At a recent CSBJ event, Mary Fagnant, the outgoing Qualtek Manufacturing CEO, was asked: What’s the biggest challenge for manufacturing companies in Colorado Springs?
Her answer: Getting suppliers and deliveries here.
El Paso County has no industrial sites, no industrial switches for rail service. And it’s a reason why 35 companies in a decade have moved elsewhere instead of settling in Colorado Springs.
On a recent regional leaders trip to Charleston, S.C., sponsored by the Colorado Springs Chamber & EDC, the group toured a Boeing facility that builds airplanes from the ground up — and uses some rail service to get parts to the facility. That plant is part of a greater industrial park that now has locations for several of Boeing’s suppliers, creating even more jobs for the South Carolina port city.
Colorado Springs does not have a large manufacturing base, despite the fact that advanced manufacturers create high-paying, primary jobs. Developing more advanced manufacturers has long been a focus of economic developers because coveted primary jobs — jobs created by making products that are sold and shipped outside the area — not only pay well but also create secondary jobs.
The Springs has fallen behind Denver, Boulder and Pueblo in manufacturing positions and companies. The reason: El Paso County doesn’t have industrial sites ready to go; it’s in the middle of the country without a port to send products; and it doesn’t have an industrial rail line that can ship supplies in and finished products out.
That could change in coming years (see related story on page 6). But it won’t be easy — and it won’t be cheap.
Estimates are that a railway switch could cost $1 million and additional rail lines between $1-2 million per mile. When you throw in the costs of land for the industrial park, and speculative warehouses for potential companies — the price tag only grows.
But does that mean we should not pursue industrial space and depend instead on proven industries here? Should we rely on tourism, on defense corporations, on the sports and wellness economy?
We need a diverse economy, one that will withstand downturns and recessions — and there will always be another downturn or recession. With statewide unemployment at 2.3 percent, it seems like there are too many jobs and not enough people, but that won’t always be the case. And to fail to take advantage of additional industries could be a job-security failure during the next economic slump.
Manufacturing could be a piece of that diversity. Having a dedicated industrial park with rail access will mean the difference when companies seek to relocate their operations. El Paso County already has so many positives — but there are companies who count the area out based solely on the lack of rail service.
With so much prosperity these days, business leaders, government officials and economic developers could work to create an industrial park that could attract businesses, employees and jobs to the region.
Manufacturers are good for the tax base because they must pay taxes on equipment and on capital investments. Additional manufacturers could ease reliance on sales taxes, which make up the bulk of revenue for the city of Colorado Springs and El Paso County. More manufacturers, particularly the small and medium-sized businesses that work cooperatively and sustainably, could provide a solid tax base for the Pikes Peak region.
Manufacturing today is small, nimble and cooperative. Smaller manufacturers work together on large contracts, creating jobs and using sustainable, environmentally friendly methods. Advanced manufacturing creates exactly the kind of jobs a 21st-century city needs — particularly one growing at the rate of Colorado Springs.
Tied in with the U.S. Ignite program launched by the Southern Colorado Women’s Chamber of Commerce, the city could use the gigabit of ultra-high speed internet access to improve its manufacturing base as well.
A new industrial park could provide jobs that veterans transitioning out of the military could fill, thanks to skills gained at Fort Carson and Peterson and Schriever Air Force bases.
It could attract new businesses, more families relocating here and provide a steady tax base for city and county governments.
The price tag is high — but so are the rewards.
Let’s find a way to create a major industrial park with railway access in El Paso County.