions about the facility. 80924 7/21/11 62 Economic Development Strategic Plan Chanute, Kansas EXHIBIT 6 - Community-Oriented Economic Studies (continued) PART C: Market Value Impact Study Objectives: Determine the potential impact of the facility on property value in the local community. Major Topics: Identify the characteristics and attributes of the facility. Identify comparable properties and analyze their location attributes in the community in which they exist. Analyze the impact of the comparable facilities on the property values in their respective communities. Uses: Estimate the net economic costs or benefits that can accrue to the property owners in the local economy from the operation of the corporate facility. To generate information that can be used in a public relations campaign in the local community to overcome negative impressions about the facility. EXHIBIT 7 - Locational Inducements and Incentives Capstone Study Objectives: Determine types and conditions of community programs available to defray costs or provide other assistance in developing corporate facilities. Major Topics: Identify and evaluate types of financial assistance programs. Identify and evaluate any tax incentive or tax abatement programs. Identify and evaluate land and space acquisition or provision programs. Identify and evaluate labor force training programs. Identify and evaluate programs that provide incentives or assistance in achieving or complying with pollution or environmental controls. Uses: Provide information about potential benefits of economic development programs designed to attract industry and employment to a community, used as input to the financial feasibility study. 80924 7/21/11 63 Economic Development Strategic Plan Chanute, Kansas Economic Development Goals 1) Strengthen the Economic Development Structure Strategy 1-1: Conduct strategic planning for the economic development organization Equally important to the strategic planning that the City is undergoing regarding economic development, the new organization in charge of the effort must undergo the same type of planning in order to operate effectively. Once the new organization is formed it will need to conduct its own strategic planning activity, a critical component of good management and governance. This will help assure that an organization remains effective and is responsive to the needs of the community and economic climate, as well as provides for organizational growth and sustainability. Details of the ten step planning process are in the organizational recommendations section of this report and a timeline is included in the implementation section. Strategy 1-2: Establish funding plan for the program Chanute plans for early funding of the economic development program to come largely via the general revenue fund of the City. This is necessary as the program is in its initial formation stages, however to fully implement the Economic Development Strategic Plan additional financial support will be necessary. Additionally, the City’s financial involvement in the Economic Development Program, while crucial, cannot always be guaranteed either fully or in part. Therefore, Chanute will need to pursue other resources to support its increased financial commitment to implementing the economic development plan. Organizational funding will come from many sources. The most attractive funding mechanisms for Economic Development Organizations are those that are sustainable (i.e. reliable year after year). Some funding sources that are less sustainable, but an important component of the overall financing picture include: 80924 7/21/11 Memberships: Business Memberships - Graduated based on the number of employees or revenues Individual - Graduated based on status; retired, student, unemployed Non-profit Memberships - Graduated based on the number of employees or revenues Donations Sponsorships Special Events/sales In-Kind Donations 64 Economic Development Strategic Plan Contract Services Loan Administration Fees Grants Private Sector Grants State of Kansas Grants: Chanute, Kansas Community Capacity Building Grant Program - The Community Capacity Building (CCB) grant program is designed to support collaborative community development planning activities in Kansas cities or counties under 50,000 in population. Collaborative community development planning implies that the community has formed both an active partnership among the key community-based organizations dedicated to developing a shared vision for the future and a plan of action to achieve that vision. Kansas PRIDE - PRIDE is a community-initiated effort that helps local leaders prepare for and manage change through a hands-on approach to community self-improvement. The program addresses such areas as planning, community services and community enrichment. The Department of Commerce and K-State Research and Extension coadminister PRIDE, providing technical assistance and training opportunities for the local programs. Community Service Tax Credit Program - Each year since 1994, the Kansas Community Service Program (CSP) has given nonprofit organizations a way to improve their ability to undertake major capital fundraising drives for various projects. This year, $4.1 million of tax credit has been allocated and will be awarded to selected nonprofit organizations to offer Kansas tax credits for contributions made to approved projects. Projects eligible for tax credit awards include community service, crime prevention and health care. Tax credit awards are distributive through a competitive application process. Based on the scope and cost of the proposed project, applicants may request up to $250,000 in tax credits. Applicant organizations in rural areas (less than 15,000 population) are eligible for a 70 percent credit. Applicant organizations in non-rural areas are eligible for a 50 percent credit. Federal Grant Sources - Economic Development Administration (EDA) Programs, HUD, USDA, EPA, etc. Of particular interest are: 80924 7/21/11 EDA - Economic Development Assistance Programs - Public Works, Economic Adjustment Assistance, and Global Climate Change Mitigation Incentive Funding Grants - grant application and details can be found at www.grants.gov 65 Economic Development Strategic Plan Chanute, Kansas EDA - Economic Development Assistance Programs—Planning and Local Technical Assistance Programs—grant application and details can be found at www.grants.gov The following sources are sustainable funding sources that should be investigated in order to provide relative financial stability to the Economic Development Organization: Local Statutory Mechanisms: Business Improvement District - Allows for the levy of a tax or fee in order to provide services, development and redevelopment within the district. Port Authority - This organization has statutory powers for development purposes, is completely separate, can own property, and levy a tax to fund its work Strategy 1-3: Develop consistent medium for communication with the public The Chanute community perceives, in general, that they are not informed enough about the economic development program. Currently, the city relies on the local media and the City website to distribute information about economic development activities. We recommend a proactive approach to communication that allows the City to retain a measure of influence over the message to the community. The community must receive information in a consistent way, from an identifiable source, as well as on a scheduled timeframe. Chanute should publish a semi-annual economic development newsletter for distribution to economic development partners, community businesses, and residents. The newsletter can provide a forum for information exchange pertaining solely to economic development activities. This will permit the City to publicize their successes, current activities, and needs for assistance. The newsletter can also take the form of an electronic publication, similar to a newsletter, distributed via email and available on the website. The Economic Development efforts must also embrace social media and incorporate the activities and information communication across Facebook, LinkedIn, and Twitter. Strategy 1-4: Develop economic development partnerships Chanute should devote significant energy to building partnerships in its economic development efforts. At the very least, resource partners, such as statewide economic development groups, utilities, financial institutions, railroads, chambers, county and regional agencies, colleges and universities, trade associations, and similar entities should be briefed on Chanute’s economic development plan and new economic development organization. If the opportunity exists Chanute’s economic development plan should be coordinated with the partners to take full advantage of any synergies that may exist. Multiple partners striving for the same objectives are much more efficient than individual uncoordinated efforts. In particular the State of Kansas, USDA, and SEKC are valuable resources for assistance in recruiting and building businesses. This is true of providing leads, as well as financial resources to assist in providing financial incentives for new and existing business developments. 80924 7/21/11 66 Economic Development Strategic Plan Chanute, Kansas Local financial institutions should be integrated into the economic development program efforts. Financial institutions can provide assistance in the form of business networking, loan guarantees, business research, financial strategies and counseling, as well as volunteering to provide advisory services for the City on specific, complex transactions. 2) Promote Chanute Strategy 2-1: Increase highway presence Over the last few decades it has become increasingly important for communities to have a highway presence. This physical presence is not only economically vital, but also creates the necessary sense of place that establishes a community. Currently Chanute does not have a significant highway presence in terms of commercial development, signage, and gateways. In most communities development has naturally gravitated towards the highway, in others that development is actively planned and promoted. While Chanute does not have the highway presence that would be expected for a growing community, the lack of development creates an opportunity for greater control over the development that does occur. Specifically, Chanute has an opportunity to influence the type and appearance of development that occurs at these significant sites. However, Chanute must take immediate steps in order to exert any control over the targeted areas. Chanute should focus on the Access Points identified in Plate 1 Access Points, located in the appendix. In order to exert control over the area the City has a few options; 1) annex the targeted area into the City, and 2) acquire the targeted area privately with a partnering organization. If the property is annexed the City can exert its control through zoning and building codes. If the property is acquired privately the City should annex the property and solicit developers. Strategy 2-2: Develop wayfinding program The term wayfinding refers to a mental process of understanding and navigating a given environment— literally “finding your way” between points A, B, and C. To make this mental process as easy as possible, communities can plan a coordinated system of signs, pathways, landmarks and other visual cues to help people understand where they are going. In addition to directing traffic and conveying practical information, the best wayfinding systems accomplish larger, more subjective goals, such as Creating a unique visual identity, Establishing a sense of place, or Communicating or reinforcing messages about a place. To put it simply, wayfinding directs travelers to a destination and creates a positive first impression about the destination. Wayfinding systems have been used for many years on college campuses, office parks and tourist districts. Cities and towns of all sizes are now using wayfinding to direct traffic to key destinations throughout the community and help shape their community brand. 80924 7/21/11 67 Economic Development Strategic Plan Chanute, Kansas It is important that the City establish a sense of place, define the boundaries of Chanute, and promote the recommended brand. The City should not rely on the signage and billboards advertising provided by private destinations or KDOT as the welcoming signage and wayfinding for Chanute. Existing signage is insufficient and does not address the comprehensive needs of Chanute. Signage and wayfinding should be simple, consistent, and clear providing direction to guide visitors throughout the attractions. Wayfinding and signage should focus on directing visitors and travelers through the Key Nodes, and Primary and Secondary Retail Corridors to the Destinations identified in Plate 2 Existing Conditions located in the appendix. Strategy 2-3: Conduct community building and build pride in Chanute Maintain an ongoing communication campaign to inform area residents about positive developments in Chanute. This should include information about city and state legislation that will help promote further improvements, new businesses, beautification efforts, infrastructure enhancements, special focus on individual community and economic development projects, etc. It’s also important to communicate to people what has been planned for Chanute and how it will benefit the entire community, not just a few residents. When people are continually confronted with information about positive progress in Chanute, they will begin to get the idea that good things are happening, which, in turn, will result in more pride and interest. All communication mediums should be used, including news releases, newsletters, web site, cable channel, etc. Without planned and deliberate communication of the progress, people will not gain enthusiasm because they are unaware of the progress occurring. Additionally, not all progress is visual in its early stages. Some stakeholders are concerned that economic development plans will not be fully implemented, and are taking the “wait and see” approach. If a significant percentage of stakeholders lose faith in the process, the whole revitalization process could suffer seriously. Clearly-defined and communicated goals, objectives and accomplishments will be needed to build momentum. Communication and celebration of accomplishments with both residents and business owners will be key components of the strategy to keep the economic development program moving in the right direction. One method for illustrating progress, before tangible progress (i.e. bricks and mortar construction, business development successes) is made, is to draw comparisons between the efforts Chanute is making and similar efforts that have met with success in other communities. These comparisons should be included in newsletter articles, in news releases, and articles posted on the web site. It is very important to keep the community informed about economic development activities and progress. One way to distribute such information relies on press releases to the local media. Press releases allow the City to provide sound facts, measure privacy concerns and influence the message presented. In addition, they can create a working partnership with the media about economic development activities. It also helps to assure accurate reporting of events. Strategy 2-4: Create economic development organization web site The importance of an informative and up-to-date web site cannot be overstated. The Economic Development web sites are typically the first stop when a new business, site selector, developer or potential resident investigates an unfamiliar community. 