Call to Order and Roll Call
The 4th meeting of the Interim Joint Committee on Economic Development and Workforce Investment was held on Tuesday, September 12, 2017, at 1:00 PM CDT, at the Warren County Area Technology Center in Bowling Green, Kentucky. Representative Jim DeCesare called the meeting to order, and the secretary called the roll.
Present were:
Members: Representative Jim DeCesare, Co-Chair; Senators Perry B. Clark, Rick Girdler, Ernie Harris, Jimmy Higdon, Stephen Meredith, Wil Schroder, and Reginald Thomas; Representatives Lynn Bechler, McKenzie Cantrell, Daniel Elliott, Al Gentry, Joni L. Jenkins, James Kay, Kim King, Jerry T. Miller, C. Wesley Morgan, Jason Nemes, Jason Petrie, Phillip Pratt, Steve Riley, Rob Rothenburger, Wilson Stone, Russell Webber, and Addia Wuchner.
Guests: Mike Buchanon, Warren County Judge Executive; Bruce Wilkerson, Mayor of Bowling Green; Rob Clayton, Warren County Superintendent, Eric Keeling, Principal of the Warren County Area Technology Center; Scott Lindsay, Rafferty’s, Dr. Phillip Neal, President of Southcentral Kentucky Community and Technical College; Deputy Secretary Brad Montell, Education and Workforce Development Cabinet; John Bradley, Senior Vice President for Economic Development, Tennessee Valley Authority; Dave Tatman, Executive Director, Kentucky Automotive Industry Association; Meredith Rozanski, Chief Operating Officer, Bowling Green Chamber of Commerce; and Ron Bunch, President and Chief Executive Officer, Bowling Green Chamber of Commerce.
LRC Staff: Carla Montgomery and Andrew Manno.
Approval of Minutes
A motion to approve the minutes of the August 17, 2017 meeting was made by Representative Rob Rothenburger, seconded by Representative Jason Nemes, and approved by voice vote.
Greetings and Introductions
Judge Executive Buchanon welcomed the committee to Warren County. He noted that workforce development has been a priority of the Warren County and Bowling Green governments for many years. There has been continuing problems with attracting a qualified workforce and noted that 5,789 positions are currently open in Warren County. Mr. Buchanon indicated there has been a lot of interest from companies since the passage of the right to work referendum. He recognized Representative Jason Nemes for his help in the passage of right to work.
Mr. Buchanon indicated that workforce development in Kentucky has been unorganized in a unilateral way by agencies that do not answer to the public. He believes there should be a change in the perception that the One Stop offices are just unemployment offices when they should be career centers with multiple offices available at the one stop office. In addition, the state must follow federal requirements and foster partnerships by giving the counties the tools to do what is required.
Mayor Wilkerson welcomed the committee to Bowling Green. He stated that the best social program is a good paying job. His goal is to help provide an atmosphere for job creation in the private sector. There has been tremendous growth in Bowling Green and the goal is to continue to manage the growth. Mayor Wilkerson recognized Eric Keeling and the great work being done at the Area Technology Center (ATC) in placing students into jobs.
Mr. Clayton indicated that a trained workforce means educating our kids and that K-12 education is a foundational piece. He noted there is no greater advocate than Eric Keeling. Mr. Clayton noted a goal to expand the ATC but recognized the monetary challenge in doing so.
Dr. Keeling thanked the committee for coming to ATC. He noted that ATC strongly believes in the power of synergy and a return on investment. Regarding synergy, he noted that partnerships with local industry, Warren County Public Schools, Bowling Green Independent Schools, the Bowling Green Chamber of Commerce, and others make the success of the ATC possible. He showed a video which highlighted a race car built entirely by the students.
Dr. Keeling discussed return on investment and noted how excited the students have been in building a race car. ATC initially was flagged for a lack of placement. However, 100 percent of students are now being placed into jobs. He noted some students now earn over $20 per hour. Enrollment is up 55 percent. Welding students have achieved 100 percent AWS accreditation this year, and the ATC has won several awards.
Dr. Neal thanked the committee for supporting educators. The mission of his school is to provide the workforce of today and tomorrow. He discussed the collaboration between the Bowling Green Chamber of Commerce, the local school systems, Western Kentucky University, and local industry to increase programs such as dual credit and student transfer arrangements. He is proud of the faculty and staff of the college for building a workplace ethics program to teach “soft skills” to students as part of the classroom program.
