Beck’s Superior Hybrids, Inc. Looking to Build in Effingham

Beck’s Hybrids, the largest family-owned retail seed company in the United States, is looking to expand its growing company into the South Central Illinois region. Beck’s Hybrids has been serving the Midwest region of the United States since 1937 providing farmers with various agriculture products as well as knowledge of modern genetics and trait technologies. They continue to serve farmers in eight states: Indiana, Illinois, Ohio, southern Michigan, western Kentucky, Tennessee, eastern Iowa and eastern Missouri. Becks’s Hybrids will not only bring an ever-expanding agricultural industry to Effingham and south central Illinois, but also provide the region with additional industry diversity which is a critical component to a healthy regional economy.

This pending expansion would be Beck’s Hybrids 10th facility to go along with their headquarters located in Atlanta, Indiana. The facility is expected to be on 90 acres in the Effingham Business Park and contain three buildings, two warehouses and one office building, totaling 92,000 square feet of both a Retail Sales Office and a Distribution Center. This expansion would also include the creation of 30 new jobs for the City of Effingham.

As Tony Huffman from the Effingham Daily News states “In addition to selling corn, soybeans and other seed to farmers in southern Illinois and eastern Missouri, the company is looking to lease ground in addition to the 90 acres to grow up to 150 acres in crops. Those crops will feature the newest seed technology, including seeding rates, tilling processes and nitrogen infusion.”  According to Jim Zimmer, a Beck’s Hybrids representative, “If all goes well, we hope to have practical farm research crops growing in the spring.” To read the entire Effingham Daily News article click here.

The South Central Illinois Planning and Development Commission has been working with Effingham city officials to apply for a Community Development Assistance Grant through the Department of Commerce and Economic Opportunity to help with infrastructure improvements for the expected facility including road improvements, water main construction, and sewer main construction.

Do Delays in Fracking Hurt Illinois

Mention the word in any city council meeting, at a little league game or among friends at your local tavern, and you are liable to get any number of responses – and some will be quite emotional. While the Illinois Department of Natural Resources slowly irons out a regulatory process, groups against the process known as “Fracking” have made strong pushes to stop it from moving forward. Meanwhile, those in favor of the approach are attempting to expedite the rule-making effort. Aside from the regulatory process, a lot of other factors are influencing whether or not Illinois will actually see a major increase in jobs and revenue because of technological advances in hydraulic fracturing. Do the hoped-for reserves exist? Will companies choose to pass by Illinois in favor of more “frack-friendly” states? And if the initiative does take hold, what is in store for those communities involved?

Hydraulic fracturing (also known as fracking) is the process of injecting wells with a hydraulic fracturing fluid, generally composed of water, proppant (such as sand), and chemicals that lubricate and stabilize the injection process. When injected under high pressure and with charges, the process allows the fluid to create small cracks in harder earth formations, and the aggregate keeps the tiny fissures open so that petroleum products can flow back into the well once the fluid has been removed. This process has been widely used for oil and gas extraction at over a million wells since the 1950’s (Energy Institute, 2012). However, new technology allows for deeper wells that are bored horizontally once they reach the desired depth, to access stores of petroleum products that have developed within deep organically-rich shale beds. A study by the National Petroleum Council has indicated that hydraulic fracturing will be the likely source of just under 70% of North America’s natural gas development (2011). And IHS Global Insights indicated that, without hydraulic fracturing, the U.S. would lose 45% of its domestic natural gas production and 17% of domestic oil production within five years (2009).

