4A Wichita Falls Economic Development Minutes - 02/04/2016 MINUTES OF THE
WICHITA FALLS ECONOMIC DEVELOPMENT CORPORATION
February 4, 2016
PRESENT:
Dick Bundy, President § Members
Reno Gustafson, Vice President/Sec'y/Treasurer §
Leo Lane §
Darron Leiker §
Dave Lilley §
Glenn Barham, Mayor § Mayor
Jim Dockery, Asst. City Manager/CFO § City Staff
R. Kinley Hegglund, Jr., City Attorney §
Linda Merrill, Recording Secretary §
Henry Florsheim § Chamber of Commerce and Industry
Kevin Pearson §
Dwayne Bovina, Chairman §
Scott Poenitzsch, Executive Committee §
Tom Zoretich
Richard Aboulafia § Teal Group
Phil Finnegan §
Jim Bruce § Bruce Facility Planning Consultants
Bill Boyd §
Jerry Schneider §
Dr. Joe Michels § Solomon Bruce Consulting
Lara Ingram §
Dean Barber § Barber Business Advisers
Jason Hamman §
Marshall Heard §
1. Call To Order
Dick Bundy called the meeting to order at 3:00 p.m.
2. Approval of Minutes (January 14, 2016)
Reno Gustafson moved, seconded by Dave Lilley, that the minutes of the WFEDC and
the Aerospace Task Force meetings of January 14, 2016 be approved. The motion carried.
3. Discussion regarding the WFEDC retaining an Aerospace Consulting Firm and
includes interviews with prospective firms.
Teal Group Interview
Tom Zoretich, Senior Economist, led the presentation. He was joined by Richard
Aboulafia, Vice President of Analysis and Phil Finnegan, Director of Corporate Analysis. The
gentlemen provided information on their individual backgrounds, the Teal corporation, and their
perspective on the aerospace industry.
Mr. Bundy noted how important Sheppard AFB is to the community, and asked if the
company's analysis would also include what type of companies not to pursue that would be in
conflict with the best interests of the military installation. Mr. Aboulafia said that would be the
very core of what they would provide.
He then noted segments that would be worthy of investment, including:
UAVs
Subcontracts for the LRS-B
Attracting foreign investment
Middle of Market 757 (200-250 seat class) airplanes
Mr. Pearson asked if the company did any work relative to MRO facilities. Mr. Aboulafia
said they follow the industry, but have not looked at regions for investment.
Mr. Zoretich summarized the Teal Group's plan:
Analyze local assets
Evaluate global aerospace industry
Target sector opportunities
Target specific company opportunities (based on Teal's contacts)
Present a marketing plan
Mr. Pearson noted the company's original bid was $287,000, and they were asked to
reduce the costs to $150,000. Mr. Zoretich noted the following items were omitted/reduced to
make the project more economical: omission of a customized template for the SWOT analysis;
reduction in the number of hours analysts will work on the project; reduction in the amount of
work performed on the global needs assessment; and omission of interviews of dozens of
company executives.
Leo Lane asked the prospects of this community to succeed in attracting a company to
this area. Mr. Aboulafia said it was reasonable to assume a community of this size can do some
good things, and cited Greenville's successful campaign to get a Honda manufacturing facility as
an example.
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Bruce Facility Planning Consultants (BFPQ
Bill Boyd identified himself as a site location consultant. He has both aerospace and
economic development experience. Jerry Schneider (via Skype) is the proposed Project Manager
and has experience in marketing, economic development and public affairs. Jim Bruce, the
President of BFPC, has experience in site location for companies such as Boeing. They also have
three other personnel who will help with certain parts of the plan.
Mr. Bruce noted that large assembly plants, such as Boeing, generate many jobs in the
supply chain. The typical business model is to farm out work to subcontractors. Wichita Falls is
in a good position to be a satellite operation if it can make a good pitch to some of these
companies, and is well located in regard to several major aviation operations, not only in regard
to Texas, an important state in the aerospace industry, but also Oklahoma, Kansas, and Colorado.
Mr. Lane asked Wichita Falls' prospects for success in this endeavor. Mr. Bruce feels the
community has an excellent opportunity. Texas has an overall business climate that is supportive
of business and industry, and it is now particularly important to diversify and generate new
businesses. He believes there will be a significant uptick in recruitment activity and if Wichita
Falls can make a compelling business case, then businesses will be interested. Mr. Pearson noted
that Mr. Bruce spent several hours here in the community with Michael Paris.
Mr. Bundy presumed the company will take into consideration the importance of
Sheppard AFB to the community and steer away from any prospects that may conflict with its
operations. Mr. Bruce agreed they would not want to attract anything that would get in the way
of pilot training activities. On the positive side, there are thousands of folks who muster out of
military service at a relatively young age searching for civilian positions, many of whom develop
contacts or even get married here and are looking for an opportunity to stay in this community. It
is important to look for opportunities and yet be sensitive.
Mr. Bundy asked if the assessment would give direction on the type and size of industry,
and Mr. Bruce replied affirmatively. They would identify specific business and industrial
activities related mainly to aviation. Wichita Falls has to be very focused and stay persistent on
an ongoing basis. He teaches this at the international economic development conference. They
will make sure that everyone in the room, as well as existing employers, have had an opportunity
to provide input so that any prospects will serve the community's objectives. He does not want
the community to spend its resources on prospects with little likelihood of coming here.
