A Lex. Economic Growth Strategy - Recently Updated Pages

Current Economic Facts & Data

EricPatrickMarr — Thu, 17 Sep 2009 08:57:40 CDT

Lexington's "Job Creation Matrix"

Revealed by an Open Records Request submitted to LFUCG on July 2, 2009

Fiscal Year	Lex. Jobs Created	Average Salary	Greater Austin Area
2005	1523	$25.8K	2004 - 2008
2006	1183	$34.7K	Note:
2007	589	$30.9K	Austin 3 1/2 times
2008	1037	$32.6K	larger than Lex.
2009	356	$25.8K
Total	4688 (Fayette Co.) Entire BG Area (4742 new jobs)	Avg. Lex Salary = $30,399 (Avg. BG Salary from new jobs = $30,215)	121,800 New Jobs (divided by 3 1/2 = 34,800 new jobs) Avg. Salary = $45,977

Quick Analysis:

We have to account for Austin's size, about 3/12 times larger than Lexington.

So scaling it, the Austin area created roughly 7 1/2 times more jobs than Lexington did.

Also, those new jobs in Austin paid about 50% more than the new jobs in the Bluegrass area.

Further Notes:

In 2007, there was $690M of venture capital invested into the Austin economy. In 2008, Lexington had just $68M.

Comparative Analysis:
Lexington's (Adjusted & Non-Adjusted) Per Capita Income vs. Other Cities

City	Per Capita Income	Cost of Living Index	Adjusted Per Capita Income	% Higher than Lex
Atlanta	$54.2K	94	$57.5K	37%
Alexandria	$70.6K	138	$51.2K	22%
Pittsburgh	$46.7K	92	$50.4K	20%
Charlotte	$45.5K	92	$49.1K	17%
Nashville	$43.4K	88	$48.6K	16%
Cincinnati	$42.7K	90	$47K	11%
Louisville	$41.6K	89	$46.2K	10%
San Francisco	$61K	137	$44.5K	6%
Madison	$43.6K	100	$43.6K	4%
Seattle	$49.4K	114	$43.3K	3.3%
Austin	$40.4K	94	$42.9K	2.4%
Indianapolis	$37.9K	88	$42.5K	1.4%
Lexington	$39.9K	95	$41.9K	---
Columbus, OH	$38.6K	94	$40.9K	-2.4%
Ann Arbor, MI	$40.9K	100	$40.9K	-2.4%
Chicago**	$45.2K	113	$40K	-4.5%

Per Capita Income from the US Department of Commerce, Bureau of Economic Analysis (2007)

Cost of Living Indexes from Kiplinger's, based on the ACCRA Index.

Cost of Living Index - How it's Configured:
Housing 29%
Groceries 13%
Utilities 10%
Transportation 9%
Healthcare 4%
Misc. Goods/Services 35%

** Chicago (and most mega-metropolitan areas) can arguably be calculated by different methodologies. For instance, Winchester is not really considered Lexington, but Naperville is considered "Chicagoland."

Citizen-Created Conceptual Proposal

EricPatrickMarr — Fri, 17 Jul 2009 11:03:12 CDT

A Sustainable Economic Growth Strategy

for Lexington, Kentucky USA

Overarching Concept

Notes:

All ideas contained herein are the express property of Eric Patrick Marr and/or the Contributors. Express, written permission must be obtained to use these ideas, or any variations, and fees may apply.
Contributors: please DO NOT ERASE any content, only add and/or suggest changes. EPM will "clean this up," regularly.
Initially, this does not get into many specific, targeted industries or large-scale programs
Keeping our imaginations open is best
Specifics can be added, by any contributor, at any point
Initial concept proposed by Eric Patrick Marr, native Lexingtonian and Behavioral Economic Consultant

Foreword:

Lexington's Economic Growth Strategy must be run and led by the very best, most talented leaders. Not just anyone.

Jim Collins in Good to Great - "first and foremost, it's about getting the right people on the bus, in the right seats, and the wrong people off."
Just as with the U.S. Presidency - elected officials must be held accountable for building Lexington's economy.
"Everything rises and falls upon Leadership" - John Maxwell

This New Lex ED Growth Strategy must be an inside-out (organic) plan.
Considering the world's best sustainable growth models... ... and Lex's assets... ... and the fact that every city is trying to "attract" people or businesses. If we look and grow from within, we'll far surpass our expectations.

Inside-Out Developmental Stages

Connect and Synergize ALL of Lex's internal assets.

