Alabama’s largest county looks to continue economic development momentum
With the recent announcements of thousands of jobs coming into Jefferson County in connection with Amazon’s advanced robotics fulfillment center, DC BLOX’s data center and Shipt’s decision to keep its corporate headquarters in Birmingham, local officials are working from a playbook that has four steps, they say. It all begins with Alabama’s business climate that has been ranked as best in the United States for growth potential and workforce training by Business Facilities magazine, said Commissioner David Carrington, chair of the county’s Finance, Information Technology and Business Development Committee. The second is that Jefferson County is the economic center of the state, with the largest population and number of jobs. In 2016, companies announced they were going to create 14,500 jobs and invest $5.1 billion in Alabama. The Birmingham-Hoover metro area accounted for about 20 percent of those jobs and 25 percent of the capital investment. Jefferson County alone was responsible for 1,436 announced jobs and $506 million in capital investment. “In fact, the metro area’s gross domestic product is greater than Mobile, Montgomery and Huntsville combined,” Carrington said. “In 2017, according to the Alabama Department of Commerce, Jefferson County led the state with 2,200 new announced jobs in targeted industries.” The next step is collaboration among partners that often include the Birmingham Business Alliance (BBA), University of Alabama at Birmingham (UAB) and, if a proposed site is in a city, the city. “As in most successful projects, it was a well-coordinated community effort that led to a successful conclusion, and we’re very grateful to our partners and allies for their great work on this project,” said Lee Smith, East Region CEO for BBVA Compass and 2018 chairman of the BBA, after the area secured Amazon’s $325 million investment. “The county actively listens to the prospect’s needs and then participates in the development of an aggressive marketing plan with (those) partners,” Carrington said. Fourth, a project team is in place that “leverages our community’s assets,” Carrington said. “. . . We will talk about our enviable road and rail transportation network when talking to a distribution company; or UAB, Southern Research and Innovation Depot when talking to a STEM (science, technology, engineering and math) company; or our central, geographic proximity to Mercedes, Honda, Hyundai, Volkswagen, Kia and the soon to be open Toyota/Mazda plants when talking to an automotive supplier.” All of those steps are done under a positioning umbrella, he said. “Even if we don’t win a project, we want the company and their consultants to ‘have a good feeling’ about the community so we will be considered for a future project,” he said. Carrington pointed to the community’s Amazon HQ2 “BringAtoB” campaign. “The primary project team knew that Birmingham was at best a long shot, but, despite the odds, we put together an innovative vision and proposal for the company to consider,” he said. “While we didn’t win the headquarters, we caught Amazon’s attention and less than a year later announced an 855,000-square-foot advanced robotics fulfillment center in Bessemer.” Republished with the permission of the Alabama Newscenter.