80924 7/21/11 68 Economic Development Strategic Plan Chanute, Kansas The City of Chanute has done a good job of including a lot of useful economic development information in its City web site. However, the economic development sections of the City web site could use some updating, and when the new economic development organization is formed a new web site should be launched. The new web site will help to establish the new organization as the lead economic development entity for the area. The web site should be dynamic, as in frequently updated, and utilize the latest web technology to provide information each target audience would seek. All ads, printed materials, and promotions of any kind should include the web site address and promote visiting the site. To provide information for Chanute’s multiple target markets, the web site will need to have several levels so specialized information can be presented in easy-to-access ways. Important components and tips for the new web site are: An easy to use sites and building database. Using Location One will work well, but use it in a way that seamlessly allows a user to search the database without noticing they have left the primary web site. Include social media links to keep up with technology trends and make information sharing easy. Create an online employment and resume database to assist in matching local talent to local jobs. Invest in high quality images and web site design. Create an online marketplace that promotes local businesses and available products. Utilize search engine keywords to make sure the web site is easily found by search engines. Assist local businesses by selling their products online, as well as, selling community-branded merchandise. Utilize local businesses as community salespeople through testimonials, podcasts, and videos. For local and area residents, there should be information specific to the plans for economic development and what projects are currently underway or have been completed. 3) Recruit New Businesses Strategy 3-1: Contact site selection firms There are numerous private companies that perform site selection services for businesses desiring to expand or relocate. Site selection firms represent a wide-range of clients from Fortune 100 companies to small start-up ventures spanning a variety of industries ranging from logistic centers to food processing. Although site selection representatives may not be the “key” decision makers, they do influence the outcome of the site selection process by serving as a guide to the prospective business. Marketing to site selection firms provides an opportunity to market, albeit indirectly, to a site selector’s entire client base, instead of marketing to one or two companies. Strategy 3-2: Develop direct mail program Direct mail is a very cost effective channel to reach targeted prospects. The direct mail marketing of Chanute can be used to direct specific messages at selected groups or other targets, often in a series that supplies ever increasing degrees of detail, or in response to a return card or contact form that 80924 7/21/11 69 Economic Development Strategic Plan Chanute, Kansas establishes some level of interest at the outset of the marketing contact effort. Done correctly, direct mail marketing permits a high degree of specialization and personalization, with mass contact potential. Direct mail marketing should prepare the prospect for further contact, usually by phone, or to stimulate a request for additional information. Strategy 3-3: Initiate call program (specific) Direct sales calls, although time consuming, can be a successful approach to attracting business to the community. Typically, a sales call should take place after some initial contact has been made with the prospect via other forms of the strategic marketing program (i.e. trade show, web site, direct mail, etc). Calls should be made on prospects that have been qualified and where specific information exists indicating a high potential for relocation or growth. Although, there are situations that warrant a speculative sales call, these should be performed with some prudence given the expense and low success ratio in conducting cold sales calls. In addition to leads generated by other components of the marketing efforts, the target industry analysis can assist Chanute in focusing on potential targets that will benefit from the community’s strengths. Strategy 3-4: Plan annual marketing trips (general) The fundamental purpose of a marketing trip and a sales call is to recruit additional investment and jobs to the community. However, the approach to a marketing trip is slightly different from a direct sales call. Whereas a sales call focuses on a specific target (generally selected after identifying a specific need or potential for relocation), a marketing trip contacts multiple targets to “introduce” the community to companies, site selection consultants, retailers, or developers. Marketing trips deliver a “general” presentation introducing the key indicators and location advantages that make the community attractive to a business. Direct sales calls, on the other hand, provide a “specific” presentation tailored to address the issues that have come to the community’s knowledge. Arranging a face-to-face meeting with a company executive, even if only for a short period of time, personalizes the community and is likely to be remembered when and if a relocation decision is made by the company. Marketing trips should be considered by Chanute to selected metropolitan areas (Kansas City, Topeka, Wichita, Springfield, Oklahoma City, Tulsa, etc.) for the purpose of making personal visits to companies in the target industry groups as well as other business prospects. Ideally, a marketing trip would include several meetings a day to provide the greatest cost effectiveness. Although often challenging to coordinate, marketing trips should include local business leaders with industry knowledge of the business prospects. Trade shows are an alternative to making a “marketing trip”. A trade show typically focuses on a particular industry segment (i.e. automotive parts, manufacturing, logistics/distribution, food processing, etc.) and attracts key decision makers from companies within those industries to a central location to provide on-going industry knowledge exchange and networking opportunities. The benefit of a trade show for Chanute’s economic development program is twofold: 1) it provides an opportunity to network with a large contingent of industry representatives within a short period of time (2-3 days), and 2) it allows the City to learn more about trends and issues within target industries. Selected trade shows should correspond to Chanute’s targeted industries. 80924 7/21/11 70 Economic Development Strategic Plan Chanute, Kansas Strategy 3-5: Create Target Industry Lead Development Program The industries targeted for Chanute’s economic development attraction efforts were selected based upon economic and market profiles, as well as, interviews from local business leaders. As Chanute conducts marketing and business attraction efforts it must also develop a program to continue to identify leads for business development efforts from local business leaders. These leads will compliment the leads generated through trade shows, direct mail, web site inquiries, etc. The most effective way to identify companies for recruitment are through existing businesses and business leaders in town. There is no denying the importance of seeking out prospects from industry journals, state and regional economic development leads, and general inquiries, however, there is a great deal of weight given to inquiries that originate or come with the endorsement of existing clients, suppliers, and/or business colleagues. The list of companies provided by PGAV under separate cover should be immediately supplemented and reviewed by local industry leaders for additional contacts and identification of companies with existing relationships which may assist the attraction process. 4) Grow Existing Businesses Strategy 4-1: Expand Business Incubator A business incubator is an innovative development tool used to foster growth that can diversify the economic base. Chanute should continue to develop its incubator program which provides an encouraging environment for companies until they are able to survive independently. In fact, the National Business Incubation Association states that new companies housed in business incubators have an 80% survival rate, while just 20% of businesses outside of incubators survive long-term. Additionally, 84% of successful incubator “graduates” locate their permanent facility in the the same community where they were nurtured. The National Business Incubation Association details best practices in regards to developing a successful business incubator program. The first consideration is the importance of having the incubator grounded in the real business world, with deep support from the local business community. Government and academic support can contribute significantly to the resources available to develop and operate a successful incubator, it’s frequently best for the sponsor to be at arms length, and absolutely necessary for to have strong input from the business community. To be successful, an incubator must be run like a business. That means being nimble, adjusting to the market and reacting quickly to changing conditions. These qualities are more often found in the business sector rather than government or academic sectors. Additionally, it is vital to provide incubator clients the expertise of other experienced entrepreneurs, along with legal, accounting and financial advisors. Chanute’s incubator is currently run by the City and needs to broaden its resources to include or board to include more individual’s from the business community, particularly those grounded in real business culture and that have credibility within the community. The City, or other sponsors of the Business Incubator, must hire management with the expertise to help companies grow and to run the Business Incubator in a business-like fashion. This includes providing adequate compensation for experienced management. These practices are often ignored by incubator developers, to their detriment. The failure of a Business Incubator can result in lost community and 80924 7/21/11 71 Economic Development Strategic Plan Chanute, Kansas political support, as well as, draining resources instead of generating new ones. Recruiting a successful former entrepreneur of individual who has worked closely with start-up businesses is important for many reasons. Incubator clients will need “been there, done that” advice, not academic theory. In order to bring the incubator to the next level Chanute must hire an experienced manager to manage the operations and assist in developing the strategic direction for the incubation program. There must be a clear understanding of the existing market that the Business Incubator will focus on. The Business Incubator must continuously evaluate the market to identify new opportunities as well as ensure there its existing focus is appropriate. Chanute’s incubator should focus on a mixed-use or general purpose incubator that can serve a subset of high technology companies, information technology and communications companies through its use of a fiber optic connection. The Business Incubator’s sponsors and management should agree on the program’s mission and determine specific criteria for measuring its successes. Just as the Economic Development Organization needs a clearly stated and agreed upon vision and mission, so should the Business Incubator. This will be part of the process of expanding the program beyond its current size to become a stand alone operation. Additionally, just as the Economic Development Organization will evaluate its progress against benchmarks, the incubator must gauge its success in order to determine whether it is targeting the right industries, utilizing all available resources, etc. We recommend that Chanute expand its incubator as one component of the overall strategy to promote entrepreneurial activity and new business development. Additionally, the incubator can be a way to take advantage of the existing fiber optic network. Making the space and resources available may significantly improve small business development in Chanute. The next steps should be to form a Business Incubator committee within the new Economic Development Organization charged with organizing a formal Business Incubation Program. The committee should utilize the findings in this report for target industries, identify available real estate, the necessary supporting resources discussed earlier, the vision and mission of the Incubator, and the Board of Directors. Ultimately, once the Business Incubator is established and Board formed an Executive Director should be hired to complete the strategic planning process and begin marketing the incubator. Strategy 4-2: Offer business plan assistance A business plan is used for a number of reasons: 1) to raise capital for an expansion or start-up project, 2) to assist a company in determining its direction and how to get there, and 3) to be used as an internal guide to short and long term goals. The first reason presents the economic developer with an opportunity to provide a service to emerging businesses. In