Editor: Mr. Majors, would you tell our readers something about your background and professional experience?
Majors : I am a lawyer by training. I practiced for about 20 years before changing careers and becoming a banker. For the past 14 years I have been President and CEO of American National Bank & Trust Company, a regional bank with about 800 million dollars in assets. We are traded on the NASDAQ exchange. I have also been very involved in economic development at the local level for a number of years, and I am now involved at the state level as a board member of the Virginia Economic Development Partnership. I have just completed my first year as Chairman of the Board.
Editor: Please give us an overview of the Partnership. For starters, what is its origin?
Majors: The Virginia Economic Development Partnership is a marketing organization created by the Virginia General Assembly in 1995 to encourage, stimulate and support the development and expansion of the economy of the Commonwealth. It is a state authority governed by a 21-member board of directors appointed by the Governor and the General Assembly. Our board members serve six-year terms, which give us some continuity from one gubernatorial administration to the next. The board appoints the Partnership's Executive Director. Together, the board and the Executive Director set the organization's strategy. It is worth noting that we are a non-partisan organization and much of our success is derived, I believe, from politics having been taken out of the process.
Editor: And the Partnership's mission?
Majors: The statutory mission is to enhance the quality of life and raise the standard of living for all Virginians through aggressive business recruitment, expansion and trade development, these initiatives to be undertaken in collaboration with the Commonwealth's communities. In so doing, we anticipate expanding the tax base and creating higher income employment opportunities. To accomplish that, we focus on cultivating new business investment, international trade growth and the expansion of existing Virginia business.
Editor: I gather that, among other things, the Partnership serves as a liaison between the private sector and Virginia's public instrumentalities.
Majors: The Partnership does serve as a liaison between the private sector and localities in Virginia. We provide assistance in the selection process, and once the company makes its selection we work with them on a development plan. We offer a number of performance-based incentives, including the Governor's Opportunity Fund which is a discretionary fund available to the Governor to help secure a business location or the expansion of an existing location for incoming investors.
We also work to provide workforce services and customized recruiting and training assistance to companies that are creating new jobs. That particular program is very useful in helping companies faced with technological change. It serves to reduce human resource development costs for new and expanding companies.
In addition, we have a number of other incentives, including the Virginia Investment Partnership Grant Fund, which is available to existing Virginia manufacturers. We also have sales and use tax exemptions and property tax exemptions that are available within certain parameters. Our Small Business Authority works to provide businesses with access to capital for growth and expansion. The state also has an enterprise zone program that provides state and local incentives to businesses that invest and create jobs within these zones, which are located throughout the state. We have technology zones as well, and six foreign trade zones.
Editor: The competition for new investment is very intense. What are the things that you say to prospective investors from elsewhere in the country and, indeed, from around the world about Virginia as an investment destination and place to do business?
Majors: I am proud that companies such as Philip Morris USA, PepsiCo, Micron, General Dynamics and others have a major presence in Virginia. Among the reasons they have chosen Virginia - and others continue to follow their lead - are the following:
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Virginia has one of the best pools of quality labor in the Southeast.
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Our corporate income tax, which is six percent, has not increased since 1972. We have no unitary tax on worldwide profits.
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We have one of the country's lowest combined state and local use tax at five percent, and, under certain circumstances, we can provide exemption from property taxes.
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We have ready access to investment capital.
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We offer low-cost workforce service programs.
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Travel to and from Virginia, and within the Commonwealth, is easy. Washington Dulles International Airport is one of the major airports in the world. The Port of Virginia is the third largest port on the East Coast. Our highway and railway networks are extensive and connect to the national networks in all directions.
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Virginia is home to one of the finest educational systems in the country. Last year ten Virginia high schools were cited by Newsweek as among the 100 best public schools in America, which placed the state third in the country with that number of schools in the top 100. At the college and university level, we have about 420,000 students enrolled at some 90 institutions. The University of Virginia, Virginia Tech and The College of William & Mary are among Virginia's world-class institutions of higher learning. We also take great pride in our community college system, which provides terrific opportunities for young people and, in addition, serves to meet the needs of many nearby industries for a highly motivated and skilled workforce.
Editor: Are there particular industry sectors that you have targeted to bring to the Commonwealth?
Majors: We have decided to target four vertical markets: advanced manufacturing, services and security, science and research, and transportation. Within the advanced manufacturing sector we include food processing, pharmaceuticals, natural resources, chemicals, plastics and polymers. Services and securities includes federal security agencies, information technology, finance and insurance, professional business services, and so forth. In the science and research sector we target biotechnology, nanotechnology, R&D, modeling and simulation, and energy. Transportation includes automotive, aerospace, global logistics and distribution.
Virginia has a diverse economy, and our analysis of the last fiscal year indicated that about 78 percent of our projects fell within these four vertical sectors. We are doing a good job of aligning with our markets.
Editor: Could you tell our readers about the Partnership's international dimension?
Majors: In recent years we have seen a transformation in our exports. Last year Virginia chip makers sent 1.5 billion dollars in computer chips overseas, representing about double the coal exports and three times those of cigarettes. In the past, these were our largest source of exports. We also export aircraft parts and tractor trailer trucks.
The Commonwealth has a couple of really fine export programs to help Virginia-based industries. Accessing International Markets (AIM) helps Virginia companies pursue international leads and new overseas markets, and Virginia Leaders In Export Trade (VALET) helps companies with firmly established domestic operations to turn to international exporting as an expansion strategy. This program has been recognized as a national model by the National Council for Public-Private Partnerships.
Governor Kaine is firmly committed to supporting our efforts. This month he will be leading an international trade mission to India, Japan and Hong Kong. This follows on Virginia trade missions to Canada and Europe.
Editor: Would you give us your thoughts about the development of Virginia and the region over, say, the next five years?
Majors: We think that Virginia's evolution into an ever more diverse economy will continue. Just recently we were very pleased to announce that SRI International, an independent non-profit scientific research institute originating on the West Coast, is going to establish a major presence in Harrisonburg, Virginia to work with James Madison University. That is going to have very positive repercussions across the entire Commonweath.
Specialty wood products have always had a strong presence in Virginia, especially in the Southside and Southwest regions. We expect that trend to continue. Swedwood, the manufacturing component of IKEA, recently announced its plans to establish its first North American manufacturing facility in Virginia - a major boost for Southside Virginia. In addition, the transportation and global logistics industry is expected to continue as a strong contributor to our success.
In southwest Virginia we are seeing a transformation in the region's economy with the shift to IT and software development. Several major projects have involved investments resulting in some 700 new jobs in the region.
Northern Virginia and Hampton Roads are in the process of becoming a destination of choice for a variety of research institutions focused on modeling and simulation. Much of this work is for governmental agencies, and the volume is such that degrees in this field are now available at both the undergraduate and graduate levels at Virginia universities. Defense and homeland security are also important to Virginia's economy, and, given our proximity to the national capital, all of the major players in that industry have a presence here.
We are seeing incredible growth in the insurance and in the financial services sector. The Federal Reserve Bank of Richmond is located in our state capital, and we also host Capital One, Genworth Financial and Wachovia Securities. Their presence is attracting others to Virginia. We believe the future is very bright.
Editor: Is there anything you would like to add?
Majors: Last year we were pleased to have been selected by Forbes.com as the best state for business. When the Governor was informed, he was told that there was not even a close competitor. Our intention is to remain the best state for business, and the Partnership is committed to making that happen.
Published May 1, 2007.
