Hartford Business Journal

20 Hartford Business Journal • August 8, 2016 www.HartfordBusiness.com OPINION & COMMENTARY EDITORIAL Private sector must lead innovation economy S tate government-backed programs aimed at developing a more vibrant startup and entrepreneurial culture are smart policy because small businesses are the lifeblood of the economy, creating the majority of new jobs. But while the investment the state of Connecticut is putting into some of these ven- tures is helpful, ultimately it's the private sector that will need to drive the effort to make it successful. Yes, policymakers can provide seed funding to create "innovation ecosys- tems" and startup mentor networks, but it's the intellectual capital inside Connecticut companies, hospitals, colleges and other non-governmental entities that will ultimately dictate whether Connecticut can better compete with cities like Boston and New York for leading-edge companies and talent. Government can, and should, play the role of convener, but the private sector must be the doer. And such state government-backed efforts must be done in conjunction with reforms that improve Connecticut's over- all business climate, which continues to be a weak spot. The state will never be able to reverse its lackluster economic growth by passing incentives for small businesses on one hand and new taxes or employer mandates on the other. The continuing budget crisis isn't helping either. Businesses, whether they are startups or Fortune 500 companies, take a holistic approach when weighing where to invest their capital. The state's innovation ecosystem program is an example of a potentially good policy idea that could make a dent in reversing the state's brain drain — if the private sector gets on board. In this week's issue, Hartford Business Journal's focus section includes a Q&A with Glendowlyn Thames, director of small business innovation and CTNext, the state's small- and startup-business promoter, about the inception of innovation places, which aim to develop certain areas in Connecticut into magnets for talent. The five-year, $30 million program is just beginning to accept applications and will provide funding for entities that support innovation and entrepreneurship in their communities and/or regions and create a common strategy to make their community a sought-after location for people and companies. Creating high-density innovation clusters is a similar strategy that's helped West Coast's Silicon Valley, Boston and New York City attract some of the best, highly educated talent in the world. For Connecticut to even come close to replicating the success of those regions, the pri- vate sector must play a critical role, actively forming partnerships with local colleges and entrepreneurial networks that provide mentorship and seed innovative ideas. Much of that already goes on in pockets of the state, but this effort is about creating such a high intensity of organized activity that a Yale or UConn graduate with the next "big idea" refuses the temptation of Boston or New York in favor of lab or office space in Hartford or New Haven. Luckily, it seems some of our state leaders understand the importance of private-sec- tor leadership in growing the state's innovation ecosystem. As Thames said in her Q&A, "This program will not reach its full potential unless there is private-sector involvement. In all successful entrepreneur communities, the private sector plays a big role." Now the onus is on the state to encourage and facilitate industry involvement. Busi- ness leaders too must take a more active role in promoting innovation and entrepreneur- ship beyond their companies' walls, because a more vibrant economy can lift all boats. That, along with other policies that make Connecticut's business climate more competitive, could start to move the needle back to a time when the Nutmeg State was among the most innovative, economically successful states in the country. n OTHER VOICES CT legislature tried to stop the exportation of water. What's next, air? By Don Vaccaro C reating an environment for job creation in Connecticut should be the No .1 goal for our elected officials, both on the local as well as state level. High employ- ment and decent pay- ing jobs equals more tax receipts, which equals better school systems and higher achievement for our students, which equals less crime. It is a never ending positive loop. Families with decent incomes are happy, which leads to happy communities. It is certainly important for our legisla- tive leaders to consider all constituencies and protect the public's interest when considering permitting for new manufacturing projects; for example, we all want to make sure our lands and waterways are protected from harmful chemi- cals. But they also have to balance competing interests to make sure that the overall common good is achieved. The state legis- lature did the right thing last month when they failed to act on a bill that would have jeopardized the Niag- ara Bottling plant in Bloomfield. But why would this company have to spend money defending itself from our elected leaders at the state capitol in the first place? Competing with other companies in other states is tough enough without having our state government adding more barriers to job creation. I understand legislators' concerns about control of local resources as well as the envi- ronmental issues regarding plastic bottles, and applaud their desire to address those issues. But in the end, Hartford, like most urban areas, needs jobs. This past March, about 1,400 applicants lined up for 300 minimum wage seasonal jobs at the Hartford Yard Goats jobs fair. The state Department of Labor reported in June that Hartford's unemployment rate was 11 percent, the highest in the state and close to double the state's unemployment rate of 5.9 percent. The Niagara Bottling plant in Connecticut is surely a good thing for the Hartford area economy. If it is fully built out, the numbers tell the story: • $3.7 million annually to the Metropolitan District Commission (MDC); • 120 jobs that will average in the $35,000 range; • $5 million in additional taxable income; • $1 million in annual property taxes to Bloomfield; • $57 million that Niagara is spending to build its new plant, where 75 percent of the construction jobs are going to Con- necticut residents. Niagara is creating jobs. Niagara is paying millions of dollars in construction fees to the government. Niagara is putting Connecticut residents to work building its plant and will provide 120 permanent jobs. And Niagara will be paying millions in corporate, property, and income taxes annually to Connecticut. The Niagara deba- cle demonstrated what is wrong with the state's approach to attracting and retain- ing business, where jobs are created. The state's leadership could have supported Niagara and demon- strated that Connecti- cut is open for busi- ness. Instead, few if any of the leadership, Democratic or Repub- lican, publicly took a stand for Niagara. Some job seekers in Connecticut got lucky this past legislative session when Connecti- cut lawmakers punted on this anti-business bill. Next time they may not be so lucky, a potential job creator may decide to avoid fighting our legislative leaders and take their business elsewhere. n Don Vaccaro is the CEO of South Windsor- based TicketNetwork. He has no business interests in the Niagara Bottling plant. HARTFORDBUSINESS.COM POLL Should hospitals/colleges make payments in lieu of taxes to the city of Hartford? ● Yes ● No To vote, go online to HartfordBusiness.com. Last week's poll results: Will the pending I-84 viaduct project do more harm or good for Hartford? 25.0% Harm 74.1% Good Don Vaccaro ▶ ▶ The state Department of Labor reported in June that Hartford's unemployment rate was 9.7 percent, the highest in the state and close to double the state rate of 5.4 percent. Send Us Your Letters The Hartford Business Journal welcomes letters to the editor and guest commentaries for our opinion pages. Electronic submissions are preferred and welcome at: editor@HartfordBusiness.com. ▶ ▶ Government can, and should, play the role of convener, but the private sector must be the doer.

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