Co-Chair Jim DeCesare recognized former state Representatives Kenny Imes and current Representatives Jody Richards and Michael Meredith and Senator Stan Humphries who were in attendance at the meeting.
Unemployment Insurance Update
Secretary Brad Montell provided the committee with an update on recent unemployment insurance (UI) changes. Secretary Hal Heiner recently announced that job centers will no longer be split between handling UI claims and job assistance. UI claims will now be filed either by phone or online. Claimants will not have to come to the office to file a claim. This will free the staff at the One Stop offices to spend a majority of time assisting with reemployment services such as career coaching, training, assisting with resumes, and helping connect workers to open jobs. Claimants can come to the One Stop office and use the phone or computer to file a claim if necessary.
Economic Development Update
Mr. Bradley showed a short video detailing the involvement of the Tennessee Valley Authority (TVA) in local communities. He explained that TVA is not just a utility but is an economic development agency. The sale of electricity allows the TVA to put money into economic development within its footprint, which covers seven states, with a main emphasis in Kentucky, Tennessee, Mississippi, Alabama and Georgia.
The mission of the TVA over its 84 years has been energy, environment, and economic development. The three parts of economic development are to attract new companies and investments, engage industries to retain what investment has previously been made, and serve the community through development and preparedness.
Mr. Bradley highlighted the creation of 5,500 jobs in the Kentucky TVA region in fiscal year 2017. In addition, there has been $1.1 billion in capital investment during that time. This is the hands-on, grassroots part of economic development. While the TVA is good at attracting and engaging industry, the economic development piece is the best part of TVA.
Mr. Bradley described the efforts being made in attracting industries to the TVA region. Product development has been a recent focus, helping communities with investment preparation, obtaining funding, and having sites in a marketable position. Many Legacy Sites, those TVA sites being repurposed, have been used to increase economic development. He noted seven recent projects in which the TVA assisted with the improvement 1,106 acres of land, 138,000 square feet of new industrial space, and invested $4.66 million. Mr. Bradley noted it was the sixth year of the product development program.
Regarding encouragement, Mr. Bradley highlighted the many incentive programs utilized by the TVA to retain existing businesses. Eight-five percent of the participants in these programs are existing businesses while the remainder is used as recruiting incentives. Investment credits, grants and loan funds are made available to help local communities finalize deals with industries. Investment credits of $26 million have been utilized in Kentucky companies in the TVA footprint, $465,000 in grants have been provided, and over $2 million in loans have been made. TVA provides about 10 percent to 20 percent of any final deal.
Mr. Bradley explained how technical assistance helps rural communities market possible sites through drawings and 3D renderings. He also noted the teamwork between TVA and its many community partners such as local power companies, the Commonwealth of Kentucky, local economic development organizations, and others which make TVA unique from a public utility model. The 54 individuals on staff at TVA have an economic development background with local and state programs which allows the TVA to operate a comprehensive economic development program.
Co-Chair Jim DeCesare recognized that the TVA has been ranked in the top ten by Site Selection Magazine as a high producing development organization. He also noted that the computer renderings allow a site to be marketed without the need of a spec building on site.
In response to Representative Jason Petrie’s question on how Kentucky compared to other states, Mr. Bradley noted that Kentucky is competitive. Right to work will have a big impact on attracting the larger projects since Kentucky will not be eliminated up front.
Responding to a question from Representative Lynn Bechler, Mr. Bradley explained how the TVA measures jobs created and jobs retained. Job creation is a new company or an expansion of an existing company. Job retention means a job kept following a competitive situation in which the company was looking to move outside of the TVA footprint.
Co-Chair Jim DeCesare thanked Mr. Bradley for TVA’s work on data center legislation.
Aluminum Industry Update
Mr. Tatman noted that aluminum is an important part of the automotive industry in Kentucky. He thanked Sen. Harris for his leadership on the metal commodities bill. He stated that the evidence of the importance of aluminum is seen throughout the Transpark in Bowling Green. Many manufactures have chosen to locate in this area but efforts must continue to maintain the growth. He noted geography, inexpensive electricity, and good transportation systems as being critical to the aluminum and automobile industries.