particular, start-up businesses and entrepreneurs welcome the availability of free or low-cost assistance in planning for the financial sustainability of their venture. A business plan is a necessity when actively seeking to obtain financing for start-up or expansion. Many times, entrepreneurs are concerned with the process and/or product of the venture and lack the business acumen to effectively plan and communicate a business plan. Chanute, in cooperation with partnering organizations, should provide this assistance as an additional strategy to facilitate new business emergence. A positive consequence of providing this assistance, is the ability of the City to measure the “viability and sustainability” of an entrepreneurial concept and business plan. An 80924 7/21/11 72 Economic Development Strategic Plan Chanute, Kansas investment by the City at the initial planning stages of a new business venture may result in the avoidance of inefficient application of time and resources to support an emerging business at a later time. At times, this can be a labor intensive economic development initiative, but it can also result in new high growth businesses forming in Chanute. If a few of these businesses get established, it could have significant spin-off benefits in the future and justify the time and expense associated with the initiative. Part of the feasibility for each of these items should be an outsourcing evaluation so as to identify other entities that are capable of providing these services in Chanute and over which Chanute’s economic development program may have some contract management responsibility, rather than operations responsibility. Strategy 4-3: Create existing business visitation program An effective local existing business visitation program is becoming increasingly important. Communities now realize that an equal number of jobs, if not more, are created by the expansion of existing firms than the attraction of new industry. Surveys show that most expansions occur at a company’s existing location. Industry will typically stay and grow where it is well treated, market conditions permitting. The continuing contact between the City of Chanute and existing businesses is a necessary action for the retention of businesses. Cooperation is built on interaction. The marketing strategies identified for business retention and expansion address the objective of increasing interaction between the City and the business community in a timely and orderly process. Existing businesses can be very reliable sources of business mobility intelligence, but this nexus requires very careful cultivation. An important, but frequently overlooked, aspect of any marketing effort is the need to contact and inform existing businesses that the City of Chanute is vitally interested in their continued operation and growth. This is one of the most readily identifiable benefits of a local visitation program. Face-to-face meetings with existing businesses should be conducted at least once a year. Most companies consider on-site expansion as the first alternative to adding new production capacity. Often times, they look for a satellite location when considering new geographic areas, when something is wrong with their existing facility, or if they are unhappy in their current environment. It is this rationale that underlies the statistic that is commonly quoted in the economic development profession that most new jobs are the result of local expansion. Existing local business leaders can also provide important leads for the community and identify contacts at other locations for the community to pursue. This networking can pay huge dividends. In addition, any Chanute based business operation that is headquartered elsewhere (or has business ties with related entities) should be sought out for special visitations. Chanute officials should establish and carry out a regular schedule of visitations to this group, both in Chanute and at locations outside of the City. Business visitations should not only include “getting to know” the company, its plans, and its concerns, but should also be used to communicate with the business about its vendors, suppliers and customers. 80924 7/21/11 73 Economic Development Strategic Plan Chanute, Kansas Companies within Chanute can provide valuable information about non-Chanute businesses that support their operation or purchase their product. Where does their raw material come from? Where is their finished product shipped? These vendors, suppliers, and customers are potential for the economic development program. The recruitment of these related businesses may also provide additional financial, logistical, or operational benefits to the existing company within Chanute, thereby facilitating a future expansion of the existing business or strengthening their existing commitment to Chanute. Strategy 4-4: Create entrepreneur development initiative Entrepreneur development, or Economic Gardening, seeks to grow the local economy from within. The underlying idea is that local entrepreneurs create companies that bring new wealth and economic growth to a region in the form of jobs, increased revenues, and a vibrant local business sector. This strategy complements business attraction strategies which aim to recruit new businesses from outside the area. Creating an entrepreneurship development program is time consuming and complicated. This Economic Development Strategic Plan has much of the information necessary to begin creating a successful entrepreneurship development program, but remaining steps must be completed locally by the organizations and people doing the work. The National Association of Counties and Center for Rural Entrepreneurship developed “A Guide for County Leaders; Energizing an Entrepreneurial Economy”. The online resources associated with this guide can be found at www.energizingentrpreneurs.org and will assist the City of Chanute and its partners with developing the specifics of an Entrepreneurship Development Program. Generally the guide details a 5-step process to build a strong strategy: 1. Readiness – evaluating and documenting community assets to build on including; Community readiness factors Rating community support for entrepreneurs 2. Assessment – finding the competitive advantage in regards to entrepreneurial talent; Identify and visit your entrepreneurial talent Articulate your development vision and goals Identifying Entrepreneurial Development Assets 3. Model Practices – strategy building specific to Chanute’s reality 4. Capacity Building – building capacity both in terms of entrepreneurial opportunities as well as the ability to provide increased assistance 5. Keeping Score – outcomes can be hard to see, so it is important to keep score and track successes. Strategy 4-5: Educate local businesses about available incentives When evaluating the business survey cross tabulations and focus group results, it was discovered that many existing businesses were not utilizing available incentives. Given the importance of retaining and growing local businesses to the economic development plan, it is very important to make them aware of the existing incentive opportunities. 80924 7/21/11 74 Economic Development Strategic Plan Chanute, Kansas There were two problems cited from the surveys and interviews; 1) a general lack of knowledge of the available incentives, and 2) confusion about how to access available incentives. Improving knowledge of available incentives should be done through direct mail and followed up during the visitation program. The City should provide more detailed information to improve clarity about how to access incentives as well as provide direct assistance throughout the application process. 5) Build Tourism Industry Strategy 5-1: Continue to focus on downtown revitalization As previously discussed in the SWOT analysis, Downtown is vital to the economic and cultural well being of Chanute. More than just a potential tourism destination, Downtown impacts the local economy in many ways. Downtown retail and small businesses are significant employers and public revenue generators. Additionally, quality of life issues are of increasing importance to companies and workers when making location decisions. There are essentially three components to every successful downtown; 1) Streetscape, 2) Retail, and 3) Public Spaces. Streetscapes are the most important of the three components of successful downtowns. In fact, you could say that “Great Streets=Great Downtowns” and “Bad Streets=Bad Downtowns”. First and foremost, great streets are physically comfortable and safe to the pedestrian, automobile, and cyclist. Great streets and the streetscape improvements are part of the community, including symbols of the heritage and are memorable to the user. When implementing streetscape improvements it is important to ensure that they are seamless and uniform. It is important that the streetscape appears as one well designed improvement and not piecemeal. Additionally, streetscape amenities such as benches, trash cans, water fountains, banners, lights, sculptures, etc. should be of uniform design and of high quality. Finally, it is very important to consider the expense and necessity for maintenance of streetscape improvements. Retail is important to successful downtowns, but in order to be successful requires the streetscape improvements discussed above to reach its full potential. Typical shoppers today shop for convenience, bargains, or the retail shopping experience. Downtown Chanute’s niche is the retail experience, although there may be elements of convenience and bargain shopping. Downtown retail requires a continuous retail experience, so Chanute should aspire to create ground floor retail on both sides of the street. This can be accomplished through incentivizing first floor space towards retail and actively filling vacant spaces. Once a critical mass of retail is reached, which is somewhere around 70-80% of total space, downtown should work to create retail anchors at the beginning and ends of streets. (This goal should be included throughout the retail incentive process previously detailed) Anchors draw customers between them and create a walkable destination. Examples of anchors include; movie theatres, farmers markets, grocery stores, furniture stores, and clusters of similar stores. It is also important that downtown address the appearance of downtown buildings, including those housing both retail and commercial businesses. Areas of focus should include facades, entrances, signage, window displays, and merchandising presentation. Last but absolutely not least is parking. Downtown should have continuous on-street parking and appropriately located off-street parking that is well lit, easy to navigate, and marked by signage. 80924 7/21/11 75 Economic Development Strategic Plan Chanute, Kansas Public spaces provide the finishing touch on successful downtowns. They offer the opportunity to hold large public rally’s, music events, fairs, parades, etc. They also provide an area to compliment and balance the “busyness” and concrete of downtown. Public spaces should be centrally located with active borders. That is, they should be bordered by retail stores and restaurants which can benefit from and contribute to the usefulness of the space. It is important that public spaces are flexible and not dedicated to one particular purpose, therefore they can support a variety of activities. Finally, just as the streetscapes are concerned they should be well lit, utilize high quality amenities, and be well maintained. Downtown currently presents an opportunity for the community. While there is room for improvement, relative to many other communities it is well occupied and the streetscape improvements done to date contribute to the overall appeal. Downtown should continue to be a focus of the economic development efforts with specific emphasis on the three elements detailed above. Strategy 5-2: Expand Destination Infrastructure In order to reach the top of the destination hierarchy and become a true tourism destination Chanute needs to improve its destination infrastructure. Chanute should increase the critical mass of activities it has in order to meet expectations associated with its brand. This can be accomplished by creating new attractions and expanding the depth of offerings of existing attractions. New attractions should be added that complement the brand strategy. New attractions destination infrastructure recommended for Chanute include: ATV/Off-Road Vehicle Park Capitalize on the natural beauty, availability of land, and most importantly the very successful Kirby’s Supers Sports dealership. The addition of this park will provide another destination as well as provide additional weight to Chanute’s recommended brand. Safari Drive-Thru and Conservation Park There are numerous Safari parks in the country, however none within the trade area of Chanute. The addition of a Safari Drive-Thru and Conservation park fits seamlessly into the current activities of the Osa and Martin Johnson museum and recommended brand. The Osa and Martin Johnson Museum can greatly expand its events and activities transitioning from a traditional museum to more interactive destination. Outdoor Amphitheatre for music and theatre The focus groups and web survey indicated a strong demand for additional outdoor music, movies, and performances. These events are most successful, and can develop organically, with the creation of permanent outdoor event space. The City has ample park space and opportunities in downtown to develop an outdoor amphitheatre and public space. It would be preferable that the space be developed in or near downtown to complement the existing revitalization efforts underway. Convention Center Space Studies of the market area revealed that Chanute is well positioned in the region to fill a gap in convention center space. The space could be used for numerous events, corporate retreats, and regional conventions. This is a long-term goal for the City and should be undertaken by a private developer, encouraged by the city with incentives. The additional convention center space will help create a well rounded destination, furthering its goals of a being a regional destination. 