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FAST LANE - November
2003
The Southern Appalachian Fund is one of six New Market Venture Capital Funds, a program approved by the U.S. Small Business Administration to aid economically depressed areas of the country. To qualify, communities must have median incomes of less than 80 percent of the national average. The fund is being managed by the Appalachian Management Co., a for-profit entity created through the partnership between Tennessee-based Technology 2020 and Kentucky Highlands. The fund will invest $200,000 to $600,000 in businesses located in such communities that are opening or wanting to expand. Companies can visit the Southern Appalachian Fund Web site, www.southappfund.com, to determine if they are within the qualifying areas and begin the application process. There are some restrictions as to the types of businesses eligible for funding. For instance, real estate and retail businesses do not qualify, nor do restaurants; the fund managers are primarily targeting manufacturing, technology and software firms. “We're looking in areas where traditional (venture capital investors) won't look,” said Grady Vanderhoofven, vice president of equity programs for Technology 2020. “We're going to be doing a lot of sifting, looking for diamonds in the rough.” SHEPHERDSVILLE A Michigan food service company has announced plans to build a new distribution center in Shepherdsville. Gordon Food Service (GFS) has acquired land just east of Interstate 65 in Bullitt County on which to build its new 300,000-square-foot, state-of-the-art facility. GFS anticipates beginning construction as early as 2004 with a projected start-up of 2006. The company expects to employ more than 200 full-time employees within five years. Wages will range from $9.06 to $16.98 per hour, excluding benefits. Gordon Food Service was founded in 1897 and now ranks as North America's largest family-owned and managed broadline foodservice distributor. The company has evolved into a multi-billion-dollar international corporation, offering more than 14,000 food products to some 30,000 customers in 10 states and throughout Canada. GFS also operates 95 Marketplace retail stores. The Shepherdsville facility will be the company's seventh distribution center in the United States and its second in Kentucky. The Commonwealth offered a $7.5 million tax incentive package in an effort to persuade the company to locate its newest facility in Kentucky. MAYFIELD Continental Tire North America is cutting 200 jobs at its plant in Mayfield, which produces tires for light trucks and passenger cars. Company officials say the ongoing economic slump and competition from other tire manufacturers for the layoffs played a significant role in the decision. The Mayfield plant is Continental's highest-volume producer in North America: The plant employs 1,300 workers who put out some 14,000 tires daily. More than 1,100 employees are union workers represented by the United Steelworkers of America Local 665. With the cutback in employees – which will primarily affect hourly workers – production will decrease to 10,900 tires per day. The layoffs are to begin early next month. Continental also operates plants in Bryan, Ohio; Charlotte, N.C.; Mt. Vernon, Ill.; Barnesville, Ga.; and San Luis Potosi, Mexico. RICHMOND
LEXINGTON Ohio-based Dominion Homes, one of the top 30 homebuilders in the nation, has selected Lexington as its next expansion market. "As Louisville's largest builder, we have been studying the Lexington market for several years," said Steve George, president of Dominion Homes' Kentucky division, who will be overseeing the expansion. "We believe there is an unmet demand in Lexington for higher quality, medium-priced single-family homes. In addition, Lexington's continued growth, historically strong economy, and demographic profile make the market very attractive." The company will initially build homes in the $125,000 - $300,000 price range and plans to hire local construction subcontractors and crews. The projects are expected to create approximately 300 new jobs in the Lexington area over the next five years. The Columbus-based company, which recently celebrated its 50th anniversary, anticipates starting land development in Lexington by the end of the year, with their first model home opening in Spring 2004. STATE