The most critical issue facing the industry is workforce. Qualified workers must be found. Many skilled autoworkers are nearing retirement age. The one issue that can halt continued economic development is lack of a qualified workforce. Two generations think of manufacturing as dirty, dark and dangerous. However, Mr. Tatman stated that manufacturing is not dirty, dark and dangerous but provides a great job with competitive wages and health care. A four year degree may not be the answer for all students. He also thanked the committee for its work and asked it to continue to focus on issues such as energy, infrastructure, taxes and workforce investment to assist manufacturing in Kentucky.
Co-Chair Jim DeCesare noted that nearby Constellium provides the perfect example of how manufacturing is no longer dirty, dark and dangerous.
Responding to a question from Representative Wilson Stone, Mr. Tatman indicated that, following the problem with workforce, that the tax structure must be altered to become more business friendly. He also noted that infrastructure is a current advantage for the area but needs to be maintained.
Mr. Bradley agreed with a point made by Senator Perry Clark that the aging population will be a growing workforce issue, particularly in the automobile industry. Senator Clark noted the aging workforce will require Kentucky to work toward attracting young people to our state.
SCK Launch
Ms. Rozanski noted the great synergy in Warren County toward workforce investment and economic development. She noted economic development is a team sport and that Warren County has been first in Kentucky in economic investment. She noted that the change in the One Stop centers to job reemployment centers will be critical. Only one-half of the 1,300 individuals receiving UI benefits are eligible for the many open positions as the other half are awaiting a call-back following a furlough.
Ms. Rozanski noted the efforts being made to create a talent pipeline to fill these open positions. She discussed SCK Launch, which stands for South Central Kentucky Learning About Unique and New Careers Here. The Chamber looked at the labor market data and discovered the top sectors in the local economy. She mentioned hospitality, recreation, public sector such as teachers and police, manufacturing, and healthcare as areas of emphasis. Posters were created for each sector detailing the knowledge and skills necessary, the salaries of various positions, the career pathway to obtain those positions, the education or certification required, and how to get certified. These posters are provided to schools and career centers in the Bowling Green area.
A realistic conversation with students must be made regarding what career they would like to pursue, what knowledge and skills are necessary to obtain the position, what investment in education must be made to obtain the position and the return on that investment. This was the impetus behind SCK Launch.
Ms. Rozanski indicated the goal was to best prepare kids for the future. The guiding principles are to support student-driven leadership that builds self-awareness, empowerment and a career-wise graduate, to provide students with meaningful opportunities to explore, experience and connect to build their career skills and knowledge, and to support the attainment of nationally-portable industry credentials and post-secondary courses to LAUNCH students’ future career paths.
This efforts begins in middle school with the SCK Launch Experience, a hands-on trade show which introduces students to the many career opportunities available. Students can choose a career pathway in high school and can learn through job shadowing, internships, tours of businesses, and other exposures to careers. Students also learn how to act and dress at work, how to prepare a resume and cover letter, and other necessary skills. Educators are also provided with resources to help them better prepare students in career planning.
SCK Launch also fosters student-led leadership and provided funds to help schools implement the program. Student ambassadors at each school help lead community projects and campaigns to encourage and promote others within the school community.
SCK Launch started in 2016 with 1,800 participants in Warren County. In 2017, 3,200 participants are confirmed throughout the ten county workforce area. Twenty-two educators have participated in externships in healthcare, professional service, manufacturing, and hospitality. Ms. Rozanski also noted that 120 students are enrolled in the Medical Arts Academy.
Co-Chair Jim DeCesare noted how the Bowling Green community has taken the initiative to grow its own workforce.
Representative Wilson Stone commented that the Bowling Green area is the center of a great deal of exciting economic development and he thanked everyone involved.
Responding to a question from Senator Ernie Harris, Ms. Rozanski noted that the information on the career pathways posters has been shared with state agencies. Mr. Bunch added that a report is created every month showing each open job in the area along with five-year and ten-year projections to assist educators. Ms. Rozanski noted the great partnerships with local colleges and universities and the local school systems.
Co-Chair Jim DeCesare announced that the next meeting of the committee will be on October 19, 2017 at Asbury University.
With no further business to come before the committee, the meeting was adjourned at 2:34 p.m. CDT.