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Tim
Kaine campaigned for governor last year on a
platform of continuity with the Warner
administration. So it's no surprise, especially
given Virginia's strong record of job creation and
income growth during the Warner years, that the
Kaine administration's economic development policies
are looking a lot like those of its predecessor.
"We
feel like Governor [Mark R.] Warner and Secretary
[Michael] Schewel did a great job of bringing us to
where we are now. They set the bar pretty
high," said Patrick Gottschalk, Schewel's
replacement as Secretary of Commerce and Trade, in a
recent interview at his downtown office.
There
will be differences, though, Gottschalk insisted. "We're
going to put our own stamp on economic development.
... Gov. Kaine is a different guy. He has his
own views of where he wants to go and the emphasis
he wants to put on things."
Other
than straightening out Virginia's patchwork of
workforce development programs -- Kaine is
determined to fix a problem that vexed both the
Gilmore and Warner administrations -- it's not clear
yet exactly what the Governor will do that's so
different. Of course, that's hardly surprising
considering that he has occupied office less than
five months and spent most of that time preoccupied
with getting a budget enacted. Furthermore,
circumstances have had a way of intruding: This
spring, Ford Motor Company announced its
plans to close its Norfolk auto assembly plant, and
then the Base Realignment and Closure Commission
dropped a bombshell regarding Oceana Naval Air
Station.
Now
that budgetary issues have subsided, at least
momentarily, economic development priorities are
likely to crystallize. It
will be Gottschalk's job to preside over the preparation
of the state's economic development strategic plan,
due for completion within a year after Kaine took
office, as well as a statewide energy plan required
by legislation passed this year.
Gottschalk,
like Schewel, is a Richmond attorney and, like his
predecessor, a team player. But where Warner's
economic development chief focused on problem
solving, he did not take to the schmoozing aspects
of the job. By contrast, Gottschalk is affable,
approachable and well connected to Virginia's
economic development professionals through his
long-time membership in the Virginia Economic
Developers Association. He brings to the job a broad
knowledge base of economic development issues and a
network of contacts around the state.
In
a wide-ranging interview, Gottschalk covered the
waterfront of economic development. By the end, I
was struck by how little Virginia's economic
development policies hinge upon partisan loyalties
or ideology. The Kaine administration's priorities,
for the most part, were the priorities of the Warner
administration -- and of the Gilmore administration
before it. Economic development policy in Virginia
is driven largely by regional interests and
institutional constraints that transcend party
lines.
If
there is anything distinctive about the Kaine
administration's approach to economic development at
this early stage, it's the emphasis on workforce
development. There is a broad consensus that
Virginians must be equipped with the skills they
need to compete in an international marketplace.
Unfortunately, state, federal and local training and
educational programs are often redundant,
overlapping and inefficient. Previous efforts to
bring order out of bureaucratic chaos have led to
naught -- Gov. Warner once said that his failure to
clean up workforce development was his greatest
regret as governor.
The
man selected to undertake that difficult job is
former AFL-CIO official Daniel LeBlanc. In the early
days of his administration, Kaine had attempted to
appoint LeBlanc as Secretary of the Commonwealth,
the cabinet member who oversees the appointment of
some 4,000 people to state boards and commissions.
But Republicans in the House of Delegates, who
objected to LeBlanc's opposition to Virginia's Right
to Work law, noisily scuttled the appointment.
With
little fanfare, Kaine then appointed LeBlanc to a
position on his staff, giving him the title of
"Senior Advisor to the Governor for
Workforce" and elevating it to cabinet-level
status. Indeed, the Governor's website
lists LeBlanc on the web page of the Kaine cabinet.
Gottschalk spoke of him as an equal. Said the
Commerce chief: "We're going to work hard on
streamlining the workforce delivery system. We have
a cabinet-level senior advisor who will work on it
full time."
