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Stuart Garfield
Friday, April 17, 2009
Mass. development chief Bialecki on state, town relationship and tech
By Galen Moore
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Over the past several months, the Patrick Administration has worked on a number of initiatives involving the technology community. State officials visited the West Coast in a highly publicized trip to advocate on behalf of New England, for example, and studies are under way to define the region’s strengths as they relate to work force and the development of clusters such as video game creation. State officials have also been meeting with the tech community to identify hurdles to growing the technology economy. Mass High Tech editor Douglas Banks and staff writer Galen Moore sat down with Greg Bialecki, state Secretary of Housing and Economic Development and the state’s chief policy adviser for business development and job growth.
MHT: You were appointed the state’s first permitting ombudsman prior to your role now. What improvements the state made and where are you planning to go this year with respect to permitting improvement and hurdling local zoning issues?
BIALECKI: So we are doing a couple of things. One, which is a longer term approach, is that we are looking at some systematic reforms in the way we do zoning and permitting in Massachusetts. For example, for the last 18 months I have chaired, at the governor’s request, a planning and zoning reform task force. That task force resulted in a bill being filed in January by Sen. (Harriette) Chandler and Rep. (Kevin) Honan that would fundamentally change the way we do local regulation in Massachusetts. One aspect of that is there were some changes that were applicable to all communities and then we also had a separate set of provisions for local communities that chose to opt into it. Are you familiar with the Green Communities Act?
BANKS: Yes.
BIALECKI: So in Massachusetts there is a tension between state government and local government, as you know. If you look at various ways we have tried to change the way the communities do zoning and land use, the more successful models over the past few years have not been like a state mandate: set out a model for a better way to do things and encourage communities to adopt into that. The 44D program is the program where a community designates a commercial site and promises to do all local permitting in six months or less. It is a local opt-in and we now have more than 50 communities that have opted in. The Green Communities Act also has opt-in. Similarly, zoning reform, which we call the Land Use Partnership Act, would say that communities that opt in would get preference for planning money, for infrastructure money. They would get certain changes in their ability to regulate land use, but one of the things we are asking communities to do is to create a clean energy zone, whether it is for energy R&D, manufacturing or energy generation.
MHT: How about the state’s plans for short term?
BIALECKI: In the shorter term, we focused on the fact that we really don’t have to change the attitude of all of our 351 communities. In fact, what we really need to do is develop a sufficient inventory around the state of places where businesses are very welcome and can get up and running very quickly. Then that can change the perception. So we built on the example of Fort Devens, the redevelopment of Fort Devens, which everybody agrees is very successful. To build on that model and to replicate that, the governor started a growth districts initiative, and we have identified about to hit 18 places around the state. Some are urban, some are suburban, and they are scattered around the state. We feel they are very promising places for new growth and development.
They are places where the community is welcoming new development. Even in this down part of the economy, when we are not seeing a lot of new groundbreakings, we are consistently working toward pursuing the permitting so getting those places through the legal process, getting as much permitting done in advance as possible, getting the local zoning changed, helping to pay for infrastructure improvements so they are done in advance instead of waiting for a company to arrive.
MHT: So designated growth districts don’t remove the home rule? Ultimately there are still local planning zoning boards and hearings that have to take place anytime some company wants to move in, right?
BIALECKI: Yes, but a lot of these places have adopted Chapter 43D, so that is an assurance of six months or less. Also, what you really learn from the Devens model is the key characteristic of these growth districts is that the communities are planning ahead. There are things you can do administratively to accelerate permitting times. You can have people file electronically instead of filing paper. But the fundamental thing that is slowing us down in Massachusetts is we are not planning ahead. When the company comes in and says I would like to build a factory there, the community says, “Well wait a minute.
I don’t know if we want a factory there.” That happens because in Massachusetts the predominant attitude is a wait-and-see attitude.
So something is zoned and maybe it requires a special permit. When you go into the permitting, that is the time when the community says, “OK, well, now you have made me a proposal for something you would like to do, let me think about whether that is something I want to do.”