We HAVE these assets, but they're often unknown or undervalued
"Connection breeds innovation, yielding prosperity."
Connection creates density, a "tightness," creating a "gravitational pull." (See image, below). Ala brain gain and financial investment.
Achieved through Educational Marketing (see Alltech and Gray Construction models)
Gallup Organization - "Citizen engagement creates more GDP growth than any other community attribute."

Talent Identification is STEP ONE toward true, great growth.

Start a "Duke-esque" Talent Identification Program (not a "program" per se, but be of that mindset)
Connecting & synergizing will allow us to identify top Lex talent quicker and easier
Incubate these talents
Gallup Research - one "superstar" = $100M of GDP growth. 10 stars = $1B. (Alltech, for instance, is now a $400M company, with goals of becoming a $1B company.)
Directly investing into incubating our potential superstars (see EIF idea)

Business Week - "Between 1980 and 2008, all net job growth in the United States came from startups, companies 5 years or younger."

Connecting and synergizing our internal assets, through Educational Marketing,
will automatically begin internally branding our Lexington, from one part of town to another

If we observe our landscape, presently, we see that our disconnectivity hurts our local enonomy, immensely. ("We don't have any reason to go downtown," one lifelong suburbanite said recently.) See last fall's DLC survey findings.
Gallup (again) - "Citizen Engagement" creates the highest ROI on a city's GDP
This yields "Economic Diversification" which Austin is so focused on, and only makes sense. This = "Clustering" Lexington's assets
Clustering creates Density. Density creates Economic Gravity (attractive pull). (See Hamburg as an example.)

Within the next 16 months, continue this organic (inside-out) growth process, until the World Equestrian Games arrive next fall

Launch a "Superband Lexington" campaign before 2010 WEG's, and continue afterward
This will open economic and cultural channels throughout the entire world "Lexington" needs to be seen on the same level as a Rolex, John Deere, and Alltech during the 2010WEG's

"Superbranding Lex" initiative highlights and promotes ALL of Our Lexington's assets (our growing, but largely unknown high-tech world, our awesome education entities, our numerous Green/Sustainability networks, our colorful Arts community, etc...) and put ALL of Lexington on the FRONT of the map.

Because we are clustered, each individual component of Lexington looks bigger than it does, alone
Our assets will rise to to the foreground of the map, the local, national and global consciousness.
Think of what we have - if you look at them together. TAO Agency + Collexion + Gray Construction + Idea Festival + Cypress + HP + Starborn + LexArts + Art League + many others...
Together, if we can see them all at once, we ALREADY DO look like a miniature Silicon Valley.
But, culturally, we just DO NOT look at them, nor value them as much.
When must value our assets and build upon them

Open these global channels from the 2010WEG's, to begin funneling global dollars into Lexington's local, innovative, imaginative cultures.

Because Lexington's VC investment culture is so weak (1/10 the size of Austin's, for example) we need to tap into other economic channels.
Since we live in a poor state, with relatively unfriendly tax systems, we're not going to get much help from our Commonwealth brethren.
But we can ride the huge shoulders of Alltech's Dr. Pearse Lyons and capitalize on the World Equestrian Games - with its 225,000 unique visitors that will see Lexington perhaps for the first time ever.

A part of this "Superbranding Lexington" initiative is a LexKy.com hubsite idea, where anyone in the world can discover EVERYTHING about Our Lexington in 3-4 clicks, not 3-4 decades.

This interactive mechanism can put Lexington on the world's map before the end of next year, changing our economic landscape FOREVER.

Allows ALL of Lexington to be easily found

Imagine a hybrid of a Craig's List + Facebook + Wikipedia

Other Needs:
Added July 1, 2009 by EPM:

See Jim Clifton's "Entrepreneurial Investment Fund" (EIF) idea in "Continually Added Thoughts." Similar in concept to a TIF. This could eventually be self-managed and self-funded, if done properly, and a HUGE catalyst for Lexington's economy.
Also - an "Entrepreneurial Road Map" making "launching your innovative business" as straightforward a process as applying to college.

Economic Development must become much more of a LFUCG priority.

Austin has 45 full-time staffers inside their city government, working on ED. Lexington has just one.
This requires reallocation and reprioritization of resources
Terminate "Partnering Service Agreement" with Commerce-Lexington, or create a much more accountable system between elected officials and Lexington's economic vitality.