Another
new priority is energy policy, Gottschalk said. A
comprehensive package of energy-related legislation
requires the state to create a 10-year comprehensive
Virginia Energy Plan to implement the Commonwealth's
energy policy, addressing the potential development
of off-shore natural gas as well as alternate and
renewable energy sources such as solar, bio-fuels
and tidal action. Said Gottschalk: "You're
going to see some interest in trying to attract
companies [with an expertise in alternate energy],
some interest in universities doing research in the
energy field."
Otherwise,
economic development policy will look very familiar:
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Southside/Southwest
Virginia. "The Governor is going to
focus on Southside and Southwest," said
Gottschalk. "I've been down there nine or
10 times since inauguration," and the
Governor has several times as well. A good
number of industrial projects are in the
pipeline, and he is optimistic that more jobs
are coming to those distressed regions. "We
feel pretty good about it."
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Northern
Virginia. Northern Virginia has plenty of
jobs but not the folks to fill them. Growth is
tempered by traffic congestion and high housing
costs. "That's not something that's going
to be addressed by traditional economic
development," Gottschalk said. Breaking the
congestion bottlenecks falls under the bailiwick
of the Secretary of Transportation.
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Research
and development. "The Governor is
really interested in maximizing economic
development that can be gained through
university R&D and commercializing
technology," Gottschalk said. He foresees
efforts to emphasize university R&D in areas
that are strategically important, such as
energy, or are tied to emerging growth sectors
of the economy such as biotechnology, nanotech
and modeling & simulation.
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Ford
Motor Company. Ford's announcement that it
plans to close its Norfolk plant was a
tremendous setback. The loss of 2,250 highly
paid auto worker jobs will be a serious hit to
the Hampton Roads economy, surpassing by the
1,882 jobs in 15 plant expansions announced by
the Kaine administration through late May. The
Kaine crew surged into emergency response mode,
but there was no way to salvage the situation,
Gottschalk said. "Everyone within Ford and
outside of Ford is very complimentary of the
plant and the work ethic." The problem is
that of the three F150 truck assembly plants,
Kansas City and Dearborn are located much closer
than Norfolk to Ford's automotive suppliers.
He's heard that the cost differential amounts to
$300 per truck, he said. "It's
geography."
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Oceana.
The Base Realignment and Closure Commission
announced this spring that it was not satisfied
with the city of Virginia Beach's efforts to
curtail development around the Oceana Naval Air
Station, heightening concern that the Defense
Department will relocate the air base. Robert P.
Crouch, a cabinet-level assistant to the
governor for commonwealth preparedness, is the
point man for the ongoing controversy.
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Fort
Monroe. Fort Monroe in Hampton will close in
2011 as part of the military base-closing
process. Two thirds of the land will revert to
the Commonwealth, giving the state a tremendous
re-development opportunity. Said Gottschalk, who
is in charge of this project: "We want it
to be a world-class development that's befitting
the character of Fort Monroe. You want to keep
the character [of the national historic
landmark] -- make it something that everybody's
proud of."
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The
distributed service initiative. This effort,
spearheaded by Jeff Anderson, executive director of the
Virginia Economic Development Partnership, is
targeting Northern Virginia technology companies
to relocate back-office operations downstate.
"They're trying to convince the Northern
Virginia companies with back office operations
like human resources, accounts receivables, that
sort of thing, to re-think where they should be
located," Gottschalk explained. "Why
not consider Danville, Martinsville and other
areas for those activities? If you're a software
company, you need your software and sales people
in the Dulles Corridor. But you don't
necessarily need the accounts payable people
there."
Economic
development isn't just his job, Gottschalk said,
it's the job of every member of the cabinet. In the
arena of university R&D, for instance, he'll be
cooperating closely with Technology Secretary Aneesh
Chopra and Education Secretary Thomas Morris. In the
realm of health insurance, of critical importance to
small businesses, he'll be collaborating with health
Secretary Marilynn Tavenner. "We're looking at
economic development very holistically."
--
June 26, 2006
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