Executive Director Tim Strege explained that the existing building is the first phase of what he envisions as “an innovation campus” of buildings focused on nurturing new businesses in specific industries with growth potential.
While the first building focuses on construction trades, the second will be devoted to information technology. Bids have gone out for it and are due Sept. 17. Strege said the plan is to break ground in October and complete the structure next summer.
Tyler Shillito, a local attorney and member of the incubator’s board, said the second building will support 300 jobs. Many jobs in technology fields are in King County, he noted. The Tacoma area needs to do more to train and employ local residents for technology careers, according to Shillito. “We have not done enough to train these people for the jobs they should fill.”
Strege said the project has a $7 million price tag and the incubator has secured $3.5 million. Of this amount, $2.67 million is from federal grants, while two state grants account for $500,000. About 200 individuals have made modest donations. Some have come from board members.
Councilmember Connie Ladenburg noted that fundraising efforts are “government heavy” and suggested the incubator staff and board need a capital campaign. “As you grow you need to find different modes and means of financing,” she said. “It is time to expand your efforts into other arenas.”
Shillito noted board members have made contributions, “but obviously we cannot write $400,000 and $500,000 checks.”
Strege said he has met with U.S. Bank about securing New Market Tax Credits for the project. These are a privately managed financing tool by which an institution can make loans and capital investments in underserved areas and can receive federal tax credits. He thinks this could generate $1 million. He is negotiating with two local banks, as well as a non-profit lending institution, and feels he could secure $1.5 million in loans.
Even if these efforts are successful, the incubator will still need more money. Much of the federal grants will have to be returned if the project is not built within a certain time frame, which is putting pressure on the staff and board. “It is very tight to finance this project in this timetable,” Strege commented.
Mayor Bill Baarsma told his colleagues that Strege has approached many foundations for funding. “It is not for lack of effort” the incubator is in the situation it faces, he noted.
City Manager Eric Anderson said if the incubator could wait until after Jan. 1, the council could allocate money from its 2008-09 budget for the request. That will not work given the incubator’s timeline, so the most likely source would be the council’s contingency fund, which currently is at about $1.2 million.
The council will likely vote on the incubator’s request at its Sept. 23 or Sept. 30 meeting.
Jane Dudley, an East Side resident who attended the meeting as a representative of the community group Tacoma’s East Action Membership, urged council members to approve the request. A 2005 economic development study pointed to the incubator playing a key role in improving conditions on the East Side, which has long been an economically disadvantaged area.
She said East Side residents are excited about the incubator’s expansion plans, especially considering its proximity to Interstate 5. “We are the last section of the city whose I-5 access has yet to be utilized to its full potential,” Dudley remarked.
Phase three of the campus will be a building focused on clean sources of energy and environmental science. Strege said Marine View Ventures, the economic development arm of Puyallup Tribe of Indians, has a memorandum of understanding with the incubator.
Colleen Barta, the incubator’s assistant director, discussed a letter from Chad Wright, executive director of Marine View Ventures, about the tribe’s interest. She, Strege, Wright and others have been meeting every two weeks to discuss the incubator’s future.
“They are totally committed to this project,” Barta said of the tribe, whose administration building is just a few blocks from the incubator. “We all want the tribe to be a vital partner and this is how we do it.”
Barta said two studies of the East Side done within the last few years formed the basis for the incubator’s expansion plans.
She said the tribe has land adjacent to where the current incubator building is. The land went into trust status this summer and this is where the tribe will build the third building.
The fourth phase of the campus will be a building focused on transportation. Barta said the tribe’s interest is due in part to its plans to develop shipping terminals on tribal land on the Tideflats. The tribe wants to ensure its members are prepared for the jobs it will create in coming years. “They know they need more skilled labor,” she remarked.
“The tribe and their leadership are as big of supporters of this as I am,” Strege told the council. “They have a vision that extends well beyond my vision.”Tacoma Weekly