As Collier weighs Jackson lab benefits, analysts question if job payoff is realistic

The people behind Jackson Laboratory

Jackson Labs plans to build research facility ...

— All that Collier County residents have to go on now are pledges and projections about what the future would hold if Maine-based Jackson Laboratory builds a medical research institute near the town of Ave Maria with $50 million initially from local tax dollars.

That leap of faith would have to stretch forward into subsequent years with another $80 million of local dollars to tap the same amount from the state, part of a multi-year economic development project so Collier could be the latest Florida community to nurture and grow a medical research park.

The state Legislature on Friday approved its 2010 budget, which called for Jackson funding of $130 million over three years. The project could move forward if the governor signs off on the earmark in the final budget and if county leaders can come up with their obligation.

Collier Commission Chairman Fred Coyle, who has taken the county’s lead on the Jackson project, has declined at this point to disclose how the county may piece together the local match.

He first wants to know that the state money is a sure thing and that Jackson can come up with $120 million in private funding. The public will have its say at public hearings when the county’s plan is ready for debate, he said.

The pitch for Jackson is that it would create 200 new jobs over five years, operating out of a 140,000-square-foot building that would be built on 50 acres off Oil Well Road. The land would be donated by the Barron Collier Co.

Jackson officials and consultants say the research institute, which would focus on genetics and personalized medicine, would serve as an anchor to entice other biomedical companies to Collier.

Jackson would lead the way for a full-fledged research park with a projected 7,500 jobs in 10 years and an annual statewide impact of $835 million.

“This community is not currently a destination for scientific research,” said Rick Woychik, president and chief executive of the nonprofit Jackson, headquartered in Bar Harbor, Maine. “We can help put Naples in the limelight.”

But that same limelight has been slow to light up seven other Florida communities where state and local governments have set aside huge sums to attract renowned biomedical research institutes.

Thousands of new jobs were promised through attracting other medical-related businesses to those communities, but the jobs haven’t materialized yet, according to an analysis in January by the state’s Office of Program Policy Analysis and Government Accountability.

* * * * *

The Florida Legislature has helped bring eight biomedical research institutes to the state so far, starting with Scripps Florida in Palm Beach County in 2003.

With the passage of special legislation just for Scripps, the state provided Scripps with $310 million in federal stimulus money.

Three years later, the Legislature created the Innovation Incentive Program, where the Jackson money would come from.

The innovation program has spent $450 million since 2006 to bring seven more biomedical institutes to the state, coupled with $526 million in matching money from the local communities.

To qualify for the state funding, each research institute has to agree to performance conditions that include job creation, average wages and investments. Each agreement has sanctions for noncompliance, including payback requirements to the state.

None of the research institutes have faced sanctions for not meeting contract terms, according to Sterling Ivey, press secretary for Gov. Charlie Crist.

As of September 2009, the seven institutes in six counties have created a total of 783 jobs, not including employees at Scripps Florida in Palm Beach.

The government accountability report says the state’s investment of $450 million “has not yet resulted in the growth of technology clusters in the counties where the program grantees have established facilities. However, experts in the biotechnology industry agree that significant cluster growth often takes decades.”

The report also points out that biotechnology businesses already existed in the communities where the state money helped establish the research facilities, but few new ones have set up shop since.

The seven institutes are the Burnham Institute in Orlando; Max Planck Florida in Jupiter; Miami Institute for Human Genomics; Vaccine & Gene Therapy Institute Florida in Port St. Lucie; Torrey Pines Institute in Port St. Lucie; SRI International in St. Petersburg and Charles Stark Draper Laboratory in St. Petersburg.

With respect to the slow job creation, it takes time and the state report acknowledged that, said Keith McKeown, spokesman for Scripps.

“It took some 30 years in California in San Diego,” he said, referring to Scripps headquarters in nearby La Jolla. That also is home to Sanford/Burnham Medical Institute, which received $155 million in state money for a campus in the Orlando area in 2006.

Mike Hyde, vice president for advancement with Jackson, said the government accountability report was done too early to fairly assess job creation.

“The report chronicled what happened over three years ago and most of that time the investment that has been made was still under construction,” Hyde said. “They were looking at a snapshot at the very start of those institutes.”

In Bar Harbor, Jackson has 1,200 employees and the institute spends $175 million annually in Maine, he said.

The projection is that Jackson would spend $50 million to $60 million annually in Florida.

* * * * *

The Scripps Florida campus, which opened in temporary quarters in Jupiter in 2004 and moved into its permanent building in early 2009, has 340 employees today, McKeown said.

“We have an agreement with the state of Florida that requires by 2013 we have 554 employees,” McKeown said. “We are ahead of schedule at 340 and hiring right now. In our agreement with the state, we are urged to give jobs to Floridians. I don’t have an exact number but we do make an effort; some faculty jobs you need to look nationwide and around the world.

“Let’s not forget each job created has a ripple effect in the economy where there may not otherwise have been,” he said, noting the workers tend to want to settle in a thriving area.

“We found that the kind of people who have been attracted to work at Scripps Research are pretty demanding of the community. They want good schools, they want good restaurants,” McKeown said. “Jupiter never had those kind of folks.”

Skeptics in Palm Beach looked at what the state and local government invested _ Scripps wasn’t required to put up any money _ and divided the total by the new job numbers stipulated in the deal to arrive at a cost ratio for each hire.

“It simply isn’t true, it doesn’t work that way,” McKeown said. “The dollars have made permanent installation that will continue to attract scientists. The people we hire are spending and we spend lots of money. We need services to operate the plant.”

Shannon LaRocque, assistant county administrator in Palm Beach County, said the government accountability report is laughable because Scripps had only been in its permanent building one year.

“We always thought it would take 20 years,” she said. “Scripps is well on its way to create jobs.”

Palm Beach officials never thought developing a biomedical foundation could be done with one well-known institute, and for that reason the county invested to bring Max Planck to the community and may do the same to bring a third biomedical entity to the community. Palm Beach government invested $500 million combined for Scripps and Max Planck, she said.

“You have to do your own research; there were others we turned down before we picked Max Planck,” she said.

With respect to Scripps, she’s been told by the institute that 60 percent of the hires have been local residents.

“They are going out of their way to hire the locals,” LaRocque said.

___ Connect with reporter Liz Freeman at www.naplesnews.com/staff/liz_freeman

© 2010 marconews.com. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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Comments » 2

ajm3s writes:

I know this is widely accepted as a good thing for SW Florida, but it is an earmark and adds to the amount of money that goes through government's hands for private industry use. A sort of industry welfare with the promise of jobs. I thought that is what private investment was for.

Time to ask: "Where is the best source of investment money- private or public?" If it is public, I question the process of due diligence and the delusion of risk since the "investors" are detached.

I tend to question the financial well-being of a company when it goes shopping for government welfare and its intent. But then again, that's me, dubious of government involvement when none other exists.

ajm3s writes:

The biotech industries tend to be located in areas that are rich in educational resources as well as a culture. Look at Research Triangle Park, NC; Thousand Oaks, CA; San Diego, CA; Cambridge, MA.

The risk of attracting similar industries based on Jackson Labs is tremendous given the successful areas listed above, some of which were "sweetened" with state financed packages.

Jackson Labs has the most to gain with little risk. The state has a lot to lose with most risk.

A one-minute review. Take it for what is it worth. Not much.

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