County of San Joaquin
San Joaquin County
Economic Development Vision
and Implementation Plan
March 2013 Board of Supervisors Carlos Villapudua, 1st District Frank L. Ruhstaller, 2nd District Steve J. Bestolarides, 3rd District Ken Vogel, 4th District Bob Elliott, 5th District
San Joaquin County
March 2013
INTRODUCTION ...... 2 RELEVANT STUDIES THAT ARE BACKGROUND ...... 2 STUDIES ...... 2 SAN JOAQUIN COUNTY’S GENERAL PLAN UPDATE 2030 ...... 6 KEY RECOMMENDATIONS ...... 7 8 KEY RECOMMENDATIONS ...... 8 LIST OF MEMBER AGENCIES ...... 9 APPENDIX ...... 10 A. REPORT: SAN JOAQUIN STRATEGIC PLAN (FOR ECONOMIC DEVELOPMENT) SAN JOAQUIN PARTNERSHIP, JANUARY 2006 BY ANGELOU ECONOMICS B. SAN JOAQUIN COUNCIL OF GOVERNMENT SAN JOAQUIN COUNTY REGIONAL BLUEPRINT VISION, JANUARY 28, 2010 C. SAN JOAQUIN COUNTY COMPREHENSIVE ECONOMIC DEVELOPMENT STRATEGY REPORT, NOVEMBER 3, 2010 D. 2011 SAN JOAQUIN COUNCIL OF GOVERNMENTS’ REGIONAL TRANSPORTATION PLAN E. SAN JOAQUIN COUNTY COMMUTING (REGIONAL ANALYST OCTOBER 2011) F. SAN JOAQUIN VALLEY REGIONAL INDUSTRY CLUSTER ANALYSIS AND ACTION PLAN, SEPTEMBER 2012 G. CALIFORNIA AND METRO FORECAST UOP EBERHARDT SCHOOL OF BUSINESS FORECASTING CENTER, OCTOBER 2012 H. THE ECONOMIC IMPACT OF WINE AND GRAPES IN LODI 2009
San Joaquin County Economic Development Vision and Implementation Plan March 2013
San Joaquin County is uniquely positioned to take advantage of the next economic cycle. As the overall U.S. economy improves, led by the technology sector in the Bay Area, San Joaquin County and its cities have been positioning themselves to catch this next wave of growth and prosperity. Various studies have been prepared over the last several years that provide an excellent assessment of the County’s strengths and opportunities. These studies form the basis and reference points for this vision and implementation plan. We are also fortunate in this County that many public and private groups involved in economic development work cooperatively as Business Team San Joaquin (see page 9 for list of member agencies). This document is an assemblage and condensation of the major recommendations for economic development, along with an update based on the most current economic and demographic information. It is also an update of the County’s General Plan, which includes recommendations for additional appropriate commercial and industrial land. This policy document and its recommendations have the endorsement of the San Joaquin County Board of Supervisors and County Administration.
The document has recommendations for implementation actions as well as recommendations for regular updates to the Board of Supervisors so that the document remains relevant and useful.
The following studies have been deemed to have valuable information and insights as to what the San Joaquin County community has been doing the last few years to improve its opportunity for quality development and are incorporated into the report by reference.
1. Report: San Joaquin Strategic Plan (for economic development) San Joaquin Partnership, January 2006 by Angelou Economics This document was the most comprehensive study that has been done to date, and involved several cities, the County, the business community, and the education community. It was guided by an advisory committee representing these groups. This report was released just before the reversal of the economy in 2007, resulting in the weakening of several of these recommended clusters.
An initial assessment of strengths and weaknesses was done, and from that, cluster analyses from which eight strong industry clusters were recommended for San Joaquin County and the San Joaquin Partnership to pursue: • Agriculture • Food Processing • Logistics/Distribution 2
San Joaquin County Economic Development Vision and Implementation Plan March 2013
• Materials Supply • General Services • Housing and Construction • Government • Retail and Wholesale Trade
Based on these clusters the following target industry profiles were recommended by the report.
• Value-Added Food Processing with niches in Wine, Organics, Health/Snack, Nutritionals • Air Transportation including Avionics, Maintenance and Storage, Micro Jets, Freight • Logistics and Distribution including Automotive OEM, Aftermarket (the closing of NUMMI eliminated auto suppliers) • Medical Manufacturing and Supplies including Hospital, Home Care, Biometric/Laser • Agriculture Technologies including Fuels, Biotech, Horticulture, Fertilizers/Feeds • Clean Energy Technologies covering Fuel Cell, Biomass, Waste, Solar, Wind
Based on changes in the global economy and new market trends, the San Joaquin Partnership list of target industries has been refined from the original recommendations.
The current list is as follows:
• Specialized Manufacturing o Medical Equipment and Supplies o Food Processing o Agriculture Technology o Energy Resources and Technology o Construction Materials Manufacturing • Backroom Office and Information Technology • Logistics/Distribution
The study also setup eight goals:
• Economic Development Focus • Economic development marketing
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San Joaquin County Economic Development Vision and Implementation Plan March 2013
• Business Climate • Sites and Infrastructure • Entrepreneurship • Tourism • Education and Workforce Development • Quality-of-Life
2. San Joaquin Council of Government San Joaquin County Regional Blueprint Vision, January 28, 2010 The primary purpose of San Joaquin County Regional Blueprint is to establish a coordinated long-range (year 2050) regional vision between transportation, land use, and the environment from an overall quality-of-life perspective. This document both summarizes the San Joaquin County process and sets the stage for future action.
Guiding Principles: 1. Sustainable Planning and Growth 2. Housing Choice 3. Transportation and Mobility Options 4. Farming and Agriculture • To sustain agriculture in San Joaquin County as an economically viable and thriving industry, while also recognizing its unique contribution to the overall quality-of-life in the County. 5. Preservation of the Environment 6. Economic Development • Strategically position San Joaquin County to compete with other regions throughout the State, the nation, and the global economy. • Identify and pursue opportunities to increase goods movement as an essential part of economic development. 7. Education and Workforce Development 8. Cultural Richness and Unique Attractions
3. San Joaquin County Comprehensive Economic Development Strategy (CEDS) Report November 3, 2010 This report was prepared by the San Joaquin County Employment and Economic Development Department with the Workforce Investment Board and the CEDS Taskforce. This report and its recommendations were adopted by the Board of Supervisors.
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San Joaquin County Economic Development Vision and Implementation Plan March 2013
This report was prepared and formatted to comply with the U.S. Department of Commerce, the Economic Development Administration (EDA) requirements, and was mandatory for receipt of EDA funding.
It is a very comprehensive report. It incorporates and updates the recommendations of the 2006 San Joaquin Partnership study. There was extensive coordination with other municipalities and the business community. The report also has an updated industry cluster analysis to identify target industries.
4. 2011 San Joaquin Council of Governments’ Regional Transportation Plan This document included the goal, “Support Economic Vitality,” and two objectives: 1) Improve Roadway Access to Key Strategic Economic Centers and 2) Promote Safe and Efficient Strategies to improve the movement of goods. Steps to implement these objectives generally addressed increasing access to economic centers by all transportation modes, decreasing the impact of goods movement on residential areas, and increasing rail grade separation facilities.
5. San Joaquin County Commuting (Regional Analyst October 2011) (Prepared by the UOP Eberhardt School of Business Forecasting Center in partnership with the San Joaquin Council of Governments.) This concise report analyzes the significant commute patterns around San Joaquin County, including the out-commuters who live in San Joaquin County but work in the Greater Bay Area. That number was over 61,000 in 2010 and continues to grow with the expansion of jobs and the lack of housing in the Bay Area. This is a significant talent pool; it is generally more highly educated and paid as compared to non-commuters. Their education levels and skills of the pool can be marketed in San Joaquin’s efforts to attract new businesses.
6. San Joaquin Valley Regional Industry Cluster Analysis and Action Plan September 2012 (Prepared for California Partnership for the San Joaquin Valley and Office of Community and Economic Development CSU Fresno, by Applied Economics.) This is a regional study whose goal is to “move the Valley to the next stage of innovation and global leadership”. The study identifies five key strategic action plan clusters with potential high growth and business/job creation opportunities.
Local agencies such as the County Employment and Economic Development Department and educational institutions in this area are already implementing some of these recommendations.
7. California and Metro Forecast UOP Eberhardt School of Business Forecasting Center October 2012 This recent forecast (updated annually) highlights statewide trends in various economic sectors and also breaks down the forecast by several Northern California Metro areas.
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San Joaquin County Economic Development Vision and Implementation Plan March 2013
The study assumes that the State will have a slow but steady business recovery over the next several years. The report indicates that the most significant growth areas will be:
• New construction leading the State in job growth • Health services • Professional, scientific and technical services • Administration and support industries
Locally (Stockton MSA), the forecast is for a strong return to job growth with construction; professional and business services; leisure and hospitality; and financial activities sectors leading.
8. The Economic Impact of Wine and Grapes in Lodi (2009) (Prepared for the Lodi District Gape Growers Association and the Lodi Wine Grape Commission in May 2009 by Stonebridge Research.) This report highlights the importance of the wine industry in San Joaquin County. The report cites the fact that the 750 grape growers and 75 operating wineries create almost 15,000 jobs and have a full economic impact of $5 billion in San Joaquin County.
The Lodi Appellation has gained increased recognition and value. There are nearly 100,000 vineyard acres in the appellation, which support this vital economic engine. Thousands of jobs in cultivation, creating, production, and tourism are generated by this rapidly expanding market. There is also a Tracy Appellation that has started to gain recognition, which covers a large area of the Southwest part of the County.
An effort is underway now to comprehensively update the County’s General Plan. A preferred alternative has been prepared, and staff is analyzing over 70 proposals by property owners to change the land use designation on their property, primarily from agriculture use to urban industrial or commercial. Both the preferred alternative and the requested modifications were considered by the Board in February 2013. A final hearing date has not yet been set. Overall, the Plan Update has the following key features for the unincorporated areas of the County:
1. Agricultural and open space preservation 2. Compact, city-centered growth 3. Appropriate unincorporated community growth 4. Encourage employment and commercial centers 5. Adequate infrastructure and services
Sound land use policies like these will preserve and enhance the robust quality-of-life enjoyed by most County residents and will help assure the fiscal health of county government.
As noted above, over 70 requests were submitted by private property owners and their representatives, many to convert agricultural land to urban commercial and industrial uses. The 6
San Joaquin County Economic Development Vision and Implementation Plan March 2013
landowner requests have been reviewed by the Planning Commission and will be presented to the Board of Supervisors for consideration in February 2013, along with the Planning Commission Preferred Growth. The Board will use the Planning Commission Recommended Alternative to refine the County’s approach to future growth and development and create the Preferred Growth Alternative. The Preferred Growth Alternative will then be used for preparing the detailed General Plan land use and circulation diagrams, updating the General Plan goals and policies and preparing the Environmental Impact Report. Many of these changes have been deemed appropriate and will expand the availability of commercial and industrial land in the County; hence, will bolster efforts of the County and the San Joaquin Partnership to recruit new businesses and create more jobs.
Partnership for Economic Development is the key message of San Joaquin County. For over 20 years, the public and private sectors have worked as a partnership to improve infrastructure and to ready sites and buildings to attract business and government investments that have created jobs opportunities for San Joaquin citizens. Government elected and professional staffs have a pro-business development attitude since communities have prepared for growth rather than fought improvements in approved areas. This is a competitive advantage since there are few geographic areas where all of the local public agencies, the business community, and the public/private economic development entities and organizations are working cooperatively to create new jobs and promote a positive business environment.
The County has a successful history shown by the County Employment and Economic Development Department which has continuously provided business retention, job training assistance programs, and financial incentive programs. By recently forming Business Team San Joaquin, they have created a community link with the seven cities economic and community development staffs, as a bi-monthly exchange of information and education on changing development techniques. The County’s responsive and helpful Community Development Department deals efficiently with daily development opportunities to grow business investment. The quality and flexibility of professional staff at all levels of local government is a competitive advantage for retaining, growing, and attracting jobs.
Finally, the San Joaquin Partnership is an award winning public/private partnership that has continuously teamed over 20 years to provide prospects with a confidential coordinated service offering that assure that all communities get a fair opportunity in marketing locational benefits to attract jobs. Working throughout the County and the seven cities, it provides an extended hand and a wealth of data and information that assists new businesses in choosing successful business location. The San Joaquin Partnership markets the County and communities externally to prospects.
Together, all of these factors have led to San Joaquin County adding a senior level position in the County Administrator’s Office to partner with this successful business recruitment and attraction team.
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San Joaquin County Economic Development Vision and Implementation Plan March 2013
Should the Board approve the recommendations, staff will implement the following key efforts and programs to effectuate positive change to the County’s economic future:
1. Economic Development Focus Continue and expand the current business retention efforts and the recruitment efforts to target expansion and relocation needs of existing Greater Bay Area businesses, as well as new businesses that are looking at the Greater Bay Area. The County and Partnership should effectively market the existing talent pool of over 61,000 workers who commute daily to the Greater Bay Area.
2. Economic Development Marketing Package and market all entitled shovel-ready major industrial and commercial properties along with any properties which may be added by the pending General Plan Update with a strong marketing campaign to the brokerage community, developers, and major companies.
3. Business Climate/Talent Continue to tap the private sector talent to build on the already positive business climate. Recruitment successes should be highlighted in the County’s marketing efforts and those individuals could become the County’s best recruitment marketing tool. The talent pool of over 61,000 daily commuters to the Bay Area also needs to be part of the sales program.
4. Site and Infrastructure Support the growth of targeted industries by improving physical infrastructure assets, such as the seaport and the airport. The County and Partnership should support legislative efforts to save and secure Enterprise Zones and to strengthen Infrastructure Finance Districts as a substitute for redevelopment. The County should review its inventory of land assets and identify appropriate parcels that could be sold or leased for economic development purposes.
5. Entrepreneurship Foster a supportive environment for entrepreneurs including continuing of support for the Angel Investor Program, and reach out to the venture capital community in the Greater Bay Area to assist in local project financing.
6. Tourism Recognize and expand tourism as an economic driver for San Joaquin County, focus on areas such as the wine industry, agri-tourism and the Delta waterways, as well as entertainment, cultural events, and authentic venues.
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San Joaquin County Economic Development Vision and Implementation Plan March 2013
7. Education & Workforce Development Create programs focused on preparing the workforce for San Joaquin County’s target industries (incorporating the individual cities’ strategies) and overall growth strategies for all. Continue the work already started by the County Employment and Economic Development Department. The County and Partnership would work with Delta College and University of the Pacific to develop programs and training that will match the skill needs of companies that we are trying to attract.
8. Quality-of-Life Work toward the overall improvement of the quality of life in the County, with a focus on centers of commerce, additional entertainment venues, parks, retail, mixed-use/lifestyle environments in each downtown, and office space for residents and resident business. Improve the fiscal health of the County by enhancing the tax base.
Business Team San Joaquin Pacific Gas & Electric Miracle Mile Improvement District Ca. Manufacturers & Technology Northern California Carpenters Association Port of Stockton City of Escalon Ripon Chamber of Commerce City of Lathrop San Joaquin County Administrator’s Office City of Lodi San Joaquin County Council of City of Manteca Governments City of Ripon San Joaquin County Human Services City of Stockton Agency City of Tracy San Joaquin Delta College Downtown Stockton Alliance San Joaquin Delta College SBDC EEDD/San Joaquin County WorkNet San Joaquin Partnership/Business Council EEDD/EDA/EZ San Joaquin Valley United Air Pollution Greater Stockton Chamber of Commerce Control District Laborers Union, Local 73 SMART/San Joaquin RTD Lodi Chamber of Commerce State EDD Lodi Electric Utility Stockton Airport Manteca Chamber of Commerce Tracy Chamber of Commerce
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San Joaquin County Economic Development Vision and Implementation Plan March 2013
See attached Appendix A-G.
A. Report: San Joaquin Strategic Plan (for economic development) San Joaquin Partnership; January 2006 by Angelou Economics.
B. San Joaquin Council of Government San Joaquin County Regional Blueprint Vision; January 28, 2010.
C. San Joaquin County Comprehensive Economic Development Strategy Report; November 3, 2010.
D. 2011 San Joaquin Council of Governments’ Regional Transportation Plan.
E. San Joaquin County Commuting (Regional Analyst October 2011).
F. San Joaquin Valley Regional Industry Cluster Analysis and Action Plan; September 2012.
G. California and Metro Forecast UOP Eberhardt School of Business Forecasting Center; October 2012.
H. The Economic Impact of Wine and Grapes in Lodi 2009.
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Appendix A
Report:
STRATEGIC RECOMMENDATIONS www.angeloueconomics.com
Presented to:
SAN JOAQUIN PARTNERSHIP
January, 2006
Appendix A
STRATEGIC PLAN
Introduction
This report, Strategic Plan, is a blueprint for San Joaquin County’s future economic development efforts. It reflects a six-month planning process including input from citizens, a 24-person steering committee, the San Joaquin Partnership, various City offices, and regional and state leaders. Hundreds of hours of research and discussion have led to this Strategic Plan for the San Joaquin Partnership, San Joaquin County, and San Joaquin cities. This effort was designed and orchestrated to culminate as a county-wide plan. The San Joaquin Partnership serves as one of many organizations that will be called on for the implementation of this Strategic Plan.
This is the final of three reports delivered to the San Joaquin Partnership (SJP) by AngelouEconomics (AE). The first report, Community Assessment, contains quantitative and qualitative information profiling the county and uncovering citizens’ and business executives’ perceptions of major economic development issues. AE presented its own assessment of key issues for the county, resulting in a strengths/weaknesses summary leading to future recommendations. The second report, Benchmark Case Studies, presented an assessment of six regions in the U.S.: three direct competitors to San Joaquin and 3 “best practices” that San Joaquin can learn from.
The recommendations in this Strategic Plan will be organized according to topic area:
1. Economic Development Focus 2. Economic Development Marketing 3. Business Climate 4. Sites & Infrastructure 5. Entrepreneurship 6. Tourism 7. Education & Workforce Development 8. Quality of Life
This report contains a review of key findings from the Community Assessment, a recommended vision for the county’s economic development efforts, target industry analysis and direction, and a list of specific goals and actions to improve the economic vitality of the county. An implementation matrix is attached that identifies each recommendation’s timeline, priority, and organization who should participate.
While there have certainly been some very positive occurrences throughout the county in the last five years, there have also been some set-backs; primarily in the area of increased cost-of-living and job creation at lower than needed wages. The Partnership has asked for guidance and ideas for the cities within the county and for the San Joaquin Partnership (SJP) to continue with their efforts to improve the long-term economic conditions in the county.
Throughout this planning process, AngelouEconomics identified a pro-business attitude coupled with city-specific identity requirements as the common thread. AE believes that the county, the individual Cities, and the Partnership can best serve its collective community through the county-wide development of programs specific to the needs of the individual cities. It is also a matter of working to define strategies in creating a prosperous and sustainable future for the county and its cities through focused business development strategies. To be successful these strategies must reflect current market demands and trends. It is important to garner the area’s collective assets and leverage them through business development practices, gaining regional and national recognition, and subsequent business opportunities.
SAN JOAQUIN STRATEGIC PLAN 1 Appendix A
AE has prepared these recommendations based on its research, analysis, collective experience, and observations. We believe strongly that the recommendations presented here will help to target San Joaquin County’s economic development effort toward supporting existing assets and creating opportunities in new areas.