80924 7/21/11 76 Economic Development Strategic Plan Chanute, Kansas Expand Lodging Options Chanute’s lodging options are limited in both quality and quantity. Many of the hotel options are old and appear visibly distressed and obsolete. In order for Chanute to grow its destination potential for larger events as well as offer higher end lodging, the City needs to encourage new hotel developments. Chanute will have to make significant improvements in its lodging offerings if it wants to evolve to a higher level of guest experience. Existing Attraction Expansion Existing attractions can greatly assist in creating additional critical mass by expanding their offerings. This is a potentially easier and short-term strategy compared to the development of new attractions. Specific existing attractions that can be expanded include: Expand existing event schedule with additional sports tournaments, outdoor movies, concerts, and theatrical productions Expand the physical space and activities around Martin and Osa Johnson Museum: Develop activities around film school, documentaries, and silent films Expand exhibits and education space into the Museum storage space across the railroad tracks from City Hall Include Osa Martin Home and graves in tour/museum holdings Capitalize on the capitalist innovation of Martin and Osa Johnson Create additional activities zoological/safari Expand activities around Octave Chanute 80924 7/21/11 Capitalize on his activities regarding inventions, by creating museum space about the numerous inventions he created as well as those of other Chanute businesses and citizens Chanute’s lodging options currently range from Poor to Fair condition. Create activities that revolve around all of Octave Chanute’s activities including; airplane design competitions of various levels and 77 Economic Development Strategic Plan Chanute, Kansas sophistication (which also capitalizes on the aerospace cluster that exists in the State of Kansas), invention camps for kids, and invention competitions (such competitions are integrated in pop culture now) Capitalize on the specific reason the City is named Chanute – his success designing railroads Strategy 5-3: Expand/Improve Existing attractions (entertainment, restaurants, shopping) Tourism in Chanute is mainly driven by its events and the Martin and Osa Johnson Museum. There are a limited number of activities for visitors to do after an event ends or museum closes, etc.. With limited restaurant offerings and most unique retailers closing their doors around 5:00PM, there are truly few other activities to keep visitors in town beyond their main purpose. Attention should be paid to the number and variety of shops and restaurants within the historic Downtown and the commercial corridors. Filling empty storefronts, with particular attention to the types of retailer, will help create a more seamless shopping experience. New and existing stores should offer goods that complement the needs of visitors as well as residents. Santa Fe Park offers a great opportunity to build on an existing asset. The ‘correct’ mix of businesses for downtown and the commercial corridor is the mix that works at any given point in time. This will be different for every community and will change. This report identifies retail gaps and makes suggestions for current deficiencies in the downtown and commercial corridor. A procedure should be put in place to inventory the downtown business mix annually, and this information should be shared with the public. Targeted retail sectors can be promoted and contacted. Business types that support the desired positioning of downtown and address deficiencies in the Hierarchy of Needs should be top priority. Strategy 5-4: Package Trips and Bundle Experiences It is important to improve the market information available among businesses and utilize pricing and packaging strategies. Many destinations capitalize on packaging trips and excursions, which helps to market the overall value of a destination. These strategies also serve to make the trip planning process easier for visitors. Potential package trips can include a stay at local lodging with a visit to the Martin and Osa Johnson Museum, visit to a spa, art lessons, craft-making, rounds of golf, etc. The benefits of packaging include increased visitor spending, length of stay, and greater exposure to Chanute’s offerings. By bundling the services of the destinations, Chanute can capitalize on extending the stay of visitors and increase the yield from each visit. 80924 7/21/11 78 Economic Development Strategic Plan Chanute, Kansas 6) Improve neighborhood conditions and housing options Strategy 6-1: Develop Neighborhood Revitalization Program A necessity when attempting to create a high quality of life and successful community is available housing. Both employers and employees look at the local housing market when considering relocation and expansion. The local housing market is reflective of both the economic health of the community but also an indicator of general community pride and quality. Through surveys and market analyses conducted as part of the strategic planning process PGAV identified a number of indications of a lack of for-sale and rental market rate housing and struggling local housing market including: A gap in available for-sale housing stock in the mid-price range ($75,000 - $125,000); Low home ownership rate in the community relative to county, region, and state averages; A lack of available and quality market rate rental units that are not income restricted; Reluctance of local developers to undertake new housing development and existing housing redevelopment due to the state of the local economy and other market factors; Identification of numerous individual homes and, in some cases, whole neighborhoods illustrating a general lack of upkeep and long-term maintenance. In order to successfully compete against other communities the City must guide the market to fill this gap, and improve the overall housing conditions. A proven method for improving neighborhood housing conditions is through the establishment of a comprehensive housing revitalization program. Comparable programs have worked in communities very much like Chanute and with similar problems. The essence of the program is to utilize existing incentives to invest and intervene in the neighborhoods in decline. The first step in the program is to conduct a comprehensive housing study that will identify the existing and future housing needs for Chanute. This study will inventory all housing in the study area, most notably housing conditions, ownership, and values. The study will provide the foundation for identifying the areas to target with neighborhood revitalization plan, which is the second step. The neighborhood revitalization plans are specific to each target neighborhood and will identify and assign priority to catalyst projects that will have the greatest positive impact on the revitalization effort. The plans will encourage building and improvement designs that are comparable and/or complimentary to the existing architectural building designs in each neighborhood. It is important to establish neighborhood beautification programs and consider any changes or improvements that would help to increase the community pride and overall attractiveness of the area. The plans will also identify strategic goals for each neighborhood, the financing strategies, and the type of organization necessary to accomplish those goals. An area of opportunity for focusing the neighborhood revitalization program was identified through public meetings, field work surveys and Economic Development Committee review and is identified as a Neighborhood Preservation District in Plate 3 Development Opportunities located in the appendix. 80924 7/21/11 79 Economic Development Strategic Plan Chanute, Kansas The City has an opportunity to take advantage of a large company that is returning to the tax rolls upon completion of its abatement period. This presents an opportunity to create a Tax Increment Finance District (TIF) that can capture a portion of those taxes for use in meeting neighborhood revitalization goals. Combining the use of TIF and residential tax abatement the program will incentivize housing rehabilitation and infrastructure improvements to spur neighborhood revitalization. Additionally, the City should investigate the use of the Individual Development Account Tax Credit Program (IDA). The IDA is an asset-building strategy established to promote residential self-sufficiency through asset-development for low-income Kansans in a matched-savings program. The tax credits are used to leverage donations that serve as a match for individual savings which the IDA can use to incentivize home ownership and residence repairs. 7) Improve Quality of Life Strategy 7-1: Continue to Improve Park Facilities and Recreation Programs The importance of quality of life factors to economic development have been documented consistently in recent studies and empirical observations. High environmental quality, culturally desirable working and living conditions, and convenient local amenities are believed to be vital to foster economic growth and job creation by retaining local businesses and attracting investment. Focus Groups cited that the Ball fields were well maintained but recreation programs were on the decline. Throughout the strategic planning process residents, stakeholders and City officials touted the high quality of life in Chanute, and identified only a few areas requiring improvement. Our surveys, in general, backed up those statements as traditional quality of life aspects, inquired about individually, received high marks across the board through the web survey. However, based on the survey data, our observations, and comparative case studies there are opportunities for improvement. The first recommendation is more of a word of caution. As Chanute undertakes a program to grow the community, inherent in that growth is the challenge of maintaining its quality of life. As the community grows, both in terms of population and industry, the challenge lies in maintaining the “small town” atmosphere that makes its currently successful quality of life. Therefore, Chanute should continue to survey residents on their overall satisfaction with quality of life factors and modify economic development goals as needed. Along these same lines the City should continue to follow and update the Parks and Recreation Master Plan completed in 2007. Strategy 7-2: Create Civic Organization Partnerships Chanute has many civic organizations which conduct numerous community improvement activities that add to the quality of life. A recurring issue raised throughout the strategic planning process was the need for existing civic organizations to work together to address new needs and where areas of interest 80924 7/21/11 80 Economic Development Strategic Plan Chanute, Kansas overlap. The reason for this was twofold; 1) many civic organizations cited shrinking resources, both in terms of membership and revenues, and 2) the creation of new civic organizations which exacerbates this problem. The civic organizations often desired to expand their programs and services but lacked the resources to sustain their current programs let alone undertake an expansion. Additionally, many of the existing civic organization’s programs complement each other. In order for these civic organizations to continue their existing level of service, and eventually increase services, they should begin to work together. The benefit to Chanute will be sustaining the existing level of civic organizations quality of life programs, and the potential for additional programs as resources are maximized. Finally, an area of opportunity often cited in focus groups and public meetings (although this issue was not directly addressed in the web survey) is the need to increase the number of recreational activities. The activities named included sports activities, which were often discussed as being smaller in scale than previous years, but also non-sports activities such as cultural events. Some of the activities mentioned included; outdoor movies, outdoor concerts, expansion of the art gallery and related activities, and community theatre program expansion. These activities are attractive not only to families, which Chanute successfully attracts and retains, but also the young talent that Chanute is targeting. 8) Create Competitive Economic Environment Strategy 8-1: Utilize fiber optic infrastructure High speed communications, including internet and fiber optics, have changed the way we live, work, and play. The demand for greater access and faster service seems to be ever increasing. A big part of the reason is that the demand is not only from businesses but individual consumers as well. It is very important that Chanute continue be forward thinking where high speed communications is concerned. Currently Chanute has a significant investment in fiber optic infrastructure within the City which provides an opportunity for a competitive advantage over other communities. However, the current infrastructure is not meeting its potential as an economic development tool as its penetration is limited to a few businesses and government and public institutions. In fact, if you visit the Connect Kansas website there are a number of maps that illustrate high speed internet service availability and adoption. Those maps indicate that Chanute offers slower broadband services than competing communities such as Cherryvale, Coffeyville, Erie, Iola, and Pittsburgh. The maps also illustrate that only Columbus and Iola offer fiber optic service for residential adoption. In order for the fiber optic to become a valuable economic development tool for Chanute it must reach the doorsteps of both businesses and residences. Chanute must take the necessary steps to increase utilization of their fiber optic backbone. These steps include creating additional competition for private telecommunications firms to offer service and creating financial mechanisms (such as affordable financing, grants, etc) to offset costs of network expansion. 