Louisville was the No. 1 city listed in terms of small-business growth and was ranked No. 15 overall. The list put Louisville as the No. 2 large city in the Midwest, behind only Minneapolis/St. Paul. Other Kentucky cities were also noted for being friendly to business start-ups. The Northern Kentucky/Cincinnati area was ranked No. 49 overall, while Lexington was listed at No. 8 in the listing of top midsize cities in the Midwest. The rankings were compiled based on the following criteria: entrepreneurial activity (based on the number of businesses five years old or younger); small-business growth (based on the number of businesses with fewer than 20 employees that had significant employment growth from January 2002 to January 2003); job growth (change in job growth over a three-year period through January 2003); and risk (bankruptcy rates). WESTERN KENTUCKY A new Kentucky Geological Survey indicates that the risk of Western Kentucky and the surrounding area suffering a major earthquake may not be as high as was once thought. The study reports that the active faults of the New Madrid Seismic Zone may not extend in the Jackson Purchase area. Based on previous findings from the U.S. Geological Survey, which indicate a high risk of a major earthquake, the region has been subject to more stringent building codes. That, in turn, makes it more expensive and difficult to design and construct buildings and roadways and results in higher insurances premiums, as well. Since more information is needed to confirm the state findings, officials connected with the state survey plan to request $500,000 from the General Assembly to fund the additional monitoring stations and scientists needed to gather more data. State Representative Charles Gevenden of Wickliffe has said the request is certainly a valid one, even in the face of a state budget crisis. "I certainly think it's worth it from an economic development standpoint," Gevenden said. "It pays for itself if one or two businesses locate in Kentucky." STATE
For the second year in a row the Kentucky Soybean Promotion Board has supplied a handful of distributors around the state with 1,000 gallons of the soy-based fuel at no charge. The distributors then pass it along to their customers. In Elizabethtown, Guy Williams and Son Inc. has been distributing the fuel to farmers and contractors for use in heavy equipment such as tractors and backhoes. The response has been highly positive. Tommy Williams, owner of Guy Williams and Son, has said that since he began carrying soy-based fuel, 90 percent of his agricultural customers have preferred that over traditional diesel. Soybean producers hope the fuel continues to attract interest as usage increases. "If interest in soy-based biodiesel continues to grow, that's good news for our Kentucky farmers because it creates a larger demand for soybean oil," explained Debbie Ellis, executive director of the Kentucky Soybean Promotion Board. Ellis notes that soy-based biodiesel – which is recommended to be used as a blend – not only decreases friction and burns more cleanly but is also safer to use and handle. Plus, it offers the possibility of providing a boost to the agricultural economy: The increased use of a two-to-five percent fuel blend could utilize anywhere from 23 to 57 percent of Kentucky's soybean crop. That, in turn, would produce an annual increase of $234 million in sales, $28.2 million in tax revenue and more than 1,200 jobs. SOMERSET An Ohio company has announced plans to move its zinc and aluminum die-casting operations to Somerset, creating up to 60 new jobs. Cleveland-based TDE (Tool Die Engineering) Inc. has purchased a 105,000-s.f. speculative building in the Valley Oak Industrial Park for $1 million and expects to begin operations there by the end of this month. TDE specializes in non-automotive die casting, such as parts for hydraulic pumps, electric motors, brackets, valve bodies, fluid-control valves and electric boxes for the nuclear industry. TDE will be bringing five members of its management team from Cleveland to Somerset; the remainder will be hired locally. Wages are expected to be in the $10-15 per hour range. In addition, a new company is being formed to produce automotive-related castings and is expected to join TDE in the spec building in the coming months, employing approximately 240 workers. TDE President/CEO Alan Adams told the Somerset Commonwealth-Journal that while it was the spec building that initially attracted the company to the area, "what brought us here was the people." Adams said locations in Tennessee, Virginia and Kentucky were considered before settling on Somerset's Valley Oak complex. "There are a lot of spec buildings, a lot of places are looking for industry, but we were impressed with the people here, the help they offered and the training (of employees)," said Adams. The Somerset-Pulaski County Development Foundation has offered TDE $5,000 in credit toward the $1 million purchase price of the building for each job created. The 350' x 300' building was built by Pulaski Fiscal Court in 1996 in an effort to bring more industry to the area. It has been vacant since completion in early 1997. STATE