San Joaquin leaders understand that a fundamental change is occurring in the San Joaquin economy. In the past decade, the industrial, warehouse, and distribution businesses in the county, alongside the agricultural businesses, have generated a great number of jobs and a large amount of investment. However, much of that current industry base is shifting to overseas operations, or other parts of the U.S. due to cost pressures in San Joaquin. Additionally, these types of businesses generally do not offer the level of wage needed (or desired) to live in San Joaquin today. The county and its individual cities must now work to diversify its industry base and build out other assets.
Through our interviews and focus groups, the collective community has acknowledged this need and has indicated the desire to take San Joaquin County to its “next level” -- sustainable economic prosperity. This Strategic Plan reflects this desire and lays out specific action items that will achieve the goal.
The San Joaquin Partnership must now gather its constituents and rally the broad community behind this new strategy. By maintaining momentum and encouraging on-going participation, the SJP, the county, and each of the cities can facilitate speedy and effective implementation of this plan.
Acknowledgements
AngelouEconomics would like to thank the staff at the San Joaquin Partnership for its support throughout the course of this project. We would also like to show our appreciation to the distinguished individuals on the Advisory Committee for their invaluable insight and ideas that led to the creation of this plan.
Jerry Sperry A.G. Spanos Co. Jose Rivera Kaiser Permanente Douglass Eberhardt Bank of Stockton Bill Huyett Lodi Unified School District Dennis Hurst Bank of the West Mark Chandler Lodi-Woodbridge Winegrape Pat Mitchell California Natural Products Commission Marty Van Houten City of Escalon Mark Martinez S.J. Cty. Hispanic Chamber Gloryanna Rhodes City of Lathrop Mayor Phil Pennino P G & E Bob Johnson City of Lodi Mike Clevenger Pegasus Development John Harris City of Manteca Anthony Neal RAM Services Inc. Leon Compton City of Ripon City Manager Manuel Lopez San Joaquin County Chuck Winn City of Ripon Mayor Raul Rodriguez San Joaquin Delta College Edward Chavez City of Stockton Doug Wilhoit Stockton Chamber of Comm. Steve Carrigan City of Stockton Susan Dell'Osso The Cambay Group Dan Bilbrey City of Tracy Kevin Huber The Grupe Company Ole Mettler Farmers & Merchants Bank Robert Matthews Tracy Press Bob Wheeler General Mills Jim Franco Tracy Unified School District Bob Kavanaugh Guaranty Bank Mark Plovnick University of the Pacific (Pacific)
SAN JOAQUIN STRATEGIC PLAN 2 Appendix A
ASSESSMENT FINDINGS
The Community Assessment provided an in-depth analysis of key strengths, opportunities, and areas for improvement throughout the County. AE was very pleased to see the many efforts and programs that each of the cities, the leadership, and the SJP have implemented. AE believes the leadership in San Joaquin County is more ready than many of the communities worked with around the country for helping the area to achieve its “next level” – taking care of its citizens through business development while maintaining the character and values of the county.
The following are the key findings of the Community Assessment for San Joaquin County:
Key Strengths
• geographical location • outdoor recreational amenities • strong business/marketing organization: SJP • diverse community • proximity to two dynamic markets: Silicon Valley and Sacramento • very strong and growing agricultural community: value-added & technology • growing wine industry • on-going downtown redevelopment throughout County • growing and forward-thinking port
Key Weaknesses / Needs
• a need to broaden the view of economic development • business development has been too centered on “industrial” • lack of business support systems and entrepreneurial development • strong leadership for growth and development, but isolated to cities v. county • underutilization in business community of higher level learning institutions • too few programs for training/re-training of workforce • loss of young professional demographic (25-44) • need to further exploit key infrastructure assets: port and airport • emerging concerns regarding affordability factor (decreasing competitive edge) • concerns regarding quality of life: schools, commuters, parks, curb appeal
Overall, San Joaquin County is in a strong position to create additional, long-term economic opportunities. By focusing resources in a targeted effort – one that matches the community’s desires as well as business trends – will yield the desired outcome of this Plan:
To create new job opportunities for all San Joaquin residents, improve the business climate for San Joaquin companies, and enhance the quality of life enjoyed by all.
SAN JOAQUIN STRATEGIC PLAN 3 Appendix A
RECOMMENDED INDUSTRY TARGETS
As a part of the strategic planning process, AngelouEconomics evaluated San Joaquin’s current set of target industries and updated the industry targets for future San Joaquin Partnership recruitment and expansion initiatives.
AngelouEconomics conducted its standard target industry assessment, focusing on four key requirements for selecting a target:
Does the industry match community goals? Are there local assets that give industries a competitive edge? Is the industry growing locally or does it provide transitional opportunities? Does the region meet the minimum requirements for the industry?
Today, San Joaquin County shows strength in numerous industry clusters: Agriculture; Food Processing; Logistics and Distribution; Materials Supplies; General Services; Housing and Construction, Government; and Retail and Wholesale Trade.
After a general understanding is gained about local concentrations of San Joaquin County’s industries, the industry list can be narrowed further to develop specific targets for the area. Besides being developed or developing locally, targets should also show national growth trends and fit the County’s, as well as the State’s, relative strengths.
Developed National Complementary Target =+Local Growth + Strengths and Potential Concentration Trends Assets
Today, the San Joaquin Partnership targets several traditional and emerging industries for recruitment and expansion:
o Electronics/Communication Technology (software, hardware manufacturing, and assembly) o Backroom Office/IT (incl: Call Centers & Fulfillment Centers) o Food Processing o Metals and Metal Fabrication o Construction Materials o Transportation/Logistics
Several of these sectors have undergone enormous change in the last two years and even represent declining industry segments due to changing technologies, global implications, or consolidations. AngelouEconomics evaluated each industry for its “target potential” in San Joaquin, taking into account existing industry, workforce availability, educational attainment, national and global industry trends, emerging technologies, and regional and national market demand.
SAN JOAQUIN STRATEGIC PLAN 4 Appendix A
AngelouEconomics recommends six target industries for San Joaquin County:
1. Logistics/Distribution (with a focus on Automotive OEM & Aftermarket) 2. Medical/Equipment & Supplies 3. Air Transportation Supplies/Maintenance/Service 4. Food Processing 5. Agbiotech 6. Energy Resources & Technology
These targets do not preclude past targets, but rather create a list for go-forward marketing purposes. In review of the current target industries supported by SJP, it should be noted that several are in a state of decline or are in the process of realignment due to global trends in the marketplace. The following recommendations are those in which efforts and resources should be focused in the future. There will continue to be opportunities in the current target industry sectors, but it may be more beneficial to manage them per the outlook and recommendations presented rather than actively pursuing them.
Initial industry research has revealed a number of assets that make San Joaquin County a unique place for doing business. However, there are numerous conditions creating difficulties for businesses and industry to compete on the West Coast. In review of these issues and the assets of San Joaquin County, the target recommendations in this report are intended to be as specific as possible, while allowing for broad-based initiatives to be sustained by the Partnership. In other words, AngelouEconomics encourages the local development of industry through education and training-based initiatives, generated from research & development/entrepreneurial activity, for the creation of future jobs.
Below is an overview of each of these corporate industries (which does not including Tourism) and the reasons behind their selection as targets for San Joaquin. A more in-depth look at each industry is in the appendix of this document.
Logistics/Distribution Focus on Automotive OEM & Aftermarket
Overall revenues for the distribution industry are forecast to rise faster than GDP growth, and employment levels will grow faster than the overall economy. The fastest growing users of distribution services are expected to be aerospace and defense, industrial equipment, computer equipment, and consumer goods. As manufacturing becomes a smaller share of the national economy, the industry is expected to align more closely with the distribution of consumer goods at the regional destination.
The size of the US motor vehicle aftermarket grew by 3% in 2003 to $244.6 billion. “More registered vehicles, more licensed drivers, more miles traveled and an aging of the vehicle fleet all helped expand the domestic aftermarket,” says Kathleen Schmatz, President and CEO of the Automotive Aftermarket Industry Association (AAIA). There are 4400 member companies and affiliates in the AAIA, the association represents more than 45,000 repair shops and parts stores.
San Joaquin currently enjoys an excellent position for distribution of aftermarket parts to support automotive maintenance facilities in major cities. San Joaquin currently has parts distribution facilities for BMW, Daimler-Chrysler, Honda, and Ford, along will several suppliers that assemble parts for the NUMMI plant in Fremont. San Joaquin should pursue other like manufacturers or parts distributors.
SAN JOAQUIN STRATEGIC PLAN 5 Appendix A
Medical Equipment & Supplies Focus on Hospital and Home Care supplies and Biometrics/Laser technologies
Health services have been one of the fastest-growing industries in the United States in recent years. The U.S. health care market is estimated to be worth $1.3 trillion annually and employs 12 million, after adding 2 million jobs through the 90s. The industry’s employment is expected to grow 26 percent by 2010 and employ over 14 million. Specific sectors will see even higher growth: the home-based health care market will grow more than 61 percent by 2010. The country’s aging population and rising standards of living have increased demand for health care services. The health services industry is relatively immune to market fluctuations. The elderly population, a group with greater than average health care needs, will grow faster than the total population through 2008 increasing demand, especially for home health care, private practice, and personal care.
California’s aging population will require increasing amounts of health services. Strong health services can be beneficial to the community as well as to economic development.
San Joaquin is strategically positioned to serve the growing demand for medical devices and supplies from its central location in California. In addition, growing workforce capabilities in nursing and diagnostics will assist in the growth of medical companies in the county.
Laser technology grows daily. Its current applications include cutting, drilling, welding, marking, micro- machining, and solar cell cutting. The mediums on which it works include metals, non-metals, ceramics, composites, plastics, rubber, and glass. For example, laser drilling has been used in jet engines and angioplasty, and laser optics are also being used by the defense department for human identification purposes.
AE believes San Joaquin County can work to develop this through a cross-over, multi-industry strategy for both existing businesses (ex: construction – using laser technology for parylene ablation, i.e. surface coatings) and developing industries (ex: laser optics in ophthalmology).
San Joaquin County is also an ideal area for the development of biometrics. The county has the space to potentially house testing, development, applications, and manufacturing facilities under one roof. The highest demand for biometrics is through the Department of Defense and increasingly in Asia where many of the actual products utilizing the technology and components are being manufactured.
Air Transportation Services Focus on Supplies/Maintenance/Services
This industry includes aircraft suppliers who provide parts and machinery for aircraft assembly and maintenance. These parts include engines, interior components, avionics, and aircraft hardware such as landing gear. These suppliers are important for both the assembly and maintenance of aircraft. The aerospace industry’s customers include the military, commercial airlines, and general aviation. At the Stockton / San Joaquin Airport, the county’s focus should be the civilian aircraft sector.
SAN JOAQUIN STRATEGIC PLAN 6 Appendix A
AngelouEconomics recognizes the county as one ideal for transportation and logistics, and this brings additional opportunities in this segment by delving into the equipment and technologies to support it, as well as grow it. Specifically, AE believes the county should focus on aviation and related segments for aviation parts, manufacturing and technology.
The global Maintenance, Repair, Overhaul (MRO) business is showing signs of strengthening with airlines slowly adding capacity as maintenance providers seek strategic partnerships with carriers and original equipment manufacturers to position themselves for long-term viability. This represents another strong opportunity for San Joaquin County, as a whole – on-site at the Airport and off-site throughout the county.
Food Processing Focus on: Wine, Organics, Snack Foods, and Nutritionals
The food processing industry includes establishments that manufacture or process food and beverages as well as related products such as chewing gum, manufactured ice, and vegetable and animal fats and oils. The food processing industry is the link between the agricultural and retail sectors.
Production and distribution of food and beverages account for over one-sixth of the nation’s industrial output. Demand for food products is expected to grow as niches such as specialty foods, ethnic foods, and pre-packaged foods make their way to the dinner table more frequently. New plants are more automated, transforming a traditionally labor intensive industry to a more automated one. Jobs will be lost but will be offset by an increase in higher skilled, higher wage jobs.
Health foods are gaining ground as new food products such as nutraceuticals blend herbs and natural compounds to treat ailments such as high cholesterol reach the market. According to the GAO, Americans spend over $16 billion per year on functional foods or under 4% of total annual expenditures on foods eaten at home, slightly more than expenditures on dietary supplements ($14.7 billion) and over twice as much as expenditures on organic foods ($7.7 billion).
Efficient distribution of food products has grown in importance as more food is being manufactured far from where it is ultimately consumed. During 2000, American companies spent an estimated $1.6 trillion on supply-related activities, including the movement, storage, and control of products.
San Joaquin County should embrace its agricultural heritage and its vast amount of assets in the food processing industry and take it to its “next level”, particularly in the “health” segment. This growth is not a “fad”; it is a trend. Consideration should be given to the other added-value foods and targets for the development of suppliers and manufacturers that will meet cross-over needs in the consumer goods/packaged foods industry segment (as above). The immediate focus and emphasis should be with tourism. SJP should work diligently to support and build this industry.
Wine production is a growing opportunity for the county, linking local grape growing to small wineries and wine production facilities. Lodi has truly begun to “come into its own”, including increased recognition of it as being a “destination” for wine lovers. The growth of this industry lends itself to opportunities in: packaging, printing, bottling/glass, corrugated, packing/warehousing/distribution, and other such segments of a consumer products economy.
SAN JOAQUIN STRATEGIC PLAN 7 Appendix A
As with the agriculture sector, the county’s distribution infrastructure (port, rail, highways) will strongly support future growth in food processing, both for export abroad and import into the U.S.
Agbiotech Focus on: Fuels, Biomaterials, Horticulture, and Fertilizers/Feeds
Agricultural technologies include high value added components of the agriculture industry, such as farm equipment manufacturing and research, ancillary manufacturing industries, agricultural biotech, and production of agriculture-based products.
There is a great deal of national and international attention being placed on this segment, and there is also a great deal of money being invested in related technologies and products. AngelouEconomics believes strongly that this will be a good target Industry for San Joaquin – with development of specific strategies in several sectors: renewable fuels, renewable materials, agricultural technologies, horticulture, and fertilizer/feeds.
San Joaquin can do several things to assist the development of its agriculture technologies cluster. Strong relations with the California Department of Food and Agriculture will be required. The county should investigate applications for alternate uses for farm product refusals. Some of these products will be valuable in building materials. San Joaquin should coordinate with research efforts at UC campuses and offer its central, agriculture location as one opportunity for pilot projects. Also, it should help local growers find new value added opportunities for existing products
Energy Resources and Technology Focus on: Fuel cells, Biomass, Waste, Solar, Wind
Clean energy is defined as technologies that reduce the environmental impact of energy generation. AngelouEconomics considers solar, geothermal, wind, clean coal, biomass, and fuel cells all to be clean energy technologies.
The energy industry is undergoing rapid change and has become truly multi-faceted. Traditional fossil fuel extraction and production is as important as ever, and new technologies are changing the way natural resources are utilized. At the same time, dwindling domestic resources, rising consumption, uncertain international energy supplies, and environmental concerns have forced the United States and others to develop sources of renewable energy production.
Energy is a long-term growth industry. As the American economy continues to grow, energy consumption will rise. The U.S. population expansion is contributing to increased energy use as well; energy consumption per capita is expected to rise 13.6% by 2013. Unfortunately, the U.S. lacks the domestic resources to meet projected demand. The most promising clean energy applications include fuel cells, biomass, wind power, and solar energy.
The opportunities for development technologies, as well as products and services are large and growing. AE believes this will be a good area for San Joaquin County to be a part. The recommendation is to center the efforts in clean and renewable energy at the port. There is adequate space for such an industry
SAN JOAQUIN STRATEGIC PLAN 8 Appendix A
endeavor, and it would bring prestige and notoriety to the port for “innovation”. It is also the location for import/export of related goods such as rotors and blades for wind energy turbines, panels and materials for solar energy, fuel cells and products containing fuel cells (GPS systems to motorcycles), and reclamation facilities for biomass.
SAN JOAQUIN STRATEGIC PLAN 9 Appendix B
San Joaquin County Regional Blueprint
A Year 2050 Transportation Land Use Environmental Vision
San Joaquin Council of Governments 555 E Weber Ave. January 28, 2010 Stockton, CA 95202
(209) 235-0600 Appendix B
EXECUTIVE SUMMARY
Regional Blueprint Purpose declining share of 20-39 year olds and increasing share of over 60-year olds The primary purpose of San Joaquin County gradually slows the rate of natural (SJC) Regional Blueprint is to establish a population growth over time. However, coordinated long-range (year 2050) overall growth in San Joaquin County will regional vision between transportation, continue to remain substantially higher than land use, and the environment from an State and National trends. overall quality of life perspective. This document both summarizes the San Key questions emerge that must be Joaquin County process and sets the stage addressed: for future action. • What will the SJC Region’s developed As a vision, the Blueprint recognizes that environment look like in the year 2050? economic, environmental, and social issues • What can be done to ensure that our are interdependent and only integrated future quality of life is sustained and approaches will effect needed changes. balanced to accommodate new Addressing one topic without recognizing growth over the next 40 plus years? potential impacts in other areas will not be enough. The location of jobs, housing, and The SJC Blueprint provides a long-term commerce affects the transportation planning framework that shows how the system…..the nature of the transportation region collectively could respond to growth system affects air quality…..air quality and infrastructure challenges in a affects health outcomes. comprehensive manner.
The Challenge Regional Blueprint Vision….What it
The current population of SJC is expected is…..What it is not to double by the year 2030 and reach 1.7 WHAT IS IT million by the year 2050. For the San Joaquin Valley, the population is expected • A long-range (year 2050) VISION that to increase by half to 7.3 million. SJC accounts for the interactions continues to be one of the fastest growing between Land Use, Transportation, & regions in California and the United States. the Environment. • Developed from a regional Demographically, SJC is young, but the perspective. population is projected to age over time • Based on a visioning process to the following broader trends. The “Over 60” year 2050….”to think outside of the population is currently the smallest group, box.” but will be the fastest growing. The share of • Supports the principles found in the “Under 20” age group will remain partner agency General Plans (GPs). relatively unchanged and the population in • Provides a foundation to begin the prime working ages of 20-59 will grow developing strategies to meet future the slowest, with their population share transportation, housing, economic declining between 2010 and 2035. The development (including agriculture), and environmental needs.
1 Appendix B
stakeholder groups. In addition, a WHAT IT IS NOT statistically relevant phone survey was • Not a General Plan. conducted by a professional polling • Does not supersede a jurisdiction’s consultant. The results supported the land use authority. outcomes of the Phase I workshops. For the • Is not applied to individual Phase II workshops, the “on the ground” jurisdictions. community-based workshop approach was • Not mandated. formatted and placed on the SJCOG • Not rigid. website to provide another option for the
community at large to access and provide
Building a Regional Blueprint input on the vision. SJC Regional Blueprint Products The eight (8) counties which comprise the
San Joaquin Valley secured funding from The Regional Blueprint establishes a future the State Department of Transportation to point of reference in two (2) key ways: develop a valley-wide transportation, land use, and environmental BLUEPRINT Vision to 1) It ties together SJCOG’s role regarding the year 2050. The valley-wide Blueprint transportation planning and delivery, consists of the sum of the individual land use, air quality, and the Blueprints associated with each of the eight environment. It provides a vehicle to (8) regions. integrate and enhance the existing
planning processes. Beginning in 2006 through 2008, a series of community-based workshops (Phase I and 2) It captures core concepts pertaining to Phase II) were conducted throughout the key public and private sector region in every incorporated city and stakeholder interests and invites them to various locations in the unincorporated consider implementing reasonable area of San Joaquin County. Similar sustainable growth policies that are workshops were held in each of the other within their control. seven valley counties. Building the SJC Regional Blueprint involved The information gained at the community a bottom-up approach beginning with level was refined by the SJCOG Board input at the community level. Different approved committees consisting of exercises were employed to initiate professional planners from each of dialogue and gain constructive input SJCOG’s partner agencies and key regarding the best approach to respond to stakeholders representing areas of interest – future growth from a land use, including environmental, housing, transportation, and environmental economic, and agriculture. perspective. The three (3) primary products that The community workshops were comprise the SJC Regional Blueprint Vision augmented by SJCOG staff providing include a Vision Statement, a set of Guiding special workshops/presentations to key Principles, and corresponding Performance
Appendix B
Measures and Indicators. A summary of growth and that this growth must occur in these products are as follows: such as way as to not impair resources for existing urban, agricultural, and I. Regional Vision Statement environmental uses.
