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FAST LANE - June 2001
From McCracken County in the west to Knott County in the east, clean coal combustion, which uses fluidized bed combustion to more efficiently burn coal and coal waste (called “gob”), is attracting attention from investors, citizens and the federal government alike. So are similar projects designed to transform solid waste into useful gases. President Bush wants to spend $2 billion over the next decade – and $155 million from the 2002 budget – to back clean coal technology development. Lexington-based Enviropower is moving forward with plans to build one plant in Knott County and another in Western Kentucky, with cost estimates in the one-billion-dollar territory. Such projects would not only boost employment in the areas (especially during the 2-3 year construction phase), but help to fill in the regional power supply grid. The Kentucky Division of Air Quality issued a permit to begin construction on the Knott County project, called Kentucky Mountain Power. Cincinnati-based Global Energy USA is pursuing its own coal waste/solid waste-burning project in Clark County, based on technology already in use at a company project in Germany. The proposed $432-million project in Trapp received $78 million in federal funding in 1999, and another $61 million more recently. In a project that involves no coal whatsoever, International Environmental Technologies of Danville is set to launch the test operation of a $1.5 million waste gasification plant in Inez. The facility, which can take in up to 160 tons of garbage per day, will use the gases from the process to heat greenhouses and power refrigerators to support an attached flower-growing operation, while the powder byproduct will be used in the manufacture of concrete products. Once approved by the Kentucky Department for Environmental Protection, the plant could be a key component of solid waste disposal for the region. STATE The foot-and-mouth epidemic in Great Britain has caused the Kentucky Agriculture Department to issue an alert to farmers. “The real danger of this disease is that it is so easily spread,” said state veterinarian Dr. Don Notter. “It can be carried by people, clothes, vehicles or even the wind. It can be spread by water, hay or waste.” Its chief symptoms are blisters on the mouth and feet, with accompanying salivation and lameness. The outbreak caused the U.S. Department of Agriculture to ban the importation of European Union livestock and uncooked animal products on March 13. In the wake of the outbreak, might Kentucky farmers see renewed interest in their stock? “Over in Europe, our sales have not been that high anyway,” says Tony Moreno, principal assistant with the Kentucky Department of Agriculture. “Most of our sales are to Canada and Mexico.” He points out that the U.S. has been lucky to have no confirmed cases of foot-and-mouth thus far. He says there’s the potential for a ban on agricultural machinery from the U.K., which would have an impact on U.S.-based machinery companies. Historically, it’s the British who don’t want the U.S. meat, citing concern over the use of growth hormone, but Moreno says Kentucky’s working to change that. “We’ve been working on an initiative in the U.K. to get our organic product there,” he says. “Another opportunity is on the genetics side, working with the genetic export council here to replenish livestock they’ve lost.” The Kentucky Cattlemen’s Association issued a release reminding consumers that the U.S. has not imported any beef from the UK since 1985. “We are protected on both borders and we have the most aggressive policies in the world when it comes to protecting our agricultural interests,” says KCA president Larry Clay. The Commonwealth is the largest cattle-producing state east of the Mississippi, with approximately 40,000 beef producers and 1.1 million cows. In 1999, Kentucky beef brought in $550 million in cash receipts. According to the Economic Research Service at the U.S. Department of Agriculture, exports of agriculture and food products will bring $53 billion into the U.S. economy in the 2001 fiscal year, bolstered in part by a surging Asian economy. LOUISVILLE Site Selection named Greater Louisville Inc. among the top 10 economic development groups of 2000, based on the $503.8 million in capital investment and over 5,000 jobs the organization helped to lure to the area last year. The Kentucky Economic Development Cabinet was among 12 other groups to receive honorable mention. GLI recently sponsored a major event in Atlanta to inspire migrated Louisvillians to consider coming back home (see Kentucky People, p. 48.) Counted among the fastest-growing private companies in downtowns nationwide were three Louisville firms. In Inc. magazine’s Inner City 100, MedVenture ranked 13th, OMG came in at No. 66 and Fischer Group was 81st. Company rankings were based on their percentage of sales increase over a five year period. STATE A new report from the U.S. Commerce Department’s Census Bureau, “What’s It Worth? Field of Training and Economic Status, 1996,” says that a full-time employee with a bachelor’s degree in engineering earns the highest average monthly salary (based on four-year degrees) in the land, at $4,680. And the lowest? You guessed it: those with education degrees make an average of $2,802 per month. The study is based on 1996 data. Like music to the ears of skills upgrade training advocates, the study’s authors point out that even training short of a degree, like a vocational certificate, boosts earning power. “The average person with a vocational certificate earns around $200 more per month than the average high school graduate,” says co-author Kurt Bauman, “but if the certificate is in an engineering-related field, the boost in earnings is close to $800.” Professional degree holders like doctors and lawyers were found to earn $7,224 per month on average in 1996. The country’s 1.9 million MBA holders earned $5,579 a month, while the 7.5 million who had bachelor’s degrees in business (the most popular study area in the nation) earned a monthly average of $3,962. A recent study by the Southern Growth Policies Board reported that Engineering and physical science majors are significantly less likely to be retained in their home states than computer/math and social science majors. The odds of retaining a computer/math major are 26 percent higher and the odds of retaining a social scientist are 29 percent higher than an engineering major, which had the lowest retention rate of any major. LONDON
“Today, we are taking a big step toward cleaning up the mess caused by a few people,” said Kentucky Natural Resources and Environmental Protection Cabinet secretary James Bickford. “We’re also putting those people on notice that they won’t be allowed to do it again.” STATE According to the Associated Press, not only is clean coal technology receiving its due in President Bush’s proposed budget, but so are other projects and industries with a Kentucky connection. The White House’s figures, most of which are cuts from last year’s appropriation amounts, include:
LEXINGTON In early May, Lexington mayor Pam Miller, in city government since her election as a council member in 1973, announced she will not seek re-election in 2002. At age 62, she said that while she was focused on keeping the promises she’s made during her remaining days in office, when those days expire she looks forward to entering a new phase of her life that’s free of the day-to-day business of running a growing city. Miller became the city’s first female mayor in 1993. Among those eyeing her post are former vice mayor Teresa Isaac, construction executive Jim Gray and councilman Scott Crosbie. LOUISVILLE As much as its vaunted Six Sigma philosophy, General Electric’s digitization initiative has been one stated reason for the company’s continually impressive recent results: 21 percent growth in profits for the fourth quarter of 2000, and a 16 percent increase in ongoing earning for the first quarter of 2001. According to the Courier-Journal, at GE Appliance Park, the number of printers has gone from 2,400 to 170 in a matter of a few months. Not only will the paper use be cut by more than half, but company officials anticipate more efficient data retrieval and management. Area schools anticipate enjoying the use of a boatload of used printers donated to them by GE. The company recently introduced its new Arctica refrigerator, one of the results of nearly a billion dollars invested by GE in a total redesign of the product line. NORTHERN
KENTUCKY Corporex will build two more high-tech office buildings near its two-building Reflections One project in the heart of the firm’s 650-acre CirclePort International Business Park, which counts Dana Corporation, The Gap and Span Pro among its tenants. Called Reflections Two, the 86,400 s.f. of space will be situated next to a lake and, say Corporex spokesmen, at the cusp of an economic turnaround. “We want to expand upon the success of the first stage of Reflections even in the face of a national slowdown,” says company vice president Rob MacLachlan. “Corporex will be well poised for the upturn.” Other Corporex projects include groundbreaking on two 216,480-s.f. industrial buildings at the 100-acre Crossroads Business Park in Orlando, Fla., a development that will include two million s.f. of both speculative and built-to-suit space. Pharmaceutical firm McKesson HBOC will occupy one of the buildings. And Adelphia Business Solutions will move 30 employees into the RiverCenter Tower 1 edifice on the Covington waterfront. “Adelphia Business Solutions Division represents the kind of technology-focused, New Economy enterprise that Tri-ED has targeted for recruitment to Northern Kentucky,” says Kenton County judge executive Richard Murgatroyd. SPRINGFIELD
CYNTHIANA Iron casting manufacturer Grede (pronounced “Grady”) Perm Cast may downsize its operation here, which employs 280. The possible downsizing would be a result of the potential sale of the facility to an as-yet-unnamed buyer. Milwaukee-based Grede, which operates 13 facilities, poured $500,000 into a November 1998 expansion, and invested another $50,000 in an expansion in November 2000. The company is currently in the midst of constructing a 50-50 joint venture foundry with Mexican firm Proeza in Monterrey, Mexico, which will produce 80,000 tons of castings on an annual basis. But company vice president for human resources Stu Davis is quick to point out that there’s no relation between the opening south of the border and the potential sale in Kentucky. “There’s no connection between expanding in Mexico and the decision to sell the facility in Kentucky,” he says, pointing out that the Cynthiana plant is unique within the company in its use of cast-iron permanent molds as opposed to today’s more commonplace sand molding process. Even a slight expansion of business to attract some cast-iron foundry work from the closing of a British plant has not been enough to stave off the decision to sell. “It was essentially that cast-iron molding process that had become non-competitive,” says Davis. “Our interest in Mexico is to serve the Mexican casting market.” The final sale isn’t expected to go through until at least mid-July, and Davis says that in the meantime, “Grede’s intention is to continue running, even at a somewhat accelerated pace, between now and then in order to produce enough product ahead of our customers’ orders so they will have enough product to keep their lines running. I don’t see any significant change in the workforce as long as Grede continues to operate it.” NORTHERN
KENTUCKY
“By sharing our report and five-year action plan, we hope to allow others to systematically track our environmental progress,” said TMMNA environmental affairs assistant GM Kevin Butt. “We hope this report helps us set the environmental benchmark for others in the industry.” The report can be accessed at www.kybiz.com. In a related move, a Tier 1 supplier for parent company Toyota Motor Corp. announced a partnership with Ford Motor Co – not traditional Toyota partner General Motors – to develop combined gas and electric power systems for Ford vehicles. Aisin AW Co. will build a system for Ford’s Escape SUV model by 2003. Toyota has a 40 percent interest in Aisin, which operates a facility in London, Kentucky. LEXINGTON
After welcoming 86,000 visitors in 2000 – just over half from Kentucky, the rest from several countries and nearly every state in the Union – this year’s event drew 84,077 over the four days. Sydney Olympics champion and Virginia resident David O’Connor continued his and his family’s tradition of excellence in the sport by not only winning this year’s event aboard the much-deserving Giltedge, but taking third place aboard his 2000 gold medal horse Custom Made. The already-lofty stature of the event also gained additional global repute, especially among the hard-to-please British equestrian media. “Both sponsorship and the trade fair have grown since last year,” says Jane Atkinson, event director and executive vice president of Equestrian Events Inc. “We’re running out of physical space for the trade fair now, with a waiting list of about 30.” Hotels and motels within 40 miles of the Horse Park were booked solid. Atkinson says the economic impact was estimated to be around $4 million eight years ago, and has probably doubled since then. “What makes me happy is the international attention that the Rolex brings to the Horse Park and to Lexington,” adds John Nicholson, executive director of the Kentucky Horse Park. “A lot of cities envy the kind of international exposure we get.” The Kentucky Horse Park Foundation may soon bid on the 2006 World Equestrian Games, submitting a proposal by Oct. 1, 2002. “The
decision whether or not to proceed will be made shortly
after the 2002 Games in Spain,” says Nicholson.
