Posts Tagged ‘TREO’
TREO hires MPA’s executive director
“Effective Nov. 15, Metropolitan Pima Alliance Executive Director Michael Guymon is leaving to become Vice-President for Regional Development for Tucson Regional Economic Opportunities (TREO).
Guymon has been MPA’s executive director since Sept. 2008, having served as the organization’s first Governmental Relations Director. His career experience includes both the public and private sectors as former Chief-of-Staff to Tucson City Council Member Fred Ronstadt and political consultant to a number of downtown area development projects.
The MPA Board of Directors will be responsible for hiring a new executive director.”
While TREO has lots of different issues(taking credit for work they didn’t do, for one of them), their biggest problem is being content selling a broken region. Yes, I know that the City and County still give them a big hunk of taxpayer dough. Yes, I know that Mayor McCheese and Sharon Bronson sit on their board. TREO’s lack of courage in telling these folks that they have an “ugly baby” is part of the reason that Tucson is slowly becoming an economic Katrina. When Raytheon picked Alabama over Tucson, TREO didn’t even bother to tell their board member, former Raytheon engineer and head cheerleader in chief, Mayor Bob.
The geniuses at TREO got together and said: “Let’s hire a Governmental Relations Director!”. It’s a good idea, but needs to have an independent guy/gal, with some guts to tell the truth on how to fix Tucson/Pima County for business. Especially small business.
1) The man who is a paid consultant for Garfield Traub to help shove the Downtown Hotel down the taxpayer’s throat.
From the Arizona Daily Star (Rob O’Dell, March 30th 2010)
“Among those expected to have some say in whether the hotel will be built:
The former City Council aide was a paid lobbyist for the company when it was trying to win the hotel bid and after it was selected.
He later became executive director at the Metropolitan Pima Alliance, whose members include businesses, developers and governments. The organization, which calls itself, “your voice for reasonable and responsible development,” is expected to make a recommendation on whether the hotel should be built.
Guymon said he disclosed his relationship with Garfield Traub before he took the job and says his contract is basically completed, although he said he will still earn a bonus if the hotel is approved.”
2) The man who sits on Museum of Contempory Arts board, which magically received a $1/year rent at the Fire Station #1 on Church street.
“The purpose of the press conference was to expose a sweetheart deal between the City Council and the Museum of Contemporary Art (MOCA), in which MOCA was given a five-year lease of the old Fire Station One for only $1-a-year. This is a facility worth millions of dollars and will require yearly maintenance costs in the six figures and more than $80,000 in upgrades.”
(check the previous post on the deal: http://tucsongrowup.com/2009/10/)
No doubt Guyman’s insider connections at the City of Tucson will help ensure funding and relationships remain in tact. Over at the County, Guyman doesn’t have the juice. He’s not from the Grijalva or Eckstrom camps so it’s going to be tough. In Oro Valley and Marana, if they are smart, they’ll tell the Tucson centric TREO to hang out on the sideline and bring out the water bottles during the time outs.
Great move TREO, kudos to your organization on remaining the ineffective organization that you’ve evolved into. Give Joe Snell a raise while you’re at it.
Folks, when it comes to economic development, options in southern Arizona we are somewhat limited. Let’s face it, we aren’t in the running for the next Intel or Boeing. We probably aren’t on the short list for a lot of jobs that require educated and skilled labor.
Why do you think TREO’s predecessor, GTEC, did such a great job with low skilled, low paying call center jobs?
What happened to us you ask?
We are running out of options because the past generations of business and elected leaders failed to act. We are at this spot today because they failed to plan, failed to put aside self interests, failed to look beyond the next election cycle.
We missed the boat on our transportation system (we shot down the RTA 5 times). Phoenix passed their RTA program 20 years ahead of us and have been spending $300m per year on infrastructure.
We have an out of control TUSD school district that resists reforms and has major admin issues. Parents are flocking away from their product because they aren’t a quality operation.