80924 7/21/11 81 Economic Development Strategic Plan Chanute, Kansas Strategy 8-2: Monitor infrastructure capacity as industry and community grows As industry and the community grows, so will the demand for utilities and infrastructure. Based on PGAV’s evaluation and surveys, Chanute is able to meet its current demand and a substantial amount of future demand with its current utilities and infrastructure. However, there will be a point in the future that additional growth, or satisfactory reliability, will not be possible and significant infrastructure investments will be necessary. The City must actively monitor its utility and infrastructure usage to ensure there is available capacity to meet future demand and be an asset for use in attracting targeted industries. A committee should be established to conduct semi-annual audits of utility and infrastructure capacity, conditions, costs, etc. These audits should include benchmark comparisons against neighboring communities to identify competitive advantages or disadvantages. Economic Development infrastructure is not restricted to utilities, in general terms the need for additional industrial park space is vital to continued successful growth. Future Industrial Park Expansion area is identified in Plate 3 Development Opportunities located in the appendix. Strategy 8-3: Integrate community college/high school workforce development programs into economic development efforts Workforce development is a necessary tool for successful economic development programs. The ability of a community to produce a labor force that can respond to industry’s ever changing needs is integral to the success of existing businesses and the attraction of new businesses. Chanute’s existing labor force and workforce development programs are an economic development asset for the community. The ability of the Neosho County Community College to create programs that quickly responds to industry needs illustrates another component of Chanute’s competitive advantage. Therefore, moving forward it is important that the community college, high school, and state workforce development agencies are integrated into the economic development efforts. Strategy 8-4: Create business assistance program to guide companies through red tape Dealing with local, state, and federal bureaucracy is often cited by businesses as a negative experience. While state and federal programs are mostly outside the City’s purview and expertise, providing assistance on navigating the City’s bureaucracy and regulating authorities is easily accomplished. The City should create a Business Assistance Program that will provide simplified access to all the information needed to open a business in the City of Chanute. The Business Assistance Program will also house information and applications for occupancy permits, tax enrollment, business licenses, tax incentives, and tax credit information. The mission of the Business Assistance Program will be to streamline and simplify the hurdles to opening a business in Chanute. 80924 7/21/11 82 Economic Development Strategic Plan Chanute, Kansas Strategy 8-5: Encourage highway expansion Just as the infrastructure needs within Chanute are important to successful economic development, certain infrastructure outside the City control is important as well. One of the most important infrastructure needs is highway access. Given the current nature of manufacturing and distribution, timely and efficient transportation is vital to economic development success for those industries. Through the course of the Economic Development Strategic Plan work, businesses cited transportation outside of Chanute as an obstacle to growth. In particular, the lack of a four lane highway connecting Chanute to other major metropolitan areas was discussed. Chanute should become very active in regional and state transportation planning initiatives through all possible avenues (i.e. local business leaders, state and federal politicians, participation on Department of Transportation committees and boards, etc.) and promote the need for highway expansion to the community. It is important to note that this will be a long-term effort. 9) Increase Status as Regional Retail Hub Strategy 9-1: Improve connections and appearance of commercial corridors First impressions make for lasting impressions, and the first impressions of Chanute are the commercial corridors off the highway. These corridors, as well as the main retail corridor on Santa Fe Ave., can be greatly improved by using streetscape elements (i.e. street signs, street lamps, street furnishings, etc.) similar to those on 35th Street at the new Chanute High School. These streetscape elements are high quality, and their consistent application will enhance Chanute’s aesthetic appeal and begin to connect the retail corridors. Connecting the retail corridors through use of consistent streetscape elements and wayfinding will have the effect of creating a seamless appearance and enhanced shopping experience. These improvements will also increase a retailer’s experience and will be an additional incentive when attempting to attract new retail to Chanute. In order to fund the recommended streetscape improvements for Chanute’s commercial corridors the City should establish a Tax Increment Finance (TIF) District in each corridor. The Primary Retail Corridor on Santa Fe Ave. should be the first corridor for use of TIF with future use occurring in the Secondary Retail Corridors (Primary and Secondary Retail Corridors are Identified in Plate 2 Existing Conditions located in the Appendix). This primary retail corridor and secondary retail corridors are in need of reinvestment and redevelopment which the streetscape improvements and redevelopment strategies can encourage and catalyze. Strategy 9-2: Develop commercial/retail design standards Many communities have adopted enhanced design standards for their commercial and retail corridors that complement the streetscape improvements. The results are retail corridors that reflect the character of the community and not the character of the national franchise. Chanute should improve its commercial design standards, specifically within designated retail corridors, to create a unique sense of place among its franchise and convenience retail and commercial/service businesses. 80924 7/21/11 83 Economic Development Strategic Plan Chanute, Kansas Strategy 9-3: Attract new targeted retail Retail development has not always been a traditional component of economic development. However, in recent years municipalities have recognized the benefits that retail development brings to a community. Attracting new retail to Chanute is important for a number of reasons: New retail development brings new money and investment to the community; Retail jobs, while not the highest paying, offer increased employment opportunities; Targeted retail sectors will help to eliminate leakage and increase sales tax collection; Targeted retail sectors will meet unmet demand, increasing quality of life for residents. In order to attract the targeted retail identified earlier the City must utilize a number of strategies. Develop Retail Oriented Incentives – Incentives should be prioritized for attracting investment into bricks and mortar improvements, providing workforce training, and loans as opposed to grants. Those types of incentives will have greater benefits for the community as loans are repaid, training stays with the workforce, and bricks and mortar improvements remain in Chanute even if the business fails. Incentives of this type include: Low interest loans or revolving loan funds for: Façade rehabilitation and beautification loans, Retail space reconfiguration or interior finishing, Fee Waivers for starting a new business Performance based loans that are repaid upon the successful performance of the business, Property tax abatement Coordinate property owners and inform them about the new incentives developed for retail attraction and the targeted retail sectors; Conduct marketing and recon trips to communities within a two hour drive in order to identify retail stores that may be successful in Chanute; Attend the International Council of Shopping Center (ICSC) events in Kansas City, particularly the Alliance program events which link public and private sector retail development efforts. ICSC is the clearinghouse for all national retail chains. Track all available retail properties and the property details (i.e. Square footage, lease/sale price, traffic count, layout, etc) for marketing purposes Establish local, regional and national retail real estate broker database for the purpose of delivering information about available space, incentives, and Chanute’s competitive advantages. Additionally, creating this database of retailer stores, their representatives, and the retailer’s typical store needs (i.e. square footage, traffic count, shopping center location, co-location desires, etc.) will help Chanute better understand the industry. 80924 7/21/11 84 Economic Development Strategic Plan Chanute, Kansas 10) Engage and Retain Youth Strategy 10-1: Create job network connecting local jobs to local youth Just as it is important to retain and grow existing local businesses, it is important to retain and grow the local workforce. A significant investment exists in the local youth and much of that investment is leaving the area upon graduation of high school and ultimately college. A significant opportunity for attempting to retain and engage local youth was discovered during the focus group process. During the “young leaders” focus group a common theme was that local youth would stay or return to Chanute if job opportunities existed, but they do not. However, during the “business leaders” focus group it was frequently mentioned that it was challenging to recruit new employees to Chanute to fill existing job openings. These two problems are complimentary. By creating a program to connect local graduates to the local job opportunities Chanute can create a “win-win” situation and retain local youth and improve local companies’ ability to attract employees. The City should work in conjunction with the public schools and business leaders to create a database linking these specific opportunities. Another method to connect local jobs to local youth is to develop a college student loan program. The program would work as a forgivable loan or scholarship on the condition that the recipient returns to Chanute to work for a set period of time. Strategy 10-2: Engage youth to increase community recreation/entertainment offerings Engaging youth to improve the local community, particularly in quality of life areas of interest to youth, is another retention method. Involving the youth in the development of the community creates additional buy-in and increases the likelihood that their ties to the community will be long lasting. From the focus groups and surveys it is evident that the areas of most importance to the youth are; 1) arts, 2) music, 3) sports. While these areas are most important to the youth, they are also quality of life areas that can greatly affect Chanute’s ability to attract and retain talent of all ages. As Chanute, works to increase the recreation activities in the area, local youth should be included in planning and development of those activities. Strategy 10-3: Incorporate youth into entrepreneur programs When creating the entrepreneurial development program it is important to create specific opportunities that include local youth. This will be another opportunity to engage youth in a manner that will tie them to the community, take advantage of the local talent, and grow businesses from within. 80924 7/21/11 85 Economic Development Strategic Plan Chanute, Kansas Implementation One of the key issues in strategic planning is the translation of the mission, goals, strategies and tactics into everyday actions. In public sector organizations particularly, the budget, all too often, drives the plan instead of vice versa. The challenge lies in having resources of the community directed toward the plan and not in random directions that may or may not contribute to reaching the goals. The prioritization and implementation of strategic actions and tactics to support Chanute’s mission and goals is a critical component of the strategic planning process. Chanute’s leadership must ensure that these actions support the diversification of the community’s economy while simultaneously keeping the inherent values of the community intact. Embracing, and subsequently, acting on strategies and tactics to enhance business investment and growth must occur in a systematic way accounting for the shortterm and long-term priorities of the community. These measures, although perhaps a departure from the way Chanute has been handling economic development in the past, will over time, produce favorable results. The hallmark of failed economic development efforts in many communities is failure to take a risk or to change the manner in which they operate. Chanute’s economic development efforts should continually evolve and adapt to the constantly changing business environment and markets, and not remain static in its approach. References have been made within this report to the importance of budgeting for economic development. Equally important to the amount and scope of a budget is a timeline for implementing the economic development program. A budget, when coupled with a timeline, provides a systematic approach to prioritizing the implementation of strategic actions as well as allocating available resources. In addition, the development of a budget and timeline assists in the identification of future strategic actions requiring additional financial investment beyond the “operational” expenses of conducting the economic development program. For example, future improvements to streetscape will require the investigation of financing. Obviously, these costs will not be supported by the annual economic development operating budget. However, capital expenses or other significant investments associated with economic development should be included in annual and long-term budgeting, and timeline planning process consistent with the goals, strategic actions, and tactics outlined within the Economic Development Strategy. Budget The resources allocated in an economic development program exemplify a community’s commitment to the success of business expansion, attraction and development. Therefore, it is reasonable to expect that Chanute will make a commitment to allocating the necessary financial resources, volunteer support and other available means to implementing the Program. We recommend an initial, cumulative budget allocation of $450,000 to $500,000 over the first three years for operation of the economic development program, not including funds attributed to loan and financing programs. In our experience, communities of similar size and with comparable resources to Chanute have committed to a three-year economic development budget within this range. A three-year 80924 7/21/11 86 Economic Development Strategic Plan Chanute, Kansas commitment ensures that adequate resources are supporting the formative stages of the economic development program allowing for an accurate analysis of the success and/or areas for improvement during the initial three years of the Program’s