That’s only a natural precursor to possible
partnership with the 2012 Cincinnati Olympic bid, but he
points out that the World Equestrian Games are big enough
in their own right. For now however, it suffices to draw justified attention to one of the state’s biggest – and paradoxically least-known – events. “Nobody seems to realize what a big deal the Rolex is,” says Atkinson, who echoes a lot of Kentucky businesspeople when she observes, “we’re better known internationally than we are in our own state.” Business Briefs BEREA
BOWLING GREEN
COVINGTON
CYNTHIANA
DANVILLE
ELIZABETHTOWN
FLORENCE
HARRODSBURG
LEXINGTON
LONDON
LOUISVILLE
MIDWAY
NORTHERN KENTUCKY
PADUCAH
PIKEVILLE
PINEVILLE
PRESTONSBURG
STATE
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Copyright 1996-2001, by Kentucky Business Online. All rights reserved. Editorial
content is copyright 2001, Lane Communications Group The Lane Report is a trademark of Lane Communications Group. All other trademarks are the property of their respective owners. |
Even
though legislation to clean up the state’s illegal
dumps didn’t survive, the pride of seven counties in
Eastern Kentucky will, thanks to the PRIDE group’s
$1.25 million in SuperGrant awards. “For decades,
the residents of Eastern Kentucky have lived with these
unsightly and unhealthy nuisances,” said
Kentucky’s 5th District U.S. Representative Hal
Rogers in presenting the awards. Among the recipients
were Jackson County Fiscal Court, up to $500,000 to clean
up Adkinstown dump, the state’s largest illegal
dump; Pike County Fiscal Court, up to $100,000 to clean
several areas along Ky. 1056; and Wayne County, up to
$100,000 to remove a dump near downtown Monticello.
Akebono
Corporation North America broke ground in early May on a
190,000-s.f. brake pad manufacturing facility at the
Clearview Commerce Center. The plant will employ up to
250 people when it becomes full operational by the third
quarter of 2002. The company already operates three other
facilities in Kentucky, and plans an initial investment
of $70 million in the new operation. “Once again,
the work ethic of the Kentucky worker proved to be a
major factor in the decision to expand in Kentucky,”
said Gene Strong, Secretary of the Kentucky Cabinet for
Economic Development. Akebono’s global sales exceed
$1.0 billion and the company is listed among the Top 150
Automotive Suppliers in North America by Automotive News.
According to Chuck Nobumoto, chairman, president and CEO
of parent company Akebono Brake Industry Co., Ltd.,
“The growth of our brake pad business in North
America has been steadily increasing. To keep up with the
projected demand, we have to create additional capacity
to meet our customers’ needs.”
Toyota Motor
Manufacturing North America, Inc. released for the first
time its environmental action plan for all the
company’s manufacturing plants. “Toyota is
proving our commitment to the environment with many of
our products,” said president Teruyuki Minoura,
“but it all starts in our manufacturing
facilities.” 
The Rolex Kentucky
Three-Day Event, presented by German conglomerate Bayer
in late April at the Kentucky Horse Park, has come a long
way since its inception 23 years ago, even though many
Kentuckians wouldn’t know it. Olympians and world
champions from around the world competed in dressage,
cross-country and stadium jumping at the western
hemisphere’s only four-star three-day event.
Mayfair
Capital chairman J. David Grissom and former PNC
executive Ronald J. Murphy have formed a new
state-chartered trust and investment company
called The Glenview Trust Company. “The
combination of enormous wealth creation over the
last two decades and the consolidation of large
regional banks have created the need for a
smaller, more flexible and focused
organization,” Grissom said. Serving on the
company’s board will be thoroughbred breeder
Ina Brown Bond, former J.P. Morgan Chase Bank
mutual fund executive Leaonard M. Spalding, Jr.
and retired plastics executive Robert C. Ayotte.