Too Many Service and Government Sector Employees
Southern Arizona has way to many service and government sector employees. We lack industries that make things, build and ship things (Raytheon is an exception but with 11,000 employees our of 1m population it’s not enough). One service sector employee goes out and shops at another service sector business and the cycle continues. Add in the stress of maintaining a bloated government sector (our single largest employer class) and a couple construction booms and busts and you can see how it all happened.
Mining, which has been an income generator in Arizona for generations, faces opposition at every turn.
Killing The Golden Goose
Tourism is probably our only real sustainable industry that brings in FRESH money. What are we doing to our golden goose? We are taxing their industry right out of town. What are we doing with the increased bed taxes? How about a cool $900k in the form of a pass through to Tucson/Pima Arts Council.
Completely Ineffective Business Leadership
Go and check out the chart…
Now that I set the stage…… a potential game changer:
INLAND PORT! - check out Carli Brosseau’s story in today’s Tucson Citizen. HERE.
Key components of TREO’s plan involve building an I-10 bypass, setting up a larger rail yard near Marana and improving infrastructure connecting Tucson to the seaport of Guaymas, Mexico.
The report also recommends the development of food processing plants because of the tons of Mexican agricultural products shipped daily through the city.
Most of the related development is anticipated along Valencia Road.
Smallhouse said the project is realistic despite the recession and should be the domain of business owners, not government.
The inland port is the low hanging fruit, the call centers of our generation.
We are in the right place at the right time to really change the course of Southern Arizona. This port concept could create high paying jobs. It will spin off small businesses and light manufacturing.
The port could truly be a game changer. I’ve studied it, met with TREO, done the background, met many of the players and I got to tell you it’s one of the most exciting things I things our region has.
What’s a little concerning is that when I speak to elected officials very few understand the full impact and need for immediate and sustained action to see this opportunity become a reality. Our business and elected leaders are busy with bus fares and rental taxes or park fees. Who’s watching out for our future?
I guess the City council got their man in Mike Letcher. From Carli Brosseau’s article in the Citizen yesterday.
Job Path is the darling of the Pima County Interfaith Council. Their results are great but the number of people they actually impact is pretty small. We’ll have to dig into the details a bit but the figures we’ve heard were that it’s a couple million dollar program and ‘retrains’ only 80 or so people a year. PCIC has been buying radio ads touting their importance to the community. I guess that’s what you call a full court press during difficult budgetary times. Looks like it worked.
Looks like TREO and the MTCVB are still safe. In fact our tourism agency got a $900,000 raise. Looks like MTCV can finally bring on the assistant to the vice presidents’s executive assistance who is in charge of special projects, sustainability (great buzz word that looks important) and good governance.
The $3 million difference, to be paid for by proposed new taxes, would be divided primarily among Job Path, the Metropolitan Tucson Convention & Visitors Bureau, School Plus Jobs and the Tucson Pima Arts Council.
Under the previous plan, Job Path, School Plus Jobs and the arts council would have received nothing.
Letcher wants to give the visitors bureau $4.2 million with about $900,000 of that added in by Letcher, the largest allocation set for any organization.
What can the Valley do to better position itself to succeed once the recession is over?
Diversify our economy and work with public sector leaders to create sensible, new programs that bring high-wage industries to Arizona. During the last decade of the real estate explosion, Arizona was one of the leading job-producing states. Over the last two years, we have fallen to 49th in terms of new job creation. Business as usual will not work. Now is the time to change our metrics and compete for other industries to migrate to Arizona.
You’ve seen first hand how important professional sports are to the local and regional economy. How can the Valley capitalize more on that in the future?
Sports are important to Arizona and we need to support what we have now. But, again, we need to focus on diversifying our economy. Like a personal stock portfolio, we cannot become “over-weighted” in any single sector. We have all the teams we need, but it will be important to attract events with significant economic impacts and exposure like the Super Bowl in the future. Our regional success will depend largely on creating a diverse and vibrant economy around many new industries and we can’t look to real estate or sports to take us out of this downturn.
