Bay County Hopes to Land a Whale at New Airport
Bay County's new airport was supposed to be an engine for economic growth. Has it succeeded?
When Bay County voters in March 2004 rejected a referendum to relocate the airport, proponents of the move recognized they had some sales work to do.
They formed Partners in Progress, comprised mainly of businessmen and women and chaired by Ed Wright, then dean of the Panama City campus of Florida State University. The group contended that a new airport, with longer runways, near West Bay would be safer than the existing facility; would obviate consideration of the environmentally questionable alternative of extending runways at the old airport into Goose Bayou; and would attract new airlines, resulting in lower fares due to competition for passengers.
And they projected that Bay County's economy would take off in response to an airport project. Realtor Tom Neubauer, speaking as a member of Partners in Progress, promised: "A relocated airport can be the economic engine that drives our local economy for decades to come."
The proponents did prevail, and Northwest Florida Beaches International Airport became the first new airport built in the United States since the 9/11 terrorist attacks. The first flight arrived on May 23, 2010.
"Optimism and speculation really spiked as the airport was coming on line," says Scott Bowman, broker/sales manager with Prudential Shimmering Sands Realty in Panama City Beach. So, too, did asking and listing prices for raw land in the airport area.
Now, more than two years after the airport opened, has the optimism proved justified?
"Not yet," Bowman reports. "There hasn't been much additional growth. Of course, the economic climate in the country and in Northwest Florida has been less than optimal. Businesses continue to see those conditions as risky ones in which to expand."
No one knows that better than Neal Wade, executive director of Bay County's Economic Development Alliance and the county's industrial recruiter-in-chief, a position he has held since January of this year.
Still, he is encouraged.
"I'm in my honeymoon period," he says, "and that will end if somethin' good doesn't happen. But the project activity we've got right now, I've never seen anything like it. We're going to close some out and we're going to have some announcements."
Wade is satisfied that he has the tools to work with and finds that Bay County has dramatically raised its economic development sights. No longer, he suggests, will it thrill at overtures from hazardous waste recyclers and toilet part manufacturers as it has in the past.
"The arrival of the airport provided Bay County with the impetus to redefine economic development," Wade says. "Ten years ago, there were very few attractive sites available. That's changed. The area was heavily reliant on tourism, but the economy and the Great Recession have led Bay County and the state as a whole to change that.
"We have local technology companies that are booming. We have aerospace opportunities. We have logistics opportunities. We are an emerging, diverse economy. Today, we can play major league ball, and that is new. I came in with a lot of relationships with site consultants I've known over the years, and the state is working to raise awareness of the region."
Wade's relationship with Florida Secretary of Commerce Gray Swoope may be as significant as any other. Swoope was commerce secretary in Mississippi when Wade held the same job in Alabama and the two men jointly marketed border regions. Wade strongly encouraged Gov. Rick Scott to name Swoope to his current position. He's a big fan.
"Gray is … giving his life and soul to bringing Florida into a more competitive situation," says Wade.
John Wheat, the man who directs the anticipated center of Bay County's new economic oasis, is certainly breathing easier these days — especially given the resolution of litigation surrounding environmental issues (ground cover, drainage, runoff) at the airport and the bringing about of financial stability.
Wheat departed Tampa for the wilds of West Bay after having been courted by Airport Authority members in Bay County and nudged to make the move by airline executives.
"When I got here (May 2011), the airport's financial integrity was at risk due to development cost overruns," says Wheat, the airport's executive director. "We were experiencing some serious rough air."
In his first year on the job, Wheat and the Airport Authority took steps to improve the airport's cash position, including a restructuring of its financing with the State of Florida and negotiating more time in which to pay incentives to Southwest Airlines. Wheat is now comfortable with the level of the airport's cash reserves and with its market share.
In part because of the reduced fares that the Partners in Progress foresaw, Bay County now boasts a 24-percent market share among airports from Pensacola to Tallahassee versus the meager 9 percent that the old airport commanded.