Creative community planning, combined Principle 2 with a shared regional vision, will result in a HOUSING CHOICES superior quality of life for all San Joaquin County residents, now and as we move A variety of housing options on a regional forward. Sustainability in action as well as in scale, while respecting the values and vision will ensure this quality of life for future preferences of individual communities, generations. creates opportunities for meeting the housing needs of families, individuals, II. Guiding Principles seniors, and persons with special needs. Housing opportunities and choices for all The SJC Regional Blueprint Guiding individuals and family structures should be Principles were developed based, primarily, consistent with local market conditions. By on citizen-identified visions, values, and providing a diversity of housing options, aspirations for San Joaquin County from the more people have a choice. Phase I workshops. In turn, the Blueprint Guiding Principles provided the foundation Principle 3 upon which the Phase II Blueprint Vision TRANSPORTATION & MOBILITY OPTIONS choices were built. Efficient land use that supports diverse and Principle 1 comprehensive transportation options is SUSTAINABLE PLANNING & GROWTH primary to this principle which: 1) connects existing internal and external regional New growth patterns that meet the needs networks for ease of use and allows for of the present, without compromising the efficient movement of goods and services, ability of future generations to meet their including agricultural products; 2) own needs, within well-defined cities and enhances air passenger transportation; 3) communities is an important principle in considers transit-themed neighborhood accommodating population growth. developments; 4) creates mobility choices, Overall, this principle involves while maintaining the existing regional innovative strategies which target growth in transportation infrastructure; and, 5) existing urban areas, with an emphasis on improves public use of transit options efficient design, land conservation, infill, through increased reliability, safety, and redevelopment. Overall goals are to convenience, and aesthetics. Strategic use natural resources wisely, preserve the community design can encourage people environment, maintain agricultural viability, to walk, ride bicycles, ride the bus or train, and create environmentally sound, healthy or car pool. As people make fewer and and resource-efficient communities. It is shorter trips closer to home to meet their implicitly recognized that resources such as everyday needs, a decrease in traffic water are necessary to support future congestion and air pollution may result.
Appendix B
Principle 4 Principle 6 FARMING & AGRICULTURE ECONOMIC DEVELOPMENT Economic growth, job retention, and job As a regional asset, the farming/agriculture creation are the foundation to this industry needs to be economically viable principle. Sustainable Community and thriving. This involves innovative approaches can improve the economy by solutions which recognize private property developing a diverse/quality job base rights and seek to minimize the loss of which will increase opportunities for irreplaceable farm land. Sustainability of residents to work closer to where they live. agriculture is essential for the region’s “Mixed-use” development is one method to economy and overall quality of life. The achieve this which has been shown to application of sustainable community create active and vital neighborhoods. design principles can accommodate the Co-location of compatible and future transportation, housing, and other complimentary uses and the strategic economic development needs and positioning of employment centers and minimize the impact on productive farm housing sufficient for the anticipated land, as well as preserve the resources workforce are important to the success of necessary to maintain the land’s current goals of this principle. and future agricultural use. Principle 7 Principle 5 EDUCATION & WORKFORCE PRESERVATION OF THE ENVIRONMENT DEVELOPMENT
Overall quality of life is better when there is Creating jobs beyond the current market clean air to breathe, clean water to drink, trend will involve ensuring that the human and a place to experience the outdoors in resource is educated, trained and settings such as parks, open space, species available. This will, in turn, depend on the and habitat preserves, rivers and the San public/private educational system to adapt Joaquin Delta. Well thought out to the specific needs of targeted growth community design can assist in the industries, while maintaining and improving preservation of the environment by programs for the existing job base. encouraging energy efficient building design, water conservation, and urban Principle 8 greening projects (such as the planting of CULTURAL RICHNESS & UNIQUE trees to reduce summer ground ATTRACTIONS temperatures). How projects are developed, how they are oriented in relationship to the street, how well designed their facades are, how well they use existing assets such as historic buildings, how well they are landscaped and how parking is handled are essential to the preservation of the unique character and cultural richness found in the individual
Appendix B
cities, towns, and communities. The activities and attractions that result from new development can enrich cultural, social, and economic development as well as retain a sense of place, uniqueness and historic identity in San Joaquin County.
III. Performance Measures & Indicators (PMIs)
The SJC Blueprint professional committees established over 68 regional Performance Measures across the eight (8) Blueprint Guiding Principles to be considered for use in gauging progress towards meeting the intent of the Blueprint from a regional perspective. The list of potential regional targets was pared down and refined by the committees. Greater detail on the Performance Measures and Indicators can be found in Chapter 3.
A matrix summarizing the relationship between the San Joaquin County Regional
Blueprint’s Guiding Principles ~ Regional Goals ~ Regional Performance Measures PMIs is found on the following page.
Appendix B
PRINCIPLE Sustainable Planning & Growth GOALS 1) Recognize and allow for increases in 2) Support innovative strategies that target development densities over time that allow growth in existing urban areas, with an for changes consistent with community emphasis on efficient design, land and marketplace realities conservation (including working agriculture and open space), infill, and redevelopment PERFORMANCE MEASURES 1) Average dwelling units per acre 2) Use of infill opportunities to support new development
PRINCIPLE Housing Choices GOALS 1) To provide the housing market with 2) To improve the ability of greater flexibility in meeting the market individuals/families to access and afford demand for a variety of housing choices quality housing PERFORMANCE MEASURES 1) Percentage of single-family to multi- 2) Percentage of home owner/renter’s family new housing income used to support housing. (e.g., mortgage, rent, insurance, utilities, taxes)
PRINCIPLE Transportation & Mobility Options GOALS 1) Provide safe, efficient and aesthetically 2) Create residential and non-residential pleasing multi-model transportation and development that is strategically mobility option/connectivity for connected to the community/city core neighborhoods, communities, and and essential destinations of regional between cities/regions significance PERFORMANCE MEASURES 1) Relationship of reduced Single 2) Residents traveling outside the region for Occupancy Vehicle (SOV) use to other work compared to year 2000 levels travel modes 1.2) Strive to keep the increase in on-road 2.2) Mean travel time to work in minutes Vehicle Miles Traveled (VMT) to an annual compared to year 2000 levels rate that is = to or < the increase in population
6 Appendix B
PRINCIPLE Farming & Agriculture GOAL 1) To sustain agriculture in San Joaquin County as an economically viable & thriving industry, while also recognizing its unique contribution to the overall quality of life in the county PERFORMANCE MEASURES 1) Acres of prime & statewide farmland used to support new development 2) Total value of agriculture within San Joaquin County
PRINCIPLE Preservation of the Environment GOAL (Air Quality) 1) To decrease the amount of carbon dioxide and small particulate matter emission from on-road vehicles PERFORMANCE MEASURES 1) Reduce CO2 attributable to on-road mobile sources (tons per day) GOAL (Water Resources) 1) To promote strategies that decrease 2) To promote strategies that increase residential water usage agricultural water use efficiencies PERFORMANCE MEASURES 1) Reduce residential Water Use in the SJC 2) Measureable increase in agricultural Region water use efficiencies through a variety of methods, including, but not limited to, reducing evapotranspiration, conversion of irrigation systems, efficiencies aimed at increased reuse of recoverable flows, and support for other supplier and on-farm technological improvements to reduce irrecoverable loss of applied water GOAL (Resource Lands) 1) Support preservation of natural resource and open space lands as distinct from production agricultural lands PERFORMANCE MEASURES 1) Acres preserved through a variety of sources, including the San Joaquin Multi-Species Open Space Conservation Plan (SJMSCP)
Appendix B
PRINCIPLE Economic Development GOAL (Economic Prosperity) 1) Strategically position San Joaquin County to compete with other regions throughout the State, the nation, and the global economy PERFORMANCE MEASURES 1) Median annual non-inflation adjusted 2) Average non-inflation adjusted household earnings ($1,000s) individual earnings ($1,000s) 3) Unemployment rate (annualized) 4) Value of new non-residential construction (In Thousands) 5) Total annualized regional taxable sales transactions (In Billions) GOAL (Goods Movement) 1) Identify and pursue opportunities to increase goods movement as an essential part of economic development PERFORMANCE MEASURES 1) Center line miles of STAA terminal access routes in the rural and urban areas
PRINCIPLE Education & Workforce Preparation GOAL 1) To have a better locally prepared and trained workforce PERFORMANCE MEASURES 1) Rate of high school enrollment to 2) College going ~ Bachelor & advanced graduation level degree recipients rates towards State average
8 Appendix B
PRINCIPLE Cultural Richness / Unique Attractions GOALS 1) Support economic development 2) Support future growth and maintain and endeavors that exploit existing cultural, support both community specific and social and historical identity in San Joaquin county-wide identity County, especially as related to the agricultural and wine Industries PERFORMANCE MEASURES 1) Transient Occupancy Tax Receipts 1) A qualitative approached will be used (non-inflation adjusted) to demonstrate progress towards promoting community and countywide identity...... past and present 1.2) Total Direct Visitor Spending in San Joaquin County (non-inflation adjusted)
9 Appendix B
Blueprint in Action……Next Steps • Developing planning tools and information. How the Regional Blueprint Vision is applied will evolve over time. The concept and • Identifying implementation incentive intent of the Blueprint has always been that opportunities through existing SJCOG of a set of Guiding Principles and tools for plans & programs. voluntary use by public and private sector stakeholders. The SJC Blueprint is not • Supporting the work of partner intended to supersede the land-use agencies/organizations which play a decision-making authority of SJCOG’s leading role in key Blueprint principles. member agencies; and, in fact, has no statutory authority to do so. • Actively contribute to and draw from the San Joaquin Valley Regional th Having a Blueprint Vision provides the Blueprint effort through identified 4 opportunity for dialogue on a set of grant activities, including: regional strategies that would ensure: o Identifying and extinguishing barriers: • Adequate resources are available to physical, procedural, and political, meet the future housing and economic that inhibit realization of identified needs. principles. o Continuing with educational • Transportation system (e.g., roadways outreach and seeking educational and alternative travel forms) supports opportunities for professional the residential and non-residential land planning staff. uses. o Improving the land use and traffic models as tools for planning and • Land uses are strategically developed evaluation. to support the transportation system. o Developing additional regional incentives and minimizing • Land and resources needed to support disincentives. new development is valued as a finite o Establishing a “tool kit” of strategies commodity. This will minimize the that can be used at the local level. impact, to the extent possible, on the o Assessing dynamics regarding the environment as well as sustain the fiscal fiscalization of land use. viability of the region’s agricultural o Assessing market demand for industry. greater variety of housing unit configurations and higher density. SJCOG will seek to implement the San o Improving the strategic jobs to Joaquin County Regional Blueprint Vision housing balance. through the following strategies: • Working with key stakeholders and • Advocating for and seeking funding partner agencies on SB 375 opportunities for the region. implementation and development of a Sustainable Community Strategy (SCS)
Appendix B
and Alternative Planning Strategy if required (APS). • Elected officials from each one of SJCOG’s Partner Agencies in their land • Developing a “maintenance of effort” use decision-making processes. strategy for on-going evaluation and monitoring of progress toward • Planning staff regarding the relationship realization of the Blueprint principles and between land use, transportation, and goals in the San Joaquin County region. the environment.
• All stakeholders as to how well the There are many complex variables that are region is moving forward in meeting the considered as local jurisdictions determine Blueprint Principles. the merits of individual transportation and land use proposals. Although consistency with the Blueprint principles is encouraged, With a shared vision, the working this is a voluntary process and consistency is relationship between SJCOG, its partner in no way required through the process. agencies, and the region’s key Further, it is recognized that the nature of stakeholders will be strengthened as the individual proposals may not make them Blueprint is put into action. appropriate to be considered in the context of the Blueprint principles.
Successful application of the San Joaquin County Regional Blueprint will involve the continuing Resources to meet efforts of the professional housing & job creation planners group and a needs stakeholder committee of community leaders and subject area experts. As the Transportation Improve AQ, protect system that framework to apply the species/habitat, & supports land uses Blueprint is formulated, the preserve natural Land uses that committees will focus on resources, sustain support the specific action and agriculture transportation monitoring strategies that system will produce progress towards meeting the preferred Blueprint Vision.
Putting the Blueprint into action needs to be performed in a way that will empower:
• SJCOG Board in their transportation decision-making process.
11 Appexdix C
San Joaquin County Comprehensive Economic Development Strategy Report
November 3, 2010
San Joaquin County Board of Supervisors
Workforce Investment Board & CEDS Task Force Appexdix C
I. Introduction
This document provides a Comprehensive Economic Development Strategy (CEDS) for San Joaquin County, California. This CEDS is a complete update of the previous countywide CEDS prepared in 2003. The updated document has been formatted in accordance with the current CEDS guidelines and requirements published by the U.S. Department of Commerce, Economic Development Administration (EDA).
The CEDS update process has included the following:
• Substantial community and private sector involvement via the CEDS Task Force, the San Joaquin County Business Retention Committee (BRC), and the San Joaquin County Workforce Investment Board (WIB).
• Incorporation of relevant research and strategic recommendations from an extensive economic development strategic planning process completed in the county in 2005 and 2006 (a process which also included a substantial public outreach component). The integration of this material into the current CEDS update has involved a review of progress made to date on the strategies outlined in the 2005/2006 plan, and a refinement of the strategies based on current priorities and opportunities.
• Compilation of current economic and demographic data, allowing for a comprehensive update of the conditions and trends documented in the 2003 CEDS and the 2005/2006 strategic planning effort.
• Reviews of relevant planning documents and current work programs of the San Joaquin Partnership (the countywide economic development corporation) and the San Joaquin Council of Governments (the countywide metropolitan planning organization).
• Extensive coordination with the individual municipalities and other institutional partners in the county to develop an integrated set of goals, objectives and strategies for economic development in San Joaquin County.
• Coordination with the municipalities and other institution partners to identify and rank CEDS projects (for purposes of this CEDS, for the internal prioritization of projects) involving planned investments in key infrastructure and other projects related to the CEDS goals.
• Preparation of an updated industry cluster analysis to assist the CEDS Task Force in identifying target industries to be the focus of CEDS implementation.
• Development of a CEDS Plan of Action based on the preceding steps.
San Joaquin County CEDS (2010) Page 1 Appexdix C
• Development of monitoring program and related performance measures to track implementation of the CEDS, and to provide a basis for refining the goals, objectives and strategies over time.
The organization of the CEDS reflects the fact that a number of existing programs and entities are aggressively addressing economic development in San Joaquin County. The intent of the CEDS is not to replace or redirect these other efforts, but to leverage their effectiveness through an enhanced degree of integration, whereby issues that would otherwise limit the success of individual programs can be mitigated through a comprehensive, coordinated strategy.
As noted above, a critical element of the CEDS is a list of planned infrastructure projects and other investments that will advance economic development in the county pursuant to the CEDS Plan of Action. The listed projects are potential candidates for EDA funding. A substantial effort within the CEDS update process has been devoted to establishing an evaluation matrix by which individual entities can rank the candidate projects based on the EDA’s current finding priorities and criteria.
San Joaquin County CEDS (2010) Page 2 Appexdix C
II. Executive Summary
Demographic data for San Joaquin County reveal that there are wide differences among County communities, while overall the County has indicators of economic stress, compared to the state and nation, in figures pertaining to educational attainment of the workforce, incomes, and unemployment. San Joaquin County has been a high-growth area. From 2000 to 2010 the County population increased by 23%, compared to 14% for all of California.
While the process of economic development follows many general principles, local conditions greatly affect the overall strategic approach to how economic development is conducted. Every location has its unique complexities, as does San Joaquin County. For example, a range of issues identified for discussion purposes at the outset of this CEDS update process fell under the following three headings:
• Historic context: Baseline conditions arising from the County’s past; • Changing influence of location: Pressures exerted on the County due largely to the expansion of adjacent, larger urban areas; and • Results: The problems and opportunities created from the combination of history and emerging locational challenges.
This list of issues was drawn largely from the documentation of a major strategic planning process completed by the San Joaquin Partnership since the last CEDS was produced. In 2005 and 2006 (i.e. approximately three years after the previous CEDS was completed) the San Joaquin Partnership (SJP) spearheaded a major strategic planning effort to define a comprehensive economic development approach for San Joaquin County. The process also involved a substantial community outreach effort, including individual interviews with approximately 50 stakeholders, 10 focus group meetings, and an online survey of residents and businesses.
The 2005-2006 strategic planning process, along with subsequent refinements reflected in SJP’s annual work plan have provided the recent strategic framework for countywide economic development programming. Key elements from that process are included in this CEDS. A second strategic planning process, the San Joaquin County Regional Blueprint Vision, January 28, 2010, prepared for the San Joaquin COG, is also addressed in this CEDS. The Blueprint is key to setting policy to developing a Sustainable Community Strategy in response to California Senate Bill No. 375. Blueprint issues particularly relevant to this CEDS pertain to the need to:
• Ensure that land use planning and other policy direction is compatible with economic development strategies.
San Joaquin County CEDS (2010) Page 3 Appexdix C
• Monitor overall development policy and activity, and promote policies and results that support the repayment of infrastructure debt.
Based largely on these previous strategic efforts, Projects and Programs, and Recommended Five-Year Objectives, are organized within this CEDS under the following eight major goal-topic headings. The topics give a sense of the comprehensive nature of the County’s economic development efforts.
• Economic Development Focus • Economic Development Marketing • Business Climate • Sites & Infrastructure • Entrepreneurship • Tourism • Education & Workforce Development, and • Quality of Life
A critical element of the CEDS is a list of planned infrastructure projects and other investments that will advance economic development in the county pursuant to the CEDS Plan of Action. The 40 projects in the project database represent a total of approximately $1 billion in investment, for water, wastewater, and storm drain projects, transportation improvements, and energy-related projects. These projects would generate an estimated 8,500 person-years of construction employment. Over half the projects involve new infrastructure. Over 3/4th of projects also involve refurbishing or upgrading existing buildings/infrastructure in order to preserve the serviceability of a facility or area, or to meet the requirements of modern logistics, energy conservation, lifestyle options, or other needs. In this sense, many of these projects aim to maintain or enhance a community’s competitive position.
Generally, the projects relate to core areas of the community – job centers or downtowns. Although the long-term job-generation effect is not explicitly delineated for all proposed projects, approximately 1/3rd appear to have a role in supporting the growth of industrial-type jobs, and another 1/4th support retail, other commercial, and office job growth.
Twenty-five existing economic development programs, including new, committee-based initiatives and long-standing institutionalized programs, are also reflected in the CEDS, and some of the more recent initiatives are also reflected in the 5-Year Action Plan.
