Powering Logistics Development
It’s rst in pass-through highways, fourth in total freight railroads, and fth in total tons shipped outbound by truck. It’s home to the second-largest FedEx hub around the globe and the sixth largest cargo airport in the country. The Hoosier Energy region has 1.4 times as many residents working in transportation and logistics as the national average. More than 120,000 truck drivers live within a 100-mile radius of Hoosier Energy’s headquarters in central Indiana. The state boasts three international- level ports: • The Port of Indiana–Burns Harbor connects the midwestern United States to the Atlantic Ocean through two inland waterways. • The Jeffersonville Port offers access to the Gulf of Mexico through the Ohio and Mississippi rivers. • The Port of Indiana-Mount Vernon is one of the largest inland ports in the country. It’s 153 miles from the con uence of the Ohio and Mississippi Rivers and connects the Ohio River Valley with the Gulf of Mexico. F R E Hoosier Energy’s Economic Development Rider (EDR) is modeled like a property tax abatement but applies to electricity rates. It phases in over the organization’s rst six years, starting at 30%, and steadily dropping to 5%, for an overall savings of about 17.5%, Sowders says. To qualify, organizations need a minimum monthly demand and must meet job creation and/or capital investment criteria. Hoosier Energy has long focused on sustainability and renewable energy. It operates 10 utility-scale solar sites, along with a range of other sources of renewable energy. As a nonpro t cooperative, Hoosier Energy can work with speed and exibility to assist new and expanding businesses. “We’re usually a little smaller and a little more nimble and more local than investor-owned utilities,” Sowders says. “We know people by name.” n
and transported, and that requires employees to be on site.”
Companies should consider these actions when deciding if and how to leverage incentives, says Jeremy Sowders, economic development manager with Hoosier Energy Economic Development: - Identify your most important location criteria. Is it an abundant workforce? Or do you need a large footprint for your operation? Your answers should inform your search. - Once you have a good idea of the geographic locations that will work, contact the state economic development corporation or utility. Most can help identify sites and incentive opportunities. - If you look at multiple states or even multiple countries, consider engaging one of the many consultants who understand incentives. “They can help cut through a lot of the uncertainty and murkiness so you can make an apples-to-apples comparison,” says Sowders. STEPS TO TAKE When Considering Incentives Sowders says he sees a growing number of communities using incentives to attract electric vehicle manufacturers. These incentives might include agreements to build the infrastructure— including roads, sewers, and water systems to the sites—in addition to tax breaks. T L M H M I I With many employees continuing to work remotely, numerous central business districts are struggling. The national of ce vacancy rate neared 18% in the second quarter of 2022, up from about 13% in 2019, according to Cushman Wake eld. In one sense, this trend doesn’t impact most supply chain jobs. As Wassmansdorf notes, “products still need to be made
However, the tight job market is prompting more supply chain and logistics companies to implement automation and robotics. As they do, the workers they bring on board need to have higher literacy and numeracy skills and be trained to work effectively in a robotic environment, Wassmansdorf says. This change may also make these projects more attractive to those awarding incentives. The currently tight labor market can also work against companies, however, as it prompts some economic development agencies to ask if they even need to award incentives. “If the primary goal is to create jobs, and there aren’t enough people to ll jobs, there’s a fundamental question, about the need for incentives,” Comerford says. Still, many of the jobs now available offer high wages and require skilled employees—exactly the types of jobs many communities want to attract. The upshot? “We see many states and areas continue to be aggressive when it makes sense for them," Comerford says. “But, they can be selective in what they’ll be aggressive for.” H E : A N E B Hoosier Energy’s Economic Development team serves 59 counties across central and southern Indiana and southeastern Illinois, and prides itself on its ability to help companies that are new or expanding their operations to do business in the region. One of its target industries is logistics. The team possesses expertise in site location, economic impact analyses, property tax studies, local and state incentives, and planning and zoning, among other skills. The group is part of Hoosier Energy, a nonpro t generation and transmission cooperative serving 18 local member cooperatives. Indiana—the Hoosier state— boasts numerous qualities attractive to transportation and logistics organizations.
60 Inbound Logistics • August 2022
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