MHT: In terms of clean energy, Maine seems to have taken the imitative with a number of wind projects that are land based where in Massachusetts, Cape Wind hasn’t taken off yet. I wonder if there is a change in strategy, if you are looking at different areas where Massachusetts might try to do more wind and solar?
BIALECKI: There really is a pretty big distinction in the water based projects than land based projects. There are things that government can try and promote and work in collaboration with private industry, and we were. In a lot of cases it is not going to be possible for state government to necessarily set the table and take the initiative. You have to look at the opportunities presented and try and support those. When we came in Cape Wind was there as the example of the private industry side of someone who was most determined to do that. So that is why we started on the water side. For that simple reason nobody decided that from a state government point of view that we would and that it was better to start there than on the land.That is just where the opportunity was. We have done everything we can to support that from the state side, and it really is relying now on this federal determination. My understanding from Secretary (Ian) Bowles is that one of the challenges, at least for us in the Massachusetts geography, is that most of our good opportunities are going to be in federal waters. So Cape Wind really is pursuing things not only first in Massachusetts but first in the nation. The bad news for them is forcing the federal government to come up with some policies and regulations, the whole idea of how they want to regulate and manage off shore wind. Once they do, it is going to help everyone else a lot.
MHT: Back to the land side?
BIALECKI: On the land side what we’ve been doing, really what Secretary Bowles has been doing, first of all, is collecting all the data that is available, and coming up with a comprehensive map of where the highest potential wind, land based wind sites are across the states. One of the challenges there is to line up where the wind is with where there are the opportunities for community support. The next step is looking at state properties for obvious reasons. It is an ongoing process, looking at opportunities where we can do state property acquisitions or repositioning of state property so that we can develop wind farms, but do it in a way that has a net positive conservation result. Then the next phase of his effort are going to be to having a conversation with communities about alternative permitting within communities for these high wind resources.
MHT: Let’s go back to manufacturing for a second.What types of manufacturing jobs are still here that can grow, and on the education front where are the opportunities for retraining people? What’s the successful manufacturing company look like now, and how are you retraining workers or working with the community colleges perhaps or high schools to retrain?
BIALECKI: You can look at it sort of on an industry sub-sector basis. We have had some success with clean tech manufacturing. We have had some success with life sciences manufacturing. Defense technology manufacturing is still very strong for us, and aviation and aerospace is still very strong. IT-related manufacturing is strong, and robotics is very strong growing cluster.
There is growth across a variety of sectors. What actually underlies that in an interesting way is that we have a real, almost century-old tradition in precision metal working and in precision plastics. So, what you are seeing there are companies that are supporting players. In the aggregate of the Massachusetts manufacturing industry, one of the things that is notable is a much, much higher percentage of the total industry is small and mid-size companies.
We don’t have manufacturing companies with thousands and thousands of workers. So a lot of them are hundreds or even one hundred or less, and that’s characteristic.
MHT: Is that unique? I mean is that different from other states in the country? I mean obviously southern states probably still have some large ones.
BIALECKI: Yeah, and in the Midwest too, to the extent that they have manufacturing. The carmakers, the big three, and I would argue we are actually where we want to be in that regards.
MHT: So smaller is better?
BIALECKI: I think I am very happy with small right now.
In addition to the companies that are in manufacturing in one of those areas, you see a whole supporting network of precision metal workers and plastics companies that are just doing jobs for hire. I think they are not generally perceived as being the cutting edge of technology but, in fact, the expertise they have is an incredibly important driver. For example, look at medical devices. We have a great health care sector, we have a great life sciences sector, we have an amazing medical device sub-sector. If you drill down and say why is that medical device sub-sector so prominent here, the answer is it’s the synergy with our plastics expertise and our metal working expertise. You have, for example, Marley fcn as a longtime plastics manufacturer in Leominster, making among other things that little plastic straw that you put on the WD40. As of five years ago, certainly 10 years ago, the percentage of their plastics that was in medical devices was zero. They said, “Guys we can do stuff with plastics that not everybody in the world can do, but we have to find some way to capitalize on that.” Now they are in medical devices, and I think the number is today 30 percent or 40 percent of all their business is medical devices. If you say, “What business are you in? They would say, ‘I am in manufacturing, I am in plastics.’ They don’t say I am life sciences company.”