DC BLOX building ‘flagship’ data center in Birmingham
Atlanta-based DC BLOX said today it is building a data center on the former Trinity Steel site in downtown Birmingham, creating 20 jobs initially with the potential to grow up to $785 million in capital investment and add jobs over the next decade. “The significant investment being made by DC BLOX to open this data center in Birmingham will not only create high-paying jobs, but also bring an exciting new chapter to a neighborhood in the city with a long industrial history,” Alabama Gov. Kay Ivey said. “We’re committed to positioning Alabama for a technology-focused future and look forward to working with the company to accelerate that process.” The 31,000-square-foot first phase of the multi-tenant Birmingham data center joins others DC BLOX has built or announced in Huntsville, Atlanta and Chattanooga. DC BLOX plans to break ground in August and have a facility configurable up to 5 megawatts (MW) of customer capacity by early 2019. As customers are added, the facility can grow up to 200,000 square feet and 80 MW. Plans are for the facility to have 13,000 square feet of office space with conference rooms, staging areas and work stations. “The Birmingham data center campus will unquestionably be our flagship property, capable of scaling to over 200,000 square feet of secure, government-grade data center space,” said DC BLOX CEO Jeff Uphues. “We believe this site will be a highly compelling alternative in the Southeast to Atlanta for enterprise, hyperscale cloud, software-as-a-service, government, network and content providers. It’s our focus to create a multi-purpose innovation campus with collaborative workspaces worthy of housing global technology companies and academia dedicated to research and collaboration.” DC BLOX has been scouting sites in Birmingham for nearly a year. “DC BLOX wanted to be in Birmingham because of its strong local economy, geographic location, fiber optic network connectivity and the University of Alabama at Birmingham,” said Mark Masi, COO of DC BLOX. “We are thankful to the city of Birmingham, Jefferson County and the state of Alabama for collaborating with DC BLOX on this project.” During the construction and operational phase, the project is expected to have an economic impact of $94 million on the Birmingham metropolitan area, more than $80 million of which will be in Jefferson County, according to an analysis prepared by the Center for Business and Economic Research at the Culverhouse College of Business at the University of Alabama. The Birmingham Business Alliance commissioned the analysis. Economic impact on the state is estimated to be $99 million. “Because data centers represent the backbone of the technology infrastructure, we see strategic benefits for Alabama to host state-of-the-art centers that keep the world connected,” said Alabama Commerce Secretary Greg Canfield. “DC BLOX is joining an impressive roster of technology companies selecting Alabama for their data centers, and we want to see that list grow.” Jefferson County Commissioner David Carrington predicted DC BLOX’s data center will attract future business. “DC BLOX will be a tremendous asset to the existing companies throughout Jefferson County and a tool to attract new companies here,” Carrington said. “This takes Birmingham’s thriving innovation ecosystem beyond its usual physical boundaries of the city center and extends it into an area that will only strengthen our core.” The new DC BLOX data center brings new life to the former Trinity Steel property, which county and city officials have long sought to bring back to productive use. “The city of Birmingham was proud to work with DC BLOX to bring this significant data center project to Birmingham,” said Mayor Randall Woodfin. “In addition to utilizing a long-vacant property in our city and transforming the surrounding neighborhood, this will serve as the company’s flagship data center and a tool to attract further business to the area.” The team luring DC BLOX to the site included the Alabama Department of Commerce, Jefferson County Commission, Jefferson County Economic and Industrial Development Authority, the city of Birmingham and its Department of Innovation and Economic Opportunity, Titusville Neighborhood Association, Birmingham Industrial Development Board, Alabama Power, Spire, Economic Development Partnership of Alabama and the Birmingham Business Alliance. “The $785 million investment over the next 10 years to build this data center technology campus represents the single largest project investment in Jefferson County in many years,” said Lee Smith, East Region CEO for BBVA Compass and 2018 chairman of the Birmingham Business Alliance. “DC BLOX recognizes the importance of Birmingham’s innovation and technology economy, and they share our vision that having a location near downtown will optimize the company’s growth opportunities. As with any successful economic development project, a great team worked together with the company to ensure its needs are met and that the project is mutually beneficial to the company, community and state.” Republished with the permission of the Alabama Newscenter.
