Victoria well-set for recession, expert says
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Coleto Creek expansion in a nutshell:
Construction: 54 to 60 months
At the peak of construction, will need about 1,500 people
Labor expense: $250 million
Begins commercial operations: 2015
Source: Robert Stevens, plant manager
Victoria's standing in today's economy depends on which chart is studied.
Victoria's metropolitan statistical area falls about in the middle when it comes to statewide unemployment but its average annual growth rate surpasses Corpus Christi, San Antonio and even Houston, said Jubal Smith, site location incentives manager for PricewaterhouseCoopers' Dallas office.
"So, is Victoria in a recession? Is the economy here in bad shape? It just depends on how you look at it," he said.
Smith spoke at the Victoria Economic Development Corporation's semi-annual meeting Thursday. The event, which took place at the Victoria Country Club, brought in about 120 people.
Texas is home to more Fortune 500 companies than any other state and, although the state isn't completely insulated from economic woes, it's a good place to be, Smith said.
Victoria has traits that make it appealing to certain industries.
Its location between Houston and the Mexican border is a good thing, he said, and the I-69 project will run right through the area, bringing opportunity and new dynamics with it.
The city's retail sector is strong and probably even a bit underserved, Smith said, noting Victoria saw $651,715,939 in taxable retail sales in 2007, equaling a per capita spending rate of $7,512.
The overall secret, Smith said, is to understand the local economy and its advantages, understand the business prospects and business targets.
"You will win industry and have tenacity about it and go at it with a lot of effort," he said, "and you will win."
The city will continue looking into new industry, said Adrian Cannady, vice president of marketing for the Victoria Economic Development Corporation.
The team has traveled the state and nation looking at potential projects in sectors such as the steel pipe industry and renewable energy.
It might be easy to look at national media coverage and assume those situations are the same in Victoria, but the local reality includes new schools, proposed new industrial facilities and new potential projects all the time.
Officials also updated guests on International Power's Coleto Creek plant.
International Power and the South Texas Electric Cooperative are securing permits from the state to move forward with a second unit at the site, Plant Manager Robert Stevens said. It is scheduled to begin commercial operations in 2015.
When the first unit went up in 1980, plans were to add the second one soon after, Stevens said. Infrastructure went in to accommodate both units but an economic downturn put the project on hold.
State-of-the-art emission controls will go into the new unit, such as sorbent injections for mercury control and a baghouse to control particulates, Stevens said.
"Because we're using all the latest, best available current technology, it will be the cleanest coal fire plant permitted in the state of Texas," he said.
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If I may,
Desal plants cost per acre foot of water is around 8 times that of other water sources, so if one entity happens to control all the water rights of conventional sources, and they say there is no more to be had unless they build desal plants and since you the public, wants the water, your going to have to pay to build the desal plants and pipelines and we (the water entity) are still going to charge you 8 times more for the water.
June 6, 2009 at 4:39 p.m.A lot of discussion about business..
June 6, 2009 at 2:13 a.m.How many of you guys own a profitable business or have ever been on the hook for payroll?
Don't talk about having a BS in BM. Actually have your own butt on the line.
Make a huge difference on how you see things.
Hi Archie,
That would be another problem. The new businesses I see are "Title Loans, Payday Loans, Dollar Stores,and Mom and Pop Mexican food stores".
Are you saying that they pay their employees a living wage?
June 5, 2009 at 11:11 p.m.Well, Superdad
I did a tongue- in- cheek observation; read the first part of my post…I don’t usually use personal stories or observations as reliable data….DuPont began their early retirement in 2002 loaded with compensation packages for 200 people, which had nothing to do with the economy but more to do with selling to Invista…Invista made their own cuts according to their standards as was outlined in the Advocate several years ago…I said majority (51%) showing a dire economic problem….Formosa used this down time for repairs ,as I have told.
I simply made a statement and as I told Kenneth, I could have been misinformed or lied to.
June 5, 2009 at 1:18 p.m.It seems everyone has a good understanding of the situation. You’re correct in your assessment exresident, concerning the “catch 22”.