Mr. Lilley asked what king of position does Wichita Falls need to be in financially to be
competitive? Mr. Bruce said the basics are important: land, utility capacity. One should not be
doing economic development by buying projects. Incentives have a role, but a community must
first demonstrate that it has a comprehensive set of advantages — that it operates a pro-business
public sector; well prepared in that property is available as needed; and the logistics are in place
(interstate, rail). This does not necessarily mean a lot of cash on the table. Incentives can sweeten
the deal, but they cannot be the basis for them. Mr. Boyd said they can be a tie breaker.
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Solomon Bruce Consulting
Dr. Joe Michels served 30 years in the USAF, retiring as a full Colonel, then was Dean of
College of Business at Montana State University for 3-1/2 years. He spoke last year at the
Foreign Direct Investment Conference on bringing foreign companies to the U.S. and research
and development in the aerospace industry. He is now an adjunct professor at the University of
North Texas at Austin. Last year, he taught business strategy at the University of Texas at
Arlington. Lara Ingram of J.0. Design, LLC, has worked for city, state, and federal governments,
as well as in the private sector, across the United States.
Dr. Michels noted Wichita Falls may be able to get involved in the maintenance repair
and overhaul industry, noting that it is 300 miles from Wichita, Kansas. He added that since it
shares an airport connection with Sheppard AFB, there may be some possibilities there, as well.
Pilots are required to retire at age 65. The Air Force has begun to use enlisted personnel to fly
drones as they do not have enough officers. There may be an opportunity for a training facility.
Solomon Bruce Consulting's approach is:
Discovery (what do you have/what do you need)
Assessment(how does it fit/will it fit)
Analysis (gap analysis/how do we fill it)
Marketing plan development (strategic road map for next steps)
All recommendations made will be tailored specifically to Wichita Falls. Mr. Pearson
added that Dr. Michels toured the community in detail.
Mr. Lane asked his opinion on the community's prospects for success. Dr. Michels said
the aerospace industry is growing and trying to find new places to invest. Texas has a good
business climate, and his marketing colleagues will identify the community's strengths and what
may be needed. Ms. Ingram said it would take market research. They do successful rebranding
and fill in the gaps in the data to give a detailed understanding of all potential prospects.
Mr. Lilley asked what effect would incentive limitations have on Wichita Falls' ability to
recruit? Dr. Michels said incentives are not the primary driving factor; rather, does the locale fit
what needs to be done?
Driving factors of site selection include:
• Location
• Schools
• Environment
Cultural activities
Good place to raise family
Place to do something
Education
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Barber Business Advisers
Dean Barber, President, appeared in person, accompanied by (via Skype) Jason Hamman,
President of Harriman Consulting Group, and Marshall Heard, President of Heard Technical
Services. Mr. Barber said business development is not easy. Most business groups are not good
at business development. He noted the RFP requested names of companies in aerospace
industries. He would provide names of presidents and CEOs, along with their email addresses
and phone numbers. He is attending the Pacific Northwest Aerospace Alliance next week, and
wondered why Wichita Falls did not have a representative attending, as well.
He spent 20 years as business editor of The Birmingham News, then went to work for an
economic development partnership in Alabama to recruit businesses. They were successful in
recruiting Mercedes Benz, Honda, Hyundai, and Boeing. He understands the recruiting game.
Jason Harriman is a former economic developer and now works with data and GPS. Marshall
Heard has had 50 years' experience in aerospace. He was the business and technology
development director for Boeing. A fourth person, Jessica Bates, would also help with research.
It is apparent, Mr. Barber said, that Wichita Falls wants jobs. It has assets, such as
Sheppard AFB, and should have technical knowledge in its workforce. It is in a "sweet spot" of
the aviation corridor from San Antonio to Wichita, Kansas.
When he recruited for Alabama, he never did a hard sell. Rather, he would say, "when the
time comes and you need a location, call me." He may not have won the project, but he made
first contact. No one person wins a project. He has over 5,600 contacts on LinkedIn and over
4,000 followers. In addition, he has over 2,000 emails in Outlook. There are ways to get names,
phone numbers, and emails, which represent ways to get past the secretary.
Mr. Barber said they would work 60-90 days to give Wichita Falls more than a report.
They want to provide leads, but the leads should be thought of in terms of relationships.
Mr. Lane asked his opinion on the prospects of success of this venture. Mr. Barber said
the area has a pretty good aviation history, and again, is in the sweet spot of the aviation corridor.
Costs would be lower here than in the Metroplex and probably than in Oklahoma City. He is a
former business journalist; he would find out the facts along with his team. They all have their
complementary strengths.
Mr. Lilley noted that Wichita Falls has been in the aviation business since 1917. He
asked where it has failed to attract some of the companies it now seeks to attract? Mr. Barber
said that his team would perform a SWOT analysis to determine the answer. He knows nothing
about the community's previous leadership, but Henry Florsheim has a good reputation. He notes
that some shops are not very aggressive. He said again that the City should be at the second
largest aviation cluster in North America next week, and should also attend the MRO show in
Dallas April 5-7.
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Kevin Pearson asked the members to rank the presentations I through 4 before the next
meeting. He then identified the other topics to be discussed at the next meeting (set for Thursday,
February 18, 2016, at 4:00 p.m. at the Amfuel plant):
Potential incentives for company involving Stanley Building
Fencing at Business Park (ask Pat Hoffman to attend meeting)
Cattle grazing lease
John Buanno to show operations at the plant
8. Adjourn
Mr. Lane moved to adjourn. Seconded by Mr. Lilley, the meeting adjourned at 5:00 p.m.
President
Dic Bund President
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