A way to build Delaware manufacturing

I kept this article around for a potential upcoming “odds and ends” post, but the more I thought about it the more I believed it was enough for a standalone article. It’s a couple weeks old but certainly evergreen enough to be a timely piece.

Charlie Copeland, who used to be the Senate Minority Leader in Delaware once upon a time, is now the co-director of the Center for Analysis of Delaware’s Economy & Government Spending. (Yes, that’s a mouthful – so we’ll call it CADEGS.) So the CADEGS head wrote a post on the blog of the Caesar Rodney Institute that told me two things, one of which I knew and one I did not: number one, the one I knew, is that Delaware got a crapton of $ from the federal government thanks to Uncle Sam’s CCP virus spending spree – so much so that it’s remarkably not all been spent. But number two, which is the one I did not know, is that “Northern Delaware has over half a dozen former industrial sites waiting to be cleaned up and waiting for infrastructure upgrades.”

How does Charlie put one and one together? He adds, “By making a one-time investment from one-time federal funds into these sites, Delaware can create a magnet for private sector business investments in these locations. Imagine close to a dozen industrial sites ready for new, clean American manufacturing.” And this makes sense, since presumably these sites either already had the infrastructure needed onsite or it was there but needed a little updating and TLC. After all, if the company I work for can update a forty-odd year-old restaurant that had no grease interceptor (meaning it was dumping grease right into the system) I suspect piping at these sites which dates from the 1940s or 1950s can be replaced.

But the second part of Copeland’s wish list is just as important.

This true infrastructure investment would be a good start, and the next step will not cost any money. Delaware needs to dramatically improve its permitting process for business site investments. This requirement was made clear in a 2019 report released by the Delaware Business Roundtable on Delaware’s job-killing permitting process. 

As stated in the report, “The permitting process plays an important role within the site selection process. Site selectors and investors often view the process as a barometer for measuring how business-friendly or supportive a state or local community is to economic development and new investment.” And Delaware is viewed as unfriendly. As a matter of fact, one national manufacturing site selection expert stated that “Delaware is not on anyone’s list.” 

Adjacent states can often complete site and business permitting in six months. In Delaware, it can take as long as two years. Job creators have options, and they are opting to go to other states where they can get their businesses operating in one-quarter of the time than it takes in Delaware. The proof of Delaware’s failure is in the continued decline in our manufacturing employment, while nationally, manufacturing has been growing as the US continues to on-shore production from China.

Charlie Copeland, “Delaware Manufacturing Job Growth Opportunity“, Caesar Rodney Institute, June 30, 2021.

Having dealt with the First State for a few commercial projects, let me restate louder for those in the back, “Delaware needs to dramatically improve its permitting process for business site investments.” For example, we spent a ridiculous amount of time dealing with site improvements for a project on a rural corner that didn’t even see 1,000 cars a day and might only gain 50-100 because of the development. Business people who have borrowed thousands to make their dream a reality don’t want to wait an extra three months to open because state and county agencies can’t get their sh*t together.

What Charlie suggests is that the “site and business permitting process could be quickly streamlined by reassigning a few State employees into ‘permitting-process concierges’ who would keep track of the status of major projects (e.g., over $5 million in investment). At the same time, the State should create a government website ‘dashboard’ giving the status of all aspects of investments in the permitting process detailing when permits were submitted, the amount of time waiting for initial comments, and what agency is currently holding a permit (and for how long). These two steps – the concierge and the dashboard – would bring transparency and accountability to a very diffuse process.”

In other words, do what certain private-sector businesses do with high-profile clients who generally receive just one point of contact. That’s not to say that smaller guys should get a runaround, but if the red tape is pushed aside for the big guys, maybe that learning curve is made easier for the small fries.

I will say, though, that Copeland was thinking mostly about the northern part of the state. I would be curious to know if this same principle could apply to whatever portions of the old DuPont facility in Seaford remain unused now that Amazon has made plans to use part of it for a regional hub. Regardless, if gaining jobs in the Wilmington/NCC area makes them just that much more prosperous, then the burden on Sussex County taxpayers should be lightened too. As it is said, a rising tide lifts all boats – and this state could use a lift.

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