VIDEO: A Discussion About Northwest Indiana

NWIndianaLife.com recently spoke to our president, Kevin Brinegar, about the key issues facing the northwest Indiana business community. We appreciate the opportunity, and here is their synopsis of the 21-minute interview.

In this interview, Kevin Brinegar of the Indiana Chamber of Commerce discusses the Chamber's relationship with Northwest Indiana. He talks about how important the Region is to Indiana as a whole, given the proximity to Chicago and the variety of infrastructure in place for transportation and industry. He goes on to discuss some of the recent developments coming out of the Region, including the Illiana Expressway and how it will improve traffic flow in and out of the area, as well as the expansion of the Gary Airport, lakefront developments, and how the RDA is helping with improvements on a regional level. Next, he covers some of the positive opportunities coming out of Gary in the future, and how the revitalization efforts are helping the future of this strategically located city. Kevin then talks about the business climate in Indianapolis, and how visionary leaders across industries have helped foster a thriving area of economic growth. He attributes this growth to Indiana having one of the best, most stable climates for business growth, and how well the state has been ranked overall. He sees Indiana's economic future in the hands of the Chamber of Commerce, helping to grow the economy over long periods and directing long-term planning for the years ahead. He goes on to discuss how the Indiana Chamber of Commerce distributes information to the people of Indiana, through emails, newsletters, magazines, blogs, twitter, and more. Some plans the Chamber of Commerce have been implementing include the Indiana Vision 2025 plan and covering the cost of preschool for families to help prepare the next generation. He sees the Porter County Career and Tech Center as a model for engagement with employers as student are learning trades in school.

Column: Right-to-Work States Have Economic Advantage

Andrea Neal of the Indiana Policy Review Foundation penned the following column on right-to-work laws for the Times of Northwest Indiana. The Indiana Chamber has been an advocate for developing a right-to-work law in the state:

It doesn’t take an economist to spot the common thread in these recent economic development headlines:

• Chattanooga, Tenn., July 29: "Volkswagen hires 2,000th employee."
• Shreveport, La., July 28: "NJ-based bag manufacturer to build Louisiana plant."
• Decatur, Ala., July 21: "Polyplex to build $185 million plant."
• West Point, Ga., July 7: "Kia builds vehicle No. 300,000."

All four stories have Southern datelines. All come from states with right-to-work laws, which prohibit labor contracts that require employees to join a union or pay a union representation fee.

This is the issue that prompted the five-week House Democratic walkout during the 2011 Indiana General Assembly. The Democrats — a minority in both House and Senate — had no other leverage. So when a right-to-work bill came up unexpectedly in a session that was supposed to be about the budget, redistricting and education, they bolted. Republicans capitulated and took the legislation off the table.

In 2012, it will return with a vengeance, and this time Democrats can’t avoid it. Right-to-work has been promised a full public airing. The Interim Study Committee on Employment Issues, chaired by Sen. Phil Boots, R-Crawfordsville, is taking a first crack this summer and hopes to recommend a bill by November. Gov. Mitch Daniels, who didn’t support the bill last session, has hinted he might this time around.

The debate goes back to 1935 when Congress passed the National Labor Relations Act protecting employees’ rights to form, join and be involved in unions. One section of the law permitted contracts that made union membership a condition of employment. Congress modified that language in 1947 when it said states could prohibit these. In response, 22 states passed right-to-work laws. Indiana is one of 28 that currently does not have such a law.

Predictably, at last week’s study committee hearing, business interests favored right-to-work while union leaders opposed it. The economists were divided. Richard Vedder, of Ohio University, summarized research showing that right-to-work states have higher rates of employment, productivity and personal income growth. Marty Wolfson, of the University of Notre Dame, testified that right-to-work laws result in lower wages and benefits.

Their conclusions are not mutually exclusive. If you grant Wolfson’s point, the policy question remains: Which is better? A state with higher wages for some but a weaker economy overall or one with lower wages for some and more vibrant growth, not to mention freedom of choice for the worker?

Companies are voting with their feet. To the extent that manufacturers are expanding in the United States — and few are — they are choosing the South and West where right-to-work is prevalent.

Alabama Gov. Robert Bentley, in announcing the $185 million project by Polyplex, the world’s fourth-largest manufacturer of thin polyester film, was blunt: "Alabama is a right-to-work state, and we will continue to be one. That’s one of our advantages for companies who are looking to build on new sites."

Companies won’t readily admit this because what they say can and will be used against them. Currently pending at the National Labor Relations Board is a case against Boeing, which recently opened a second production facility in South Carolina for its 787 Dreamliner airplane.

South Carolina has a right-to-work law. Boeing’s other production site is in Washington state, which does not. The board’s complaint alleges that Boeing chose South Carolina in retaliation for strikes by Washington workers in violation of the National Labor Relations Act. Its proposed remedy would force Boeing to move its South Carolina operation to Washington. This would be an extraordinary use of federal power to promote the cause of organized labor at one company’s expense.

Right-to-work does not destroy unions. It gives workers the right to decide for themselves whether to join. "This greater accountability results in unions that are more responsive to their members and more reasonable in their wage and work rule demands," the Mackinac Center for Public Policy said.

It should come as no surprise to Indiana legislators that expanding industries favor that kind of relationship. The legislative choice is between protecting unions as we know them or protecting the long-term interests of Hoosier workers.

More on Illinois: Tax Until You Drop, And They Probably Will

We told you here two days ago that Illinois lawmakers were seriously considering tax increases of 75% on individual income and 49% on corporations. Well, good news for the residents of the land that might more closely resemble its nickname (Prairie State) in the coming years as those increases were lowered to 67% and 30%, respectively.

