There were good reasons to be skeptical about the Sacramento region’s new economic development group and its brash leader.
But now in its third year, the Greater Sacramento Economic Council may be turning the corner.
It just announced that McKesson Corp., the San Francisco-based health care behemoth, will build a 316,100-square-foot warehouse in Roseville and bring nearly 170 jobs. It’s the first big win for the council’s campaign touting Sacramento as the gateway to the “Northern California Mega-region” that includes the Bay Area and Silicon Valley.
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Barry Broome, the council’s boosterish CEO, says the strategy has made a “huge breakthrough” in the last 30 days. He told me Friday that in the past week he had secured commitments from at least three companies – and as many as five – that will be publicly announced in the next 90 days, a big jump from the council’s average of 10 a year.
The way he figures it, if Sacramento can grab 10 percent of the jobs moving out of the Bay Area, the region will be “economically bulletproof.”
Still, long term, the region can’t just poach from Silicon Valley. It must generate new, high-paying jobs from within – maybe even launch its own big tech company.
That’s a much more difficult job, but Broome doesn’t lack for ambition. From the council’s new offices on the 25th floor of the Wells Fargo Center on Capitol Mall, he commands a sweeping view of what could be next.
He can see the riverfront he and Mayor Darrell Steinberg hope will be transformed into a real destination for residents and visitors. There’s the downtown railyard, likely home to a Kaiser hospital and a Major League Soccer stadium and eventually perhaps a major mixed-use project. There’s the huge 1,500-worker warehouse Amazon is building near Sacramento International Airport.
And in the distance – both geographically and realistically – is the Interstate 5 corridor near the airport, a prime location, Broome says, for a next-generation automotive research and manufacturing hub. If Sacramento can catch the wave of what he believes will be the next big industry in California, there is “unlimited potential” to add good jobs.
Now, he has more firepower. The council’s annual budget is $3.6 million, more than double its first year. Of the money, 80 percent comes from 37 corporations in the region (including McClatchy, the parent of The Sacramento Bee); the other 20 percent comes from 19 cities and counties.
With that additional money, the council is trying to raise the Sacramento region’s profile around the nation and the world. In July 2016, the council opened an office in Sunnyvale, the heart of Silicon Valley. More recently, the council spent $150,000 ($15,000 from its own coffers and $135,000 from corporations and sponsors) on a digital marketing push into the Bay Area. Forbes magazine and Bloomberg have published pieces recently that endorsed Sacramento – where the cost of doing business is 33 percent to 50 percent lower – as a destination for tech firms and workers looking to leave the crowded and expensive Bay Area.
The council also placed a 32-page promotional spread in the American Airlines in-flight magazine for August. It provided the content, while the airline sold ads to major players in the region. The potential audience is 16 million passengers on domestic and international flights, though, of course, not all of them will read the supplement.
Most of the highlights will be familiar to area residents: Golden 1 Center and the proposed Republic FC soccer stadium, farm-to-fork, and the food industry, weather and recreation.
The “Spotlight” supplement also promotes the idea of Sacramento on the tech cutting edge. It mentions Verizon picking the city as a test for ultra-fast 5G wireless and Volkswagen choosing it as the first “Green City” for electric vehicles.
And the supplement sells the entire region, with separate features on Folsom, Rancho Cordova, Rocklin and Roseville.
This “we’re all in it together” approach was part of the council’s founding mission. That comes in defeats such as Aerojet Rocketdyne’s announcement in April that 1,100 of its 1,400 jobs in Rancho Cordova would go away and that manufacturing operations would end by 2019. Broome points out that many of those workers live in Roseville and Rocklin, so it’s a loss for them, too.
But he hopes the entire region benefits from more victories. One key lesson of landing McKesson is that Roseville approved everything needed for construction in 143 days, including entitlements, environmental review, plan review and permits. Broome says companies often are on tight schedules, so he wants other cities to streamline their permitting as well.
Besides becoming more business-friendly, Broome says the region must get much better at keeping graduates from UC Davis and Sacramento State from leaving and at training a tech-ready workforce.
Broome still bad-mouths Sacramento too much for my liking – that it has been an afterthought for CEOs, for instance, or that we have been too afraid of rapid growth and too hesitant to promote ourselves. There were smart and dedicated folks recruiting companies before he arrived, and modesty is not always bad.
But maybe it did take an outsider not shy about ruffling some feathers to jump-start economic development. If he keeps reeling in companies such as McKesson, or helps create an auto research hub, it’ll be hard to argue with the results.