‘Ahead of the curve’

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Jack Cashman remembers hearing talk of a new collaboration between Lewiston and Auburn more than 20 years ago.

Back then, the legislator from Old Town couldn’t escape the buzz in Augusta about a new growth council dedicated to joint development of both cities.

“They were ahead of the curve then and they still are,” said Cashman, now the commissioner of the Maine Department of Economic and Community Development. “They are the best example in the state of two communities pulling together to help each other.”

Since its inception in 1981, the Lewiston-Auburn Economic Growth Council has been a player in nearly every deal that’s brought significant investment and jobs to the cities.

Over the past 25 years, it lobbied hard for L.A. College, a needed investment in the area’s infrastructure. It worked in the public eye and behind the scenes for the Bates Mill Enterprise Complex, Wal-Mart Distribution Center and Foreign Trade Zone. Its handprints can be found on the business plans of dozens of companies that turned to the LAEGC for gap financing or site selection.

“When Tom Coyne and I bought the company, we went to the growth council to say we were interested in acquiring Diamond Phoenix,” said Larry Strayhorn, president. “We started a relationship then that’s still benefiting us today.”

In addition to helping find a site for a new facility, the growth council also arranged financing for the company. Diamond Phoenix grew rapidly, but then stalled during the recession and was forced to lay people off.

“The growth council was very understanding of the financial situation of the company,” said Strayhorn. “They understood that it takes money to turn a company around.”

Today Diamond Phoenix employs more than 100 people and expects sales of between $20 million and $30 million.

“During the whole process, they assisted us,” said Strayhorn. “As we built the building, through the downturn and rebirth.”

It’s a story often repeated. Born of separate development corporations on each side of the river, the growth council has stayed true to its three-prong mission: to bring good-paying jobs to the community; to invest in its infrastructure; and to expand the tax base.

“When you look at what’s happened over the last 25 years, most people think of bricks and mortar,” said Paul Badeau, the growth council’s marketing manager. “But what also shakes out is non bricks and mortar, things like marketing campaigns, business advocacy, the Bates Mill development, transportation infrastructure and business loans.”

Two of the original minds behind the growth council are still movers and shakers. Chip Morrison, then city manager for Auburn, and Lucien Gosselin, then city administrator for Lewiston, proposed joint development at the airport – to share the risks and rewards of forming an industrial park at the airport.

The project was a success, and led to the formation of the LAEGC. Among its first accomplishments was setting a protocol for economic development.

“They set the ground rules for what’s fair play and what’s not,” said Badeau. “We don’t play one community off the other.”

Much of the earliest years of the growth council were taken with finding sites for prospective new businesses and developing marketing campaigns to get the word out about L-A’s assets. As federal money for economic development became available in the mid-’80s, the growth council started to arrange financing. Today, money from two federal sources, the Finance Authority of Maine and the cities’ Community Development Block Grants, are funneled through the growth council to economic development.

“I’m busy,” said a smiling Ken St. Amand, the financial director for the growth council. “It’s never-ending.”

Right now the council has about $750,000 to loan, but that amount changes as loans are made and repaid. St. Amand said growth council-backed projects have prodded about $56 million in private bank investment. And its default rate stands at a respectable 5 percent, he said.

Deals are increasingly complex, Badeau said. No longer concerned with simply site location and gap financing, the growth council finds itself in the thick of tax deals, holding companies and marketing campaigns.

Badeau said the council can handle the increasingly sophisticated transactions because of the depth of expertise on its board and affiliated organizations: Lewiston Development Corp., Lewiston Auburn Railroad, Auburn Business Development Corp. and the growth council’s loan committee. More than 70 people are connected to the growth council through those bodies, including lawyers such as Peter Garcia and Dave Pierson, and CEO’s like Pete Chalke of Central Maine Medical Center.

“They are our strength,” said Badeau, “and a big part of our success.”

Cashman said other sister communities, divided by contentious infighting, could do well to study L-A’s model.

“Economic development should always be regional,” he said. “I love going down there. The whole atmosphere is very positive.

“And that’s how things get done.”

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