Everyone deserves a second chance, or a few more, sometimes! Let’s pretend that those in power are ready to take serious action in developing further the Victoria economy. Under that assumption this would probably be the best way to start, create a fact-finding committee.
Take an inventory of every business in the area.
1. Are they a service provider, manufacturer, or etc?
2. How many employees do they have and how many did they have a year ago?
3. Who are the businesses that they are connected too and in what way?
4. What are the specific skills of their employees working and laid off?
5. What are their expenses?
6. What is their current, one year, three year and five year position; usually it’s five, ten, and thirty.
Once you have acquired all pertinent information its time to organize into three areas: cost management efficiency, labor marketing potential, and labor expertise expansion and development.
Companies are interested in three things: how much it cost, how much trouble, and is it worth the trouble.
(Cost Management Efficiency)
Reducing the cost of operating a business in the Victoria area.
Seek out grants for commercial development of energy efficient buildings.
The sell, this reduces energy expense and provides and incentive for further investment.
Repair and develop “smart roads”.
The sell, this reduces distribution expense, through shortening delivery time, improve mileage, and reduce maintenance.
Improve and expand education.
The sell, this reduces cost of training and accidents, through higher aptitudes and greater awareness.
Develop “healthy living areas”.
The sell, this reduces cost of health insurance, through physical activity and emotional stability.
Just suggestions.
(Labor Marketing Potential)
Companies are more inclined to relocate, if there exist a solid competent labor force to facilitate their purposes.
(Labor Expertise Expansion and Development)
Expertise Expansion
Provide incentives and the capacity for existing labor to diversify their skills and knowledge.
Development
Determine what new industry you want to bring to Victoria. Identify all occupations and supporting occupations until you find a match locally. Develop a plan to recruit businesses with occupations that will bridge the gap. First, begin recruiting businesses that local occupations may provide a supporting structure. Keep in mind you want to attract businesses that import dollars, rather than export. This will provide incentive for other companies that will continue filling the gap.
I’m getting tired, almost time for “tea”; I mean beer.
Oh, one more point to make, all plans will fail when corruption or incompetence due to vainity or wrongfully placed self-assurance is involved.l
June 5, 2009 at 1:08 p.m.Mike..
you are wrong...Dow has had several reduction of force right before Union Carbide sold out, Dupont let go abunch back in what 2004 also ROF and early retirements. Of course its not 50% but I would think it was at least 15-20%. Most all the plants in the area had 1,200 employees and today maybe 800.
The big TVs sellling...Duh! with the FCC switching to digital most are changing out and probably rest are buying the not converted TVs cheap for spare rooms or hunting lease.
Valentine Day! I bet a great number went out to eat on that day. Did you check on Mothers Day???? That logic does not work...why do you think everyone has $1 menu to choose from. Go to Rosenberg/Richmond and see ALL THE NEW business. What has come here...not even Cracker Barrel next to Home Depot. But listen to Mr.Lyons who is running for council and He too says the business are lining up---WHERE?
June 5, 2009 at 12:56 p.m.Ken, what percentage of the workforce did the plants lay off? I know there were layoffs, but I didn't know it was more than 50%.
And before you reply, I'm not trolling, I'm not questioning your statement. I would really like to know.
June 5, 2009 at 11:05 a.m.Kenneth
June 5, 2009 at 11:04 a.m.I am going on the word of my son-in-law,other relatives,and many friends from Dow,Formosa,Invista and Dupont....I am not talking about contract workers...If they are lying or misinformed;then I stand corrected.
I don’t know the economic status of Victoria but as long as we are using observations as the tool to contradict the Chambers stats…If I may.
1. This past Valentine’s day, I drove around relentlessly trying to find a restaurant...They were all full….Drive around Victoria at lunchtime
June 5, 2009 at 10:29 a.m.2. The local industrial plants did not lay off a majority of its workforce.