By Janet Perez
Like the rest of the state, Southern Arizona has been in a recession since 2007, and at least one prominent economist says the situation won’t be getting better anytime soon.
“My forecast is that it’s going to take a while to get (credit markets) straightened out again and functioning as they should,” says Marshall Vest, director of the Economic and Business Research Center at the University of Arizona’s Eller College of Management. “I think that takes up most of 2009. Then we have all the excess housing that needs to be absorbed. That’s going to take some time and we’re not really absorbing the housing right now because credit markets have been essentially frozen. So, I think it’s the end of 2009 before the economy really regains its footing. I think we’ll start to move up in 2010. By move up, I mean the economy will once again begin to expand and enter a recovery phase.”
Joe Snell, president and CEO of Tucson Regional Economic Opportunities (TREO), says that despite the already deteriorating economic conditions, Tucson still managed to draw new companies and expansions in 2008.
“We’re definitely seeing a slow down in a lot of ways, both in the recruitment of companies and the expansion of companies, but not a massive downtick,” he says. “Our pipeline is as full as it’s ever been. But what we are seeing are companies that may have been ready to announce a $100 million expansion in November saying, ‘We’re going to wait on that until January, we’re cautious, we want to see what’s going to happen in the next three months.’ ”
Last year, the region still saw growth in the health care, bioscience, alternative energy and aerospace industries. Of particular note was the purchase of Ventana Medical Systems in Oro Valley by Swiss drug maker Roche for $3.4 billion. Roche also announced plans for a $100 million expansion at Ventana that would increase employment from 750 to about 1,000. In addition, Roche purchased more than 17 acres of land around the Ventana site to expand the location.
“Possibly the most significant thing we can point to though, is that 57 percent of the successful projects were in our targeted industries, and that’s important because those targeted industries represent quality rather than quantity, meaning, closing the wage gap,” Snell says. “Historically, Tucson has ranked somewhat below both the state and the national average in wages. So we’re rapidly moving in the right direction to close that gap. To me, that’s a big takeaway.”
Southern Arizona has not been immune to the effects of the housing market collapse and its devastating impact on the construction industry. For example, one of the first companies TREO recruited, window and doormaker Pella Corp., announced in November 2008 that it was idling its Tucson plant, affecting 65 workers. When Pella first located to Tucson in 2005, company officials said it had plans to employ more than 400 people at its facility.
Still, as Vest points out, since the construction boom was not as great in Southern Arizona as it was in the Phoenix area, the drop has been less precipitous. For example, year-over-year job losses in the construction industry in October 2008 stood at 4,000 in the Tucson metro area, according to figures from the Arizona Department of Commerce. In the Phoenix-Scottsdale-Mesa area, 30,000 construction industry jobs were lost during the same period.
“Commercial (construction) is still in relatively good shape. Vacancy rates are moving up, but they are still fairly low. Tucson didn’t see the construction boom in commercial that you saw in Phoenix, so, commercial construction here in Tucson doesn’t have as far to fall,” Vest says. “For residential, the indicators that I see are pretty comparable to Phoenix, except for the housing price data. I don’t think the declines have been quite as large (in Southern Arizona).”
Snell says that so far, Southern Arizona has managed to hold its own on employment.
“We have losses in construction, but we’re gaining it on biotech, we’re gaining it on solar, we’re gaining it in logistics companies. I think right now we’re sort of a wash,” he says.
Vest, however, expects more job losses across the state as the recession drags on through 2009. In fact, comparisons of unemployment rates from 2007 and 2008 already are startlingly eye opening.
In October 2008, the unemployment rate for the state, the Phoenix metro and the Tucson metro stood at 6.1 percent, 5.5 percent and 5.8 percent, respectively. In October 2007, the state’s unemployment rate was 3.9 percent, Phoenix’s was at 3.4 percent, and Tucson came in at 3.9 percent.
