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Archive for Saturday, April 6, 2013

Simons’ Saturday Column: Kansas should work to repeat early KBA successes

April 6, 2013

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State lawmakers, the governor and many others, such as the Kansas Chamber of Commerce and various economic development organizations, currently are trying to figure out how to generate more revenue to help pay for state-funded services.

Decreased or limited state revenues result in cutbacks or elimination of many state-supported programs. Borrowing or taking money from one state program to prop up another struggling program may be of temporary help, but it’s a short-term fix.

Some way, some policy or some initiative is needed to kick-start the Kansas economy. The current game being played by Kansas and Missouri economic leaders of buying or subsidizing businesses to move back and forth across the state line isn’t a sound, long-range plan.

Not too many years ago, two state legislators — Rep. Kenny Wilk and Sen. Nick Jordan — came up with a plan to create the Kansas Bioscience Authority, which was a unique, powerful and effective means of attracting business and industry to the state. Additionally, it was to help existing firms in the state to expand and grow their workforces (taxpayers).

During the first several years of the KBA, the program had remarkable success. Clay Blair, a Johnson County real estate developer and a former chair of the Kansas Board of Regents, led the KBA and did a superb job of identifying companies around the country that might consider moving to Kansas, as well as learning about Kansas firms that, if given fiscal help, could expand and add workers. He did an excellent job of getting the Authority off to a great start. Democrats and Republicans served on the board, but partisan politics did not play a role in any way. Unfortunately, raw politics eventually entered the scene. Blair left the board and the KBA lost much of its momentum, vision and effectiveness.

However, the early success of the KBA should serve as an example of what can be done to improve the economic development of the state — if there is visionary leadership.

Blair was told by a state legislator about a small company in the middle of the state that wasn’t getting the attention it deserved and that there might be an opportunity for the KBA to step in and be of some help.

Blair made a connection with Gene Zaid, the founder of a small company in Sterling called JACAM, and set a date to meet with the Wichita State University graduate.

A meeting was held in a small back room of a Sterling restaurant with Zaid, a county official, several of Zaid’s associates and a couple of other interested individuals.

Out of that meeting, KBA directors agreed to provide approximately $500,000 for Zaid and JACAM to buy a scanning electron microscope.

At that time, the company had approximately 65 employees, four people working in the laboratory and a relatively small production facility.

Today, five or six years later, the company has 370 employees and 10 individuals in the lab, two of whom are Ph.D.s, and the company continues to expand its plant, which now is three times its original size.

The company was started by Zaid in 1982 by using the family’s savings of $13,000. A few days ago, a news release told about Canada Energy Services and Technology Corp. buying JACAM for $240 million.

Zaid said this all started with Blair and the KBA providing the money to buy the microscope, allowing him and JACAM to get into the global business and compete with “the giants” in his field of activity. JACAM manufactures and distributes oilfield-related specialty chemicals throughout the world as well as a good part of the United States.

Zaid said, “Blair and the KBA allowed our company to grow, and it speaks very loudly for this part of the country, the Bible Belt, with good people and hard workers with good values.”

Zaid received his bachelor’s, master’s and doctoral degrees in business, chemistry and mathematics from WSU. He is a dreamer, an entrepreneur and an enthusiastic, positive-thinking and optimistic individual. He is looked upon as an industry expert. His office wall is decorated with 30 patent documents and he is a hard worker.

JACAM is located in Sterling, a community of approximately 2,400 and the home of Sterling College, a private Christian college with an enrollment of about 700.

Consider what has happened to this 31-year-old business in a small town in the middle of Kansas. Are there other Gene Zaids in Kansas and more companies such as JACAM, which, with some help like KBA provided, could grow and add to their workforces?

In its formative years, KBA was interested in developing opportunities in all parts of the state, realizing that western Kansas needed all the help it could get in encouraging business and economic development.

Consider what the $500,000 investment in JACAM has meant to Kansas in the way of new jobs, added payroll dollars, added tax revenue, the expansion of the plant, tax revenue from the sale of the company and the likelihood the company will continue to grow with Zaid’s involvement. It’s a win-win-win story in every respect.

In recent years, the KBA has handed out millions of dollars to help worthy academic, medical and research efforts, but has it spent as much time trying to identify businesses in Kansas that, with some help, could prove to be another JACAM-Zaid story?

Another great success story of early KBA days was the help given to the former Sterling Drug plant, now called Hospira, in McPherson.

Hospira officials were pleased with their McPherson operation but were having a difficult time attracting and holding some of their higher-level employees. Again, Blair worked with Hospira officials and representatives of the state universities and developed a plan to support science internships for students. KBA offered signing bonuses and student loan reduction packages for recent university science graduates who committed to a minimum of two years of full-time employment at the McPherson facility.

Since that time, the plant has had a $60 million expansion project, and another $5 million expansion was just announced.

The workforce has grown by more than 1,100 since the KBA involvement.

Kansas needs more such stories throughout the state, not just in the eastern quadrant. It needs more involvement of individuals, such as Blair, with vision and commitment, and the great potential of the KBA needs to be utilized.

Comments

yourworstnightmare 1 year, 3 months ago

It is a shame Mr. Simons cannot put aside politics.

Clay Blair = GOP. "Later" = democratic.

Mr. Simons fails to point out a major success under the democrats in charge of the KBA: NCI designation of the Kansas Cancer Center, possibly the biggest news to hit the Kansas biotech scene in decades if not the biggest ever.

KU also has an Alzheimer's Center, Mr. Simons. Your selective memory is worrisome.

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Phillbert 1 year, 3 months ago

It's a shame that the Governor and Republican legislators that Mr. Simons so wholeheartedly endorses have done everything they can to defund and sideline the KBA.

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irtnog2001 1 year, 3 months ago

Mr. Zaid is also a graduate of Kansas Wesleyan.

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