Experts purport that conditions are right for discovery of large stores of oil and gas deposits in the New Albany shale bed, which covers parts of Illinois, Indiana, and Kentucky. Potentially, large oil-rich portions of the formation are located within Illinois. With successful initiatives launched in Pennsylvania, Ohio, Texas, North Dakota and many other states, it is not surprising that advocates of the process are seeking to implement it in Illinois as soon as possible. The Illinois Chamber Foundation commissioned a study by Dr. David Loomis in December, 2012, entitled, “The Potential Economic Impact of New Albany Gas on the Illinois Economy.” In the study, Loomis indicates that three scenarios exist for the employment potential once the administrative rules are completed and the process begins in Illinois. At the low end, only 1,034 new direct, indirect and induced jobs would be created. But at the high end, 47,312 would be created, translating to more than $9.5 billion in economic impact for Illinois. The study did not include the economic impact of land leases or the potential benefits of extractable oil deposits. As a result, the economic benefits could be much greater.

The Illinois Hydraulic Fracturing Regulatory Act (HFRA) went into effect on June 17, 2013 and will be the basis for regulating high-volume, horizontal hydraulic fracturing operations in the state. For purposes of Illinois statute, high-volume, horizontal hydraulic fracturing is distinguished from traditional fracking in that “…more than 80,000 gallons per stage or more than 300,000 gallons total of hydraulic fracturing fluid and proppant (would be used) to initiate or propagate fractures…” at the site (Illinois PA 098-0022, Article 1, Sec. 1-5). The act is touted as the most restrictive of any state’s hydraulic fracturing laws, with the Illinois DNR and EPA charged with the duties of regulation and enforcement of the process. The IDNR is undertaking the massive effort of sorting through more than 35,000 public comments (unofficial count) on the draft administrative rules, which were gathered during a 45-day public comment period from November 15, 2013 to January 3, 2014. Many comments were issued during a series of five public meetings, but the vast majority was issued online. As a result of the backlog, IDNR was unable to issue a set of revised administrative rules to the Joint Committee on Administrative Rules (JCAR) of the General Assembly, originally planned to occur in April of 2014. IDNR hopes to do so sometime in July of 2014. JCAR will have an additional 45-day public comment period and a similarly high number of public comments are likely to be issued when that period begins. As a result, I anticipate that the State of Illinois will not have a set of administrative rules for implementing the HFRA until sometime in spring of 2015.

This is discouraging for many in the oil and gas industry, as well as those who cite the potential economic benefit as a primary driver for replenishment of the state’s economy. Under the HFRA, all severance tax revenues are earmarked for the state’s general fund. And fees for fracking permits are used to pay for enforcement by IDNR and IEPA. Currently, local governments hope to benefit from increased sales and property tax revenues in order to assist with road repairs, other infrastructure needs, or increased personnel costs for public safety and other services if fracking activities occur.

This additional revenue may not be enough. As an example, with many rural county road budget allocations set at .1% of the assessed property tax valuation, a county-wide increase of $100,000,000 in equalized assessed value would result in $100,000 to fund road repairs. This revenue arrives two years after the actual increase in value and the amount actually needed for repairs may well reach into the millions, given the heavy trucking conditions that such roads are generally not built to accommodate.

Other challenges include the housing needs of both high-and low-skilled transient workers. This can result in a number of challenges for often-unregulated and unzoned townships, where work camps can pop up in various unsewered and unwatered locations. On a smaller scale, multiple workers may make arrangements with homeowners to park a handful of RV’s in their driveways and overload local septic tank capacities. In areas with a limited number of apartments, rent inflation can occur, challenging folks on limited incomes, such as retirees.

In a May, 2014, conference call with staff from Ohio State University’s College of Food, Agricultural and Environmental Sciences, I learned that many communities realize the potential for workforce development opportunities if they stay ahead of the curve. Those communities that did not plan ahead often found their local bus drivers and street department personnel leaving their posts to fill truck driving positions with fracking rig operators at much higher wages. Some local colleges in Ohio began offering training in local pipeline drill-site training, specialized welding, security, diesel mechanics. With approximately 75% of short-term jobs being filled by transient staff, a number of support industries also have increased or sprung up, such as; motor vehicle sales and services, food service, hazardous emergency training, housecleaning, and laundry services.

As a result of the many challenges and opportunities that fracking may hold in store for rural central Illinois communities, the regulatory delay has one silver lining for us. Our local governments have the time needed to better prepare for, and capitalize on, what is to come.