3. The Wal-Mart and HEB’s parking lots seem to always full…Bestbuy is still selling those large screen TVs.
4. I do see more of neighbors mowing their own lawns, changing their oil, and washing their cars.
5.I do see a slowdown
Okay, first of all, the Advocate is going to publish rubbish, they always have, they always will! They don't have reporters they have gossip columnist. Second of all, we are in a recession and Victoria is feeling it. This article makes NO SENSE what so ever! The first line says it all, "Victoria's standing in today's economy depends on which chart is studied." DUH!!! I would study the chart that makes us look great as well, doesn't mean we are fairing better or worse than any other city our size, it just means your charts prettier! Listen, let's face facts people, we are in a recession and if the city government wants to believe this type of crap coming down from "eductated" individuals then we are in for even more trouble down the road. Secondly, the Advocate is not a newspaper. It's simply a gossip column that publishes whatever it wants, twists stories to make them juicer because they don't have a skilled reporter anywhere on the team. It's a shame really, it could be a good source of information for this town if someone would stand up and say enough is enough.
June 5, 2009 at 9:53 a.m.Victoria needs to be the leader in business. Not a follower whose commerce is subjugated to the influences of larger cities. This needs to be the place where interstate and international business originates, instead of just passing through. Isn’t anyone tired of settling for scraps? Victoria needs to be the place where serious research and development leading to new or a renewal of industry.
Why is the next generation in solar technology being developed near Houston instead of “in Victoria”?
Perhaps the real reason is that “many” community business leaders, that have the money and connections to make this happen, are scared. A long time ago they were fearless business entrepreneurs; I suspect because they were either backed by connects, money, or both.
Now many mask their fears with money, self-adulation, and praises from yes men. Many have created nice little niches for themselves, similar to fiefdoms. They have lost their capacity to smell and taste the hunger for “real business”. Instead they play it safe like hospice patients or prisoners incarcerated by their own insecurities.
I learned from a very old man, who incidentally was also named John; “There is no room in business for fear; the sharks can smell it hundreds of miles away and will stop at nothing to get at it.”
You can B.S. anyone; in fact not to long ago some very smart men B.S. the world, with devastating consequences. However, no one can escape the inevitable facts of reality. Victoria needs new blood.
The people who were laid off are a testament that subscribing “solely” to the practices of the past, are not enough. Victoria maybe in good shape compared to the rest of the nation, but that is not enough.
“I smell something in the air, and feel a salty taste on my lips”; I’m hungry how about everyone else. I feel sorry for anyone in my way when I’m hungry.
June 5, 2009 at 9:25 a.m.C'mon business is 'bright' in victoria. take the shades off and really look around even the store fronts off Airline/Laurent are starting to get bare.
VEDC will not say anything negative its their JOB at stake. How many conventions are coming to town and more importantly how many have cancelled all together???? Where is that story.....
June 5, 2009 at 9:23 a.m."Originally published June 5, 2009 at 8:06 a.m., updated June 4, 2009 at 9:57 p.m."
?? nice lol-now this would be a story....
June 5, 2009 at 8:55 a.m.He has an unusual swagger in his face; I wonder what F.B.I analysis would gather from it. This is very interesting; I wonder what else he is involved in, just out of curiosity.
June 5, 2009 at 8:11 a.m.Pilot, every time I pass by that billboard "Be A Welder!", I chuckle thinking oO I'd rather be an O'Connor. I'm a fence builder and have had ONE phone call in the last several weeks, even though I dropped my basic prices to those of the late 1900's, and that phone call was from one of my competitors. This stinks and bad!
June 5, 2009 at 7:59 a.m.woofwoof
don't count the closed businesses count the new ones opening!
June 5, 2009 at 7:22 a.m.closed businesses are everywhere that's nothing new!
we need to quit blaming the Advocate for the news that they report!
June 5, 2009 at 7:19 a.m.This reads like a Chamber of Commerce press release.
June 4, 2009 at 11:08 p.m.Once again, the Advocate proves how out of touch it is with the community.
Denial not only runs through Egypt, it runs right down Constitution Street!
Great headline on this article. I counted 20 closed businesses along a 3 mile stretch on Navarro street.
June 4, 2009 at 9:30 p.m.