implementation. However, evaluation of the budget should take place on an annual basis to ensure that the allocated amount is consistent with the expected outcomes of the program and to adjust to emerging business trends or changing market conditions. Timeline The following timeline establishes a general prioritization of strategic actions and tactics while simultaneously allowing enough flexibility to implement and perform those actions in accordance with Chanute’s economic development budget, Chanute’s capital expenditure budget, business markets and significant economic development events within the community. We believe the timeline should be viewed as the execution of short-term, mid-term, and long-term strategies. The short-term strategies should be implemented in the first year, establishing a foundation for future economic development activities. Mid-term strategies may require planning during the initial year of the program, but their full implementation should occur between years 2-5. Long-term strategies should be implemented in years 5-10. The long-term strategies will require significant evaluation of their financial feasibility, overall necessity, and potential viability. Many of the strategies are ongoing in nature and their stage of implementation represents when each strategy should begin. Goal 1: Strengthen Economic Development Structure Strategic Action Responsible Party Support Groups Funding Priority Set-up Chanute Regional Development Authority City of Chanute Chamber, Main Street $60,000 Short-Term Milestones 80924 7/21/11 Establish committee to form the board of directors File Articles of Incorporation Develop By-Laws and board policies Apply for Federal EIN Open bank account and establish financial procedures Establish open records policy File for federal tax exempt status Develop Start-up budget and operating budget Develop activities budget Hire Staff Establish payroll systems Conduct Organizational Strategic Planning 87 Economic Development Strategic Plan Chanute, Kansas Goal 1: Strengthen Economic Development Structure (continued) Strategic Action 1-1: Organizational strategic planning Milestones 1-2: Establish funding program Milestones Support Groups Funding Priority CRDA City, Chamber, Main Street $5,000 Short-Term Conduct a strategic planning retreat upon establishment of the CRDA CRDA City - Long-Term Establish funding committee Review budget and future operation and program demands to establish revenue needs Develop fundraising events 1-3: Develop consistent medium for communication with the public CRDA Milestones 1-4: Develop economic development partnerships Milestones Responsible Party $10,000 Medium-Term Communications committee to develop marketing landscape and calendar of outreach including social media and traditional media outlets CRDA City, Chamber, Main Street City, Chamber $5,000 Medium-Term Business development committee selects key regional and state economic development organizations to develop working relationships Goal 2: Promote Chanute Strategic Action 2-1: Increase highway presence Milestones 80924 7/21/11 Responsible Party Support Groups Funding Priority City CRDA, Chamber, Main Street N/A Short-Term Evaluate feasibility of annexation of targeted areas. If annexed, appropriately zone property If not feasible to annex, purchase property 88 Economic Development Strategic Plan Chanute, Kansas Goal 2: Promote Chanute (continued) Strategic Action 2-2: Develop wayfinding program Milestones 2-3: Conduct community building and build pride in Chanute Responsible Party Support Groups Funding Priority CRDA City, Chamber, Main Street N/A1 Medium-Term City issue RFP for Wayfinding and Signage Plan to solicit design, manufacture and installation. Chamber Milestones 2-4: Create economic development organization web site $10,000 Medium-Term Communications committee outreach to civic organizations to initiate grassroots community-building campaign. CRDA Milestones City, CRDA, Main Street City, Chamber, Main Street $30,000 Short-Term Communications committee engage local graphics and web developers for website development proposals Develop wireframe and website skeleton for review by Board of Directors Add content, copy, utilize search optimization, and publish the site Establish monthly update process 1 —Typical costs for comprehensive wayfinding sign programs for a City of Chanute’s size range from $30,000—$45,000. Goal 3: Recruit New Businesses Strategic Action 3-1: Contact site selection firms Milestones 80924 7/21/11 Responsible Party Support Groups Funding Priority CRDA City, Chamber, Main Street N/A Medium-Term Business Attraction, Retention and Expansion Committee (BAREC) create site selection customer relationship management (CRM) database Develop outreach plan of mailings, follow-up calls, and visits at industry events and conferences. 89 Economic Development Strategic Plan Chanute, Kansas Goal 3: Recruit New Businesses (continued) Strategic Action 3-2: Develop Direct Mail Program Milestones 3-3: Initiate call program Support Groups Funding Priority CRDA City, Chamber $15,000 Medium-Term BAREC develop marketing materials (postcard series for initial contacts) and CRM database Create a program for updating and developing new marketing materials and keeping CRM database up-to-date CRDA Milestones 3-4: Annual marketing trips 3-5: Create target industry lead development program Milestones City, CRDA N/A Medium-Term Utilize CRM database and follow-up from marketing lead generation to initiate call program CRDA Milestones 80924 7/21/11 Responsible Party City, Chamber, Main Street $10,000 Medium-Term BAREC develop annual calendar of economic development and target industry conferences and events within budget parameters Prepare marketing trip agenda and marketing materials for each utilizing attendee lists, targeted companies, CRM database and marketing objectives CRDA City, Chamber, Main Street N/A Short-Term BAREC develop process to utilize the CRM database as a foundation to develop additional targeted company leads from local industry leaders, industry trade journals, and conference attendance 90 Economic Development Strategic Plan Chanute, Kansas Goal 4: Grow Existing Businesses Strategic Action 4-1: Develop business incubator program Milestones Support Groups Funding Priority City CRDA, Chamber N/A Short-Term Create a Business Incubator Committee Develop mission, focus and operating framework for the incubator Identify local, state and federal funding sources Procure physical space Hire Executive Director for the incubator Conduct final operations planning with Executive Director and begin application process 4-2: Offer business plan assistance CRDA Milestones 4-3: Create existing business visitation program Chamber $5,000 Long-Term BAREC create a network of volunteers made up of bankers, executives, retired executives to act as business plan advisors Develop criteria for business plan assistance qualification in relation to target industry creation goals City Milestones CRDA N/A Short-Term BAREC utilize CRM database and populate with major local companies Identify “at risk” and “priority” companies for visits by those that have: recently hired large numbers of employees, recently laid off large numbers of employees, been recently acquired, or operate in consolidating or declining industries Prepare preliminary information and beginning visiting companies biweekly or monthly depending upon demand 4-4: Create entrepreneur development initiative Milestones 80924 7/21/11 Responsible Party CRDA City $15,000 Medium-Term Business Incubator Committee should work within a regional or county context to conduct the 5-step process for creating an entrepreneur development initiative. 91 Economic Development Strategic Plan Chanute, Kansas Goal 4: Grow Existing Businesses (continued) Strategic Action 4-5: Educate local businesses about available incentives Milestones Responsible Party Support Groups Funding Priority CRDA City, Chamber, Main Street $5,000 Medium-Term Develop a simple brochure detailing available assistance for local companies Distribute at local events, city hall, and site visits Goal 5: Build Tourism Industry Strategic Action 5-1: Continue to focus on downtown revitalization Milestones 5-2: Expand destination infrastructure Support Groups Funding Priority Main Street City, CRDA, Chamber N/A Short-Term Develop a Business Improvement District Feasibility Committee to evaluate the feasibility of establishing a BID for the Downtown area to implement streetscape, marketing and other improvements When identifying new physical locations of the Business Incubator, CRDA, etc. consider downtown spaces Chamber CRDA, City N/A Short-Term Milestones Tourism Committee to create Developer Solicitation Packages for each of the recommended new attractions Distribute to local developers, industry leaders and civic organizations, as well as to owners/operators of similar types of attractions throughout the country. 5-3: Expand/Improve existing attractions Milestones 80924 7/21/11 Responsible Party Chamber CRDA, City, Main Street N/A Long-Term Retail Development Committee to work with the Tourism Committee to annually inventory the business mix and identify remaining gaps according to the visitors hierarchy of needs 92 Economic Development Strategic Plan Chanute, Kansas Goal 5: Build Tourism Industry (continued) Strategic Action 5-4: Package trips and bundle experiences Milestones Responsible Party Support Groups Funding Priority Chamber CRDA, City, Main Street N/A Short-Term Tourism committee to reach out to existing destinations and tourist support services to create multiple bundles of visitor experiences Package and market the trips through each participating business and visitor/tourist information websites Goal 6: Improve Neighborhood Revitalization Program Strategic Action 6-1: Develop neighborhood revitalization program Milestones Responsible Party Support Groups Funding Priority City CRDA, Chamber N/A2 Short-Term City prepare and issue RFP to create a neighborhood revitalization program The City should hire an experienced housing consulting agency to conduct a housing study, develop a work plan, and implement a TIF district for the targeted areas. Costs for this type of work vary greatly depending on size but are eligible for reimbursement from the TIF district revenues. Goal 7: Improve Quality of Life Strategic Action Responsible Party Support Groups Funding Priority 7-1: Continue to improve park facilities and recreation programs City CRDA, Chamber, Main Street N/A Short-Term Milestones 80924 7/21/11 Reinvigorate the Recreation Committee and Facilities Committee with some “fresh blood” and a focus on increasing funding for improvements and increased recreation activities Hold special events and offer sponsorships of park facilities and activities to raise money for additional improvements Develop an umbrella committee that can combine efforts of the 93 Economic Development Strategic Plan Chanute, Kansas Goal 7: Improve Quality of Life (continued) Strategic Action 7-2: Create civic organization partnerships Milestones Responsible Party Support Groups Funding Priority Chamber CRDA, Main Street, City N/A Short-Term Hold a kick-off meeting to create a discussion among all the civic organizations to entertain the idea of collaboration and resource maximization Goal 8: Create Competitive Economic Environment Strategic Action 8-1: Utilize fiber optic infrastructure Milestones 8-2: Monitor infrastructure capacity as industry and community grows Milestones 8-3: Integrate community college/high school workforce development programs into economic development efforts Milestones 80924 7/21/11 Responsible Party Support Groups Funding Priority City CRDA, Chamber N/A Short-Term Infrastructure Committee to work with services providers and state broadband initiatives to expand fiber connectivity City CRDA N/A Long-Term Infrastructure Committee to establish a procedure to review capacity as industry and community grows CRDA City, Chamber $2,000 Medium-Term Include representatives of the workforce development and education sectors in committees 94 Economic Development Strategic Plan Chanute, Kansas Goal 8: Create Competitive Economic Environment (continued) Strategic Action 8-4: Create business assistance program Milestones 8-5: Encourage highway expansion Responsible Party Support Groups Funding Priority City CRDA, Chamber N/A Medium-Term BAREC to walk through the process of opening a new business, expanding a new business, and conducting a real estate development project to understand the process BAREC will then work with the City to establish a process to simplify the process or assist businesses and developers with the process CRDA Milestones City, Chamber $2,000 Long-Term Infrastructure Committee to identify key players at KDOT and state political representatives to push the importance of the highway widening north and south of Chanute Goal 9: Increase Status as Regional Retail Hub Strategic Action 9-1: Improve connections and appearance of commercial corridors Milestones 9-2: Develop commercial/retail design standards Support Groups Funding Priority City CRDA, Chamber N/A Medium-Term Retail Development Committee to hold public meetings within the targeted retail corridors to discuss potential of Tax Increment Finance or Business Improvement Districts to finance infrastructure and streetscape improvements to the area City Milestones 80924 7/21/11 Responsible Party CRDA, Chamber N/A Medium-Term Retail Development Committee to review examples of other communities commercial/retail design standards Hold public input meetings to gauge public desires for design standards and preferences on design Proceed with revisions to comprehensive plan, zoning and building codes based when appropriate 95 Economic Development Strategic Plan Chanute, Kansas Goal 9: Increase Status as Regional Retail Hub Strategic Action 9-3: Attract new targeted retail Milestones Responsible Party Support Groups Funding Priority CRDA City, Chamber $5,0002 Medium-Term Retail Development Committee to create retail development oriented incentives Retail Development Committee to coordinate property owners and businesses about incentives and targeted retail sectors Retail Development Committee to conduct marketing trips to nearby communities Retail Development Committee to attend ICSC events and join the ICSC Alliance program Retail Development Committee to create a database of all available retail property and potential retail development sites Utilize the CRM to include a database of local, regional, and national retail