LFUCG must begin lobbying Frankfort for tax flexibility.

At his recent budget press conference, Mayor Newberry stated that "LFUCG doesn't lobby Frankfort for tax changes, the Kentucky Leagues of Cities has tried, without much traction."
Currently, Lexington derives 83% of its General Fund budget ($270M +/-) from the local payroll tax.

Lexington's Economic Growth Strategy MUST include hard, quantifiable, measurable benchmarks.

Austin's "Opportunity Austin 2.0," for instance has the stated goal of creating 117,00 new jobs and adding $10.8B to their regional payroll in next five years.
During their original Opportunity Austin, in the previous five years, they surpassed their goals by adding 121,800 new jobs and $5.6B to their regional payroll.

Lexington's image/brand MUST be revamped.

Austin proves this ("The Human Capital), as does Richard Florida, as does Gallup, as does basic common sense.
We must change Lexington's culture - where presently, we devalue our intellectual capital (see Centrepointe debate) in favor of "the few."
Look at Louisville's surveys and findings - Louisville was INVISIBLE to the nation. We can reasonably extrapolate those numbers for Lexington, as well.
Being known as "The Athens of the West" conveys a much stronger, much more attractive message than "The Horse Capital of the World" in today's 21st Century Knowledge Economy
What if, in 5 years, "Made in Lexington" is synonymous with "Toyota Quality" or Apple's brand/image for coolness and innovation?!?!

Continually Added Thoughts

EricPatrickMarr — Fri, 17 Jul 2009 10:55:33 CDT

Important Note: All ideas contained herein are the express property of Eric Patrick Marr and/or the Contributors. Express, written permission must be obtained to use these ideas, or any variations, and fees may apply.

There is economic justification to focus on developing venture backed companies (they simply outperform per dollar invested). This is a tough sell because you are talking about a very small universe and therefore, fewer ultimate votes you can point to upon your bid for re-election (assuming public dollars are used to incent start-up creation).
Two things drive company creation -- PEOPLE and DOLLARS. (along with a good idea)
Kentucky is starved for capital -- both human and financial.

Start a fund that invests both dollars and people in KY

I have a full blown PPT deck on this very idea....
Having capital is ONLY one tenth of the battle; having seasoned entrepreneurs and operators is the other 90%. Ideas are a dime a dozen and that is precisely why most GOOD VC firms NEVER sign an NDA, more than likely, they will see your idea by the end of the month.

I like this idea of an "Lexington Entrepreneurial Investment Fund (EIF)." #InvestLex. - EPM
Something where startups who succeed with original seed money (this original seed money could come from a "TIF" spinoff, encouraging innovation and ideas with the right mentorship and guidance, then reinvested back into the fund, thereby growing the fund as they grow. The WEG's could also play a role here, if this fund is launched beforehand, giving Lexington businesses global exposure. Then, in next 5 years, as they grow, Lexington's EIF will grow.

NOTE: This DOES NOT mean I am implying the talent does not exist here, but I would say that we are talent scarce (as well as capital).

Story: I have lived in Dallas, Nashville, Charlotte, and Raleigh. Each winter I would meet 30-40 VERY smart people in sports bars watching UK BB. To a person, almost everyone would say, "I would love to move back home, but I just cannot find a good paying job."

Story: When in Raleigh, a friend called me and asked me if I knew anything about a company called DataBeam in Lexington (he knew I was from Lex). I said, no, but would make a few calls and call him back. I called the Chamber and got NOTHING. I called my dad and was sent a complete file.

Story: Upon graduating from Vandy (MBA), I called the Chamber to inquiry into what they might be able to do for someone in my shoes. Sent a member's directory.

Good Kauffman FACTS --> http://www.kauffman.org/uploadedFiles/kfs_08.pdf. Survey of start-ups, demographics, industries, funding, etc. This provides an excellent overview of what a start-up looks like, how it is financed and its economic impact.

And, the data behind the assertion that venture backed companies outperform --> PDF HERE.