Review of SCIRPDC’s Last Three Years

As the Commission awaits the next three-year District Planning Grant contract with the Economic Development Administration, the staff would like to reiterate the services the EDA contract allows the Commission to provide.

  • Support local planning efforts in communities with limited financial resources;
  • Support planning efforts that include one or more units of local government or planning agencies working together;
  • Provide technical assistance to regional governments that request it for the development of local planning ordinances and regulations;
  • Encourage local governments to engage in planning, regulatory, and development approaches that promote and encourage comprehensive planning;
  • Prepare and distribute reports, and other technical publications that promote and encourage comprehensive planning; and
  • Research and report upon the results and impact of activities funded by the technical assistance grant.

As the Commission provides the services above as a part of our scope of work, EDA asks the Economic Development District to a review our performance of the last three years.  The following summarizes those accomplishments;

 

Economic Development Administration

Public Infrastructure

Project Type of Project Grant Amount Private/Public Investment  Jobs Created  Jobs Retained
Effingham Fed-EX Hub Logistics  $1,200,000  $4,500,000 400.0 0
Newton Water Plant Industrial  $1,866,000  $2,445,212 25.0 0
Centralia Wabash Ave. Industrial  $2,000,000  $4,557,315 100.0 0
Total    $5,066,000  $11,502,527 525.0 0

 

Department of Commerce and Economic Opportunity

Community Development Assistance

Program Public Infrastructure

Municipality Type of Project  Grant Amount   Private/Public Investment   Jobs Created   Jobs Retained 
LaClede Township Water Comp. Expansion  $350,000  $523,282 3.2 2.0
Lone Grove Towship Water Coop Expansion  $350,000  $498,869 3.5 2.0
St. Marie Township Water Coop Expansion  $350,000 $307,790 4.0 2.0
Fox Township Water Coop Expansion $350,000  $120,245 3.7 2.0
Denver Township Water Coop Expansion  $350,000  $232,847 4.2 2.0
Preston Township Water Coop Expansion  $350,000  $710,119 3.5 2.0
Totals    $2,100,000  $2,393,152 22.1 12.0

 

Department of Commerce and Economic Opportunity 

Community Development Assistance Programs 

Housing Rehabilitation

Municpality Type of Project  Grant Amount   Private/Public Investment   Jobs Created   Jobs Retained 
City of Centralia Housing Rehabilitation  $248,500.00  $20,000 3.0 2.0
City of Newton Housing Rehabilitation  $213,199.00  $3,501 3.6 2.0
Town of Wamac Housing Rehabilitation  $257,157.00  $1,363 3.4 2.0
Total    $470,356.00  $24,864 10.0 6.0

 

Department of Commerce and Economic Opportunity 

Community Development Assistance Programs

            Design Engineering

Municipality Type of Project  Grant Amount   Private/Public Investment   Jobs Created   Jobs Retained 
Hunt City Water Coop Expansion  $63,201 $8,677 0 2.0
Loudon Township Water Coop Expansion $61,742  $2,700 0 2.0
Otego Township Water Coop Expansion  $85,268  $2,700 0 2.0
Mason Township Water Coop Expansion  $61,540  $5,081 0 2.0
Totals    $271,751  $19,158 0 8.0

 

Department of Commerce and Economic Opportunity

Community Development Assistance Programs 

Flexible Opportunity

Municipality Type of Project  Grant Amount   Private/Public Investment   Jobs Created   Jobs Retained 
City of Vandalia Streetscape  $750,000  $187,500 7.0 2.0
City of Centralia Fire Debris Removal  $354,375  $205,954 14.0 2.0
Totals   $1,104,375  $393,304 21.0 4.0

 

          Illinois Department of Transportation
Municipality Type of Project  Grant Amount   Private/Public Investment   Jobs Created   Jobs Retained 
Village of Dieterich Economic Development/Truck Access Route Program  $134,750  $72,200 2.0 0
Totals    $134,750  $ 72,200.00 2.0 0

