Economic Development News
Temperate business expansion activity continues in 2013
Published: Tuesday, April 15, 2014
By: Shaun Sappenfield
The Chamber’s existing business program continues to work closely with local employers to identify expansion opportunities for sustainable job growth. Existing business growth at several local companies added capital investment to our community in 2013 and our local economy saw incremental increases in employment.
This trend should continue in 2014; however, the expansion activity for Jefferson City’s principal manufacturing/distribution operations is temperate in comparison to past years (2007-2012). This is due largely to an ongoing national trend indicating that companies are becoming more efficient by increasing output by investing in automated equipment, and by better utilization of their current workforce. This trend is nothing new within the workplace. We must constantly remind ourselves that companies are not in business to create jobs; they’re in business to make money. Productivity gains have made it possible for manufacturers to increase output while holding employment constant or even shedding jobs. In October 2013, Jefferson City felt the impact of the closure of RR Donnelley which laid-off 475 well paid positions. Expansion activity in 2013 included announcements by Modern Litho Print Co. and Brown Printing and Sonoco Plastics.
In July of last year, Modern Litho announced plans to add 23,000 square feet of production/warehouse space coupled with a merger announcement with Midtown Printing, a full-service commercial printing company based in St. Louis. Brown Printing, Modern Litho’s sister company, has increased its portfolio by adding wide format and display graphic specialty services. Sonoco Plastics, which employs over 140 individuals, finalized some internal upgrades to their existing facility at 1621 Maytag Dr. to help support their ever-increasing production levels in addition to safety improvements. Collectively, the proposed growth of all three companies will inject additional payroll into the community of over $1.0 million based on 30 new full-time positions along with over $8.0 million of new capital investment.
Incentives at the state and local level were secured by each company as the Chamber worked behind the scenes to help facilitate the application and approval process. Modern Litho received tax credits and local property tax abatement via the Cole County Enhanced Enterprise Zone. Modern Litho was approved for $106,578 in Enhanced Enterprise Zone state tax credits based on new payroll and private investment over a five year period, coupled with 50% tax abatement for 10 years based on improvements to real property. Modern Litho is the fourth local manufacturer to receive state tax credits via the Enhanced Enterprise Zone Program since Cole County received its designation in 2009. Brown Printing qualified for two Rebuilding Communities Tax Credits at levels of 25 and 40 percent based on new private investment within a qualified Rebuilding Communities area. Sonoco Plastics received $25,000 in Missouri Customized Training Grant Funds for the purposes of training new and existing employees.
Training new and existing employees is critical for all manufacturing operations and Missouri’s Customized Training Program offers eligible companies funding to help offset these expenditures. In fiscal year 2014, Missouri appropriated $14.5 million dollars via the Missouri Job Development Fund (Missouri Customized Training Program) to assist manufacturers with their ongoing training requirements. Six manufacturers located in Cole County received a total of $237,000 in Customized Training Funds. Since 2008, local manufacturing operations have received over $1.4 million in Missouri Customized Training Funds. Again, these funds are immensely beneficial to employers and employees alike because ongoing training and retraining is vital to the success of our local manufacturing sector.
Expansion activity in 2013 was encouraging. As we look to the future, the Chamber’s existing business program will continue to work with our local companies to assist them in identifying training grants, tax credits, and other incentives that will assist their workforce enhancement needs and potential expansion opportunities.