LOUISVILLE The Centers for Disease Control and Prevention has awarded a $989,000 three-year grant to the Institute for Bioethics, Health Policy and Law at the University of Louisville, designating the institute as one of two collaborating Centers for Public Health Law. The other is the Georgetown University/Johns Hopkins Center for Public Health Law. The new Center for Partnership in Public Health Law will coordinate professional education for a range of related professionals including public health officials, law enforcement personnel, prosecutors, public health lawyers and judges. The center will address the needs of judges and lawyers who are unfamiliar with the provisions of public health laws in their particular jurisdictions. With the rise of Severe Acute Respiratory Syndrome, bioterrorism and similar threats, center faculty members say it is imperative that judges and others responsible for enforcing state and local public health laws be prepared. The center is working with its partners and the CDC to develop a strategic plan for increasing the public health law training capacity of such groups as the American Bar Association, National Association of State Judicial Educators and the National Association of Local Boards of Health. LOUISVILLE Sypris Solutions has signed a letter of understanding with Dana Corporation to serve as a key supplier for the manufacture of a wide range of drive train components for the Ohio auto parts company. The outsourcing arrangement is expected to cover approximately $130 million of business per year when completed, based upon current market conditions. The components to be manufactured will be incorporated into Dana's final axle assemblies. The transaction is expected to be finalized in stages later this year and early in 2004. WURTLAND
Both state and local officials maintain that the completed highway – which was finished ahead of schedule and $15 million under budget – opens opportunities for economic growth not seen since construction of the railroad through northeast Kentucky. In fact, the highway has already been responsible for some of the significant growth seen in the area in the past several years. Shortly after construction on the first stretch of roadway began in 1998, plans for a new business park were born with the creation of the EastPark regional business park. In 2000, Cintas built a new manufacturing and distribution center that now employs more than 250 workers. Cingular Wireless has also built a customer call center in the park, bringing more than 900 new jobs to the community. “(This highway) is a 50-year investment,” said Patton. “I guarantee you it will be much different than it is today in 50 years.” LOUISVILLE A 3,000-acre tract of land south of Louisville International Airport has been designated as a "Renaissance Zone," an area designed to spur new industrial redevelopment. The site is bounded by I-265 and I-65 as well as a CSX rail line. The designation also creates a tax increment financing district that will set aside a portion of future state and local tax revenues from future industrial development to be used to finance infrastructure improvements in the area. Under the agreement, a portion of the future increase in tax revenues – as a result of new development, not new taxes – will go toward public improvement projects within the Renaissance Zone. The project is the culmination of a partnership between state and local government and private enterprise. "Our airport corridor is already a powerful economic engine for our community and our state. It helps generate more than 36,000 jobs, a payroll of more than $1.5 billion annually and taxes to local and state governments of more than $220 million a year," said Louisville Mayor Jerry Abramson. "This innovative pilot program will foster new industrial development in this area in the years to come and maximize the investment we made in the airport expansion." SIMPSON COUNTY