real estate brokers 2 —These costs represent only operational aspects of the retail attraction strategies, not financial incentives. Goal 10: Engage and Retain Youth Strategic Action 10-1: Create job network connecting local jobs to local youth Milestones 10-2: Engage youth to increase community recreation/entertainment offerings Support Groups Funding Priority CRDA City, Chamber $5,000 Medium-Term Develop a database and online resource for job seekers and employers Engage local industries and banks to create a student loan program City Milestones 80924 7/21/11 Responsible Party CRDA, Chamber, Main Street N/A Medium-Term Establish goals for youth involvement and responsibility allotment for committees Effectively engage college students returning for the summer in internships within CRDA and local industry 96 Economic Development Strategic Plan Chanute, Kansas Goal 10: Engage and Retain Youth Strategic Action 10-3: Incorporate youth into entrepreneur programs Milestones 80924 7/21/11 Responsible Party Support Groups Funding Priority CRDA City, Chamber N/A Medium-Term Integrate entrepreneurship programs, writing a business plan, and community pride programs into curriculum at High School and Community College 97 Economic Development Strategic Plan Chanute, Kansas Benchmarking Evaluation is frequently the most neglected part of the strategic planning process. The evaluation process measures performance based against the service, program, or product’s ability to meet or exceed expectations. A consistent and effective system of evaluation views programs, activities and services as repeatable processes instead of a cluster of innovative activities reinvented each time they are executed. Performance evaluation identifies “best practices” and successful approaches. In addition, an evaluation system may identify areas for improvement and “unsuccessful practices”. Ultimately, the underlying assumption of performance evaluation is to determine if the organization should continue with current administrative practices, or initiate a search for better ways to manage limited resources. The evaluation must be pegged to results that are finite and not just means or tactics within the “process”. With proper stewardship, performance evaluation can be an effective management tool. Performance evaluation can be summarized as: A system to improve process consistency and reduce errors and “wheel spinning” through an ongoing, organization-wide effort using staff involved in the process and empowered to make changes. The ability to use measurement tools to track processes and pinpoint problems. A method of focusing on increasing customer satisfaction An approach to increase opportunities for partnership. Think long-term; act short-term Benchmarking is the cornerstone of performance evaluation. According to Bruce Hendrickson, author of Management of Local Planning, benchmarking is “the continuous process of measuring products, services, and practices against the toughest competitors and/or recognized industry leaders”. Benchmarking analyzes the systematic practices employed in economic development against best practices in other industries (i.e. real estate, services companies, etc.) for insights into how economic development processes can be improved. The results of benchmarking provide: Reference points for evaluation. Models to be emulated. Performance measures and benchmarks for Chanute’s Economic Development Program The measurement of economic development success or failure is a difficult task. Therefore, it is important that benchmarks used to measure Chanute’s economic development program performance represent the overall impact of the economic development process. The combined use of quantitative and qualitative measures ensures that a balance exists between statistical data and intangible affects of the economic development program. The following benchmarks provide a broad representation of the types of performance measures employed by organizations in their evaluation of programs. We recommend that Chanute review these benchmarks in the context of the Strategic Plan and select benchmarks which currently align with the 80924 7/21/11 98 Economic Development Strategic Plan Chanute, Kansas priorities of the community. It is expected that over time the priorities of Chanute’s economic development program will change as should the benchmarks selected to measure the program. Quantitative Measures Quantitative measures remove much of the subjectivity involved in performance measures. It provides a consistent and valid measure of a program’s performance. Typically, quantitative measures count units, process time, ad responses, number of contacts, errors, costs, completion time, and related factors. However, the adoption of quantitative measures has some limitations. First, data is not always readily available and may require an investment in creating a process of systematically collecting and analyzing data. Second, quantitative data does not always “tell the whole story”. Environmental conditions such as a natural disaster, governmental change, business market conditions can indirectly impact the “specific” data in positive or negative ways. It is important to evaluate quantitative data in the context of the larger environment in which the program operates. Therefore, Chanute must give careful consideration to the availability of resources, the accessibility of data, and the weighted importance of particular objectives when selecting quantitative benchmarks for performance measurement. Number of jobs created/retained Number of retained businesses Number of businesses visited Number of businesses surveyed Number of “at risk” businesses assisted Average salary of jobs created Loan/business failure rates Number of positive press stories Types of jobs created Number of business inquiries about the community Qualitative Measures Qualitative measures are a subjective judgment based on a person or groups’ perception. Therefore, qualitative measures present a greater challenge, but they are critical to benchmarking service organizations like economic development. Performance must be measured through observation by capturing and quantifying opinions and attitudes of customer groups (i.e. existing businesses, prospective businesses, partners of the community). Possible tools include interviews, surveys, and focus group sessions. Business perceptions of local government 80924 7/21/11 99 Economic Development Strategic Plan Business perceptions of the community Involvement of assisted businesses in other community activities Diversification of businesses Perception of value tax incentives Perceived impact of economic development on the community Community involvement and support 80924 7/21/11 Chanute, Kansas 100 Economic Development Strategic Plan Chanute, Kansas Appendix 80924 7/21/11 101 Economic Development Strategic Plan Plate 1 Access Points Chanute, Kansas Economic Development Strategic Plan Plate 2 Existing Conditions Chanute, Kansas Economic Development Strategic Plan Plate 3 Development Opportunities Chanute, Kansas Economic Development Strategic Plan Chanute, Kansas Economic Development Strategic Plan Chanute, Kansas Cost of Doing Business Comparison Business Costs Kansas Top Corporate Income Tax Arkansas Iowa Missouri Nebraska Oklahoma Texas 7.05 6.5 9.9 5.156 7.81 6 0 State Taxes as Percentage of Personal Income 9.6 10 9.3 9.2 9.8 9.8 8.4 Sales Tax & Use Tax % 5.3 6 6 4.225 5.5 4.5 6.25 Internet Sales Tax % 5.3 6 6 4.225 5.5 4.5 6.25 Property Tax (land & building, as share of personal income) 3.41 1.58 3.47 2.77 3.7 1.53 3.87 Workers' Compensation as % of Covered Wages 0.81 0.64 0.98 0.87 0.93 1.27 0.42 Unemployment Insurance Tax per Employee, '09 $320 Right to Work State Y $444 Y $245 Y $456 N $116 Y $179 Y $243 Y Tax Exemptions Manufacturing Machinery Ex empt Exempt Exempt Exempt Exempt Exempt Ex empt Office Equipment Taxable Taxable Taxable Taxable Taxable Taxable Taxable Custom Software Ex empt Taxable Exempt Exempt Taxable Exempt Taxable Modified Canned Software Taxable Taxable Taxable Exempt Taxable Taxable Taxable Tangible Personal Property Taxable Taxable Taxable Taxable Taxable Taxable Taxable $19.58 $14.18 $16.63 $18.34 $15.99 $14.76 $15.42 Other Business Costs Average Hourly Earnings for Production Workers, '09 Electricity, September 2009 (cents/kWh) 6.2 5.7 5.6 5.8 5.9 4.58 6.7 Natural Gas, May 2009 ($/ 1,000 cu ft.) 3.97 3.61 5.04 N/A N/A 3.51 3.82 All information is from sources deemed reliable and is subject to errors, omissions and modifications. Tax information is from the Federal Clearing House Inc., 2008. Mo st other statistics are collected from CQ's Press' State Rankings 2010, The Annie E. Casey Foundation Baltimore, MD, Small Business Survival Index, and US Department of Commerce: Statistical Abs tract of the US. Economic Development Strategic Plan Economic Development Survey Results Chanute, Kansas Zoomerang Survey Results Chanute Economic Development Strategy Survey Response Status: Completes Filter: No filter applied Dec 27, 2010 2:56 PM PST This survey, with your input, is an important part of Chanute's Economic Development Strategy. Please take a few minutes to provide us with your insights. If you have questions or problems, please contact Jane Brophy at (620) 431-3350. Overall Satisfaction With City Services - Using a scale of 1 to 4 where 4 means excellent and 1 means poor, please rate your satisfaction with each of the services listed. 1. Rate your overall satisfaction with city services Poor 3 3% Fair 15 14% Good 61 55% Excellent 31 28% 0 0% Don't Know Total 110 100% 2. Rate the overall enforcement of City codes and ordinances Poor 13 12% Fair 34 31% Good 51 46% Excellent 9 8% Don't Know 3 3% Total 110 100% 3. Rate the overall flow of traffic and congestion management in the City Poor 2 2% Fair 19 17% Good 55 50% Excellent 33 30% 0 0% Don't Know Total 109 100% 4. Rate the overall effectiveness of City communication with the public Poor 17 16% Fair 33 31% Good 47 44% Excellent 10 9% Don't Know 1 1% Total 108 100% 5. Rate the overall value that you receive for your City tax dollars and fees Poor 15 14% Fair 35 32% Good 43 39% Excellent 14 13% Don't Know 2 2% Total 109 100% 6. How well is the City planning for growth Poor 28 26% Fair 40 37% Good 30 28% Excellent 7 6% 3 3% Don't Know Total 108 100% 7. How well is the City managing growth Poor 30 28% Fair 35 32% Good 31 29% Excellent 4 4% Don't Know 8 7% Total 108 100% 8. Which two of these items do you think should receive the most emphasis from City leaders over the next TWO years? Enforcement of City codes and ordinances 15 14% Flow of traffic and congestion management 3 3% City communication with the public 36 33% Value for City tax dollars and fees 51 46% Planning for growth 67 61% Managing for growth 38 35% Poor 7 6% Fair 37 34% Good 62 56% Excellent 4 4% Don't Know 0 0% Several items that may influence your perception of Chanute as a community are listed below. Please rate your satisfaction with each item on a scale of 1 to 4 where 4 means excellent and 1 means poor 9. How would you rate the overall image of the City Total 110 100% 10. How would you rate the overall quality of life in the City Poor 6 6% Fair 28 26% Good 52 48% Excellent 23 21% Don't Know 0 0% Total 109 100% 11. How would you rate the overall feeling of safety in the City Poor 3 3% Fair 14 13% Good 52 48% Excellent 40 37% Don't Know 0 0% Total 109 100% 12. How would you rate the overall quality of new development in the City Poor 36 33% Fair 43 39% Good 26 24% Excellent 5 5% 0 0% Don't Know Total 110 100% 13. How would you rate the overall quality of life in the City Poor 4 4% Fair 28 26% Good 56 52% Excellent 20 19% Don't Know 0 0% Total 108 100% 14. How would you rate the City as a place to retire Poor 21 19% Fair 24 22% Good 34 31% Excellent 27 25% Don't Know 2 2% Total 108 100% 15. How would you rate the overall appearance of the City Poor 5 5% Fair 39 36% Good 57 52% Excellent 7 6% 1 1% Don't Know Total 109 100% 16. How would you rate the availability of affordable housing Poor 33 30% Fair 37 34% Good 32 29% Excellent 2 2% Don't Know 5 5% Total 109 100% 17. How would you rate the acceptance of diverse populations in the City Poor 7 6% Fair 37 34% Good 52 48% Excellent 12 11% Don't Know 1 1% Total 109 100% 18. How would you rate the availability of jobs in the City Poor 61 56% Fair 39 36% Good 6 6% Excellent 0 0% 2 2% Don't Know Total 108 100% 19. How would you rate the ability to open a business in the City Poor 34 31% Fair 41 37% Good 21 19% Excellent 8 7% Don't Know 6 5% Total 110 100% 20. How would you rate the ability to raise a family Poor 7 6% Fair 25 23% Good 44 40% Excellent 34 31% Don't Know 0 0% Total 110 100% Parks - For each of the items listed, please rate your satisfaction on a scale of 1 to 5 where 4 means excellent and 1 means poor. 21. Maintenance of City parks Poor 4 4% Fair 14 13% Good 60 55% Excellent 31 28% Don't Know 0 0% Total 109 100% 22. Number of City parks Poor 0 0% Fair 8 7% Good 54 50% Excellent 47 43% Don't Know 0 0% Total 109 100% 23. Number of walking and biking trails Poor 8 7% Fair 17 15% Good 52 47% Excellent 32 29% Don't Know 1 1% Total 110 100% 24. Quality of outdoor athletic fields Poor 19 17% Fair 19 17% Good 33 30% Excellent 36 33% 3 3% Don't Know Total 110 100% 25. Number of outdoor athletic fields Poor 9 8% Fair 14 13% Good 51 47% Excellent 32 29% Don't Know 3 3% Total 109 100% 26. Landscaping and appearance of public areas along City streets Poor 10 9% Fair 29 27% Good 50 46% Excellent 20 18% Don't Know 0 0% Total 109 100% Recreation - For each of the items listed, please rate your satisfaction on a scale of 1 to 5 where 4 means excellent and 1 means poor. 27. Availability of information about City parks and recreation programs Poor 12 11% Fair 36 33% Good 48 44% Excellent 12 11% Don't Know 2 2% Total 110 100% 28. The City's youth athletic programs Poor 19 17% Fair 25 23% Good 40 36% Excellent 18 16% Don't Know 8 7% Total 110 100% 29. The City's adult athletic programs Poor 20 18% Fair 29 27% Good 38 35% Excellent 8 7% Don't Know 14 13% Total 109 100% 30. City special events and festivals Poor 4 4% Fair 23 21% Good 48 44% Excellent 34 31% 1 1% Don't Know Total 110 100% 31. Cultural arts programs (ceramics, dance, etc.) Poor 15 14% Fair 48 44% Good 32 29% Excellent 4 4% Don't Know 11 10% Total 110 100% Several reasons for deciding where to live are listed below. On a scale from 1 to 4 where 4 is very important and 1 is unimportant, how important was each for your decision to live in Chanute? 