San Joaquin County CEDS (2010) Page 4 Appendix D
2011 Regional Transportation Plan
DRAFT
San Joaquin Council of Governments 555 East Weber Avenue, Stockton, California 95202 Phone: (209) 235‐0600 Fax: (209) 235‐0438
Appendix D
Executive Summary
EXECUTIVE SUMMARY
The 2011 Regional Transportation Plan (RTP) represents a new chapter in the development of the San Joaquin region’s transportation system. It incorporates the clear mandate from the citizens of San Joaquin County who succeeded in 2006, with 78% of the vote, to extend Measure K an additional 30 years. It is comprehensive in its response to new federal statutes embodied in the 2005 Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU). And it continues to provide a vision for 2035 that recognizes the significant impact the transportation network has on the region’s quality of life and economic vitality. As the region’s comprehensive long-range transportation planning document, the 2011 RTP serves as a guide for achieving public policy decisions that will result in balanced investments for a wide range of multi-modal transportation improvements.
REGULATORY SETTING
In addition to its role in establishing the vision for the region’s future transportation system, the 2011 RTP must comply with federal planning (23 CFR 450) and air quality (40 CFR 51 and 93) regulations. This includes compliance with SAFETEA-LU, which was signed into law on August 10, 2005. On February 14, 2007 the U.S. Department of Transportation published in the Federal Register the final regulations implementing the new statutes.
As such, the 2011 RTP address all applicable Federal and State transportation planning requirements, including the following:
• The Caltrans RTP Checklist as updated in September 2007 is included in Appendix E-1.
• In federally designated non-attainment and maintenance areas, the U. S. Department of Transportation, Federal Highway Administration (FHWA), and Federal Transit Administration (FTA) require that regions submit a regional transportation plan (RTP) every four years that covers a period of at least 20 years. The 2011 RTP was last updated in 2007, covers the period 2010-2035.
• The RTP must also meet the air quality budgets set for the State Implementation Plan (SIP) as amended under the Federal Clean Air Act. This determination is documented in the associated Air Quality Document covering the 2011 RTP.
• All transportation investments in the San Joaquin region that include Federal transportation funds must be consistent with the RTP and must be included in the Federal Transportation Improvement Program (FTIP) when ready for funding. The FTIP is consistent with the RTP and must be updated at least every four years for
2011 San Joaquin Council of Governments’ Regional Transportation Plan E-1 Appendix D
Executive Summary
funding. SJCOG’s FTIP was last updated in 2009, The 2011 FTIP update includes four full years of programming.
It is important to note that the planning process is continuous and the RTP is not a static document; rather, it provides a framework for investments and must be updated again no later than 4 years from the federal approval of the conformity determination.
SAN JOAQUIN COUNTY SETTING
San Joaquin County remains one of the fastest growing regions in California. While much of this trend continues to be the result of “spillover” from the Bay Area, the County’s geographical advantages and quality of life also contribute to the growth. This growth has led to increased urbanization and the persistent challenge to meet state and federal air quality requirements.
Economically, San Joaquin County continues to grow in many segments of its economy. Downtown revitalization efforts in Stockton, Big League Dreams in Manteca, and the Lodi area’s success producing world-class wines are shaping San Joaquin County into a destination for tourism and entertainment. The region also continues to be an attractive location for new warehousing and distribution centers that serve northern California, the Bay Area and the west coast. A centralized and diverse network of highway, rail, air and seaport facilities support the continued development of San Joaquin County into a major goods movement region.
As San Joaquin County is transformed, these growth factors have profound effects on the ability to finance, deliver and maintain the transportation infrastructure. The 2011 Regional Transportation Plan aims to create both an efficient and effective multimodal transportation system for San Joaquin County that balances the needs for maintenance and preservation with expansion and enhancements. A conscious effort is made to design a system that both promotes mobility as well as preserves the environment. This effort is guided by a set of overarching goals.
GOALS, POLICIES, OBJECTIVES, AND PERFORMANCE INDICATORS
The 2011 RTP can be considered the San Joaquin region’s 25-year “statement of priorities” for the future transportation system. Therefore, at the highest level, the goals, policies, objectives, and performance indicators for this document are all designed to articulate: what the region wants the future transportation system to look like, what types of decisions will help the region attain its vision, and measures, or indicators by which the region can assess its progress.
Establishing clear linkages between the broad, value-laden goals and the more specific performance indicators helps to provide a tangible path towards success.
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The 2011 RTP built upon the 2007RTP goals, policies, objectives, and performance measures foundation in order to provide a simplified and more clearly articulated vision of the future that emphasizes the fundamental values reflected in past RTPs, while at the same time, addresses the current values and priorities as articulated through public outreach efforts in 2009 and 2010, as well as by the voters in San Joaquin County through both the renewal of the County’s Measure K sales tax..
In addition, the San Joaquin Council of Governments revisited adopted Revenue Policies and Project Delivery Policies that target specific issues relating to the funding and delivery of transportation projects in the region to ensure they continue to reflect the values of the region. SJCOG staff conducted a comprehensive review that resulted in the seven goals, 18 objectives, and 64 performance indicators identified in the 2011 RTP as well as a clear link between the 2011 goals, objectives, and performance measures and the congestion management process (CMP).
The seven goals are:
• Enhance the Environment, Quality of Life, and Conserve the Environment • Increase Accessibility and Mobility • Increase Safety and Security • Preserve the Existing Regional Transportation System and Promote Efficient Roadway System Management and Operations • Support Economic Vitality • Promote Interagency Coordination and Public Participation for Transportation Decision-Making and Planning Efforts • Maximize Cost Effectiveness
Six policies (four revenue based policies and two project delivery policies) were also adopted by the San Joaquin Council of Governments’ (SJCOG) Board in 2010 to guide revenue decisions and expedite the delivery of projects in the region. These policies can be found in chapter 2 of the 2011 RTP.
The goals, policies, objectives, and performance measures discussed in this document provide a path for addressing the issues facing the development of the region’s transportation system.
THE TRANSPORTATION SYSTEM
San Joaquin County’s roadway network is defined by several intersecting highways. On a north-south axis this includes Highway 99, the “Main Street” of the San Joaquin Valley, and Interstate 5, a corridor of statewide and national significance. Within the last 10 years, each route has experienced dramatic traffic growth and levels of congestion. Each route also carries truck traffic at volumes much higher than the statewide average for the highway system, making them vital to goods movement. Without improvements, both Highway 99
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Executive Summary and I-5 within San Joaquin County are projected to operate significantly beyond capacity, resulting in sustained peak period driving conditions and deteriorating levels of service.
Major east-west movement is handled by Route 132 at the southern tip of the county, Interstates 580 and 205 in the southwest region of the county, as well as Route 120, Route 4 and Route 12. Interstates 205 and 580 serve as a gateway connection between the San Joaquin Valley and the Bay Area, and are critical to interregional travel and commerce. Each however, has experienced increased travel movement much beyond the statewide average. I- 205 in particular remains one of the most impacted travel routes in the County. State Routes 4 and 12 are primarily two lane conventional highways linking the east and west sides of the county. Each operates as a freeway segment for a brief but important segment between Highway 99 and I-5. Both Routes 4 and 12 connect with Bay Area counties across the San Joaquin Delta. These two lane rural roads now handle significant commuter and interregional traffic.
Highways 26 and 88 in the central and northeast portion of the County are two lane rural highways which link to Calaveras and Amador Counties. Each roadway has also experienced significant traffic volume increases partly due to recreational traffic but also resulting from rapid growth occurring in these neighboring counties to the east.
Transit services in San Joaquin County have also grown dramatically over the past fifteen years. From a time when the Stockton Metropolitan Area Regional Transit District was the only major transit operator in the County, to today, where the region is served by the San Joaquin Regional Transit District, Lodi’s Grapeline, the Tracy Tracer, Manteca Transit, the Altamont Commuter Express, and smaller services in the cities of Escalon and Ripon. San Joaquin County contains local transit systems, bus rapid transit, intercity and interregional bus transit services, intercity and interregional commuter rail service, and needed services such as demand response for both those who are in need of transit for medical purposes and those in the rural areas of the County.
All cities and unincorporated areas in San Joaquin County are served by a public transit system. These systems range in size and complexity. From the 130 buses operated by the San Joaquin Regional Transit District (SJRTD), to the single bus operated by the City of Ripon.
Aviation services in San Joaquin County address a variety of local and regional needs. The aviation system serves the U.S. military, supports local farmers, police, and medical services, and provides business, passenger, and recreational opportunities for the citizens of San Joaquin County. Together, the airports provide a viable mobility option for the County’s citizens and businesses. Three publicly owned airports operate in the County: Stockton Metropolitan Airport, Tracy Municipal Airport, and the New Jerusalem Airport in Tracy. In addition, three private airports operate in the Lodi area.
As described in Chapter 7, the San Joaquin County transportation system is also defined by pedestrian and bicycle facilities, a deep water port, and active rail lines that carry both freight and passenger rail cars.
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THE FUNDING OUTLOOK
Since the 2007 RTP, our region’s revenue picture has changed due to the current economic recession’s impact on transportation sales tax revenues that contribute to transportation funding across local, state and federal levels. The transportation system needs on the mainline highways, interchanges, regional roadways, rail and bus services, railroad grade crossings, and deferred maintenance continue to outstrip projected revenues. In order to address the needs that can be met through the revenues identified in the 2011 RTP and at the same time recognize the needs that cannot be met due to funding constraints, the 2011 RTP establishes two categories of projects.
• Tier I projects are those that this region intends to build, implement, and maintain during the Plan period with identified revenue sources. They represent the region’s fiscally constrained program for developing the transportation system. Only the Tier I projects are modeled for air quality conformity.
• Tier II projects are those that need to be built, implemented, and maintained during the Plan period but have to be deferred until new funding resources materialize. They include both maintenance and expansion projects in all modes of travel.
The expected revenues for the twenty-five year plan period total approximately $10 billion. This chart illustrates the shortfall in funding between the fiscally constrained Tier I projects and the projected total need.
Figure E-1: Transportation Needs and Shortfalls
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Revenue The 2011 RTP revenue sources are derived from local sources (55%), State sources (32%), and federal sources (13%), and are illustrated in Figure E-2 below.
Figure E-2: RTP Revenue Sources 2010-2035
Local Funding from local sources contributes fifty-five percent of the revenues to this Regional Transportation Plan. Of this local revenue, the major contributions are from: Local Transportation Funds (6.7%), the Regional Transportation Impact Fund (4.6%), Local Developer Fee programs/General Funds (18%), and the Measure K ½ cent sales tax program.
Measure K
In November 2006, voters in San Joaquin County approved the renewal of this ½ cent sales tax dedicated to transportation in San Joaquin County by a margin of 78% approval. This adds over $3.1 billion in transportation resources available between 2011 and 2041. Funds will be used roughly one-third for maintenance and safety, one-third for transit and alternative modes of travel, and one-third for roadway operational and capacity improvements. The Measure K program is the largest revenue source from all local, state and federal sources that fund this RTP.
The most important element of Measure K is its flexibility. Measure K is an important funding source covering operating costs associated with local street maintenance and transit. In addition, Measure K is useful in terms of leveraging state and federal dollars. It is also one of the few sources of funds for air quality beneficial projects (bike lanes and paths, park and ride lots, railroad grade separations, etc.). Measure K also provides SJCOG with the opportunity to use innovative financing techniques for major capital projects.
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Local Developer Fees and General Funds Local Developer Fees and General Funds account for a large percentage of the local revenue for the RTP. The implementation of local developer fee programs enables faster delivery of projects, with the additional benefit of leveraging State and federal sources. In addition, in the Spring of 2006, all local governments in San Joaquin County and SJCOG approved a Regional Transportation Impact Fee on new development. These funds, which will be collected through the life of this Plan are targeted to key regional highway and roadway improvements and regionally significant transit improvements. The RTIF and local developer fee programs account for approximately $2 billion of the revenue of the RTP. As part of the implementation of the Airport Land Use Compatibility Plan (ALUCP) a developer fee is levied by the responsible jurisdiction to offset the cost to the extent possible of reviewing projects and maintaining the Airport Land Use Commission (ALUC).
State Revenue State funding sources make up about 32% of the total twenty-five year transportation budget. Most of the state revenues come from the State Transportation Improvement Program (6%), the State Highway Operation and Protection Program (6%), and the State Transportation Bond (5%).
In November 2006, California voters passed Propositions 1B. Prop 1B secures $19.9 billion of dollars for transportation projects across the state. Proposition 1B funds safety improvements, expanded public transit, traffic congestion relief, local street repair and air pollution reduction. The funding programs under Proposition 1B include the Corridor Mobility Improvement Account (CMIA), the State Route 99 program, Trade Corridor program, Intercity Rail, and State and Local Partnership among others.
Federal Revenue About 13% of the transportation funds for this Plan come from Federal transit and highway funding sources. These funds are generally used to support transit capital and operating needs. Federal sources also include the flexible funding programs known as Surface Transportation Program (STP) and Congestion Mitigation and Air Quality Improvement Program (CMAQ). In this Plan, STP and CMAQ total 4.5% of anticipated funds.
THE INVESTMENT PROGRAM
The 2011 RTP identifies significant capacity increases and operational improvements to more efficiently manage traffic conditions. The capacity improvements target corridors that are the most essential to improving mobility in the county and have been assessed through the congestion management process. This includes extensions of the roadway network to improve connectivity and upgrade of interchanges where lower standard facilities are no longer adequate to handle near tern travel demand.
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The second priority is to address areas of congestion and deficiencies that are anticipated based on the substantial increase on travel growth projected for the county. Several portions of the highway and local arterial system will have the remaining capacity fully absorbed within the next ten years and begin to experience regular and elongating daily congestion.
As the County continues to grow and travel demand increases, it will become increasingly important to continue providing investments into transit, Commute Connection, and bike and pedestrian improvements, as identified in this Plan. These alternative modes in particular should be coordinated with community growth and downtown and neighborhood revitalization efforts.
While enhanced mobility is important, maintaining what we already have and ensuring the current system is operating safely is equally important. Therefore each element identifies resources to adequately operate, maintain and where necessary rehabilitate the existing roadway system.
Figure E-3 depicts the investments by major category for the Tier I program of projects.
Figure E-3: Transportation Investments by Mode
Operations and Maintenance Section 450.322(f)(10) of the Final Rule implementing SAFETEA-LU includes a requirement to include system-level estimates of costs and revenue sources that are reasonably expected to be available to adequately operate and maintain federal-aid highways and public transportation system. This requirement is addressed in Chapter 7, with over $4.5 billion in revenue identified for operations and maintenance of the transportation system (roadway and transit
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combined). SJCOG staff coordinated the development of these costs and revenues with the applicable local and State agencies.
Transit Service Bus service improvements continue throughout the life of the Plan for local city services, intercity and interregional services, bus rapid transit, system operations and maintenance, and system expansions. San Joaquin County transit operators anticipate additional transit vehicles to meet demand and replace aging fleets. The Regional Transit District and the Rail Commission anticipate building new maintenance facilities to support growing systems. Transit operators also continue to look ahead with planned updates to short and long range transit plans. Rail service improvements are dominated by the top priority of the Regional Rail Commission to provide dedicated right of way for the Altamont Commuter Express (ACE) service.
Roadway Network Projects in the Mainline Highway, Interchange, Regional Roadway, and Railroad Grade Separation categories take up over 70% of the revenues anticipated through 2035, with over 25% of those funds being dedicated to operating and maintaining the system. With the recent influx of dollars for transportation improvements, many of the large projects identified in the Plan, including the widening of State Route 99 and Interstate 5, are only now beginning to address the backlog of needs throughout the County. The region continues to pursue funding opportunities to address safety concerns at railroad crossings as well as congestion both along major commute corridors and along regionally significant arterial roadways.
Managing Travel Demand The 2011 RTP also addresses strategies that support mobility as well as improvement to air quality. These go beyond traditional roadway and transit projects and include the development of park and ride lots, bicycle facilities, traffic flow improvements like signal synchronization, and continued operation of the freeway service patrol and SJCOG’s rideshare program, Commute Connection.
2011 RTP PUBLIC OUTREACH & INTERAGENCY CONSULTATION
Public involvement and interagency consultation during the development and implementation of the Regional Transportation Plan is essential to an effective planning process. In addition to being a key component of new SAFETEA-LU requirements, it is an opportunity for SJCOG to make meaningful connections with San Joaquin County residents and other local, State and federal agencies involved with transportation planning.
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Public Participation Plan SJCOG’s Public Participation Plan is an evolving document that has guided SJCOG’s public outreach efforts since 1995. In accordance with this participation plan, the 2011 RTP: held a 45-day public comment period and public hearing (see Appendix E-1 for documentation), documents responses to comments (Appendix E-2), and provides documentation of SJCOG Board adoption by resolution (Appendix E-3).
To enhance consultation on the development of the 2007 SJCOG Public Participation Plan, the San Joaquin Valley COGs held a meeting on March 2, 2007, in which resource agencies were invited to provide input into the RTP outreach and Public Participation Plans being updated throughout the Valley. A survey was distributed as an open-ended invitation for resource agencies to provide suggestions about how to improve public participation. Recognizing that the intent of SAFETEA-LU is to require consultation efforts beyond what was done in the past, SJCOG is embarking on additional outreach and is committed to meeting the challenge of enhanced agency consultation.
2011 RTP Public Outreach SJCOG staff followed the formal process outlined in SJCOG’s Public Participation Plan, which included a 45-day public comment period and public hearing in June 2010. SJCOG staff also utilized several methods to reach out to the citizens of San Joaquin County that involved public workshops and two sets of surveys. From the beginning of the outreach effort, SJCOG staff recognized that there was already a clear mandate by the citizens of San Joaquin County for the future transportation system as was voiced in the renewal of Measure K by 78% of the votes on November 7, 2006. As a result SJCOG’s public outreach efforts focused on the incorporation of the draft congestion management process into the RTP planning process, the draft tier I and II project listings; the draft goals objectives and performance measures; and the draft revenue expenditures.
Public Workshops Seven public workshops were advertized in January, 2010 in local English language and Spanish language newspapers, on the SJCOG website and various organization websites and in the SJCOG monthly online newsletter Horizons. Public workshops were held in Stockton, Manteca, Lathrop, Lodi, Tracy, Ripon and Escalon, and Thornton during January and February, 2010.
In addition, draft RTP surveys were posted on various websites, including: SJCOG, The Regional Rail Commission, Greater Stockton Chamber of Commerce, Lodi Chamber of Commerce, Manteca Chamber of Commerce, El Concilio of San Joaquin, and The San Joaquin League of Women Voters. Fliers of the survey were distributed on the Altamont Corridor Express, the commuter rail line that stretches into the Bay Area.
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SJCOG staff presented on the 2011 RTP outreach materials at meetings of the El Concilio, an education group for the Hispanic community, COMA, the San Joaquin umbrella group for all Hispanic organizations, the American Indian Council and the SJCOG Citizens Advisory Committee, where members, including the past two presidents of the local chapter of the NAACP agreed to bring the survey back to their groups.
Samples of the materials provided at the workshops are included in Appendix 5-2.
Interagency Consultation The San Joaquin Valley MPOs hold ongoing Interagency Consultation Group meetings attended by MPO staff from across the Valley, the San Joaquin Valley Unified Air Pollution Control District, Caltrans District and Headquarters, Air Resources Board, U.S. Environmental Protection Agency, and the Federal Highway and Transit Administrations.