Jefferson County leaders find bond market `very forgiving’ five years after bankruptcy
For localities worried about facing big bond-market penalties if they go bankrupt, consider Jefferson County. The county of 659,000 people – once the largest municipality to ever seek bankruptcy protection – has sold debt several times since emerging from court protection in 2013. Carrying an investment-grade rating of AA- in May, the county completed a refinancing of its general-obligation debt by paying yields of 2.86 percent on bonds due in 2026, just about half a percentage point above top-rated debt. “We were told our children would be destined to poverty, you were going to be the hole in the donut, you will never recuperate,” County Commissioner David Carrington said. He said the county’s bond deals have even seen strong demand from investors. “The markets are very forgiving if you have results.” Municipal-bond market analysts – and even investor Warren Buffett – have long worried that the fading stigma of bankruptcy could embolden more local governments to petition the court to cut their debts. But despite a few municipal bankruptcies in the wake of the last recession, there’s been little sign that more will follow suit. No city or town has filed for bankruptcy protection since Hillview, Kentucky, did in 2015 as a result of an adverse ruling in a contract dispute that it couldn’t afford to pay. Rather than let its capital go bankrupt, debt-strapped Connecticut agreed to pay off some of Hartford’s debts instead. While Jefferson County has gotten market access and its investment-grade rating back, the process was far from painless. Contending at the same time with revenue lost when a court struck down a key tax, it fired 1,300 employees, put off roadwork and shuttered inpatient services at its hospital that cared for the poor. To exit bankruptcy, officials agreed to raise sewer rates 8 percent annually through October 2018, followed by yearly jumps of 3.5 percent until 2053. Creditors, including JPMorgan Chase & Co., forgave $1.4 billion of debt. “You have to get to that point where there is no other alternative,” Carrington said. He said he’s been contacted by elected officials who are considering bankruptcy and has told them there is a “huge” financial burden. He said it cost the county about $1 million per month during the two years it took to get through the bankruptcy process. “Do you have the political will as a governing body to make the decisions you’re going to have to make?” he asked. Detroit, which followed Jefferson County with a bankruptcy filing in 2013, exited state financial oversight this year but still hasn’t returned to the bond market on its own. Mammoth Lakes, California, which sought bankruptcy protection in 2012 after a fight with a real estate developer, sold $24 million in investment-grade bonds in October 2017 that priced at a top yield of 4.47 percent in 2035, more than 1.8 percentage points above top-rated debt. In the years since the bankruptcy, the town has cut expenses and grown its revenues, S&P Global Ratings said. Local bankruptcies have been deterred because of the barriers to filing and the improving economy, said Henry Kevane, managing partner at law firm Pachulski Stang Ziehl & Jones LLP that specializes in such cases. Some states, including Illinois, don’t allow municipalities to file for Chapter 9, and others require permission from the governor. Still, municipalities face financial pressure points, he said. State and local governments’ unfunded pension liabilities stand at around $1.8 trillion, according to Federal Reserve data, which will require them to boost their payments into retirement funds. “Municipalities still have colossal post-employment obligations that aren’t going anywhere,” Kevane said. “I still see that becoming a real problem.” Republished with the permission of the Alabama Newscenter.
Steve Flowers: Sorting out ‘unforeseens’ in Alabama Governor’s race
Those of us who follow Alabama politics had circled June 6, 2017, as the beginning of the 2018 governor’s race. However, we did not foresee Donald Trump’s election as President in November and the subsequent appointment of our U.S. Senator, Jeff Sessions, as his Attorney General, thus, opening a U.S. Senate seat and causing the need for an unanticipated special election for the open Senate seat this year. Therefore, the race for Sessions’ Senate seat will dominate the political news for at least the next three months. This Senate seat race has pushed back the timetable for gubernatorial aspirants by about three months. The thoroughbreds who might enter the Derby for the Brass Ring of Alabama politics probably have the luxury of waiting until Labor Day or maybe after the Sept. 26 GOP runoff for U.S. Senator. However, they do need to declare by Oct. 1, because qualifying will begin in late November for next year’s June 