 

Illinois Department of Public Health
Municipality Type of Project  Grant Amount   Private/Public Investment   Jobs Created   Jobs Retained 
13 County Health           Dept. Coalition We Choose Health $300,000 $35,400 2.0 0
Totals   $300,000 $35,400 2.0 0

 

Loans
Borrower Loan Type Loan Amount Private/Public Sector Investment Job Created Jobs Retained
Not Disclosed RBI  $160,000  $0 0.0 0
Jasper County Housing CDI  $125,000  $150,000 4.5 0
City of Kinmundy CDI  $85,953  $120,953 3.0 0
TDL Group SBA 504  $1,500,000  $5,140,000 0.0 110
Country Bob SBA 504  $1,058,850  $2,647,125 4.0 14
Total    $2,929,803  $8,058,078 11.5 124

 

Performance Summary 2011-2013
Type of Project  Grant Amount   Private/Public Investment   Jobs Created   Jobs Retained 
 5 Loans       $2,929,803  $8,237,428   12  124
 21 Grants       $9,546,232  $14,341,058  586    30
 26 Projects    $12,476,035  $22,578,486   598  154

 

 

Illinois Energy Now Begins July 1st!

Illinois Energy Now Beginning July 1st

The Illinois Energy Now grant program provides millions of dollars in rebates to local governments including park districts, conservation districts, forest preserve districts and municipalities that make energy efficiency improvements to their electric and natural gas systems. More than $70 million is available annually to help fund these projects.

Why Apply?

Eligible organizations can experience both short-term savings through reimbursement for up to 75% of energy improvement costs and long-term savings through a reduction in utility bills.

Who Qualifies?

All Illinois public facilities located within Ameren Illinois electrical service areas or Ameren Illinois Natural Gas areas are eligible to take advantage of the Illinois Energy Now grant program.

What Projects Are Eligible?
Potential upgrades to electric and natural gas systems include but are not limited to:

• Lighting equipment
• HVAC equipment
• Gas furnaces
• Water heaters and boilers
• Refrigeration equipment
• Motors and drives
• LED Traffic signs

How do I Apply?

• Step 1: Contact James Patrick at South Central Illinois Regional Planning & Development Commission
• Step 2: If your project is eligible a pre-application will be done free of charge
• Step 3: DCEO reviews application, gives notice to proceed and confirms rebate amount
• Step 4: Upgrade qualifying Ameren electric and gas equipment
• Step 5: Submit a final application with work completed and costs, again free of charge.
• Step 6: DCEO reviews final application and processes rebate

FREE ENERGY EFFICIENCY BUILDING ASSESSMENTS ALSO AVAILABLE

Additionally, we are pleased to announce that the ERC, the Smart Energy Design Assistance Center (SEDAC), and the State of Illinois are also offering FREE building energy assessments in connection with Illinois Energy Now and other energy efficiency grant programs.  A building energy assessment helps agencies determine the amount of energy savings that will result from energy efficiency improvements. A team of engineers and architects will provide technical advice on cost saving energy efficiency measures that include an analysis of historic energy consumption, a site visit with your agency’s building maintenance personnel to review facility equipment and construction, and delivery of a final report with energy efficiency recommendations. This report will discuss energy and cost savings opportunities, recommendations for implementing the projects, and identify grants funds that may be available. While the goal of the program is full implementation of the recommendations in the report, there is no obligation to do so.

Over the past seven years, this program has identified more than:
• $37,300,000 in annual energy savings
• 14,000,000 therms in annual natural gas savings
• 263,000,000 kWh in annual electrical savings
• 51,000 kW in annual demand reduction
• 79,600 tons of annual CO2 savings

The services provided through this program are sponsored by DCEO, in partnership with, Ameren Illinois Utilities, The program provides valuable services at no cost. For more information contact James Patrick at 618-548-4234 ext. 225, or email  jpatrick@scirpdc.com