The San Joaquin Valley MPOs also sponsored two Interagency workshops (August, 2009 and February 2010) to discuss the Valley MPOs progress in development of the 2011 RTPs. Participants in these workshops included Air Resources Board; Caltrans Headquarters, Districts 6, and District 10; Federal Highway Administration, U.S. EPA; San Joaquin Valley Air Pollution Control District; the 8 San Joaquin Valley MPOs. Topics of discussion for the workshops include: updates on the 2011 RTP development process undertaken by each MPO; the San Joaquin Valley conformity process; and public outreach efforts. The goal of each workshop was to facilitate an open discussion between the Valley MPOs and state and federal partner agencies in the development of the 2011 RTPs. Agendas and workshop participant list can be found in appendix 5-5
ENVIRONMENTAL JUSTICE
The 2011 RTP provides an analysis of environmental justice. Environmental Justice refers to preventative measures that ensure no one group will be disproportionately affected by the implementation of the RTP. The findings show that the RTP program of projects, as a whole, does not cause a disproportionate burden on any one group.
ENVIRONMENTAL IMPACTS
The environmental impacts associated with the implementation of this RTP are described in Chapter 1 and in the Environmental Impact Report accompanying this document (Appendix 1-2. In addition, SAFETEA-LU requires enhanced consultation with resource agencies to provide a discussion of potential environmental mitigation activities.
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CONCLUSION
At the most fundamental level, regional transportation plans are developed to respond to State and federal mandates. SJCOG’s 2011 RTP, however, seeks to go beyond that. It seeks to clearly articulate the region’s values and goals when it comes to the future transportation system, and to look to the future to describe and implement an outcome that is shaped by local citizens through the renewal of Measure K, the citizens of California through the passage of Proposition 1A and 1B, and the federal priorities established by the enactment and implementation of SAFETEA-LU.
The 2011 RTP also recognizes that success in developing the future transportation system is dependant on an on-going, collaborative process with local jurisdictions, State and federal partners, and a wide range of public and private agencies and individuals that have a vested interest in San Joaquin County as a place to live, work, and do business. It is a dynamic process that searches out the best ways to use the available resources to develop an effective, efficient, and balanced multi-modal transportation system.
This Plan will be updated at least every four years to reflect the ever-changing funding picture, the evolving economic activity and growth pressures of the region, and to re-assess the region’s progress towards achieving its transportation system goals.
2011 San Joaquin Council of Governments’ Regional Transportation Plan E-12 Appendix E EBERHARDT SCHOOL OF BUSINESS Business Forecasting Center 12 in partnership with San Joaquin Council of Governments Lodi
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4 Stockton Lathrop REGIONAL 120 Escalon Manteca Ripon 205 Tracy analyst
OCTOBER 2011
San Joaquin County Commuting One of the defining characteristics however, highlights the need for 2008 American Community Survey of San Joaquin County’s economic properly informed decisions about 3-Year estimates. First, we will relationship with the region is regional infrastructure improvements analyze cross-county commuter flows commuting. Workers travel to and and public policy. Local and discuss changes since data was from the Bay Area, the Sacramento governments need to have proper last collected by the 2000 Census. Metro Area, and the central San information about where commuters Next, we will delve deeper into the Joaquin Valley seeking jobs, higher are travelling to best manage cross-county flows by examining wages, higher quality of life, or lower congestion, economic growth, and industry-level data. This will reveal cost of living. Over the past decade, the environment. Understanding commuting patterns by industry, the number of workers commuting commuting patterns is essential to allowing the exploration of the into and out of San Joaquin County regional governments’ ability to relationship between the number of has grown over 32% to more than coordinate infrastructure and policy people working in each industry and 106,200 people. Workers come to meet these goals. Additionally, the number of people who work in from all manner of industries from understanding commuting Agriculture and Manufacturing patterns gives insight into to Government. This has been a the distribution of worker boon to many of the communities skills in and around San in which commuters choose to Joaquin County that might live. Commuters – especially those be highlighted to attract new commuting from San Joaquin businesses or shape policy. County to the Bay Area – earn above average wages and spend much of This Regional Analyst this income in their communities. examines San Joaquin This local spending supports County commuting patterns economic growth throughout these with data compiled by communities. Census Transportation Planning Products (CTPP) The strong growth in commuting, using results from the 2006- Appendix E each industry and who live Sutter in San Joaquin County. Map 1. Legend • Pl•acer Incommuters 10 Commuting by EI Dorado • 100 County Yolo • Map 1 displays the • relative number of in- Sacramento '-~P--:Amador·_~~ commuters coming from each respective county • according to the 2006- Solano Calaveras 2008 ACS. Of the 106,200 • people who crossed the San Joaquin County border for Contra Costa • work, 37% - about 40,000 workers – commuted into San Joaquin the county. San Joaquin • Tuolumne County attracted workers Al ameda Stanislaus from 36 counties across California, from as far • north as Shasta County San Mateo :::X:::..""'.... ~------'~ to as far south as Orange County. Three-quarters of San Joaquin County in- Santa Clara Merced commuters, however, came • from Stanislaus (17,800 Santa Cruz • people), Sacramento (8,500 people), Calaveras (3,300 people), and Merced (2,000 people) Counties. Significant numbers also came from commuting from Stanislaus County. County and worked in some other Contra Costa (1,900 people) and The share of in-commuters from the county, of which there were about Alameda Counties (1,700 people). central San Joaquin Valley increased 67,200 workers - 63% of total San While workers came from all over from 49% of all in-commuters to Joaquin County commuters. The California, about 45% came from just over 51% of all in-commuters. Greater Bay Area was by far the most Stanislaus County alone. This is in contrast to in-commuting popular destination of San Joaquin from the Bay Area – in-commuting out-commuters – 70% of out- Comparing the 2000 Census to increased by 850 people between the commuters travelled to the Greater the 2006-2008 ACS, San Joaquin 2000 Census and the 2006-2008 Bay Area for work. About 40% of County in-commuters increased ACS, an increase of about 22%. The out-commuters – 26,300 people - by 9,500 people or about 27%. proportion of commuters coming travelled to Alameda County for Most of this increase came from a from the Greater Bay Area fell to work. Of other Bay Area counties, 34% increase in commuters from 11.6% of total in-commuters from 8,800 travelled to Santa Clara the central San Joaquin Valley, 12.1% in 2000. County, 5,300 to Contra Costa accounting for 5,200 new in- County, and about 2,800 commuted commuters to San Joaquin County. Map 2 shows the out-commuter to San Francisco for work. The next Of this, 3,800 new workers are equivalent of Map 1. These are workers who lived in San Joaquin
2 Regional Analyst | October 2011 Appendix E Sutter increased by 39% from Map 2. Legend • I • 7,000 in 2000 to 9,700 Qutcommuters in the 2006-2008 period, 10 EI Dorado surpassing the Greater • 100 Yolo • Sacramento Area as the • second most popular out- Sacramento commuting destination. In the mid-2000s, the median home price in San • Joaquin County surpassed Solano Calaveras that of Sacramento • • County, which likely made commuting from San Joaquin County far less attractive than during the San Joaquin 1990’s. Tuolumne Table 1 displays a selection of counties and the number of in- and out- commuters, as well as the number of net commuters Santa Clara – the number of out- Merced commuters subtracted from the number of in- • commuters. This table • reveals a strong commute pattern from the Valley to the Bay Area. All the counties in which net- commuting was negative most popular region for San Joaquin tech bubble. Despite decline in the (more out-commuters County commuters was the central Bay Area jobs after the tech bubble than in-commuters) are in the Bay San Joaquin Valley. Over 9,700 collapse, commuting to the Greater Area, whereas there was strong in- workers commuted to this region Bay Area increased 37% from 34,100 commuting to San Joaquin County for work, though 8,800 travelled to 46,800 workers during the San from other San Joaquin Valley to Stanislaus County alone. An Joaquin housing boom. Most of this counties. This is in contrast to the additional 520 workers travelled to was an increase in commuting to relationship between San Joaquin Merced County, while 360 travelled Alameda County, but commuting County and Sacramento County to Fresno County. increased to every county in the where the number of in- and out- Greater Bay Area as well. Over the commuters was nearly equal – even San Joaquin County’s lesser cost of same period, out-commuting to living compared with the Bay Area the central San Joaquin Valley also during the early and mid-2000s continued the out-commuting trend begun in the late 1990’s during the
Over 106,200 people from 36 counties commuted into or out of San Joaquin County for work during the 2006-2008 period.
Regional Analyst | September 2011 3 Appendix E slightly positive. We attribute this to slightly higher wages in Sacramento County workers to reside in the more a difference in what influences the County. However, in contrast to the urban Sacramento area. Despite decision to commute. usual pattern, there was a slight net the extremely high concentration inflow of commuters to San Joaquin of public administration jobs Most commuting patterns are driven County from Sacramento County, in Sacramento County, there is by differences between housing costs, suggesting that there were some somewhat surprisingly a small net job opportunities, and wages. There amenities that attracted San Joaquin inflow of public sector workers is a strong wage and housing cost gradient stretching from the Bay Area, through the I-580 corridor and Table 1. San Joaquin County Commuting by County southern San Joaquin County into 27,200 more people out-commute than in-commute. Stanislaus County down I-5 and County In Out Net Highway 99. This gradient drives Alameda County 1,735 26,325 -24,590 strong commuting patterns in the Santa Clara County 435 8,800 -8,365 southern end of San Joaquin County, a net outflow to the Bay Area, Contra Costa County 1,895 5,330 -3,435 and a significant net inflow from San Francisco County 40 2,835 -2,795 Stanislaus County. In contrast, there San Mateo County 95 1,805 -1,710 is less overall commuting traffic and Solano County 380 1,030 -650 balanced flow of in-commuters and Sacramento County 8,455 7,695 760 out-commuters between Sacramento Merced County 2,015 520 1,495 and San Joaquin County. Housing Calaveras County 3,245 260 2,985 costs in San Joaquin and Sacramento Stanislaus County 17,820 8,785 9,035 County are fairly comparable, but there are more job opportunities and Source: CTPP, 2006-2008 County-to-County Worker Flow Tables
Figure 1. San Joaquin County Incommuters by Industry The majority of San Joaquin County incommuters - 64% - work in five Industry sectors. 16%
14% ----- 1 --
12%
10%
8% -- 6%
4% ...... - ... - 2% 0% n "
Note: E.H.S.: Education, Health, & Social Services, T.W.U: Transportation, Warehouse, & Utilities Source: Census Transportation Planning Products (CTPP), 2006-2008 ACS County-to-County Industry Flow tables
4 Regional Analyst | October 2011 Appendix E Figure 2. Proportion of Jobs Held By Incommuters by Industry More than One-in-four Construction and Transportation, Warehousing, & Utilities workers commute into San Jaoquin County.
30%
25%
20%
15%
10%
5%
0% ~, ~' #0 #'~ ~<1-C!J J>0 "' # ~ ~ 45% of in-commuters to San Joaquin County came from Stanislaus County, while 40% of out-commuters work in Alameda County. Regional Analyst | September 2011 5 Appendix E Figure 3. San Joaquin County Outcommuters by Industry 52% of Outcommuters work in four industries; three of these industries make up a large share of incommuters, as well. 16% 14% 12% r- r- r- 10% - 8% r- 6% r- ... 4% r--= 2% 0% ··········nn Note: E.H.S.: Education, Health, & Social Services, T.W.U: Transportation, Warehouse, & Utilities Source: Census Transportation Planning Products (CTPP), 2006-2008 ACS County-to-County Industry Flow tables and Manufacturing (21.4%). The Like in-commuters, San Joaquin of people commuting to work in geographical distribution of these out-commuters worked in a variety each sector: 48% of out-commuters in-commuters followed the familiar of industry sectors throughout in Manufacturing worked in commuting pattern. California. Figure 3 shows the Alameda County at places like the distribution of San Joaquin recently closed NUMMI plant, In most of these sectors, the majority County out-commuters across along with 46% of Wholesale Trade of the in-commuting workforce came industry sectors. Just over 52% workers, and 45% of Financial from Stanislaus County. About 60% of out-commuters worked in Services and Professional Business & of the in-commuting Manufacturing four industries: about 15% of Technology Services workers each. A workers came from Stanislaus out-commuters worked in the quarter of commuters to Santa Clara County and 56% of those working Construction sector, 12.9% worked County worked in Manufacturing. in the Retail and Wholesale Trade in Education, Health, & Social Construction workers made up sectors. In most other sectors, at least Services, 12.8% in Manufacturing, the largest proportion of those 30% of in-commuters came from and 11.7% work in the Professional commuting to both Contra Costa Stanislaus County. Overall, 45% of Business & Technology Sector. (18%) and San Francisco (30%) in-commuters came from Stanislaus A moderate proportion of out- counties. County. There are two notable commuters also work in the exceptions, however: more in- Retail Trade, the Transportation, Aside from understanding commuters from Sacramento County Warehouse, & Utilities, and commuting patterns, this data also worked in the Arts & Recreation Government sectors. allows us to compare the distribution (33%) and Government (35%) of people who worked in San sectors than in-commuters from By far, most out-commuters travelled Joaquin County to the distribution Stanislaus County. This is likely to the Greater Bay Area for work, of people who lived in San Joaquin attributable to these sectors being with over 46,800 workers - 7% of County across industries. This much larger and more developed in all out-commuters - commuting comparison allows us to determine Sacramento County. there. Workers travelling to Alameda whether an industry attracted County accounted for the majority 6 Regional Analyst | October 2011 Appendix E Figure 4. San Joaquin Industry Sectors by Commuter Quotient The Information and Agriculture & Mining sectors are the greatest outliers among San Joaquin County sectors of industry. 160 140 120 100 80 60 40 Note: E.H.S.: Education, Health, & Social Services, T.W.U: Transportation, Warehouse, & Utilities Source: Census Transportation Planning Products (CTPP), 2006-2008 ACS County-to-County Industry Flow tables workers from outside the county or if (though, there may still be people quarters of these commuters travel workers sought employment outside commuting outside the county to to some Greater Bay Area county, the county (commute). We do this by work in this industry). with 45% alone commuting to work dividing the proportion of workers in Alameda County. This is likely living in San Joaquin County in each Figure 4 displays the results of this a reflection of few job opportunities industry with each industry’s share comparison for each industry. About being available in these sectors in of San Joaquin workers, which we half the industries in San Joaquin San Joaquin County. have reduced to a number we call a County have Commuter Quotients “Commuter Quotient”. An industry of about 100, but many differ The industries with Commuter with a Commuter Quotient of 100 significantly. The Information sector Quotients less than 95 are the means the share of people who work has the largest Commuter Quotient: Agriculture & Mining, Wholesale in that industry is equal to the share only 1.3% of people who work in Trade, Retail Trade, and of people who work in that industry San Joaquin County work in the Transportation, Warehouse, & and live in San Joaquin County. Information sector, but 2% of people Utilities sectors. The Agriculture Consequently, an industry with a who live in San Joaquin County & Mining sector employs 5.9% of commuter quotient larger than 100 are employed in the Information San Joaquin County workers but means a significant amount of people sector. Three-quarters of these people only 5% of those who live in San live in the county but commute commute to the Greater Bay Area, Joaquin County are employed in outside the county for work. An while one-third alone commutes the sector, resulting in the smallest industry with a quotient less than to Contra Costa County. Another Commuter Quotient of San Joaquin 100 means more people work in the stand-out is the Professional Business County industries at 86. 32% of industry in San Joaquin County & Technology Services sector with a these in-commuters come from than there are people living in the Commuter Quotient of 117. Similar Stanislaus County, while 20% come county and working in that industry to the Information sector, three- – the industry relies on workers commuting in from other counties For questions or comments about this article, please contact: Business Forecasting Center Director, Jeffrey Michael Eberhardt School of Business E-mail: [email protected] 3601 Pacific Avenue Stockton, CA 95211 Research Associate, Andrew J. Padovani Phone: 209.946.7385 E-mail: [email protected] Regional Analyst | September 2011 7 Appendix E San Joaquin Council of Governments PRST-STD 555 E. Weber Avenue US POSTAGE Stockton, CA 95202 PAID STOCKTON, CA PH: 209.235.0600 PERMIT 383 Return Service Requested from Sacramento, and another 16% 70% of out-commuters worked in come from Merced County. The the Bay Area – mostly in Alameda Wholesale Trade, Retail Trade, and Contra Costa counties. These and Transportation, Warehouse, & commuters worked in all industry The most common Utilities sectors are similar: roughly sectors, but most worked in the half the in-commuters in each sector Construction, Education & Health industries worked come from Stanislaus County, Services, and Manufacturing while most of the rest come from sectors. Though, it is unclear how in by San Joaquin Sacramento County. commuting has been affected by the recession, commuters in County commuters Conclusion the Construction sector have surely declined significantly and were Construction, A workforce nearly half the total Manufacturing commuters to the number of workers employed in Bay Area may have declined as Education & Health San Joaquin County commuted to well. It is likely, however, the overall and from San Joaquin County to commuting pattern presented here Services, and work according to the 2006-2008 has not changed significantly. ACS. Almost half of in-commuters came from Stanislaus County, while Manufacturing. COMMUTE BETTER SHARE RIDETHE 1-800-52-SHARE CommuteConnection.com Appendix F SAN JOAQUIN VALLEY REGIONAL INDUSTRY CLUSTER ANALYSIS AND ACTION PLAN SEPTEMBER 2012 Prepared for: Office of Community and Economic Development California State University, Fresno On Behalf of California Partnership for the San Joaquin Valley Prepared by: Applied Development Economics In Association with Arakel A. Arisian, AICP, LEED AP Arisian Development Virginia Hamilton, Consultant Appendix F Prepared for: Office of Community and Economic Development California State University, Fresno On Behalf of California Partnership for the San Joaquin Valley www.sjvpartnership.org Prepared by: Applied Development Economics Project Team: Trish Kelly Doug Svensson Kathryn Studwell Peter Cheng Carleen Bedwell In Association with Arakel A. Arisian Arisian Development Virginia Hamilton, Consultant Appendix F Thanks to the many partners who provided their invaluable assistance and guidance for this project, including co-hosting convenings, engaging members and stakeholders, providing information resources and logistical support, and networking: Adventist Health Greater Stockton Chamber of Bakersfield College Commerce/REACON Building Healthy Communities, South Kern Health Sciences Research Institute, UC Merced Business and Entrepreneurship Center Kern County Economic Development California Center for Applied Competitive Corporation Technologies Kings County Economic Development California Centers for International Trade Corporation Development Fresno Workforce Investment Board (Workforce California Central Valley Economic Development Connection) Corp. (CCVEDC) Hospital Council of Northern and Central California Emerging Technology Fund California California State University, Bakersfield Kaiser Permanente Central Valley California Strategic Growth Council Kern Community College District California Water Institute Great Valley Center California Workforce Investment Board Local Government Commission Caltrans, District 6 Lyles Center for Innovation and Cambridge Systematics, Inc./Jock O’Connell Entrepreneurship Consulting Manufacturers Council of the Central Valley Center for Irrigation Technology, Fresno State Merced College Business, Industry and Central California Business Incubator Community Services Central California Center of Excellence (Modesto Pacific Gas and Electric Junior College) Regional Policy Council/Councils of Government Central California Community Colleges Regional Jobs Initiative Implementation Team Committed to Change (C6) San Joaquin Partnership Central California Obesity Prevention Program San Joaquin Valley Air Pollution Control District (CROPP) San Joaquin Valley Clean Energy Organization Central Region Consortium (California San Joaquin Valley College Community Colleges) San Joaquin Valley Rural Development Center Central Valley Business Incubator (CVBI) Stanislaus Alliance WorkNet Central Valley Health Network TeamCalifornia Central California Workforce