5 Primary. Also, we did not anticipate the resignation of Gov. Robert Bentley April 10 and the ultimate elevation of Lt. Gov., Kay Ivey, to Governor. Kay Ivey has been governor for less than three months; however, she has taken to the post like a “duck to water.” She has been deliberative and decisive and looks very gubernatorial. She is slowly putting her people into Cabinet posts. Enterprise Mayor, Ken Boswell, is a good choice for ADECA Director. This is a prime post as it doles out all the Federal grants that come to the state for infrastructure projects. She has named Christopher Blankenship acting Commissioner of Conservation and Natural Resources. She has removed Serve Alabama Director Jon Mason, and Alabama Law Enforcement Agency Secretary, Stan Stabler. Her two closest advisors throughout her career have been Steve Pelham and Will Sellers. She has brought Pelham with her as her Chief of Staff. She has appointed Will Sellers to a vacant seat on the state Supreme Court. Pelham will be the most important person in state government for at least 18 months. These unforeseen events have changed the political landscape dramatically when it comes to the 2018 governor’s race. This time last year, Roy Moore and Luther Strange were two of the lead horses for governor. They are now the two frontrunners for the open Senate seat. Win or lose they are removed from the governor’s race. Kay Ivey’s elevation to governor has made her the favorite at this time. However, as this past year’s events reveal, a lot can change in a year’s time. As we assess the field with less than a year to the finish line, Kay Ivey is the linchpin of the race. She is the incumbent. She has good name identification and her age, 72, is an advantage and not a disadvantage. She looks like your grandmother. That sells better than young and glamorous, especially among female voters. They can identify and feel comfortable with Kay. Currently, Kay is in the proverbial catbird’s seat. The million-dollar question is does Kay really want to run for a full four-year term. If she were to ask me as a friend, I would tell her no. If I were her, I would not want to go through the rigors of a yearlong campaign. She can go to the house and proudly say that she was Governor of Alabama. A 20-month tenure as governor is not an insignificant amount of time. There are four significant thoroughbreds in the race, regardless of Ivey’s intentions. PSC President, Twinkle Cavanaugh, 50, is popular and well positioned. She has won three statewide races. Agriculture Commissioner, John McMillan, 75, has been at his important post for eight years. He has done an exemplary job. However, he cannot run again. He is well-liked. Huntsville Mayor, Tommy Battle, 61, will be a player in the governor’s race. He is the popular Mayor of Alabama’s economic crown jewel. Jefferson County Commissioner, David Carrington, 69, could be a factor. He has some name recognition from being seen often in the all-important Birmingham media market. If he gets strong support from the Birmingham suburbs, he could be a dark horse. Birmingham-based evangelist, Scott Dawson, 49, might catch fire. Tuscaloosa’s popular young mayor, Walt Maddox, may make the gubernatorial plunge as a Democrat. We will see. See you next week. ___ Steve Flowers is Alabama’s leading political columnist. His weekly column appears in over 60 Alabama newspapers. He served 16 years in the state Legislature. Steve may be reached at www.steveflowers.us.
Steve Flowers: Looking at the thoroughbreds in governor’s derby
The race for our open U.S. Senate seat will be the marquee political event for the remainder of this year. It will be a great show. However, we have a sensational and pivotal 2018 governor’s race evolving simultaneously. This much-anticipated gubernatorial derby will be affected by the preliminary Senate horse race. The political landscape has changed dramatically with the decisive move by new Governor Kay Ivey to call for the election of Jeff Sessions’ successor to the Senate this year. Unlike in olden days where running a preliminary statewide race was a steppingstone to getting elected four years later, in recent years, losing statewide is not good — especially if that loss has occurred within less than six months. Therefore, three or more thoroughbreds are removed from the governor’s race. One will be in the Senate and the other two will be exiled to Buck’s Pocket and will not be players in the governor’s race. You can remove Roy Moore, Luther Strange and any unknown wealthy person, who can and will spend 5 to 10 million dollars of their own money. This unknown rich man will either be Senator or gone from the scene. Roy Moore’s removal from the governor’s race is the most significant change to the gubernatorial track. His evangelical base, which probably accounts for 20-30 percent of a GOP primary vote, will be splintered