June 2006 PIONEER Timothy W. Brennan, Executive Director VALLEY 26 Central Street - Suite 34, West Springfield Massachusetts 01089-2787 PLANNING Te l.: (413) 781-6045 PVPCCOMMISSION Fax: (413) 732-2593 www.pvpc.org July 1, 2006 Paul M. Raetsch, Regional Director U.S. Department of Commerce Economic Development Administration (EDA) The Curtis Center, Suite 140 Independence Square West Philadelphia, PA 19106 Attention: William Good Reference: Submittal of Final Year 2006 Comprehensive Economic Development Strategy (CEDS) Annual Update Report for the Pioneer Valley Region of Massachusetts Dear Mr. Raetsch: I have enclosed, for EDA’s review and approval, the final version of our region’s Year 2006 CEDS Annual Update Report, which was recommended to the Planning Commission for adoption by the Plan for Progress Coordinating Council and the Pioneer Valley Economic Development District Planning Cabinet. This new CEDS Annual Report was, in turn, reviewed and formally adopted by a vote of the Pioneer Valley Planning Commission (PVPC) Executive Committee at a regular meeting held on June 29, 2006. The enclosed 2006 CEDS Annual Report presents an overall update on the current economic conditions of the Pioneer Valley region, summarizes the current status of the action strategies that constitute the core of the Plan for Progress, presents an updated priority-ranked listing of potential projects from our region that are most likely to seek EDA financial assistance in Federal Fiscal Year (FFY) 2007, and provides a series of attachments that are designed to highlight the most significant EDA-supported planning activities and projects that have been completed or initiated over the past year. I trust you will find that we’ve continued our efforts to improve the format, organization, and content of this very important planning document. With respect to the Year 2006 CEDS Projects Listing, which is a key component of our 2006 CEDS document, I need to underscore that three proposed EDA projects – two located in Springfield and one located in the City of Northampton – have been assigned our region’s highest priority rankings as part of the process leading up to the June 29th adoption of this 2006 CEDS document. After carefully evaluating all the submissions we received from PVPC member communities, these two projects were all deemed regionally significant. All these project proposals, along with their local and regional priority rankings, can be found annotated in our region’s new 2006 CEDS document. Paul Raetsch, Regional Director July 1, 2006 Page 2 For the record, please take note that the enclosed 2006 CEDS Annual Update Report is the eighth we have prepared and submitted to EDA since our region was designated by EDA as an official Economic Development District (EDD) in fall of 1999. Accordingly, we have done our best to respond to the needs of this region’s EDD and hope this report helps to substantiate that we are continuing to make progress and are using our EDA-funded planning process to the advantage of the region and its local cities and towns. Similarly, we are especially proud of the progress that has been made over the past year on several Plan for Progress strategy initiatives including, the creation of the Regional Technology Corporation, the continuing evolution of the interstate Hartford-Springfield Economic Partnership, and business retention programs coordinated by the Economic Development Council of Western Massachusetts, among others. Moreover, we are convinced that our EDD designation continues to strengthen our region’s overall economic development planning capabilities, and we look forward to continuing a strong record of performance, progress, and achievement over the upcoming 2006-2007 time frame. I trust you will find the enclosed 2006 CEDS Annual Update Report complete and satisfactory. If, however, you should have questions or need additional information, please do not hesitate to contact Executive Director Tim Brennan at the Planning Commission’s telephone number, which is listed above. On behalf of the Plan for Progress and the Pioneer Valley Planning Commission, as well as all those who have benefited from the assistance, guidance, and support provided by EDA, I once again I want to extend our sincere thanks for continuing EDA’s interest and support of our efforts here in the Pioneer Valley. We believe it has led to another year of solid progress here in the Pioneer Valley and look forward to EDA’s review and approval of the enclosed 2006 CEDS Annual Update Report. Sincerely, Henry A. Barton, Chairman Pioneer Valley Planning Commission and Economic Development District Pioneer Valley Comprehensive Economic Development Strategy (CEDS) Annual Report June 2006 Prepared by Pioneer Valley Planning Commission 26 Central Street West Springfield, MA 01089 Funding for this project was provided in part through an EDA Section 203(a) Urban Planning Assistance Grant awarded by the U.S. Department of Commerce, Economic Development Administration TABLE OF CONTENTS EXECUTIVE SUMMARY ............................................................................................................. 1 AN ANALYSIS OF REGIONAL ECONOMIC CONDITIONS...................................................... 3 A Snapshot of the Pioneer Valley Region .................................................................. 3 The State of the Pioneer Valley Region..................................................................... 4 The People ................................................................................................. 4 The Economy ............................................................................................20 The Infrastructure .......................................................................................28 Opportunities and Threats Posed by External Trends and Forces ....................................39 Availability of Partners and Resources for Economic Development ................................40 A VISION FOR THE PIONEER VALLEY REGION.................................................................... 43 Regional Goals and Objectives .............................................................................43 Cross Cutting Themes .........................................................................................44 CEDS Report Card..............................................................................................46 Appraisal of the Region’s Competitive Advantage ......................................................66 AN ACTION PLAN FOR THE REGIONAL ECONOMY ........................................................... 67 Investment Priorities Linked to the Pioneer Valley Region’s Economic Development Planning Process ...............................................................................................67 Market-Based Investment..............................................................................68 Proactive Investment ...................................................................................68 Future-Focused and Diversified Investment .......................................................69 Maximizing Private Sector Investment .............................................................69 High Probability of Success Investment ............................................................70 High Skill and High Wage Job Investment ........................................................71 Maximizing Return on Taxpayer Investment ......................................................72 2006 CEDS Projects ...........................................................................................72 The Project Proposal Process .........................................................................72 Summary of Project Proposals ........................................................................73 AN EVALUATION OF OUR PROCESS AND PERFORMANCE ................................................. 79 Process Evaluation .............................................................................................80 Method ....................................................................................................80 Results .....................................................................................................81 Performance Evaluation .......................................................................................82 Method ....................................................................................................82 Results .....................................................................................................83 APPENDIX A PROJECT PROPOSALS BY INDIVIDUAL COMMUNITIES ............................... 89 APPENDIX B PLAN FOR PROGRESS COORDINATING COUNCIL, TRUSTEES, AND URBAN INVESTMENT STRATEGY TEAM MEMBERSHIPS.............................. 131 i LIST OF FIGURES Figure 1: Percent Change in Population (2000-2005)...................................................... 4 Figure 2: Pioneer Valley Region Population Changes by Race and Ethnicity ........................ 7 Figure 3: Net Domestic Migration in the Pioneer Valley Region........................................ 7 Figure 4: Population Age Groups in the Pioneer Valley Region ......................................... 8 Figure 5: Foreign Born Persons by Year of Entry in the Pioneer Valley Region....................... 8 Figure 6: Poverty Rates for All Persons and Foreign Born Persons by Citizenship Status .......... 9 Figure 7: Per Capita Income in the Pioneer Valley