Collaborative The California Endowment (CCWC) The Maddy Institute City of Fresno UC Davis Center for Regional Change Clinica Sierra Vista UC Advanced Solar Technologies Institute Council on Adult and Experiential Learning UC Merced SBDC Regional Network Economic Development Corporation serving University Center to Advance Manufacturing Fresno County (UCAM) Employers’ Training Resource (Kern County) USDA Rural Development, California Federal Reserve Bank of California, Community Water, Energy and Technology (WET) Center Development West Hills Community College District Fresno Business Council Workforce Investment Board of Tulare County Fresno City College SJV Regional Industry Cluster Draft Action Plan | ADE | Applied Development Economics Appendix F EXECUTIVE SUMMARY “CHARTING THE COURSE FOR THE SAN JOAQUIN VALLEY’S ECONOMIC FUTURE” PROJECT OVERVIEW In August 2011, the Office of Community and Economic Development (OCED), California State University, Fresno received an Economic Adjustment grant from the Economic Development Administration (EDA), U.S. Department of Commerce, to prepare a valley-wide industry cluster analysis and a regional strategy – Action Plan – to catalyze the growth of priority clusters. They have been prepared for OCED on behalf of the California Partnership for the San Joaquin Valley (Partnership). The Project’s goal is to support improved regional economic performance, sustainability, and shared opportunity for Valley residents, businesses and communities. The Partnership is an unprecedented public-private sector partnership between the Valley and the state of California. It was created in 2005 to address the Valley’s persistent economic, environmental and social challenges and disparities compared to other regions in the state and nationally, while acknowledging the statewide and national significance of the Valley, and changing the pathway for its economic future and overall well-being. As part of its charge, in 2006 Partnership leaders prepared a Strategic Action Proposal (SAP), The San Joaquin Valley, California’s 21st Century Opportunity. OCED serves as the Secretariat for the Partnership and manages the SAP through the “New Valley” program, through which ten Work Groups were created to develop and implement the New Valley’s first five year action plans (2006-2011). Most of the Work Groups are led by OCED partner organizations at the regional level. OCED also manages or supports many other synergistic programs, aligning university resources with Valley initiatives and leveraging state, federal, philanthropic and other resources on behalf of regional and local initiatives. The Cluster Action Plan provides recommendations for the New Valley’s next stage. According to Corwin Harper, Partnership Deputy Chair, Senior Vice President, Kaiser Permanente Central Valley, and co- convenor for one of the project’s Health and Wellness Cluster meetings, “This is an opportunity to achieve big outcomes for the Valley, focusing on the key few “big things” the Partnership can do, where the Valley has a regional competitive advantage.” SJV Regional Industry Cluster Action Plan | ADE | Applied Development Economics P a g e | 1 Appendix F THE NEED FOR A REGIONAL CLUSTER UPDATE Clusters are geographic concentrations of firms and industries that do business with each other and have common needs for talent, technology, and infrastructure. According to EDA, Regional Innovation Clusters (RIC) are a proven way to create jobs and grow the economy. They benefit from a well- developed regional strategy that leverages core regional strengths.1 The Valley has been a leader in cluster-based strategies, starting with The Economic Future of the San Joaquin Valley report in 2000 and the Fresno Regional Jobs Initiative (RJI) in 2003. The RJI resulted in the creation of 12 clusters. Building upon these efforts, the SAP identified five regional clusters of opportunity for focused action: agribusiness, health and medical, manufacturing, renewable energy, and supply chain management and logistics. These clusters reflected shared priorities across the Valley and sectors where the region’s comparative advantage was considered to be strong or emerging. The clusters have been a touchstone for the work of the New Valley, in particular for the economic development, education and workforce development partners who serve as champions for several of the New Valley Work Groups. Much progress has been made in terms of regional collaboration around demand-driven cluster and sector strategies. However, a valley-wide regional cluster analysis had not been prepared since 2004, and updated “market intelligence” was needed to help guide the next stage of the New Valley cluster implementation. This Project addresses a number of concerns and issues: The Valley has been more severely impacted by the “Great Recession” than most other California regions and needs to reposition itself for economic recovery. The global economy is experiencing structural changes and new opportunities are emerging which demand new responses at the regional level. Local budget challenges constrain the ability of many jurisdictions, partners and business champions to manage, implement and support county and regional cluster initiatives. There are emerging areas of opportunity that can best be leveraged through collaboration at the regional level, bringing efforts to scale for increased competitiveness. These areas include renewable energy and water technology innovations, and regional food systems. The planning process involved economic analysis; research; documentation of cluster-related initiatives and resources; cluster stakeholder meetings which were co-convened with many partners throughout the Valley; meetings and ongoing consultation with partners, cluster leaders, subject area experts, state and federal agencies, and Partnership Board members; and review of cluster innovation models. 1 http://www.eda.gov/AboutEDA/RIC/ SJV Regional Industry Cluster Action Plan | ADE | Applied Development Economics P a g e | 2 Appendix F IMPORTANCE OF THE CLUSTERS The San Joaquin Valley is an economic powerhouse. Recent estimates place the Gross Domestic Product (GDP) of the Valley at $140 billion, and total industry production including intermediate and final goods at $228.6 billion in 2010. 2 ADE analyzed the Valley’s major economic sectors and validated that the five original New Valley clusters continue to be the shared priorities across the region, although they have been adapted or expanded upon through the value chain concept. Each cluster contains several “components,” each with sets of industries that comprise the value chain. For example, the Agriculture Cluster includes production, processing and packaging, distribution and diverse support activities. The Health Cluster now incorporates dimensions of wellness. Two clusters have been added – water technology and public sector infrastructure, based on their current and emerging importance and potential for the Valley. The 2012 Action Plan priority clusters are: Agriculture Energy Health and Wellness Logistics Manufacturing (which is connected to all of the clusters) Water Technology Public Sector Infrastructure (Construction) The analysis indicates that as of 2010, these clusters (with the exception of public sector infrastructure, for which information was provided in a separate analysis sponsored by the Central California Workforce Collaborative) represent about 41 percent of total employment in the region, but during the 2001-2010 period were responsible for 73 percent of private sector job growth, as shown below. Source: IMPLAN CEW, ADE 2 GDP obtained from Center for Continuing Study of the California Economy, Numbers in the News, September 2012. Industry output calculated by ADE from the IMPLAN3 input-output model used for the cluster analysis. SJV Regional Industry Cluster Action Plan | ADE | Applied Development Economics P a g e | 3 Appendix F CAPTURING THE “VALUE CHAIN” Even in clusters where the Valley has comparative advantage, such as agriculture and logistics, the Valley is not capturing the “value chain” – where value is added along the continuum of economic activity within the components of a cluster. Instead, goods flow out of the Valley where value is added later, and businesses and industries that buy goods and services from other businesses are buying a significant share of those goods and services outside the Valley, representing a leakage of economic potential. This report documents other kinds of leakage that occur as well, including skilled workers who commute to jobs located outside of the Valley; jobs within the Valley going to workers who live outside of the Valley; and loss of innovation. This loss of innovation is related to intellectual capital (inventions, patents, etc.) leaving the Valley in pursuit of investment capital or a more supportive entrepreneurial environment, including for specialized research and development, legal and business services. Source: ADE SJV Regional Industry Cluster Action Plan | ADE | Applied Development Economics P a g e | 4 Appendix F The cluster analysis identified areas of potential growth across the Valley and for the eight counties based on trends in size of the clusters; rates of employment growth, especially in specific cluster “components” or industry groupings; concentration in the Valley compared to the state; and rate of growth compared to the state’s rate. This information provides insight into the region’s areas of comparative advantage. The analysis also identified trade flows indicators – output of goods and services produced by each cluster, and leakage outside of the Valley based on business-to-business supplier inputs of goods and services in 2010. Regional demand for each cluster’s goods and services by non-cluster-related consumers (households, institutions and other businesses) also was estimated. The leakage analysis was conducted for individual clusters, resulting in a potential list of economic development targets for business expansion, start-ups and attraction to meet these gaps. The findings were reviewed at several industry cluster meetings convened by OCED and ADE along with partners across the Valley, and have been validated as a high priority for implementation action. ADE also aggregated these estimates of leakage by commodity type across the clusters to identify those with high levels of leakgage, further screening them for business types that realistically could be developed in the region. The table below summarizes the potential economic development targets by type of commodity supplied from outside the region and the estimated level of “leakage” – and therefore market support – for new or expanded businesses. The gaps are very large in some commodity areas. AGGREGATED ECONOMIC DEVELOPMENT LEAKAGE TARGETS Description Market Support Lessors of nonfinancial intangible assets $712,685,000 Scientific research and development services $699,203,000 Paper mills $611,657,000 Oilseed farming $457,940,000 Other basic organic chemical manufacturing $395,251,000 Petrochemical manufacturing $388,308,000 Artificial and synthetic fibers and filaments manufacturing $385,175,000 Software publishers $375,381,000 Plastics material and resin manufacturing $363,584,000 Automotive equipment rental and leasing $336,797,000 Plastics bottle manufacturing $336,107,000 Management, scientific, and technical consulting services $323,597,000 Aluminum product manufacturing from purchased aluminum $303,463,000 Advertising and related services $284,775,000 Paperboard Mills $257,934,000 Other plastics product manufacturing $244,702,000 Semiconductor and related device manufacturing $241,775,000 Metal can, box, and other metal container (light gauge) manufacturing $222,663,000 Plastics packaging materials and unlaminated film and sheet manufacturing $220,031,000 Motor vehicle parts manufacturing $212,772,000 All other chemical product and preparation manufacturing $169,215,000 All other basic inorganic chemical manufacturing $166,139,000 Architectural, engineering, and related services $165,780,000 Source: IMPLAN 3 I-O Model, ADE SJV Regional Industry Cluster Action Plan | ADE | Applied Development Economics P a g e | 5 Appendix F “Lessors of nonfinancial intangible assets” was the largest category shown. Activities in this industry include brand name licensing; franchising agreements, leasing, selling or licensing; oil royalty companies; oil royalty leasing; industrial design licensing; patent buying and licensing; patent leasing; and trademark licensing. This industry represents specialization of business services, including legal expertise, which is sought outside of the Valley. “Scientific research and development services” was the next largest market gap. Combined with management, scientific and consulting services, these industries provide another professional services target for developing specialized expertise within the Valley. Research and scientific consulting services are a growth opportunity in both the Energy and Health and Wellness Clusters. Oilseed farming was the fourth largest gap and relates to the Agriculture and Energy Clusters, including as an input for biofuels. Most of the other potential targets are in manufacturing industries. The architectural, engineering, and related services industry is another potential growth area, especially with opportunities related to planned public sector infrastructure construction (estimated at more than $36 billion from 2010-2020 across several infrastructure categories). CLUSTER ACTION PLAN PRIORITIES The economic and cluster analyses and partner/stakeholder engagement process provide: 1) a platform for the evolution of the Valley’s cluster initiatives; 2) a framework to align initiatives and resources to capture value chain opportunities; and 3) articulation of the role for the Partnership and OCED for the next phase of the New Valley, including the organization of the Work Groups to lead or support the clusters. The Valley has significant assets. There are an almost overwhelming number of initiatives underway across the Valley and related to the clusters, as well as efforts that are increasingly a convergence across the clusters, such as with Agriculture, Energy and Water Technology. A great deal of leadership and expertise resides with the partners involved in these initiatives, but they are dealing with diminished resources, the very large scale of the Valley, a diversity of issues facing the clusters, and the inherent challenges of collaboration such as capacity and dedication of time. However, partners increasingly are developing the capacity to regionalize their networks and ways to engage in specific initiatives on behalf of their networks. This network-to-network process is proving to be very beneficial. The Partnership and OCED’s goal should be to connect, support and optimize these assets and initiatives. The Project planning process led to the identification of many cluster-related issues, opportunities and recommendations. The highlights are discussed in Chapter 5 and are summarized on the following page. They constitute the basis for development or refinement of cluster-specific implementation plans by the New Valley Work Groups and associated cluster leaders and partners. They are a starting point for focusing on a “few big things” in 2013 – a core set of tangible initiatives with targeted outcomes and metrics that are the platform for engagement. There is an especially strong emphasis on education and workforce initiatives, around which the Valley has been mobilizing for several years to meet critical skills gaps and provide a pathway from poverty to prosperity for workers. SJV Regional Industry Cluster Action Plan | ADE | Applied Development Economics P a g e | 6 Appendix F KEY CLUSTER ACTION PLAN PRIORITIES Cluster Issues/Opportunities Recommended Actions All 5 issue areas addressed in Regional Economic All actions have designated champions and recommended actions; Agriculture Summit Partnership & OCED are tracking progress. See www.sjvpartnership.org SJV Clean Energy Organization should be lead for cluster development Regional focus on cluster development & action plan; expand networking to connect more stakeholders coordination needed; opportunity to develop Advocate for funding for SJV Regional Energy Plan Roadmap biofuels; better define cluster components Coordinate with County Planners (CSAC) working on simpler expedited Conditional Use permits vary by county – frustrating solar permitting process throughout the state; coordinate locally for international companies willing to invest in the Coordinate with UC Solar Research Institute, CVBI, Lyles Center for Energy Valley; results in project delays or cancellations Innovation and Entrepreneurship, Central Valley Fund, Business and Increase entrepreneurial climate; need to create Entrepreneurship Center, UC Merced SBDC Regional Network, CalFOR culture of early stage investment, create dialogue & others to accelerate technology commercialization & with entrepreneurs, & encourage students to create entrepreneurship the next generation of solar technology Provide input to PUC on energy facilities sitings Leakage of energy use See Regional Economic Summit Strategy recommendations Partnership health leaders should convene high level cluster meetings Difficult to coordinate with so many initiatives across Advocate for transfers within regional network of accredited courses the Valley (C6 project is opportunity to standardize curriculum), including for Need for consistent and regionalized standards and nursing curriculum for same occupations/certificates, & for Collaborate with hospitals to unify employee competencies, translate transferability of credits from Community Colleges to to college curriculum CSUs Expand nursing residencies across the Valley; coordinate with Need to standardize residency requirements for hospitals, community colleges, universities Health nurses Advocate for Regional Industry Clusters of Opportunity (RICO) funding and Wellness Address gaps in workforce skills – need for better Expand mentoring programs information, programs to increase skill levels Coordinate with SJV Regional Broadband Consortium, employer Need to prepare for health information networks like Central Valley Health Network, WIBs, etc. for e-health technologies; expand broadband infrastructure Collaborate with Councils of Government, employers, transit agencies Need improved access to jobs and health care to develop more regional, coordinated transportation systems services in rural areas Expand Patient Navigator, Promotora and other model programs Wellness/prevention focus will increase demand for Coordinate with UC Merced Health Sciences Research Institute, CVBI, services and workers and entrepreneurship centers Additional options for goods movement needed Ensure coordination between Regional Policy Council/COGs (non-truck) (stakeholder planning process underway), SJV Air Pollution Control Logistics Foreign Trade Zones underutilized District, CCVEDC, Caltrans, Partnership Sustainable Communities Work Emissions impact air quality and health Group, railroad companies on planning/projects Issues identified at Regional Economic Summit See Regional Economic Summit Strategy recommendations Main issue for employers is workforce development Identify lead cluster partners Lack of high-level engineering jobs in the Valley, so Coordinate with C6 and California Center for Applied Competitive many students leave the region Technologies for increased training; including in skilled trades Need cross-pollination of engineering workplace Match resources of the universities to the manufacturers; connect Manufacturing skills with existing workforce internships with employers; support UCAM Need appropriate infrastructure to create new Develop a strategy to close supplier gaps products out of recycled products; waste Do policy advocacy (coordinated by REACON) on increase markets for commodities being shipped overseas recycling in California (Recycling BIN – Build Infrastructure Now) Broaden focus of R&D to address diverse water supply and quality Demand for clean water, sustainable water resources issues across an increased range of industries; coordinate with WET Water & infrastructure is creating new business Center, Lyles College of Engineering, CVBI & other partners Technology opportunities beyond agriculture Focus on growth of specific technologies (BlueTech Valley) Issues identified at Regional Economic Summit See Regional Economic Summit Strategy recommendations RJI Construction Cluster not active Implement CCWC Regional Plan as Cluster Strategy for workforce Lack of awareness regarding aggregated impact of Coordinate with Partnership to advocate for public sector Public Sector public sector investments investment/local hiring Infrastructure Updated inventory of projects & schedules needed Identify lead to update project inventory and schedule - (CCWC on ongoing basis Project) Coordinate with Regional Policy Council and SJV Economic Coordination needed with economic development Development District to link project priorities with possible funding and planning to secure project funding sources SJV Regional Industry Cluster Action Plan | ADE | Applied Development Economics P a g e | 7 Appendix F LEVERAGING COLLECTIVE IMPACT The recent conference Meeting of the Minds in Monterey, sponsored by the California Workforce Association, was framed around the concept of “Collective Impact.” Research and practice have documented early successes based on this concept, finding “that large-scale social change comes from better cross-sector coordination rather than from isolated intervention of individual organizations.”3 The California Partnership for the San Joaquin Valley and many of the regional collaboration initiatives underway across the Valley are in and of themselves innovation models. They exemplify many of the characteristics of successful collective impact initiatives: a common agenda, shared measurement systems, mutually reinforcing activities, continuous communication, and backbone support organizations. They provide a strong foundation for advancing the Cluster Action Plan priorities and charting the pathway for the Valley’s future, especially if their knowledge and expertise can be leveraged and brought to scale. They are referenced throughout the report. Concurrently, there are major new initiatives, especially at the state, federal and philanthropic levels, that are aligning with regional cluster-based economic strategies, including linking economic and workforce development from the ground up. These are catalytic initiatives and the Valley is well- positioned to contribute to and benefit from these initiatives. They also are referenced in the report and a few of the key ones are summarized as follows: “Doing What Matters for Jobs and the Economy” – an initiative of the California Community Colleges, Division of Workforce and Economic Development. Goals are to supply in-demand skills for employers, create