among the field. As I peruse the horses grazing in the pasture, let’s take a look at them because the race begins in less than a month, with fundraising for the June 2018 primaries beginning June 6. Before I mention some horses, who look to be front-runners, let me say that most of these folks ain’t ponies. Kay Ivey is 72. She would have probably gone out to pasture had she not become governor. With 18 months as governor she begins to look very gubernatorial. If she decides to run, she will be running as the incumbent and will be a viable horse, if not the front-runner. Huntsville Mayor, Tommy Battle, 61, is going to be a player in this race. He has done an exemplary job as mayor of Alabama’s most important and successful city. Folks, if we did not have Huntsville, we would be last in everything. Battle is popular in his neck of the woods and will come out of the Tennessee Valley with a good many votes. The “Yella Fella,” Jimmy Rane, 70, may make the race for governor. He is a successful businessman worth $600 million, according to Forbes Magazine. His business success has not gone to his head. He is and would come across as a “good ole guy.” Jack Hawkins, the 72-year-old Chancellor of the Troy University System, would be the best-qualified person to be governor. If you put his resume into a merit system roster, the computer would print out his name. He would also be an attractive candidate. Besides building and presiding over a university system for 30 years, he is tall, handsome, and very articulate and exudes honesty and integrity. He would also be the only Marine in the race. David Carrington, 69, is a Jefferson County Commissioner and successful businessman. He could garner significant support from the Birmingham business community. He also should have some name identification from being seen on Birmingham television for six years. John McMillan, 75, is one of the best-liked and successful statewide officeholders in Alabama. He has had a stellar eight-year reign as Agriculture Commissioner. John is a native of Baldwin County, which is one of Alabama’s fastest growing and largest Republican counties. If there is a large field, a strong vote in his home county could catapult him into a runoff. What about the other statewide officeholders? Twinkle Cavanaugh and John Merrill are younger than the aforementioned horses. At 50, they could sit out this race and come back either four or eight years later. Most observers expect Twinkle to run for Lt. Governor. She would be a favorite in that race. John Merrill probably stays another term as Secretary of State, which is prudent. If he and Twinkle bide their time, they would be the front-runners for governor next time around. Two older horses in secondary statewide office are question marks. Young Boozer, 68, is term-limited from running again for Treasurer. He is mum on his plans. State Auditor Jim Ziegler, 68, has garnered a lot of press the last few years from that benign office. Folks would be wise to not underestimate him. However, his best race would be for Attorney General. He would enter as the favorite in that race. See you next week. ___ Steve Flowers is Alabama’s leading political columnist. His weekly column appears in over 60 Alabama newspapers. He served 16 years in the state Legislature. Steve may be reached at www.steveflowers.us.
Steve Flowers: Handicapping Democrats for 2018 governor’s race
Last week, we handicapped some of the potential horses in the upcoming 2018 Governor’s Race. We mentioned Judge Roy Moore, PSC President Twinkle Cavanaugh, Agriculture Commissioner John McMillan, Secretary of State John Merrill, State Treasurer Young Boozer, State Senator Del Marsh and Huntsville Mayor Tommy Battle. Some others that may be considering pursuing the brass ring of Alabama politics are Lt. Governor Kay Ivey, Supreme Court Justice Jim Main, Jefferson County Commission President David Carrington, Trump’s Trumpeter in the State Perry Hooper, Jr., Huntsville State Representative Jim Patterson and ADECA Director and former Prattville Mayor Jim Byard. You can also add former Auburn coach Tommy Tuberville to the mix of possible gubernatorial candidates. All of these aforementioned horses would run as Republicans in the 2018 Gubernatorial Derby. It is assumed that only a Republican can win statewide office in Alabama and that next year’s June 2018 GOP primary is tantamount to election. Therefore, it is only a 15-month race to election for governor. The late Lucy Baxley was the last Democrat to hold statewide office in Alabama. She lost re-election to the PSC in 2012. It has been almost two decades since a Democrat has captured the Governor’s office. Donald Trump carried Alabama with almost 63 percent of the vote. It is thought by most political prognosticators that a Democratic candidate can at best get 40 percent of the vote in the Heart of Dixie. However, there