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Newport News lands two huge development projects
(Richmond Times-Dispatch (VA) Via Acquire Media NewsEdge) Nov. 9--NEWPORT NEWS -- While parts of the U.S. economy lie in smoking ruins, the city of Newport News is basking in the warmth of two huge economic-development projects that promise a total of $1 billion in investment and more than 1,500 jobs.
Canon Virginia Inc., which has produced printer cartridges in the city since 1985, is undertaking a $650 million expansion, including a 700,000-square-foot manufacturing plant that will increase production tenfold.
Two weeks ago, Northrop Grumman Newport News Shipbuilding, the city's longtime economic anchor, announced a $363.4 million joint venture with the French firm Areva to build components for holding nuclear fuel in commercial power plants. No nuclear materials or fuel are to be produced at the facility, which will bring 540 jobs.
The announcement of the two such major projects in less than six months is partly a coincidence of timing and a case of unique foreign companies taking advantage of the weak dollar to expand in the U.S., said Newport News Mayor Joe Frank.
But he said city officials helped create their own good fortune.
"We maintain very close relationships with our existing businesses," Frank said. "A week doesn't go by that we're not talking to them. So when they're expanding, they give us a look."
Barbara G. Kingston, the city's economic-development director, said Newport News has used workforce-training programs to make the most of a skilled regional labor pool that includes a steady stream of retired military men and women.
Newport News, a city of roughly 180,000 people along the lower James River on the Peninsula, is not widely regarded as an economic powerhouse. Its unemployment rate of 4.3 is higher than the state average.
But two of its longtime economic mainstays, Canon and the shipyard, would be the envy of many communities.
A few years ago, Canon began looking for the right place to expand its printer-cartridge manufacturing operations and to open repair facilities for cameras, camcorders and other products for its customers in the Americas, said N. Scott Millar, Canon Virginia's director of human resources.
The company had plenty of options but gave Newport News an inside track.
Canon already owned sufficient land in Newport News, which had excellent access to water, rail and the interstate system, Millar said. The city and state offered financial incentives as well.
But what closed the deal, he said, was the active efforts of Newport News and the state to develop a training program through nearby Thomas Nelson Community College to teach workers the exact skills Canon needed.
Dozens of those prospective workers, from fresh-faced high school graduates to retired Navy personnel, already are taking classes at the community college and in a city-owned building leased to Canon.
The company also has found a rich pool of qualified workers for its fast-expanding camera-repair facilities in its existing plant. Former Navy avionics technicians have shown great adaptability to the work.
Canon also will expand its recycling subsidiary for toner cartridges in Gloucester County on the Middle Peninsula.
Millar said Newport News officials anticipated Canon's workforce-training needs and got the state and community colleges involved.
"They gave Canon a comfortable feeling that we could achieve our manpower goals here," Millar said. "That was probably the most important factor" in bringing the project to the city.
The shipyard, which is the only builder of U.S. aircraft carriers and one of only two builders of Navy submarines, has long been Hampton Roads' largest private employer despite the ebbs and flows in defense spending.
In September, the yard was awarded a $5.1 billion contract to build the carrier Gerald R. Ford, the first in a new class of carriers.
But the shipyard has worked to diversify in recent years. Its new partnership with Areva, a Paris-based nuclear vendor with offices in Lynchburg, is the latest example.
The partnership, Areva Newport News LLC, is betting on a renewed interest in commercial nuclear power. It plans to construct a 300,000-square-foot manufacturing facility on shipyard property, and to use the shipyard's giant cranes to load its finished pieces onto barges for shipment via the James River.
The city of Newport News was not a key player in the formation of the partnership, which was quietly in the works for years, said shipyard spokeswoman Jerri Dickseski.
But as the plan came together, Newport News provided tax breaks and approved the building of the huge Areva facility, which will alter the look of the city's riverfront.
The city and the shipyard have worked together closely on previous projects to improve the quality of life in the downtown area, including the transformation of a blighted area outside the shipyard gates into an engineering campus for the yard, Dickseski said.
Newport News' Kingston said the city has burnished its reputation as a desirable area for highly skilled engineers and other professionals by pouring $87 million since 2000 into City Center at Oyster Point, a mixed-use residential, commercial and industrial area where residents can walk or bicycle to shops and restaurants.
Some city taxpayers have complained about the cost, she said, but the coming influx of jobs is partly the fruit of it.
Elizabeth G. Povar, director of business development for the Virginia Economic Development Partnership, said Newport News' recent successes offer a lesson to many Virginia localities.
"Pay close attention to the industries you already have in your backyard. Be attentive to your industries' global strategic goals, and ask high-level questions." Contact Bill Geroux at (757) 498-2820 or bgeroux@timesdispatch.com.
To see more of the Richmond Times-Dispatch, or to subscribe to the newspaper, go to http://www.timesdispatch.com.
Copyright (c) 2008, Richmond Times-Dispatch, Va.
Distributed by McClatchy-Tribune Information Services.
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