As a result of the Fiscal Court’s latest decision, Simpson County Judge-Executive Jim Henderson has resigned from the Inter-Modal Transportation Authority board of directors. Henderson told the Bowling Green Daily News that while he would have been willing to remain on the board, he didn’t believe it was appropriate, given the action taken by the fiscal court. The proposed transpark will be located between Bowling Green and Oakland on a 2,100-acre site that provides easy access to rail, highway and air transportation. A new interchange on I-65 is planned to accommodate the increased traffic and the park will also offer access to US 31-W and the main CSX rail line. A new regional airport is in the plans as well. SOMERSET Textile manufacturer CS International has signed a lease agreement for the former Tecumseh Products facility in Somerset with plans to move its headquarter operations to Kentucky from Los Angeles. The company is also relocating its operations in Eminence, Kentucky to Somerset, which will serve as the major distribution center for CS. CS International produces home fashion textiles such as kitchen towels, napkins and place mats. Wal-Mart is the company's largest client; other customers include Target, K-Mart, Sears, JCPenney and Meijer. The company expects to eventually employ up to 300 people and has already hired 60 Kentuckians, some of whom were previously employed by Tecumseh. CS will lease the 270,000-s.f. building from the Somerset-Pulaski County Development Foundation. The building was given to the foundation by Tecumseh when that company made the decision to close its Somerset operations in 2000. CS will lease the building for 10 years with an option to buy or renew the lease at the end of that time. In the meantime, CS has already expressed hopes to add another 36,000 square feet in order to accommodate its operations. The decision to move to Kentucky was primarily a factor of finding a more business-friendly climate, according to CS President Harold Schierholt. Schierholt noted that California had enacted more than 1,000 items of business-related legislation in the last year alone. TENNESSEE
“Following our asset sales, we are a dramatically different company than we were a couple of years ago – both in focus and geographic dispersion,” said Chairman and CEO Mark Suwyn. “Nashville is an excellent fit for our company...It’s closer to our mills, customers and financial shareholders, while offering an affordable, good quality of life for our employees and a positive business climate.” Louisiana-Pacific is a supplier of building materials and other specialty products for the retail, wholesale, home building and industrial sectors and employs nearly 8,000 workers in 44 facilities. Other cities considered by LP included Charlotte, North Carolina; Richmond, Virginia; and Portland, Oregon, the location of the company’s current headquarters. OHIO The University of Cincinnati has been awarded a $600,000 grant from the National Science Foundation (NSF) to support a three-year program to develop a regional pool of new entrepreneurs. The proposal for the program was submitted to the NSF’s Partnership for Innovation Program by UC and its five partner organizations: BIO/START, Emerging Concepts, Hamilton County Business Center, CincyTech USA and Cincinnati Children’s Hospital Medical Center. The proposal details a comprehensive training program that addresses key knowledge, skills and insights needed to be successful in the entrepreneurial arena. Participants in the educational program will be connected to a pipeline of critical resources to take them from the idea stage to successful company formation. As each entrepreneur moves through the training stages, they will be applying the information learned to the creation of their own business plans. Participants who successfully complete the program will be eligible to submit their final business plans in a competition for funding ranging from $25,000-$50,000 to support the early implementation needs of their business plans. Successful program participants will also be connected to a range of experts to gain business advice as well as exposure to additional sources of funding.
Business Briefs BOWLING GREEN
BROWNSVILLE
CALVERT CITY
CORBIN
DANVILLE
ELIZABETHTOWN
ERLANGER
FLORENCE
FRANKFORT
FRANKLIN
GLASGOW
LEXINGTON
LONDON
LOUISVILLE
LLOYD
MONTICELLO
NORTHERN KENTUCKY
OLIVE HILL
OWENSBORO
PADUCAH
PAINTSVILLE
PULASKI COUNTY
RICHMOND
RICHWOOD
SIMPSON COUNTY
SOMERSET
TAYLOR COUNTY
TODD COUNTY
WINCHESTER
WOODFORD COUNTY
INDIANA
OHIO
TENNESSEE
WEST VIRGINIA
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Copyright 1996-2003, by Kentucky Business Online. All rights reserved. Editorial content
is copyright 2003, Lane Communications Group The Lane Report is a trademark of Lane Communications Group. All other trademarks are the property of their respective owners. |
London-based Kentucky Highlands Investment Corporation has partnered with a Tennessee firm to create a new $12.5 million fund that will be used to develop new businesses and jobs in Kentucky, Tennessee, Alabama, Georgia and Mississippi. 
A recent report released by Entrepreneur magazine ranks Louisville as one of the best cities in the U.S. for entrepreneurs and small businesses.
A statewide program is giving diesel customers a chance to evaluate soy-based biodiesel, a processed fuel made from soybean oil. 