32. Sense of belonging to the community Unimportant 9 8% Not Sure 8 7% Somewhat Important 50 45% Very Important 43 39% Total 110 100% 33. Quality of public schools Unimportant 3 3% Not Sure 1 1% Somewhat Important 25 23% Very Important 80 73% Total 109 100% 34. Employment opportunities Unimportant 4 4% Not Sure 1 1% Somewhat Important 18 16% Very Important 87 79% Total 110 100% 35. Types of housing Unimportant 2 2% Not Sure 3 3% Somewhat Important 45 41% Very Important 60 55% Total 110 100% 36. Affordability of housing Unimportant 2 2% Not Sure 3 3% Somewhat Important 38 35% Very Important 65 60% Total 108 100% 37. Access to quality shopping Unimportant 13 12% Not Sure 6 5% Somewhat Important 51 46% Very Important 40 36% Total 110 100% 38. Availability of parks and recreation opportunities Unimportant 5 5% Not Sure 6 6% Somewhat Important 61 56% Very Important 37 34% Total 109 100% 39. Near family or friends Unimportant 12 11% Not Sure 8 7% Somewhat Important 36 33% Very Important 52 48% Total 108 100% 40. Safety and security Unimportant 1 1% Not Sure 1 1% Somewhat Important 28 26% Very Important 77 72% Total 107 100% 41. Availability of transportation options Unimportant 34 31% Not Sure 18 17% Somewhat Important 40 37% Very Important 16 15% Total 108 100% 42. Availability of cultural activities and the arts Unimportant 27 25% Not Sure 18 17% Somewhat Important 44 41% Very Important 19 18% Total 108 100% 43. Access to restaurants and entertainment Unimportant 7 6% Not Sure 5 5% Somewhat Important 53 49% Very Important 44 40% Total 109 100% 44. Quality of health services Unimportant 2 2% Not Sure 3 3% Somewhat Important 26 24% Very Important 76 71% Total 107 100% City Communication - For each item listed, please rate your satisfaction on a scale of 1 to 4 where 4 means excellent and 1 means poor. 45. Availability of information about City programs and services Poor 6 6% Fair 36 33% Good 58 53% Excellent 8 7% 1 1% Don't Know Total 109 100% 46. Efforts to keep you informed about local issues/events Poor 9 8% Fair 37 34% Good 55 51% Excellent 7 6% Don't Know 0 0% Total 108 100% 47. How open the City is to public involvement and input Poor 27 25% Fair 34 31% Good 35 32% Excellent 12 11% Don't Know 1 1% Total 109 100% 48. The quality of the City's website Poor 8 7% Fair 26 24% Good 42 39% Excellent 15 14% Don't Know 18 17% Total 109 100% 49. Cultural arts programs (ceramics, dance, etc.) Poor 18 17% Fair 35 32% Good 35 32% Excellent 5 5% Don't Know 16 15% Total 109 100% Economic Development - Using a five point scale where 5 means much too slow and 1 means much too fast, please rate the City's current pace of development in each of the following areas. 50. Office development Much Too Fast 1 1% Fast 3 3% Just Right 24 22% Slow 35 32% Much Too Slow 19 17% Don't Know 27 25% Total 109 100% 51. Multi-family residential development Much Too Fast 4 4% Fast 5 5% Just Right 40 37% Slow 33 31% Much Too Slow 11 10% Don't Know 15 14% Total 108 100% 52. Single-family residential development Much Too Fast 2 2% Fast 6 6% Just Right 28 26% Slow 39 36% Much Too Slow 24 22% Don't Know 10 9% Total 109 100% 53. Retail development Much Too Fast 0 0% Fast 1 1% Just Right 16 15% Slow 47 44% Much Too Slow 39 36% 5 5% Don't Know Total 108 100% 54. Mixed-use development Much Too Fast 0 0% Fast 0 0% Just Right 14 13% Slow 35 32% Much Too Slow 22 20% Don't Know 37 34% Total 108 100% 55. How often do you typically go outside Chanute city limits to shop? Every Day 3 3% A Few Times Per Week 2 2% At Least Once a Week 15 14% A Few Times Per Month 49 45% A Few Times Per Year 36 33% Seldom or Never 4 4% Total 109 100% 56. If you leave Chanute to shop, where do you go? 99 Responses 57. If you leave Chanute to shop, what do you leave to buy? 97 Responses 58. Do you feel that a redeveloped downtown is an important part of the City's Economic Development Strategy? Essential 40 37% Important 30 28% Not Sure 18 17% Not Important 18 17% Detrimental 3 3% Total 109 100% 59. In general, how supportive are you of having the City use incentives to attract and expand retail, manufacturing, science and technology, and/or regional office companies. Very Supportive 86 79% Somewhat Supportive 15 14% Not Sure 4 4% 4 4% Not Supportive Total 109 100% 60. Of these Capital Improvements, which three would you select as the most important? Stormwater System Improvements 43 40% Street Extensions 17 16% Sidewalk Construction 41 38% Street Reconstruction 66 61% Traffic Signal Replacements/Upgrades 17 16% Parks 22 20% Public Facilities 49 45% Additional Bicycle Lanes/Off-Road Paths 17 16% Transit - Regional Transit Services 12 11% Lodging 25 23% Family or Casual Style Dining 47 43% Fine Dining 27 25% Upscale Specialty Shops 14 13% Ice Cream Shop 32 29% Antique Shops 5 5% 61. Of the businesses listed below, which three would you most like to see in Chanute? Art Galleries and Shops 5 5% Grocery Store 18 17% Clothing Stores 61 56% Arcade or Other Attraction Aimed at Youth 25 23% Bars/Nightclubs 9 8% Bookstore 18 17% Coffee Shop 15 14% Shoe Store 10 9% Electronics Store 18 17% Outdoor Equipment Store 22 20% 62. If the business you would most like to see in Chanute is not listed above please add here. 25 Responses Demographics 63. Approximately how many years have you lived in the City of Chanute? Less Than 5 Years 9 8% 5-10 Years 9 8% 11-20 Years 13 12% More Than 20 Years 80 72% Total 111 100% 64. What is your age? Under 25 4 4% 25 to 34 14 13% 35 to 44 25 23% 45 to 54 36 32% 55 to 64 26 23% 65+ 6 5% Total 111 100% 65. Which of the following best describes your durrent place of employment? Employed Outside the Home 78 70% Self-Employed or Work Out of Home 23 21% Student 3 3% Retired 3 3% Not Currently Employed 4 4% Total 111 100% 66. If you answered Employed Outside the Home above, where do you work? In Chanute 80 88% Outside the City of Chanute 11 12% Total 91 100% Male 62 56% Female 49 44% Total 111 100% 67. If you answered Outside the City of Chanute above, in what City or area do you work? 11 Responses 68. Your gender? 69. Your income level? Under $20,000 5 5% $20,000 to $34,999 10 10% $35,000 to $49,999 25 24% $50,000 to $64,999 19 18% $65,000 to $79,999 17 16% $80,000 to $94,999 9 9% $95,000 to $109,999 8 8% $110,000+ 12 11% Total 105 100% This concludes the survey. Thank you for your time! For more information about the Chanute Economic Development Strategy and the survey results please join us Thursday, October 21st at 6PM in the Alliance Room of the Memorial building. 70. Tagged results for: If you leave Chanute to shop, where do you go? Kansas City 39 54% Joplin 31 43% Springfield 2 3% Wichita 12 17% Tulsa 9 12% Pittsburgh 0 0% Topeka 6 8% Other 10 14% 71. Tagged results for: If you leave Chanute to shop, what do you leave to buy? Sporting Goods 9 13% Shoes 12 17% Clothes 59 83% Hardware 6 8% Electronics 5 7% Other 11 15% Humboldt 2 33% Parsons 1 17% Iola 1 17% Missouri 1 17% Other 1 17% 72. Tagged results for: If you answered Outside the City of Chanute above, in what City or area do you work? 56. If you leave Chanute to shop, where do you go? Respondent # 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 Response Kansas City Joplin Tulsa Overland Park, KS Topeka Kansas City or Joplin Wichita, Joplin, Tulsa Wichita Tulsa, Joplin, Kansas City wichita, pittsburg, bartlesville Kansas City, Pittsburg Kansas City wichita Kansas City Pittsburg or KC Ks City, Joplin & Springfield Kansas City or Joplin n/a joplin, ks. city, wichita Kansas City, Wichita, Pittsburg, Iola Joplin TOPEKA, KANSAS CITY, Overland Park A city KC or Joplin kansas city Kansas City Kansas City or Jopin Varies from Humboldt to a city Kansas City or Topeka Internet or Kansas City Joplin, MO Tulsa, Oklahoma Joplin, Kansas City, Wichita, Tulsa Kansas City Kansas City area KC, Tulsa, Springfield, Joplin Kansas City Kansas City or Joplin KC 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 Olathe, Kansas Joplin, Mo., Kansas City, Mo. KC The city with a mall Kansas City or Joplin kansas city Kansas City Joplin Joplin, Kansas City, Wichita Kansas City & Lawrence or Joplin area joplin Pittsburg, Joplin, Kansas City Kansas City ‐ Joplin KC kansas city kansas city KANSAS CITY WICHITA, KANSAS CITY, JOPLIN, PITTSBURG Joplin Topeka joplin, pittsburg, & kansas city Topeka or Kansas City or Independance Pittsburg, Tulsa Wichita, Pittsburg, Joplin KC, Wichita, Joplin, Tulsa Kansas City or Joplin kansas city, topeka, joplin joplin or kansas city Iola McGinty Whitworth, Town & Country or Kansas City Cabellas Pittsburg, Tulsa KC, Joplin, Wichita Joplin, Branson, Mo kansas city KC‐METRO kanjsas city,mo Joplin Iola, parsons, pitt, and joplin Owasso Wichita or KC Kansas City pittsburg, kansas city, wichita, Wichita and Kansas City 83 joplin,missouri to academy sports they sell lots of different items. It's a great store to have in a city!!! 84 Joplln 85 Kansas City, Joplin 86 Iola, kansas city 87 Joplin 88 Kansas City, Ks 89 joplin, wichita, topeka, tulsa 90 Pittsburg, joplin, kc 91 Joplin, Kansas City, Wichita 92 Kansas city, wichita, joplin 93 Kansas city and Topeka 94 Wichita, KC 95 Topeka 96 Wal‐Mart 97 Branson, Kansas City, Wichita 98 Tulsa 99 Joplin, Kansas City 57. If you leave Chanute to shop, what do you leave to buy? Respondent # 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Response Shoes and womens clothes equipment, supplies Clothes, and atheletic equipment. Clothing, special food items, home decor Clothes Clothes, sporting goods, building materials, home decor/supplies Clothes, electronics, books larger sized clothes Clothes, Shoes, natural food/health food stores, restaurants, zoo and cultural events Dillards clothes & shoes Kids clothing, shoes, kids shoes, household items (rugs, towels, curtains), fabric, lamps, etc. Men's clothing, women's jeans clothes, shoes Clothing Electronics, Men's Clothing, Womens Clothing, Hunting Equipment and supplies, furniture 16 Nothing specific 17 clothes, X‐mas shopping 18 cloths, gas 19 n/a 20 school clothes, clothes, eat out, sight see 21 clothing, shoes, household items. Very limited shopping in Chanute. Try to buy locally whenever possible. 22 Clothes 23 CLOTHING, SPORTING GOODS, HOUSEHOLD GOODS 24 clothing 25 Clothing, household items 26 apparell, toyes, outdoors equipment 27 large ticket items 28 Clothes, Household goods, 29 Clothes 30 Clothing, fabric, home improvement & landscaping items. 31 Home improvement supplies, we need a lumber store that is open in the evenings and on weekends, that is when most workign people work on their homes. Vehicles, we need a Toyota dealership Clothing, we need a variety, I appreciate Maurices and JC Penny but something else would be nice Entertainment in the eveningings, a town our size should have somewhere to have dinner, drinks, dancing... 32 beauty products, clothing, shoes, 33 Building supplies and clothes 34 Electronics, food, clothing, gifts, hobby supplies, fuel, furniture. 35 Normally what is not available locally or something that is much cheaper. Lower sales tax on big ticket items lures us away. 36 Clothing, Athletic supplies 37 Clothing, gifts 38 Clothing, shoes, home decor... 39 Kansas City 40 Various stuff 41 Clothes 42 Clothes mainly 43 What ever I can't find in Chanute 44 clothes, lotion, dvd's, cd's... etc 45 Men's Clothes 46 personal and household items 47 Sporting & Hunting Goods Furniture & Appliances Mens Clothes 48 Clothing,& Home Improvement items. 49 Clothes, Shoes, Electronics, sports equipment, sporting goods. 50 Clothes, shoes, home improvement items 51 Groceries, Sporting goods, clothing, shoes 52 clothes, 53 Everything, Food Clothes, Building Supplies 54 men's clothes 55 things not available in Chanute 56 MENS CLOTHING, BULK ITEMS FROM SAM WHOLESALER, SPECIALIST IN DENTISTRY, EYES ETC 57 CLOTHES, FURNITURE, APPLIANCES, 58 Clothing 59 colthing & household items 60 Clothes, furniture, groceries 61 clothing, hardware/building materials, fabric, restaurant 62 Electronics, Clothing, Recreation 63 Sporting goods, mens clothing 64 Clothes / Shoes 65 Clothes, bulk items, dinner 66 clothing 67 Clothing. 68 Fabric and sewing supplies Men's clothing 69 Clothes, 70 Men's clothing, 71 Clothing, etc. 72 men clothing 73 electronics, clothes, hardware 74 Clothes, sports equipment 75 things that chanute don't have ...lot's of stuff 76 77 78 79 80 81 Clothing,shoes.Do most online though. clothes Things that ae hard to find here clothing, home decor, food Discount goods (Sam's) Gifts (Malls) shoes,clothing, sporting goods for softball and frisbee golf discs for our new course at highland park. All can be found at academy sports!!! 82 What cannot be found in Chanute at a reasonable cost... 83 clothes, home improvement supplies 84 Home supplies Clothes 85 Cheaper prices, more options 86 Home furnishings, Clothes for kids. and vehicles. 87 88 89 90 91 92 93 94 95 96 97 everything... Target, Big Lots, Sam's Clothing, Appliances, Furniture, Vehicles Most any retail but wal Mart Clothes and furniture and vehicles WHAT IS NOT AVAILABLE OR IS NOT AT A REASONABLE COST. Books, clothes, computers, food. Virtually the only shopping choice left is WalMart. Electronics, quality & whole foods Christmas, Household goods, vehicles Sporting goods Apple products, Cloths, Shoes 62. If the business you would most like to see in Chanute is not listed above please add here. Respondent # 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Response Sporting Goods Sporting Goods store fast food lowes Sporting goods store Need to develop more manufacturing/service jobs Factory Outlet Mall.... Indoor Flea Market Support Safari Museum! coffee shop / bakery Shopping Center in a Square Fashion like Zona Rosa in KC (Smaller Scale for Chanute) manufacturing Gasoline & Food at south Hwy 169 exit. any manufacturing business a Walgreen's would be nice JCPenney needs to open bigger store in old IGA 16 we need more places to eat and shop that everyone can afford 17 manufacturing jobs that pay well with good family benefits 18 starbucks,applebees, target or bath and bodyworks 19 Sirloin Stockade, Long John Silvers, 20 Large home store, ie: Home Depot, Lowes 21 Cici's pizza 22 bar ‐n‐ grill; tj max; athletic apparel 23 Any business that would produce many jobs! 24 we need a mall 25 RESTURANTS 67. If you answered Outside the City of Chanute above, in what City or area do you work? Respondent # 1 2 3 4 5 6 7 8 9 10 11 Response Both in Chanute and in Parsons humboldt Missouri Humboldt, Kansas kansas Iola, KS Iola,KS Wichita Erie Pittsburg, KS I work in Chanute, most of my income comes fropm internet generated sales as the majority of population in this town have no jobs or money that is expendible.