Governor Pat Quinn is expected to sign the legislation to help stem an ever-growing budget deficit. The state anticipates it will raise an additional $6.5 billion in revenue in 2011. But do those projections take into account the companies and the families that will be fleeing for points near (Indiana) and far?

We hinted earlier that Indiana would need to be ready to roll out the welcome mat for those defectors. A brief conversation with someone from the Indiana Economic Development Corporation (and public comments from Mitch Roob) confirmed that an aggressive marketing plan is in the works along with additional personnel in Northwest Indiana and focused efforts in Terre Haute, Evansville, etc.

The Tax Foundation reports the moves (if part of the 2011 evaluation) would drop the Illinois tax climate from No. 23 to No. 36. Indiana, by the way, is a solid No. 10.

Here’s the Tax Foundation brief on the impacts of the spend, spend, tax and spend some more plan in Illinois.

Regionally Speaking … to a Point

In the Northwest Indiana roundtable discussion in our current BizVoice, it is mentioned by an economic development official that we don’t care which county (or community) is home to the next major project. Will others in the Region have the same opinion? 

Bill Nangle, executive editor of The Times, says, "The end result will be that getting that company to develop here will outweigh any other consideration. Doesn’t mean there won’t be one community versus another. The one that I always think of is Krispy Kreme Dougnuts (battle between Highland and Schererville, with the latter the winner but the facility no longer in operation).

Mike Schrage, leader of Centier Bank, offers, "I think the public is very accepting of a business … as long as it comes to the area, that’s great. On the political side, we haven’t quite gotten the changeover; they’re still into a little fiefdom-type thing that unless it comes to our community, we’re not going to get the best benefit out of it."

Read this story and other Northwest Indiana and education features in BizVoice.

Ridin’ the Rails in Da Region

Our next BizVoice magazine (available online February 26) features four Northwest Indiana leaders talking about what it’s going to take for the Region to thrive economically. Extension of the South Shore rail service (a mainstay from South Bend to Chicago and stops inbetween) is part of the discussion, but the following didn’t make the final cut for the story.

Leigh Morris, who is chairman of the Northwest Indiana RDA (that’s Regional Development Authority) and oversees the Indiana Toll Road for the state Department of Transportation, noted the two proposed South Shore extensions are "from Hammond south through Munster and down to Lowell and Crown Point; the other one is an extension from the main line down to Valparaiso in Porter County."

As for the timelines, Morris adds, "Both of these projects are in the process of feasibility evaluations and studies. There are a variety of issues that have to be addressed. The RDA’s position is that both of these routes must be studied sumultaneously. We may do one before the other, but it is not one or the other; it’s both."

With existing rail corridors in place for both, "they could happen fairly expeditiously, within a five-year time frame. One or both could be well underway or even in operation in that time frame. A lot of that depends on being able to assemble the dollars that are involved (more than a billion through regional, state and federal resources).

The public reaction, in Porter County in particular, has been negative as the message about affordability (50% federal match) and economic development opportunities has been overshadowed by that nasty three letter word — tax.

Morris summarizes: "We’ve allowed people to think that we’re going to extend these railroad tracks down here, and there will be a bunch of people getting on the train and going to Chicago. It’s so much more than that. This is the catalyst that will cause major new investment and the creation of new sustainability in our communities."

On the passenger and freight side, Morris offers an interesting tidbit. "We have probably the single most congested piece of rail in the entire national on the Norfolk Southern between Porter, Indiana and Chicago." Stimulus funding is pending to address that.

Read this story and more from Northwest Indiana (and from both K-12 and higher education) in the March-April BizVoice.

Valpo, Recycling … and Ringo?

As a member of my beloved Beatles, Ringo Starr holds a special place in my heart. Granted, he’s not my favorite member (that distinction goes to Mr. McCartney), but his quirkiness is decidedly endearing.

As Ringo celebrated his birthday earlier this month and his hit, “It Don’t Come Easy” serenaded me home from work, I reflected on how that statement applies to my cooking skills (it wasn’t my proudest moment when Tater Tots caught fire in the oven.)  Fortunately, however, some things do come easy in life – like making an impact in the recycling world.

Take Northwest Indiana, for example. People are working hard to reduce waste and advance sustainable construction, but many of their initiatives include things that are easy to do (turning off lights before leaving the office, participating in curbside recycling). The city of Valparaiso diverts 49% of residential trash away from landfills through recycling. (Heck, if you’re going to take out the trash anyway, why not toss a few recyclables into a bin?)

Other green initiatives taking place in the region include redevelopment of the Lake Michigan lakefront and a partnership between the city of Valparaiso and a beer wholesaler to enhance environmental stewardship.

Learn more about these exciting developments in the current issue of BizVoice® magazine.

Could Chicago Olympics be Good as Gold for Northwest Indiana?

Inside Indiana Business asked Speros Batistatos, President/CEO of the South Shore Convention & Visitors Authority, about the impact an Olympiad in Chicago could have on "da region" and the state.

IIB reports:

Organizers with Chicago’s bid for the 2016 Olympic and Paralympic games will outline their plans today in northwest Indiana. South Shore Convention & Visitors Authority President and Chief Executive Officer Speros Batistatos says a formal study has not been commissioned, but he believes the global sporting event could pump "tens and tens of millions of dollars" into the region’s economy. He also says the Olympics would be the largest single event ever for northwest Indiana’s hospitality industry.

Listen to the audio clip here for more.