"Most of the public health laws in the United States were developed in the early part of the 20th century," said Larry Palmer, who holds the institute's endowed chair in urban health policy. "In recent years, a global economy and transportation system combined with emerging infectious diseases and bioterrorism threats have created new challenges for public health laws and public health professionals."
Under the proposed agreements, Sypris will acquire Dana's plant in Morganton, North Carolina; a portion of its manufacturing campus in Toluca, Mexico; and certain production equipment at its plants in Glasgow, Kentucky and Humboldt, Tennessee. Approximately 600 employees in Morganton and Toluca are expected to transfer to Sypris as part of the transaction.
Governor Paul Patton and a host of other state, local and business officials recently joined more than 400 people to officially open the last section of the Industrial Parkway between Kentucky 207 near Flatwoods and U.S. 23 in Wurtland.
The Simpson County Fiscal Court has withdrawn its support of the Kentucky TriModal Transpark based on concerns that the Bowling Green park will draw business away from its two industrial parks. Simpson’s court had originally voted in March 2001 to support development of the project.
Louisiana-Pacific Corp. has announced that it plans to move its headquarter operations from Oregon to Nashville within the next year. The building supply firm’s statement follows a major restructuring in which the company divested non-strategic operations to reduce debt and improve financial flexibility. 
CTS CarTop Systems N.A. Inc. has opened a new 36,000-s.f. manufacturing facility in Bowling Green. CTS, a subsidiary of CTS Fahrzeug-Dachsysteme GmbH of Germany, will produce retractable hard tops for GM's new Cadillac XLR and removable Targa tops for the 2004 Corvette. Both vehicles are produced at GM's Corvette Assembly Plant in Bowling Green. The new facility will create 75 new jobs. 
COVINGTON
Dana Sealing Products Division is in the process of expanding its Danville plant to accommodate production of a new product: a multi-layer steel gasket for the automotive industry. The expansion will double the size of the existing plant. The company has hired an additional 100 people since January to help handle the new line. 
Xanodyne Pharmacal has licensed Canadian distribution and marketing rights for LucidexÆ - the company's nonprescription caffeine pill - to Pharmascience, Inc. Lucidex, which was launched in the U.S. last fall, is the only caffeine tablet on the market that is coated to minimize the stomach irritation problems associated with many caffeine products. 
North Carolina-based Krispy Kreme Doughnuts Inc. is expanding its presence in Kentucky with its first store in Lexington. The company currently operates two stores in Louisville and one in Florence as part of its 300-store chain. 
The Louisville Zoo has been honored by the American Zoo and Aquarium Association with the 2003 AZA Exhibit Award for its "Gorilla Forest" exhibit. The AZA Exhibit Award is presented for outstanding dedication to conservation issues and construction of exhibit space replicating natural habitats. The Louisville Zoo ran against 12 such notables, including the Saint Louis Zoo, Fort Worth Zoo, Lincoln Park Zoo and Monterey Bay Aquarium, for competing exhibits with budgets reaching up to $47 million.
Elder-Beerman, a Dayton-based department store chain, has been sold to The Bon-Ton Stores for $92.8 million. In recent months, Elder-Beerman had become the focus of a bidding war between Pennsylvania-based Bon-Ton and Wright Holdings, a subsidiary of Minneapolis-based Goldner Hawn Johnson & Morrison. In September, the board of Elder-Beerman announced that it had accepted Bon-Ton’s bid of $8 per share over that of Wright Holdings’ bid $7.80 per share. With the acquisition, Elder-Beerman will become a subsidiary of The Bon-Ton. Elder-Beerman operates 68 stores in Ohio, West Virginia, Indiana, Michigan, Illinois, Kentucky, Wisconsin and Pennsylvania. The Bon-Ton Stores, Inc. operates 72 department stores in targeted markets in Pennsylvania, New York, Maryland, New Jersey, Connecticut, Massachusetts, New Hampshire, Vermont and West Virginia.