LexEnomics

EricPatrickMarr — Sat, 11 Jul 2009 16:46:01 CDT

A Collaborative, Sustainable Economic Growth Strategy

for Lexington, Kentucky USA
(A satellite of Transform Lexington)

Launched June 29, 2009

E-mail EPM@EricPatrickMarr.com to easily become a contributor

Read
Harvard Business' Generation M Manifesto
a tremendous truth

Table of Contents

Current Economic Facts & Data

Citizen-Created Concept

Destination 2040's Economic Growth Ideas

Continually Added Thoughts

Other Valuable Resources

Opportunity Austin 2.0

Gallup Organization's Economic Model for Societies

Louisville's Possibility City Branding Project, Annual Report

Stay abreast of Gallup's latest discoveries

Destination 2040's Economic Growth Ideas

EricPatrickMarr — Mon, 29 Jun 2009 10:43:29 CDT

Notes:

This is copied practically verbatim from LFUCG's D2040 Document.
It is included here per Lexington Councilman Doug Martin's words that D2040 is a good starting point, with good ideas.
Destination 2040 was a LFUCG initiated "Community Vision-Building" endeavor, conducted in 2008.

The Value Statement for Economic Expansion describes Lexington as a fertile field of opportunity,

where taking advantage of key strengths and exploring creative new endeavors will benefit all its people.

Economic Expansion aspect includes community elements with a primary impact of protecting
or creating opportunities for commerce and employment, and producing and keeping a well-educated / wellpaid work force.

Community Elements Most Valued	Other Elements:
New or Existing Business Expansion Stable Employment / Adequate Wages Agricultural Industry Workforce Training and Education	Stabilization of Government Revenues Generation of New Markets or Products Regional Cooperation Institutions of Higher Education as Economic Engines Business Recruitment Strategies / Methods Entrepreneurship and Innovative Partnerships / Programs

ACTION APPROACHES FOR TOP FOUR ELEMENTS:

STABLE EMPLOYMENT / ADEQUATE WAGES:
Good jobs that are widely available strengthen households and boost a community’s confidence

A. Further enhance business, government, and non-profit job expansion efforts toward both highwage skills-based workplaces (examples: technical, manufacturing, service) and high-income knowledgebased workplaces (examples: professional, technological, scientific, engineering). Identify specific target employers such as pharmaceutical, bio-life engineering, equine and agri-business.
Suggested Initiators: CLX, KAED, BGADD, LFUCG, KFB, KTA, UK
Time Frame to Complete: 1-5 years; ongoing
Synergies Realized: Education, workforce training, community appeal, regional cooperation

B. Expand opportunities for workers to receive training and become more highly skilled, to promote their upward mobility in the work force.
Suggested Initiators: State Economic Development Cabinet, public and private employers
Time Frame to Complete: 1-5 years; ongoing
Synergies Realized: Education, workforce training, community appeal

C. Attract people who will build and sustain both skilled trades and white collar businesses by ensuring the presence of a strong, active cultural arts scene. Suggested Initiators: LFUCG, CLX, state, local arts community, developers, LexArts
Time Frame to Complete: 1-5 years
Synergies Realized: Community appeal, cultural life

D. Develop permanent school-based staff positions dedicated to linking students (from preschool to college levels) with both skilled trades and knowledge-based companies. Examples of linking approaches include job shadowing and mentoring. Offer scholarships for these students to continue their educations at local or regional post-secondary educational institutions
Suggested Initiators: EBCE Program, FCPS, guidance counselors, tech schools, CLX, businesses
Time Frame to Complete: 1-5 years, ongoing
Synergies Realized: Education, community appeal, workforce training

NEW & EXISTING BUSINESS EXPANSION
Expanding businesses lead to flourishing communities.

A. Revamp the existing tax structure to encourage business development and ensure more local control over tax revenues. Review available revenue streams and seek to implement a more progressive and effective system of taxation.
Suggested Initiators: State enabling legislation needed, CLX, LFUCG
Time Frame to Complete: 1-5 years
Synergies Realized: Entrepreneurship, innovation, community appeal

B. Recognize and expand UK's research and development as the primary driver for business and job expansion in the community
Suggested Initiators: UK, LFUCG, CLX Time Frame to Complete: 1-5 years, ongoing
Synergies Realized: Education, workforce development, stable employment, adequate wages, community appeal,

C. Continue to streamline and improve all means of assistance geared toward growing business and jobs.
Suggested Initiators: State & local government, private sector, CLX, LFUCG, UK
Time Frame to Complete: 1-5 years
Synergies Realized: Education, entrepreneurship, agri-business

D. Continue to concentrate efforts on connecting new and existing businesses to the financial resources (capital) and business relationships (networks) needed for success.
Suggested Initiators: LFUCG, UK, CLX
Time Frame to Complete: 1-5 years
Synergies Realized: Entrepreneurship, innovation