“I think the unemployment rate will likely reach 8 percent before we’re through,” Vest says.
Vest adds that rate is in line with the jobless figures of the last major recession of the early 1980s. Back then, unemployment peaked at 13 percent in the state, 8.9 percent in Phoenix and 10.5 percent in Tucson.
Fortunately for Southern Arizona, Vest says, the region’s economy is considerably more diverse than it was in the early ’80s. But with credit still tight and the housing market stuck in freefall, Vest cautions about being too optimistic on the strength of a recovery.
“I really think this recovery is probably going to be muted. I don’t see us rebounding very strongly. The process is going to take awhile,” he says. “This recession is going to be longer than the recessions of the early ’80s or mid ’70s. If it stretches through 2009 and the recession began in the fourth quarter of 2007, we’re talking about a two-year-long recession. Nationwide, the longest recession has been 16 months.
“It’s been a very long time in this country since we have encountered a very severe recession. The recessions of 2001 and 1991 were both very short and shallow. They barely qualified as recessions, rather than a growth slowdown. It’s only the gray hairs that remember what a severe recession is like,” Vest adds. “This is scary. This is messy. But we’ve been through this before. If you are a business and you can hang on and remain solvent and get through this, there will be plenty of opportunities on the other side. I would also say that it’s during times like this that the seeds are sown for fortunes to be made. Savvy investors will take positions in markets where assets are cheap and will benefit handsomely as the economy recovers —as surely it will. And the deep pockets know that and there is a lot of money on the sidelines waiting for the right opportunity.”
Snell agrees, adding that now is the time for Southern Arizona to stake a claim in future growth and prosperity.
“We’re not going to ride out the recession. I’m a big believer that now is the time to get aggressive,” he says. “I think we have a good head of steam. At this point, I would say Tucson is as competitive as any major city in the country, including Phoenix. That’s a first for us. Are we going to get cooled off by the national economy? Yes, absolutely. But I think we’re in as good a position as anyone coming out of this recession to capitalize, and maybe within this recession to capitalize.”
Ventana Medical is a local Tucson (Oro Valley and Marana that is) success story. The company started here in our valley with automated blood testing equipment. Venatana Medical started by a UofA pathologist 20 years ago and went public in 1996. From FORBESyou can read the saga around the Roche buy out but it amounted to arriving at the right price and Ventana owners and stock holders walking away with A LOT OF MONEY.
I understand a group from TREO and Oro Valley went out to Switzerland to meet with the CEO and incoming management team. I’m sure they will love our valley and Oro Valley in particular.
It will be curious to see how the Pima County schools compare to the European education system, I would imagine the executives will be bringing families to our region.
From today’s AZ Daily Star HERE;
The CEO of a global drug company laid out big plans Tuesday for Oro Valley-based Ventana Medical Systems — including an increase in work force by roughly 250 employees over the next year and an expansion of research-and-development facilities.
- UofA professor and students develop a great technology
- A company is formed and first stage R&D funding is attained
- Company goes to market with superior product
- Company goes public injecting cash to grow and expand.
- Hundreds of educated workers are hired from UofA and local employment pool
- Dozens of local feeder small businesses benefit from Ventana’s success
- 20 years later the company takes a $3 billion buyout and the new company stays in Tucson
I’m not asking for much just a dozen or so more Ventana’s or Hughes/Raytheon’s to diversify our economic base – preferably in a vertical industry like defense or bio medical or solar so we can finally be known for something other than tourism.
The best thing about a Raytheon or Ventana Medical is that they don’t require much support from the government entities. All they want is a pool of educated workers (like thousands of graduate from the UofA each year), a great place to live, a convenient airport (we are so so here), and if they intend to expand or grow that the local government entities make that process as smooth as possible.
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