relevant career pathways and stackable credentials, promote student success and get Californians into open jobs. The focus is on spurring job creation and bridging skills gaps in priority/emergent sectors and clusters; taking effective practices to scale; integrating and leveraging programming between funding streams; promoting metrics for students success; and removing structural barriers. This initiative is a collaboration with the California Workforce Investment Board, which is preparing the State Strategic Workforce Plan; a prioirity is supporting regional economies and Regional Industry Clusters of Opportunity (RICO). The Central Region Consortium and the Central California Community Colleges Committed to Change Initiative (C6) include the Valley’s Community Colleges which are partners in the development of the Cluster Action Plan. The C6 Initiative is supported by a major federal grant, focused on systemic changes for academic success and skills building in the areas of agriculture, energy, heatlh and manufacturing. The California Workforce Investment Board’s investment in the Valley’s RICO project is seen as a foundation for health-related cluster efforts. California Financial Opportunities Roundtable (CalFOR) – is part of a statewide initiative supporting regional industry clusters to provide jobs, entrepreneurial opportunities, business growth, and public and private sector investment in value-chain infrastructure and sustainable communities. CalFOR has developed the “Access to Capital” guide to support innovation in capital markets and provide new 3 Kania, John and Mark Kramer, “Collective Impact,” Stanford Social Innovation Review, 48, Winter 2011, p. 3. SJV Regional Industry Cluster Action Plan | ADE | Applied Development Economics P a g e | 8 Appendix F sources of investment; expansion of regional food systems; growth of biomass utilization, biofuels and renewable energies; and improved Rural-Urban collaboration. USDA Rural California is a core partner and one of the lead federal agencies in the Fresno area’s Strong Cities Strong Communities Initiative as well in many other Valley initiatives, including the San Joaquin Valley Broadband Consortium managed by OCED, development of the Valley’s “Ag Tech Cluster,” and support for “buy local/invest local” efforts. California Stewardship Network – a network of regional collaboratives throughout the State, including the California Partnership for the San Joaquin Valley, participating in the development of the California Economic Action Plan, based on priorities identified through regional economic summits and the statewide Economic Summit held in May 2012. The Action Plan is moving forward. With consideration of opportunities to leverage collective impact through the implementation of the Cluster Action Plan, the following section addresses the roles of the Partnership, OCED and the New Valley Work Groups in driving the progress and success of the Valley’s Regional Innovation Clusters for the next five years of the New Valley initiative. ROLE OF THE PARTNERSHIP Given its mission and role, how and where can the Partnership best add value at the regional level for successful on-the-ground implementation and long-term impact on the Valley’s key measures of economic, environmental and community progress? Participants in the Project planning process identified the following desired roles for the Partnership in advancing an agenda for regional prosperity: Network – Help connect the many efforts across the region that are cluster-based or support the clusters (cluster foundations such as infrastructure – including broadband, sustainable communities, financing, environmental quality, and education and workforce). Convene – Play a convening role for the bigger valley-wide issues that are not being addressed in other forums, to drive the agenda for the growth and vitality of the clusters. Integrate – Provide synergy across the region, helping to knit together the clusters, the issues and the initiatives to pursue shared priorities. Advocate – Promote and advocate regarding cluster priorities on behalf of the Valley, including the removal of barriers, elevation of regional issues and opportunities, resource needs, and networking with partners and investors outside of the region. Catalyze – Be a catalyst for collaboration and the diffusion of innovation, including through the elevation of models. The Partnership plays many of these roles already. The next step is for more intentional engagement around cluster-based economic strategy. Cluster processes are by their nature vehicles for engagement of champions, businesses, stakeholders and partners in regional strategies. During the course of the project, ADE found that awareness of the Partnership was varied. Proactive engagement of the Partnership in the implementation of the Action Plan will increase this awareness and expand its impact. SJV Regional Industry Cluster Action Plan | ADE | Applied Development Economics P a g e | 9 Appendix F This process can be guided by the Executive Committee of the Partnership. At the Partnership’s September 2012 Board meeting, Executive Committee members indicated they would convene specifically to discuss the next steps for Action Plan implementation, including the identification of a set of tangible strategic initiatives for 2013, and its role in overall implementation. Participation of individual Partnership Board members in the New Valley Work Groups, especially as OCED coordinates with the Work Groups to identify their priorities for 2013 implementation initiatives, will be most valuable, building on their expertise and leadership role provided during the Project planning process. ROLE OF OCED/NEW VALLEY WORK GROUPS One of the key elements for successful collective impact efforts is the presence of backbone support organizations. Successful collaboration requires a supporting infrastructure. This requirement is extremely important for effective cluster initiatives. As Secretariat for the Partnership, OCED plays a critical backbone role. Implementation of the Cluster Action Plan will require an increase in or realignment of existing OCED capacity to support or lead the New Valley Work Groups; continue OCED’s outreach, networking, coordination and consultation process around the cluster opportunities; and engage new partners, stakeholders and leaders in Work Group and Action Plan initiatives. The Work Groups are at varying levels of capacity and operational status; some need to be revitalized or refocused. Several of the Work Groups have updated their work plans within the past year, while others are in process of updating them. The Health and Human Services Work Group has not been active and is being reorganized by OCED as the Health and Wellness Work Group, to align with Action Plan recommendations. It will be managed by OCED during this process. OCED will continue as the lead for the San Joaquin Valley Regional Broadband Consortium (Advanced Communications Work Group) and the Housing Work Group, and will continue in its support of the other Work Groups. OCED has been discussing with partner organizations, including those which currently lead or support the Work Groups, the role they can and would like to play in Action Plan implementation. Staff will be following up with the Work Group leads and key partners to discuss specific Action Plan findings and recommendations, to see how they fit with Work Group goals and activities, and determine how OCED can support the Work Groups to integrate Action Plan recommendations into their existing scopes of work. A key OCED role will be to help connect and coordinate partners and initiatives across the Work Groups and with other major initiatives, and to be a liaison with the Partnership Executive Committee. OCED will designate a lead staff for this role. NEXT STEPS OCED has been working on implementation next steps since the summer of 2012, based on the emerging findings of the Cluster Analysis; the results of the Cluster stakeholder meetings; ongoing consultation and meetings with partners – especially economic and workforce development networks (CCVEDC, CCWC, Central Region Consortium, and C6); and connecting with new initiatives such as SJV Regional Industry Cluster Action Plan | ADE | Applied Development Economics P a g e | 10 Appendix F “Doing What Matters for Jobs and the Economy.” As noted, the Partnership’s Executive Committee will play an important role in the Project’s implementation, along with individual Board members engaged with specific clusters. OCED is working with the Committee and the Board on this process. The following is a list of recommended next steps for the Partnership and OCED to carry forward the Action Plan. Work Group Leads/Work Plans. OCED staff will meet with Work Group leads and partners to review Project findings and recommendations and alignment with existing work plans; confirm lead partners and expanded/refined roles; identify 2013 priority cluster initiatives; and support work plan updates and expanded engagement of stakeholders. OCED should convene the stakeholders from the June meeting of the 1. Manufacturing/Energy/Logistics Clusters to identify cross-cluster priorities and actions. This process will be coordinated with the Partnership’s Executive Committee. OCED should coordinate with USDA Rural Development and other champions on the implementation of the Ag Value Chain Regional Economic Summit action priorities. Health and Wellness Cluster Work Group. OCED should work with Partnership board members to convene the 2. Cluster stakeholders to identify priorities, develop the work plan around Action Plan recommendations, and drive the implementation of the work plan. Economic Development Targets. OCED is working with CCVEDC and other partners on the process to develop a strategy for the Economic Development Targets (aggregated and cluster-specific), and identify a lead for 3. implementation of the strategy. Partners should coordinate with TeamCalifornia to enhance marketing and outreach opportunities on the Valley’s cluster priorities. Economic Development/Education/Workforce Coordination. OCED should develop a process for increased, systemic linkages between economic development, education, and workforce development partners (CCVEDC, CCWC, Central Region Consortium, C6, universities) around regionalized cluster-focused issues. The partners should collaborate to seek funding support for: research to identify priority workforce gaps and occupational 4. demand; designated staff to facilitate the coordination process across the clusters and the systems; expanding the reach of innovative training programs. OCED should facilitate integrated connections with state partners such as the California Workforce Investment Board, California Labor and Workforce Development Agency, Chancellor’s Office, the Employment Training Panel, and the U.S. Dept. of Labor. Public Sector Infrastructure/Logistics. OCED should convene the CCWC, the SJV Regional Policy Council, CCVEDC, Caltrans, labor, and other partners to link the interregional goods movement planning process and 5. CCWC’s Public Sector Infrastructure Workforce Plan, including for identification of project funding priorities, funding sources for construction projects, and workforce development needs. Leverage the new Economic Development District. Work Group Coordination. OCED should convene the leadership of the New Valley Work Groups quarterly for 6. updates on their work plans, and facilitate coordination across Work Groups and initiatives on an ongoing basis. Regional/State Economic Summits. The Partnership and OCED will continue coordination with the statewide economic summit process, and align the annual outcomes of the Work Group work plans for the Valley’s next 7. regional economic summit (fall of 2013) and state-wide summit (late 2013). OCED and the Work Groups should report on the progress of the 2013 cluster initiatives at the next Regional Economic Summit. Reporting Process. OCED should develop a process to report on Cluster Action Plan activities, metrics and 8. progress to the Partnership’s Executive Committee on an ongoing basis. The growth of the clusters should be tracked as an annual metric. Communications. OCED should create a dedicated location on the Partnership’s website for the Cluster Action Plan and resource materials, building upon the Regional Economic Summit materials. It should use the Cluster 9. Action Plan implementation as a vehicle for communications about the Partnership, and as a portal to partner initiatives and resources. SJV Regional Industry Cluster Action Plan | ADE | Applied Development Economics P a g e | 11 ! Appendix G i 2012-2016 California & Metro FORECAST October 2012 EBERHARDT SCHOOL OF BUSINESS I BusinessForecasting] Center Published quarterly by the Business Forecasting Center at the University of the Pacific Eberhardt School of Business. I Copyright © 2012 Business Forecasting Center. All rights reserved. '[ i This forecast was prepared based upon assumptions reflecting the Forecasting Center's ; judgments as of the date it bears. Actual results could vary materially from the forecast. Neither the Pacific Business Forecasting Center nor The Regents of the University of the Pacific shall be held responsible as a consequence of any such variance. Unless approved by the Pacific Business Forecasting Center, the publication or distribution of this forecast and the preparation, publication or distribution of any excerpts from this forecast are prohibited. FORECAST HIGHLIGHTS Appendix G Highlights of the October 2012 California Forecast • California continues to experience a sluggish recovery. We forecast the state economy will grow an average 2.5% in 2012 and 2% in 2013, a similar pace to the first two years of recovery. Growth will accelerate above 3% in 2014 and 2015. • California unemployment rate has declined rapidly to 10.2%. We expect the improvement in the unemployment rate to slow with increased labor force growth. The state unemployment rate is not projected to remain above 9% until 2014. • Payroll jobs continue to grow at a slow, steady rate, but the state has recovered less than two of every five jobs lost in the recession. Non-farm employment is forecast to recover its pre-recession peak in the fourth quarter of2015. • Single-family housing starts will begin to rebound in 2013, with over 45,900 single family housing starts and 48,300 multi-family housing starts. By 2016, single-family housing starts could surpass 100,000 units and stabilize at a level that is about two- thirds the pre-recession peak. " • State and local government employment, including public schools, has decreased by 145,000 jobs since summer 2007. Government employment will bottom out over the next year, and ~ill only add back 66,000 jobs by the end of 2016. • 245,000 new Construction jobs are expected to be created over the next four years, which will represent about 20% of California's total non-farm job growth. Despite leading the state in job growth between 2012 and 2016, there will still be nearly 120,000 fewer Construction jobs in 2016 than before the recession. • The trend of gradual growth in Manufacturing employment is expected to reverse in 2012 with an employment loss of -0.2%. Growth is expected to return in 2013 at 0.4%. • The Health Services sector was the only private sector to experience consistent job growth throughout the recession, adding 27,500 jobs per year throughout the recession. Strong employment growth will continue in the coming years, adding over 40,000 jobs per year over the next four years. • Professional Scientific & Technical Services led all industries in job growth in 2011 and will grow strongly in 2012 with a larger 4.8% increase. Only the Admin & Support industry will post a stronger gain of 5.2%. • Despite sluggish job creation, real personal income is expected to approach and exceed its 2008 peak in the third quarter of 2012 due to stronger recovery in non-wage income and higher wage industries such as technology. UniverSity of the Pacific Business Forecasting Center 5 FORECAST SUMMARY Appendix G California Outlook Our overall forecast for the California economy remains We will sort through the effects of the election in the next little changed compared to recent forecasts. We expect a. forecast. For now, we see another year of sluggish and fourth year of sluggish, roughly 2% growth in 20l3, before inconsistent growth in 20 l3 before the recovery is able an eventual acceleration of growth above 3% in 2014 and to achieve faster growth. Most of the adjustments in this beyond. There has been much talk of how California job forecast are at the regional level. growth has outpaced the U.S. in the first half of 2012, but the state posted weak job gtowth in the 3,d quarter. Our forecast for California job growth remains in the 1.5% to The Regional Outlook 2% range for the next two years, only marginally better The San Jose and Sau Francisco areas continue to be than the U.S. Other indicators are also sending mixed California's strongest regional economies. Both areas are signals. poised to fully recover their pre-recession levels of jobs Auto sales have surged across the state this year spurred within the next few months, a full three years before the on by pent-up demand, low interest rates and growing rest of the state and four to five years sooner than most confidence. Home prices are rising again as foreclosures areas in the Central Valley. We expect Bay Area job growth ebb, but single-family housing starts remain stuck below to cool to about 2% in 2013 and subsequent years. The 30,000 for a fourth consecutive year while multi-family manufacturing component of the tech recovety has slowed construction has recovered and now exceeds single-family with falling demand for semiconductors and PCs, and homebuilding. Califurnia's export growth has slowed the'surging real estate market in some parts of the Bay significantly in recent months. State level policy uncertainty is bringing back the high cost of living that has been a looms large with the roll out of cap-and-trade, and historical constraint on regional growth. Despite a slight uncertainty over whether the election will bring a state tax slowdown, the Bay Area economy will remain strong, but it increase or mid-year spending cuts. will uot be carrying the state's economy to the extent that it has in 2011 and 2012. The uncer.tainty looming over the 2013 outloo~xtends to the national and global levels. On the cusp of :l'major 2012 has been the first year of recovery in the Valley. election, there is a continued risk of a policy induced Stockton has surprised many, with initial reports showing recession if federal lawmakers are unable to resolve the some of the fastest year to year job growth in the nation, "fiscal cliff" of automatic spending CUts and tax increases surpassing 5% in several months. Out Stockton MSA that together amount to nearly 5% of U.S. GDP. The deep forecast has been and remains strong for 2012, fueled by European recession continues to affect global economy, the enormous corrections healthcare industty project, and and rising geo-political risks in Iran aud Syria could have continued growth in the logistics and agricultural basis. economic impacts. However, we believe there is evidence that Stockton's job growth in 2012 has been over-reported in service and Real Gross State Product (% change) 2.0 2.5 2.0 2.9 3.7 3.2 Non-Farm Payroll Employment (% change) 1.0 1.8 1.6 1.7 2.1 1.9 Unemployment Rate (%) ll.8 10.7 9.8 8.8 7.5 6.5 Housing Starts (thousands) 45.6 59.8 94.2 131.9 168.9 189.5 6 California & Metro Forecast· October 2012 FORECAST SUMMARY Appendix G Table 2. Central Valley Metro Forecast Summary Metro Area Nonfarm Payroll Employment (% change) Unemployment Rate (%) 2011 2012 2013 2014 2015 2011 2012 2013 2014 2015 Sacramento -1.0 1.3 1.6 1.7 2.3 11.9 10.6 9.8 9.0 7.9 Stockton -1.0 3.1 1.5 1.8 2.4 16.8 15.2 14.8 14.1 12.7 Modesto -1.5 1.2 2.3 1.7 2.0 16.8 15.6 14.9 13.8 12.7 Merced 0.6 0.2 2.9 2.9 2.3 18.3 17.6 16.8 15.9 14.6 Fresno 0.2 1.6 1.7 1.9 2.2 16.6 15.4 14.9 14.2 12.8 California 1.0 1.8 1.6 1.7 2.1 11.8 10.7 9.8 8.8 7.5 NOTE: Sacramento MSA includes Sacramento, EI Dorado, Placer, and Yolo counties. Stockton, Merced, Fresno and Modesto MSAs correspond to San Joaquin, Merced, Fresno and Stanislaus counties. Table 3. Bay Area Metro Forecast Summary Metro Area Nonfarm Payroll Employment (% change) Unemployment Rate (%) 2011 2012 2013 2014 2015 2011 2012 2013 2014 2015 San Francisco 1.8 3.4 2.0 1.4 1.7 8.2 7.0 6.1 5.1 4.2 San Jose 2.8 3.6 2.1 2.0 2.5 4l.9 8.5 7.7 6.8 5.5 Oakland 0.0 2.0 1.9 1.9 2.3 10.], 9.1 8.4 7.6 6.4 Santa Cruz 1.3 3.0 1.2 1.2 1.9 12.1 11.1 10.6 10.0 9.0 Vallejo 0.6 1.8 1.3 1.7 2.2 11.4 10.2 9.4 8.6 7.5 California 1.0 1.8 1.6 1.7 2.1 11.8 10.7 9.8 8.8 7.5 NOTE: San Francisco MSA includes San Francisco, Marin and San Mateo counties. Oakland MSA includes Contra Costa and Alameda counties. San Jose MSA includes Santa Clara and San Benito counties. Vallejo and Santa Cruz MSAs correspond to Solano and Santa Cruz counties. manufacturing and have lowered our forecast for 2012 job losses headlined by the closure of Campbell's soup offset a growth from 4% to 3%, and forecast Stockton area job Sutter Health's planned expansion through a new regional growth to slow to the 1.5-2.0% pace for the next two years. administrative center ina former HP faciliry in Roseville. In contrast, we have raised our dismal previous forecasts Alternative Employment Data Presents for Modesto and Merced in response to better employment Different View ofSome Metro Areas reported through unemployment tax filings as discussed below. Combined with the anticipated launch of high-speed Forecasting local economies can be challenging due to rail construction in late 2013 and continued growth at UC limited data. A weather forecaster can accurately observe Merced, the small Merced MSA could potentially lead the current conditions, but it generally takes a year or two for Valley in job growth in 2013 and 2014 even as it continues hard, reliable numbers on detailed local economic data to have the region's highest unemployment rate. like jobs, income, output and retail sales to be developed. Regional forecasters rely heavily on monthly employment Hard-hit Sacramento also joined the recovery with a estimates from EDD and BLS for current data, but projected 1.3% gain in employment in 2012. We expect recognize that this monthly data rely on surveys with Sacramento's recovery to remain slow, with job growth relatively small sample sizes, especially for smaller metro remaining below 2% in 2013 and 2014, even as its real areas, until the data is ultimately benchmarked to full estate market improves. Regardless of the outcome of the tax records once a year. Data from two more reliable, but Governor's tax initiative, Sacramento's public employment lagging, government sources are now available for 2011 and base is unlikely to grow in coming years, and its limited present a somewhat different view of the job market in some non-housing private sector base has seen some high-profile of the metro areas we track. University of the Pacific Business Forecasting C..enter 7 FORECAST SUMMARY Appendix G unemployment rates in Table 4. Unemployment Rate Comparisons between the American Community Survey (ACS) and the official estimates from the Bureau of Labor Statistics and California Employment Development the ACS survey, only Department (BLS/EDD). Statistically significant differences in bold italics. 