E. Work with the business community, organized labor, and state government to support agreedupon legislative changes that would allow employers and workplaces to offer employment opportunity to all qualified workers regardless of organized labor membership.
Suggested Initiators: CLX, Central KY Labor Council Time Frame to Complete: 1-5 years
Synergies Realized: Business recruitment, business expansion, workforce training

F. Pursue Quality of Life enhancements targeted to appeal to creative and talented persons of all ages.
Suggested Initiators: LFUCG, CLX, colleges, LexArts
Time Frame to Complete: 1-5 years, ongoing
Synergies Realized: Community appeal, stable employment, adequate wages, diverse cultural offerings

G. Provide tax and other incentives related to venture and start-up capital, to support efforts to grow existing businesses and create new ones.
Suggested Initiators: State and federal government, CLX
Time Frame to Complete: 1-5 years
Synergies Realized: Business recruitment, entrepreneurship, new markets or products, community appeal

AGRICULTURAL INDUSTRY
More than just beautiful farms, the agricultural industry brings great economic reward to the community.

A. Protect and build upon the region's signature equine industry and other aspects of agriculture such as animal research and health, field crops, produce, and other livestock.
Suggested Initiators: UK, KTA, KFB, CLX, equine cluster and other agricultural businesses
Time Frame to Complete: 1-32 years
Synergies Realized: Community brand, education, economic development, community appeal

B. Coordinate the cluster of equine-related entities into a more identifiable economic development entity. (All related services, farms, etc – see model contained in LFUCG Equine Task Force Report).
Suggested Initiators: KY Thoroughbred Assn, KFB, Farm Owners, KEEP, CLX, LFUCG
Time Frame to Complete: 1-5 years
Synergies Realized: Community brand, education, economic development, cultural identity

C. Work with agri-business entities, financial consultants, and state and local government to create and maintain a competitive tax structure for the agricultural industry.
Suggested Initiators: KY Thoroughbred Assn, KFB, State Legislature, CLX, LFUCG
Time Frame to Complete: 1-5 years
Synergies Realized: Economic development, community brand, rural / urban mix

D. Connect with non-resident horse farm owners and encourage them to do business in Lexington.
Suggested Initiators: Farm Owners, Mayor, CLX, KY Thoroughbred Assn, KFB
Time Frame to Complete: 1-5 years, ongoing
Synergies Realized: Economic development, community brand, rural / urban mix

E. Generate / create a larger, sustainable agri-business workforce pool.
Suggested Initiators: LFUCG, Farm Owners, KFB, State Legislature
Time Frame to Complete: 1-5 years
Synergies Realized: Stable employment, adequate wages, education, community brand, economic development, workforce training

WORKFORCE TRAINING & EDUCATION
Strong educational institutions and opportunities attract and retain productive residents.

A. Set and reach a goal for Fayette County Public Schools to be ranked in the top tier of public school systems nationally.
Suggested Initiators: FCPS, private sector, LFUCG
Time Frame to Complete: 1-15 years
Synergies Realized: Numerous

B. Offer a number of free 2-4 year scholarships to attend local or regional post-secondary / technical schools for deserving local students who commit to complete their educations here.
Suggested Initiators: FCPS, private sector, colleges / technical schools
Time Frame to Complete: 1-5 years
Synergies Realized: Education, community appeal

C. Build a rich package of incentives to attract the best Preschool-12th Grade teachers in the nation; include financial incentives for excellent teaching, and many community benefits.
Suggested Initiators: FCPS, State DOE, KEA, Legislature
Time Frame to Complete: 1-5 years
Synergies Realized: Education, community appeal

D. Expand financial incentives to businesses that provide opportunities to their workers to receive training and become more highly skilled, to promote their upward mobility through the work force.
Suggested Initiators: State Workforce Development Cabinet
Time Frame to Complete: 1-5 years
Synergies Realized: Education, community appeal

E. Publicly honor "Hometown Heroes" for their work, civic involvement, mentoring, and other contributions to improving community life.
Suggested Initiators: Local Media, LFUCG, FCPS, UK
Time Frame to Complete: 1-5 years, ongoing
Synergies Realized: Education, community appeal

F. Work with K-12 educators to incorporate evidence-based education on the energy cycle and energy efficiency as relates to environmental stewardship and protection.
Suggested Initiators: FCPS, colleges, LFUCG
Time Frame to Complete: 1-5 years, ongoing
Synergies Realized: Education, sustainability, transportation, land use,