Most people in Colorado probably didn’t notice the business-related headline out of Arkansas earlier this week.
The news was positive for that Southern state in its proactive efforts to bounce back from the recession. Arkansas’ governor, Mike Beebe, made the announcement of what was labeled in advance simply as a “superproject” — meaning it would bring at least 500 new jobs and an initial investment of at least $500 million.
The superproject, it turns out, will be a steel mill in the northeast Arkansas town of Osceola (population 7,700) on the Mississippi River about an hour north of Memphis. The details are impressive: about 525 jobs averaging $75,000 in salary and benefits per year, and the total investment will reach an estimated total of $1 billion.
That’s right, $1 billion — in Arkansas (population 2.9 million), where the median household income is just $38,758 a year, ranking 48th among the states. By comparison, Colorado is 15th at $55,387, with 5.2 million residents.
Granted, Colorado wouldn’t have had a chance for that steel mill, because one apparent requirement was access to a major waterway, as well as railways and freeways in all directions. Dig into that deal, though, and one finds a lesson for Colorado to consider.
That superproject was made possible by state money that helped cover start-up costs, from a voter-approved ballot issue called Amendment 82. It allows Arkansas to issue bonds up to $235 million (or 5 percent of the state’s net general revenues in the most recent year) as a means of enticing big employers. In this case, state officials say they don’t need the maximum amount, and if the Arkansas Legislature approves, the superproject will move forward quickly.
Another aspect: That steel mill is not aimed to affect the politically powerful or more populated areas of Arkansas. Osceola is 175 miles from the state capital of Little Rock.
The point is this: If a state like Arkansas can find ways to attract manufacturers with hundreds of good jobs, why not Colorado? Arkansas, like Colorado, is proud of having a streak of balanced state budgets, and floating $125 million toward this superproject won’t change that.
Arkansas was inspired to come up with Amendment 82 by a defeat — losing to San Antonio for a Toyota plant to make Tundra trucks. Other states also were courting the steel-mill company, but this time was different. It’s all about investing in jobs — and by the way, if that company decided to renege on its promises, it would have to return a portion of the state money.
Colorado would be smart to look into that Arkansas model, with other possible opportunities floating around. In fact, earlier rumors had suggested that the superproject might have been Chinese companies wanting to put a manufacturing plant in southwest Arkansas, far from the Mississippi River.
Turning such speculation into reality, aggressively seeking out those opportunities, could be the best way to score noteworthy victories in today’s world of state-level economic development.
The question is this: Does Colorado want to jump into that game, or watch superprojects and jobs go elsewhere?