With a little more than 15,000 residents according to 2013 Census data, Batavia resembles many other small towns in the western part of New York. It features a vibrant downtown shopping district with quaint stores and cafés, several small parks and a bustling public library. Batavia also has its own Class A baseball team: the Batavia Muckdogs, whose fans fill Dwyer Stadium even on muggy summer nights.
Batavia serves as the heart of a U.S. Census Bureau designation that covers Genesee County and is known as a “Micropolitan Statistical Area.” The Batavia MSA was recognized as a top micropolitan area by Site Selection magazine earlier this month, tying for fourth place in the nation for having 12 major business projects in the pipeline last year.
The term micropolitan — an area that has an urban core of between 10,000 and 50,000 people — was created by the Census Bureau about a decade ago, but not until the past two years have economic developers pushed these areas as a viable choice for relocating businesses that provide higher-paying positions, which help revive the communities. Some of the new businesses and expansions in Genesee County include companies such as First Wave Technologies, which provides financing for start-ups; Yancey’s Fancy (a high-end artisan cheese company); Liberty Pumps (a commercial wastewater pump manufacturer), and U.S. Gypsum (a Sheetrock maker).
“Throughout 2014, we continued to see tremendous growth in Genesee County as a result of our strategic business attraction and expansion efforts to generate capital investment and create more job opportunities,” said Steve Hyde, president and chief executive officer of the Genesee County Economic Development Center, adding that further development is expected this year.
Gov. Andrew Cuomo has made business attraction a top priority with a variety of incentives such as Start-Up NY and the Excelsior Jobs Program. Industrial development agencies can also offer relocating business incentives such as PILOTs (payment in lieu of taxes), as well as rebates from local utilities.
Start-Up NY is a generous program for businesses looking to relocate to the state. An incentive package allows businesses to enjoy being 100 percent tax free for 10 years, freeing companies from paying state income tax (including employees), sales or property tax, business or corporate state tax and franchise fees.
Aside from Batavia, other New York micropolitan areas recognized by Site Selection magazine include Plattsburgh, Massena and Ogdensburg — all of which were in the top 10 ranking.
In New York, Ohio and Massachusetts, local development corporations are having success targeting sectors such as advanced manufacturing, which includes companies that specialize in 3-D printing or small parts for jet engines; biotechnology; data centers; film-production facilities; corporate headquarters for financial firms; digital imaging, and value-added agriculture, which includes distilleries, artisan cheese and bread, and grain-fed sausages, among other products. These are sectors that have higher-paying jobs — often between $20 and $25 an hour for line work and much more for managers, supervisors and product developers.
Other targeted sectors include energy and niche manufacturing. For example, Wooster, Ohio, has several start-up projects, such as Quasar Energy Group — a processing company that converts waste into energy. Another start-up is 3i Ingredients Innovations International, which makes products for the “nutraceutical” market.
Another sector closer to retail and apparel is warehouses and distribution centers. Gap Inc. recently revealed an expansion of its Fishkill, N.Y., distribution center. The $96 million project will add 1,200 jobs over the next five years. Currently, there are about 420 full-time equivalent positions at the warehouse. According to Glassdoor.com, warehouse positions at the facility have starting wages of $15 an hour, a positive for a local economy that’s been wounded by ongoing downsizing of nearby IBM.
From a financial perspective, the 2014 Batavia projects represented $58.07 million in fresh capital investments as well as 140 jobs. This doesn’t sound like a lot of money or jobs, but for small cities the impact is huge. Economists note that there’s a “multiplier effect” when jobs are added to a local community. Batavia’s 140 new positions can add several million dollars each year to tax rolls and local businesses.
From a retailer’s perspective, these micropolitan areas may be small, but can serve as a market bridge between larger metropolitan areas. Moreover, as companies deploy “omnichannel” retailing strategies, there’s potential for distribution centers to pop up across the country as a way to get goods to consumers quicker and more efficiently. Proximity to major markets will be essential.
Batavia, for example, is located between Rochester and Buffalo, and has its own Thruway interstate exit. Aside from the proximity of these two cities, Batavia and other similar micropolitan areas are attractive to companies looking to relocate because of other factors. These include:
• A ready and high-quality workforce with a nearby college or university.
• An affordable and well-maintained housing stock. In Batavia, a 1,500-square-foot Victorian or Arts and Crafts-style home can sell for as little as $95,000.
• High-quality of life as measured by crime rates, income and other key metrics.
There are downsides. Batavia experiences “lake effect” snow from nearby Lake Ontario, and the total snowfall in 2014 was 41 inches. Since the beginning of this year, this small city has seen 43 inches of snow. But spring begins this week.