"Fares have been reduced upward of 35 to 40 percent as a function of competition," Wheat notes. "We brought in Southwest, a low-cost carrier that also tends to put on more sales. But the real key to any lowering of fares is always the marketplace and competition. Southwest came in with eight flights a day, propelling huge growth, and Delta also grew dramatically."
While impressed by the work of local officials in landing a new airport, Wheat recognizes, too, that the contributions and influence of The St. Joe Company, which provided the land, and the support of then-Florida Gov. Jeb Bush and his brother, President George W. Bush, were crucial.
"The last major commercial service airport that was developed had been Denver, and that was back in the 1990s," Wheat says. "When I look at what Bay County was able to accomplish, raising the money that they did and coming up with the approach that they did, I think that's pretty outstanding. That's really hard to do in any community in the country. A lot of things had to come together."
Wade believes the growth potential is almost unlimited, but the challenge remains in persuading businesses to expand. For the residential sector to grow, he says, you first have to grow the business community. "It's about getting that first large client to come in here. We've got to have a whale."
Wade felt the same when he was Alabama's commerce secretary and was part of the team that helped bring Mercedes to the state, which was not globally competitive.
"When Mercedes came, it was like that Good Housekeeping seal. That was the tipping point for economic development in the state," Wade says. "I think that's what's going to have to happen here. We're going to need a global, good-sized aerospace company to locate at the airport and, once that is done, I think you're going to see much more activity."
Wade said that this summer the decision-makers responsible for two major planned aerospace projects have been looking at Bay County, specifically because of the new airport. Competition, however, remains severe. Lots of whalers are plying the oceans.
Escambia and Okaloosa counties have attractive sites, Wade points out. And then you have Alabama, Georgia and the other southeastern states — not to mention some global competition. Under those circumstances, he favors something he calls "coopetition."
"By that I mean that if we market the entire Gulf Coast region as a corridor, we're going to attract more attention and get more prospects," Wade explains. "Coopetition is a word that came out of the auto industry. What it basically says is that we're going to cooperate, work together for the good of the region, then we're each going to compete when we get that larger plant in, compete for suppliers and shares of the ripple effect. You work together to help the whole region and then you compete and everybody benefits."
He expects the first big announcement to come in technology, but added that there are projects active in various industry sectors: technology, logistics, aerospace.
His optimism is based on experience. In 1991, Wade was in charge of corporate communications at Alabama Power Co. when the president of the company, Elmer Harris, asked for help in assembling a statewide, private economic development organization. He ended up becoming the head of the group.
"In the years since, I've earned my Ph.D. on the job and I've seen the key factors in economic development decisions evolve and trade places," he says in reflection. "Twenty years ago, incentives and site location were probably the big drivers. Today, I believe it's all about workforce. I believe you have to convince a company that you can furnish the employees they need."
In Wade's view, Bay County is home to many highly skilled and talented workers and is capable of readily attracting more, given the quality of life it has to offer. Too, it is home to three schools — FSU-PC, Gulf Coast State College and Haney Technical Center — that have pledged to tailor curriculum to the needs of employers.
How would Wade quantify the West Bay area's growth potential?
"I've heard forecasts to suggest that there will be 30,000 people working out there in 10 to 15 years," Wade says. "That's probably a bit ambitious, although if we hit that mega-project, that could happen maybe quicker than some people think."
St. Joe has 1,000 acres ready for commercial development right outside the airport fence, with the ability to do tens of thousands of more acres. He expects that the airport will become an economic center unto itself, like Alliance Airport in Dallas.
"Ten years from now, we probably won't recognize the place," Wade says.
In the meantime, he plans to keep a sharp eye out for good projects.
"It's my rule of thumb that I want to look back on a project and be able to say that we did everything we could to win it," Wade says. "There have been some that I've lost that I really didn't want to lose. But there were some that I've won that I didn't necessarily expect to win."