are several brave souls who are die-hard Democrats and may be bold enough to test that theory. One of these emboldened is Parker Griffith, who ran as the Democratic nominee against Robert Bentley four years ago, in 2014 and received 36 percent of the vote. Griffith is a personable, former oncologist, State Senator and Congressman from Huntsville. He seems dedicated to making the plunge. The most mentioned Democratic candidate is former Chief Justice Sue Bell Cobb. She was elected to the state Supreme Court in 2012, which was the last time a Democrat won statewide in Alabama. She is seriously considering the race for governor. She could be handicapped by the fact that she quit in the middle of her term on the Court and a Republican was appointed by the Governor. State Representative Craig Ford who has served as House Minority Leader is considering a run for governor. Like Griffith, Ford is likable. He is one of the few remaining white Democrats left in the Alabama House of Representatives. In fact, if Ford vacated his seat to run for Governor a Republican would probably take it. The wild card in a potential Democratic field might be the popular young Mayor of Tuscaloosa, Walt Maddox. He considers himself a Democrat. Maddox is well thought of in the Druid City, which is a more populous and vote-rich area of the state than most folks realize. If he got a strong support from Tuscaloosa coupled with the ADC and New South endorsements, it could propel him to the Democratic nomination. He would bring to the dance a sterling record of achievement as Mayor of Tuscaloosa. However, if he has to go through a bruising primary he may come to the prom beat up and broke. Not to mention that the Prom King/Queen is highly favored to be a Republican. He would be hard-pressed to raise campaign money in the fall campaign. Most of the bets would be placed on the Republican. This brings us to another chapter in the governor’s race. The folks who wrote our 1901 Constitution intended for the power in state government to be rested in the hands of the legislature. During the Wallace years, George Wallace had immense power over the legislature. This usurpation of power has incrementally declined over the years. It has culminated with a decimation of gubernatorial power. The last two governors, Bob Riley and Robert Bentley, have been rendered irrelevant by the legislature. Special interests have taken note of this transfer of power and their money has followed. Campaign money that use to go to the governor’s race now flows to legislative races. It is not unusual to see House seats cost $300,000 and State Senate races rise to $1 million. It is going to be a great election year. See you next week. ___ Steve Flowers is Alabama’s leading political columnist. His weekly column appears in over 60 Alabama newspapers. He served 16 years in the state Legislature. Steve may be reached at www.steveflowers.us.
David Carrington eyes 2018 gubernatorial run
Republican David Carrington announced Tuesday that he has his sights set on becoming Alabama’s next governor rather than running for another term on the Jefferson County Commission. Carrington said GOP insiders told him he was “cutting into the front of the line,” but the commissioner said his background as a city council and commission president makes him more qualified to be Alabama’s top elected official in 2018 than others. “I honestly don’t believe that a Washington or Montgomery insider, who either created the mess in Montgomery or stood idly by while the mess was being created, can do what needs to be done in Montgomery to right the ship,” he said. Carrington was president of Jefferson County when it filed for bankruptcy in 2011, and has presided over budget cuts and staff reductions that have caused multiple debt rating services to upgrade the county’s rating. The commissioner also serves as president of RacingUSA.com, a website that bills itself as the “world’s most frequently shopped, independently owned store for officially licensed NASCAR merchandise.” The path from Jefferson County Commissioner to the governor’s mansion is a long one, and Carrington will have to face off against many better-known and well-funded candidates vying for the job. Still, Carrington believes he is the most qualified candidate for the job. “Here is the way I see it,” he said Tuesday on the Matt Murphy Radio Show. “Montgomery is a mess, as was Jefferson County the day I was sworn into office six years ago. Now, hardly a day goes by that someone doesn’t tell me that things are much better in Jefferson County than they were on my first day in office. “Let’s be honest, not many citizens gave me and my fellow commissioners a prayer of ever turning around Jefferson County and it was accomplished in less than four years,” he continued. “I truly believe the same can happen in Montgomery with the right leadership team.”
