SmartZones Wont Create HighTech Gaps In State Officials Say

June 5, 2002
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LANSING — Michigan’s new SmartZone designations to help communities lure high-paying jobs won’t foster high-tech gaps between northern and southern regions, officials predict.

That’s despite the announcement two weeks ago that of the 11 sites selected for SmartZones in Michigan, only two — in Houghton and Isabella counties — could be considered in the northern half of the state. And, in Isabella’s case, it’s extremely close.

The SmartZone program is aimed at creating and retaining jobs that are closely related to high technology. The designated areas can use local taxes over 15 years for land acquisition, improvements, management or marketing.

The fund will be generated from businesses within each of the 11 zones.

The Michigan Economic Development Corp. designated nine counties in southern Michigan — including Kent and Muskegon Counties — one from the middle part of the state and one from the Upper Peninsula.

The concentration in the southern part is strictly due to population, said Jennifer Kopp, communication specialist for MEDC. “The majority of people in Michigan live in Southeast Michigan. It’s important for high-tech companies to be in more urban areas.”

Another factor is whether an area has a university to serve as a partner, Kopp said. A partnership with a university is a requirement. Houghton County, for example, was selected because of its partnership with Michigan Technological University, she said.

Ron Steiner, the executive director for the Oceana County Economic Development Corp., said having a university in an area was the key: “The SmartZones that were awarded all have very strong university participation.”

Michigan State University promised its support to Oceana County, but the county wasn’t invited to submit a full proposal. “We just didn’t have enough strength in our pre-proposal,” Steiner said. “We don’t have an actual Michigan State University. We didn’t have the existing base in place.”

Even though Oceana County was not recognized as a SmartZone, Steiner said, the county has enough economic bases other than high-tech industry. “Our county’s strongest industry is agriculture,” he said.

Oceana County has two agricultural processing Renaissance Zones and was expecting to make high-tech processing available by being designated as a SmartZone. “We’re going to pursue our high-technology agricultural goal with or without a SmartZone,” Steiner said.

Mike Brennan, editor and founder of Michigan Technology News.Com, said MEDC is not intentionally favoring southern Michigan, but that there’s going to be a technology cluster there anyway.

That doesn’t mean, however, the northern part of the Lower Peninsula will be economically left behind, he said.

“Because of the Internet economy, your physical location is less and less relevant. I think the Internet economy is going to be the savior for the northern part of the Lower Peninsula as well as the Upper Peninsula,” Brennan said.

Brennan predicts people will make money in high-tech areas and strengthen the buying power in more resort areas, bringing in the wages.

“Over time, you’ll see more and more people getting tired of living in a big urban environment,” he said.

Charles Hadden, vice president of government affairs for the Michigan Manufacturers Association, also said the northern part of the state will compete with the southern part. “The reason for that is some of the best-wired cities are in the northern part of the mid-state. One of the most wired cities in the state is Traverse City, as a matter of fact.”

Hadden said tourism and the demand for high-speed technology will keep supporting the economy in the northern part.

But it’s hard to say there’s no possibility the north won’t be economically left behind, Hadden said. “I don’t see that as a problem, but it’s a legitimate concern. I think we have to keep an eye on it and make sure nobody does get left behind.”

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