8.4% in 2011, than in the official EDD/BLS 2011 2011 ACS 2011 diff 2010 diff 2009 diff EDDjBLS estimates. Santa Cruz 8.4 12.1 -3.7 -2.8 -1.6 Second, the Quarterly Fresno 16.1 16.6 -0.5 -1.6 -2.1 Census of Employment and Wages, based Merced 17.6 18.3 -0.7 -0.7 -0.6 on a full census of Modesto 18.2 16.8 1.4 -0.3 -0.1 unemployment tax San Jose 10.2 9.9 0.3 0 -0.5 filings, was released Stockton 18 16.8 1.2 0.1 0.1 in September through SF-Oakland 9.7 9.4 0.3 0.4 0 the County level for 2012. The QCEW lags Sacramento 14.1 11.9 2.2 1.2 0.9 behind the monthly Vallejo 13.1 11.4 1.7 1.3 0.4 official EDD/BLS employment estimates because it is based on Table 5. Percentage change In employment from March 2011 to March 2012 for Central Valley metro areas as reported In the Quarterly Census more comprehensive data from tax filings. of Employment and Wages, and the Initial monthly estimates reported by It is used to revise the official EDD/BLS California EDD. series each winter. Table 5 compares the new EDD change QCEW data to initial ED D estimates in QCEW change (% preliminary) the Central Valley, where some significant Fresno 1.4 0.9 discrepancies suggest recent job growth may be somewhat different than the initial Merced 2.5 ·0.7 reports. In particular, preliminary EDD data. Modesto 1.5 -1.7 reported continuing job loss in Modesto, Stockton 1.2 4.0 Merced and Sacramento from March 2011 Sacramento 1.7 '~>l\ -0.1 to 2012, whereas the new QCEW numbers show modest job growth in line with an initial period of recovery. In contrast, it First, the Census Bureau released the results of the 2011 appears that the surprisingly high job growth initially American Community Survey (ACS) which gives an reported for Stockton in 2012 will be less impressive than alternative measure of unemployment rates based on a larger early reports. These discrepancies illustrate the challenge sample size for small metro areas than the EDD/BLS series. in forecasting employment in smaller metro areas from the Table 4 compares the two unemployment estimates fotour initial monthly employment reports. We have incorporated forecast metro areas. For the state of California overall, this new data into our forecast, revising down the 2012 job the ACS reported a 12.3% unemployment rate in 2011, growth forecast for Stockton while revising up the outlook 0.5 percentage points higher than the EDDIBLS estimate in Modesto and Merced which reduces the divergence seen of 11.8%. For areas in the Central Valley, the difference between these neighboring and similar areas. between ACS and EDD was typically much higher, especially in Sacramento where the 2011 unemployment rate Stockton's Bankruptcy Case Continues was estimated at 14.1%, more than two percentage points higher than the BLS/EDD data. This higher unemployment With so much written and said about the City of Stockton's rate for Sacramento seems plausible, as we have been .- bankruptcy, it's hard to believe that the case is still in somewhat surprised that the official unemployment rate in the eligibility stage. Some creditors, particularly bond Sacramento did not rise even higher through the recession insurance companies, are challenging the City's eligibility given the over 10% loss in Sacramento payroll jobs during for bankruptcy, and it will be next year before eligibility the recession. The ACS survey put Stockton and Modesto is settled. We expect the City will be found eligible for MSA unemployment rates at 18% in 2011, over a full bankruptcy protection, but the antagonistic approach of the percentage point higher than EDD/BLS. In contrast, creditors and precedent setting narure of the case mean that the Santa Cruz area has conSistently shown much lower it will be years before Stockton emerges from bankruptcy 8 California & Metro Forecast· October 2012 FORECAST SUMMARY Appendix G protection with a plan of adjustment. would see the cost of its pensions make a large short-tun jump, the opposite of what it needs in banktuptcy. If its In previous issues of the forecast, we have discussed some CalPers plan was terminated, the City could ironically end of Stockton's financial problems including the downturn up paying more in the short-run, even if it substantially cut in revenues from the recession, unsustainable employee pensions. contracts that led to excessive salaries, unfunded retiree healthcare liabilities, and an enormous amount of debt, This problem with cutting CalPers payments highlights mostly bonds issued over the past decade for a variety of a key reason why the City targeted the retiree healthcare purposes. Although growing pension costs are a major obligation for complete elimination. The City's proposal component of excessive employee compensation, we have to eliminate retiree healthcare is an over $400 million loss not said much about the City's pensions, with the exception to retirees and current employees, the same group that of the ill-timed pension bonds that lost millions in a would be ultimately hurt by the CalPers cut. Thus, the City risky stock market bet. The insurers of those bonds are is using the large cut to retiree healthcare to argue that now insisting that Stockton severely cut pensions for its f' leaving CalPers unchanged is not inequitable since both employees and retirees (by cutting payments to CalPers) are post-retirement benefits for present and past employees. and pay their pension bonds in full. As discussed in the Targeting retiree healthcare over CalPers clearly makes previous forecast, we believe the bond insurers argument is legal and financial sense for Stockton, although it is an weak since the bond underwriters sold the pension bonds inequitable lump-sum cut for retirees who vary substantially specifically as a low-risk financial strategy that would in their financial dependence on the retiree healthcare eliminate the need for Stockton to cut pensions, and benefit. virtually all the City's unsustainable contracts, debt, and real estate downturn were in full view when they insured An October 2 letter to the editor in the Wall Street Journal, the risky pension bonds in 2007. written iI"'{esponse to a September 28 op-ed by city manager Bilb Deis, makes a similar point on the problem of The City's bond creditors aren't alone in wanting Stockton cutting CalPers. to more aggressively target pensions, specifically CalPers, in bankruptcy. Many observers, correctly, see a growing Mr- Deis says that pension benefits cannot be cut during pension crisis squeezing local governments across the state bankruptcy because that would lead to an exodus of and nation, and would like to see the largest municipal . police officers and senior management. But perhaps the bankruptcy case in U.S. histoty force concessions from real reason that Stockton has chosen not to cut pensions CalPers that could possibly be a precedent for other cities is that, ironically, it cannot afford to, That's because and increase the pressure for comprehensive pension cutting would trigger a takeover of pension obligations reforms. While we agree that pension reforms would by the California Public Employees' Retirement System immensely help Stockton and other cities, it is hard to see (CaIPers) and, under California law, Stockton would be how cutting CalPers payments could Significantly help required to pay CalPers a lump sum to cover unfunded Stockton's near term financial challenges and emerge from liabilities. The kicker is, those liabilities would get repriced bankruptcy. at a 3.8% discount rate, instead of the 7,5% discount rate that CalPers normally uses for pricing liabilities, So To see this, you have to recognize that the main purpose Stockton, already struggling with what it perceives to of bankruptcy is to resttucture debt and other long-term be hundreds of millions of dollars of unfunded pension liabilities, and compare that to the root cause of the pension liabilities, would face a demand by CalPers for a much crisis. In large part, the pension crisis results from CalPers larger amount if it tries to cut pensions, and other public pension funds allowing cities like Stockton to contribute too little each year to fund their pension In other words, Stockton is trapped in CalPers's game liabilities, primarily by using optimistic assumptions of of kick the can down the road. Stay in the game, and it future investment returns. gets to use CalPers's rosy investment assumptions to If Stockton missed its payments to CalPers, CalPers would underfund its pension obligations, passing the true cost terminate the City's plan, and place its investments in a to future generations. Quit the game, and it's stuck paying special account. This would not eliminate the City's pension the true cost now. liability to its retirees, but the City would no longer be Michael J. Sabin allowed to fund those liabilities using CalPers optimistic assumptions. Forced to fund the pension liability without Sunnyvale, Calif. the assistance of CalPers actuarial assumptions, the City University of the Pacific Business Forecasting Center 9 • Appendix H The Economic Impact of Wine and Grapes in Lodi 2009 Prepared for the Lodi District Grape Growers Association and the Lodi Winegrape Commission May 2009 A STONEBRIDGE RESEARCH REPORT Copyright ©2009 Stonebridge Research Group™ LLC 550 Gateway Drive, Suite 100, Napa, CA 94558 www.stonebridgeresearch.com All rights reserved. No part of this publication may be reproduced, stored or transmitted in any form or by any means without the prior written permission of Stonebridge Research Group LLC. Appendix H HIGHLIGHTS FULL ECONOMIC IMPACT OF LODI WINE AND GRAPES IN LODI REGION $5 BILLION ECONOMIC IMPACT Number of Operating Wineries¹ 75 Number of Grape Growers 750 Vineyard Acreage 100,000 Vineyard Acres Full-time Equivalent Jobs 14,900 Wages Paid $493 million Cases of Lodi Appellation Wine Produced 39.7 million (9L equivalents) Wine Related Tourism Expenditures $409.5 million Number of Wine Related Visits 2 million $155 million CA and Local Taxes Paid $170 million Federal Charitable Contributions² $35 million ¹From the Alcohol and Tobacco Tax and Trade Bureauʼs list of Wine Producers and Blenders ²Our surveys indicate that winery charitable contributions average 1.7% of sales Economic Impact of Wine and Grapes in Lodi 2009 page 2 of 9 Appendix H Executive Summary The Lodi region has a growing reputation for quality wines. Though wine has been produced in the Lodi area since the 1850s, an influx of new wineries and improved viticultural practices have recently attracted more attention to the region. As detailed in Tables 1 and 2 below, Stonebridge Research Group LLC found that, in 2007, the full economic impact of the wine and vineyard sector and allied industries in the Lodi area is $5 billion. Moreover, the wine and vineyard sector is one of the area’s largest employers. The Lodi region’s wine and vineyard sector directly, and indirectly through services and products they consume or generate, provide nearly 15,000 jobs in the region. These jobs generate total wages of over $493 million. Moreover, the wine and vineyard sector and its related activities generate more than $325 million in taxes, conservatively estimated. This includes $155 million in State and Local taxes, and $170 million in Federal taxes. Local taxes are paid in both Sacramento and San Joaquin Counties. There are currently 75 wineries in the Lodi area, employing over 1,300 workers. This is up from about 900 employed in 2001. In 1991, there were only eight wineries in the region, five of which were high volume production facilities. In addition to the area’s large wineries, more smaller production boutique wineries and mid-sized wineries have recently appeared in the area. Total winery revenue from sales of wine produced in the Lodi region exceeds $2 billion. In addition, several well known brands purchase grapes from the Lodi area to process elsewhere. The Lodi Appellation, which was approved by the federal government in 1986, now includes seven sub-appellations. Approved in August 2006, these sub-appellations include the Alta Mesa AVA, Borden Ranch AVA, Clements Hills AVA, Cosumnes River AVA, Jahant AVA, Mokelumne River AVA, and Sloughouse AVA. Each sub-appellation has a unique soil and climate, creating distinct aromas and flavors. The Lodi district leads all other California districts in the production of several varietals, including Cabernet Sauvignon, Merlot, Chardonnay, Sauvignon Blanc, and Zinfandel. However, Lodi’s Zinfandel reigns supreme. The soil and climate in the Lodi district are perfect for the production of Zinfandel grapes, and the varietal has long been produced in the area. Several Zinfandel wines are produced from single vineyards, with old vines dating back over a hundred years. Economic Impact of Wine and Grapes in Lodi 2009 page 3 of 9 Appendix H There are currently 100,000 vineyard acres in the Lodi region, farmed by 750 grape growers, employing over 3,800 vineyard workers, with 80% of the acreage located in San Joaquin County, and 20% in Sacramento County. The grapes grown in the Lodi region account for 86% of total winegrape production in San Joaquin County and 78% of total winegrape production in Sacramento County. Winegrape production in the area makes up more than 18% of statewide production. Since the early 1990s, winegrape production has remained steady while statewide production has been highly variable, as shown in Figure 1 below, and the Lodi region has consistently seen an increase in tons of grapes crushed. Figure 1: Tons of Grapes Crushed in Lodi Region and Statewide, 1991-2007 Lodi Region Statewide 4,000,000 3,000,000 2,000,000 1,000,000 0 1991 1993 1995 1997 1999 2001 2003 2005 2007 Source: National Agricultural Statistics Service Crush Reports, 1991-2007 Winery tourism makes up over 80% of all tourism to the Lodi area, for a total of 2 million wine related visits each year. Tourism impacts several different industries, from wineries to hotels and restaurants, and is a vital facet of the local economy. WInery tourism contributes nearly 700 jobs to the region, for a total of over $17.7 million in wages paid and almost $410 million in wine related tourism expenditures. Additionally, wine tourism related spending has steadily increased over the past fifteen years, suggesting that the branding of the Lodi region has helped to increase consumer awareness of the high quality wines produced in the area. Since 1992, wine related tourism expenditures have increased 88% from around $218 million. Economic Impact of Wine and Grapes in Lodi 2009 page 4 of 9 Appendix H As indicated in Table 2, Lodi winegrape prices have remained stable since at least 2000, with total crop value increasing with production. Figure 2: Tons Crushed and Value Per Ton, 2000-2007 Tons Crushed (in thousands) Value Per Ton (in $) 800 600 400 200 0 2000 2001 2002 2003 2004 2005 2006 2007 Source: National Agricultural Statistics Service Crush Reports, 2000-2007 and San Joaquin and Sacramento County Agricultural Commissioner’s Reports. 2001-2007 However, Lodi’s strong reputation for quality combined with value positions the region extremely well in the current economic climate. Economic Impact of Wine and Grapes in Lodi 2009 page 5 of 9 Appendix H Table 1: 2006 Total Economic Impact (Sum of Total Spending) of Lodi Wine and Grapes LODI Revenue Winery Sales $ 1,654,414,834 Winery Direct Sales $ 403,754,613 Distributors Sales $ 8,275,570 Retail and Restaurant Wine Sales $ 28,300,121 Wine Grapes Sales $ 233,114,673 Tourism $ 409,497,600 Tax Revenues - State & Local $ 155,009,077 Tax Revenues - Federal $ 169,792,284 Financing Revenues - Debt $ 145,244,050 Vineyard Development/Management - $ 200,600,000 Overhead Vineyard Development - Materials $ 94,600,000 (excluding vines) Wine Labels $ 912,838 Grapevines $ 544,671 Trucking $ 11,580,735 Charitable Contributions $ 34,988,872 Winery Construction and Engineering $ 19,498,618 Wine Labs $ 676,969 Grapevine Assessments $ 1,800,000 Professional Services $ 26,336,513 Indirect (IMPLAN) $ 466,359,908 Induced (IMPLAN) $ 441,978,647 Total Revenue $ 4,507,280,593 Wages Winery Employees $ 42,052,760 Vineyard Employees $ 77,975,720 Tourism $ 17,759,114 Vineyard Development $ 35,295,000 Vineyard Materials $ 420,000 Labels $ 275,000 Grapevines/Nurseries $ 312,000 Retail/Liquor/Grocery Stores - Wine $ 3,118,800 Specific Restaurant Wages - Wine Specific $ 3,367,520 Economic Impact of Wine and Grapes in Lodi 2009 page 6 of 9 Appendix H LODI Trucking $ 4,003,788 Winery Construction and Engineering $ 3,899,724 Wine Labs $ 120,000 Professional Services $ 2,371,374 Indirect (IMPLAN) $ 158,254,807 Induced (IMPLAN) $ 144,169,381 Total Wages $ 493,394,988 Total $ 5,000,675,581 Source: Stonebridge Research Group LLC and IMPLAN Table 2: 2006 Total Employment: Lodi Wine, Grapes and Allied Industries EMPLOYMENT LODI Winery 1,359 Vineyard 3,844 Tourism 698 Vineyard Development 1,875 Vineyard Materials 14 Distributor 1 Labels 5 Grapevine Nurseries 10 Retail/Liquor/Grocery 105 Restaurants 230 Trucking 175 Winery Construction/Engineering 130 Wine Labs 2 Professional Services 95 Indirect (IMPLAN) 3,186 Induced (IMPLAN) 3,259 Total 14,988 Source: Stonebridge Research Group LLC and IMPLAN Economic Impact of Wine and Grapes in Lodi 2009 page 7 of 9 Appendix H Methodology To produce this assessment, Stonebridge Research Group LLC focused on the largest and most significant section of the industry involved in wine production and consumption, grape cultivation and allied industries - distribution, tourism, and equipment and suppliers. Other economic benefits, including tax revenues, financing, charitable contributions and other indirect and induced benefits generated by the wine industry are also summarized. Direct, Indirect and Induced Effects (IMPLAN) Much like dropping a rock into a pond, the wine industry has ripple effects on Lodi’s economy. Economic impact studies estimate the impact of an industry in a defined geographical area by identifying and measuring specific concrete economic “events.” The events tracked in this report are jobs by industry code. IMPLAN is the acronym for “IMpact analysis for PLANing.” IMPLAN is a well established and widely used economic model that uses input-output analyses and tables for over 500 industries to estimate regional and industry-specific economic impacts of a specific industry. Thus, the full economic impact of California wine, as shown in Table 1, combines the Crush District 11’s wine industry’s direct, indirect and induced economic effects as measure by the application of the IMPLAN model to the employment data presented in Table 2 this report. The IMPLAN model and its structure are updated annually to reflect changes in the US economy, in wages, in productivity assumptions and in regional economic structures. Thus, readers should not try to directly compare the IMPLAN results from the first report with the results of this update. The IMPLAN model and methodology classifies these effects into three categories, as defined below: Direct Effects, Indirect Effects, and Induced Effects. Direct Effects Direct effects are economic changes in industries directly associated with the product’s final demand. This, direct effects in this case consider the direct employment and spending of wineries, vineyards, distributors, and immediately allied industries, data on which Stonebridge Research Group LLC collected through primary research. Indirect Effects Economic Impact of Wine and Grapes in Lodi 2009 page 8 of 9 Appendix H Indirect effects are economic changes - income created through job creation - in industries that supply goods and services to the directly affect industries noted above. Examples of industry effects are purchases of electricity and gasoline by wineries, of janitorial services by wine bottle manufacturers, and cash registers purchased for use in a tasting room. These may also be defined as “secondary economic exchanges.” Induced Effects Induced effects are the effects of these new workers spending their new incomes, creating a still further flow of income in their communities and a flow of new jobs and services. Examples are spending in grocery and retail stores, medical offices, insurance companies, internet providers, and other non-wine related industries by workers in industries allied to the wine industry - such as the spending by the janitor working under contract to the wine bottle manufacturer in California. These tertiary exchanges induce more jobs and incomes throughout California, based on the original economic flows from the wine industry. Measuring the Full Economic Impact of the Lodi Wine Industry Lodi’s wine industry has a “multiplier” effect, extending across the county, state, and nation in a broad network of economic benefits. The revenue derived by the wine industry becomes income for other workers and firms, who spend more money on other goods and services. Economic Impact of Wine and Grapes in Lodi 2009 page 9 of 9 SanSan JoaquinJoaquin CountyCounty BoardBoard ofof SupervisorsSupervisors MeetingMeeting March 12, 2013 Strengths/Assets of the County: Land Availability Lower Costs Pro-Business Environment 60 Miles from the Country's Strongest Economy Growing Agricultural Sector ($6.6 Billion economic impact) Skilled Commuter Labor Force Ideal Logistics Location: Rail Truck Seaport Airport Gateway to Bay Area, the Pacific, and the Far East 2 Challenges for the County: Training and Education Commuting Workforce Quality-of-Life Inadequate Infrastructure 3 4 c Business, University of the Pacifi Business,University of Forecasting, Eberhardt School of of Forecasting, Eberhardt School continued Tom Pogue, Associate Director, Associate Tom Pogue, BusinessDirector, Source UOP Jan 3, Jan 2013 3, Source UOP Challenges – Challenges – continued 5 Key Recommendations: 1. Economic Development Focus 2. Economic Development Marketing 3. Business Climate/Talent 4. Site and Infrastructure 6 Key Recommendations: 5. Entrepreneurship 6. Tourism 7. Quality-of-Life 8. Education & Workforce Development 7 What is Happening in Silicon Valley? Job Market Growth Reliance on Foreign Born Talent Start Ups Increasing Space Limited Pressure on Adjacent Areas 8 Recommendations: Approve the San Joaquin County Economic Development Vision and Implementation Plan Direct the County Administrator and affected County departments to initiate implementation of the 8 key recommendations. 9 San Joaquin County Uniquely Positioned for the Next Economic Cycle http://inhabitat.com/wp-content/blogs.dir/1/files/2012/03/apple-campus-spaceship.jpg 10