MHT: You have touched on a couple of issues. One is the age; the average age of the workers is older. Are we training the next generation? What is the state, the system doing to train people in those jobs for the future?
BIALECKI: Barry Bluestone from Northeastern (University) was here earlier today, and he was talking about an initiative that he started. They are now going to do some work. I am just trying to get a baseline here of what we are doing between the vocational high schools, community colleges, union apprentice programs, you know, the pipe line? What is the demand? Even if manufacturing only holds out at the 8 percent number, I know there is a little bit shy of 300,000 people in manufacturing today. Let’s assume that number doesn’t grow at all over the next ten years. Given the attrition in the work force there’s more room for skilled machinists. For every kid in Massachusetts who wants to grow up to be a skilled machinist, if we could train him, there is a job waiting for him at the end of that. Even if the industry declines a little bit because as you know the industry is growing in the sense of output but in order to compete we just have to, we have been forced to become so much more productive that the output number is like this and the input number is like this. Even if the manufacturing total employment does decline a little bit, there is still plenty of room for anybody that wants it. One of the things that (Bluestone) is going to look at is a bit of a chicken and the egg issue. On one hand there are people who say that we don’t have enough capacity in the pipeline. In other words, we actually have a pretty good set of vocational schools in Massachusetts. But if you look at them, only a fraction of their kids are in the manufacturing and machining programs. A lot of them are doing all kinds of other stuff.
MHT: Plumbing, electricity?
BIALECKI: Plumbing, culinary arts and other stuff too. There’s some question about whether there are enough seats in the classroom if you add up vocational ed, community college, and so forth. Even if there were kids that wanted to do it, do we have enough seats in the classroom to meet the need, and do we need to grow them? I think the answer is going to be that we do need to grow them. One of the things we have to get past right away is there is also a chicken and the egg issue which is there is some resistance to making a full throated effort to do that because people say, “Well, kids don’t want to do that. So I am not willing to double the size of those programs.” In some cases it is parents saying, “I am not going to send my kids to these.”
MHT: Right.
BIALECKI: The other thing is if we are really competing, of the manufacturing companies we have in Massachusetts, many are literally the best in the world at what they do. So, you don’t just necessarily want to put fannies in the seats of those classrooms. You want the kids who are sharp kids and who are motivated, want to succeed, and want to do great things. You want them to see that being in manufacturing is the route to do that. That is one of the things that is exciting I think about what they have done at Lynn. I don’t know what the morale was, but I heard it wasn’t very good. It was a feeling that they were kind of left behind in GE, and now you go down there and they really feel like they are at the cutting edge of what they are doing.
Also if we are going to push for an expansion of the programs to do the training, we also have to say that manufacturing is here to stay in the future of Massachusetts, that it is a great career, that it pays well, that it’s challenging and rewarding, it’s clean and safe, and it’s a good career for young people to start. We have to simultaneously make the room for those training programs but also drive the demand a little bit.
MHT: Shifting the topic a little bit. We talked a little bit about the IT industry. A billion dollar biotech bill, 345 Clean Energy Green related bills. The IT industry feels left out. There is a little bit of hand-wringing, some “Don’t you remember us?” So there is an initiative now to brand, to re-brand route 128?
BIALECKI: Well first of all the, there has been some press around the re-branding but I have got to take a step back. What we are doing is really learning from history. What happened with life sciences is that before the Patrick Administration came along there was an effort by a bunch of people to build a life sciences collaborative, in other words get three corners of the stool-- government, industry and academia --to sit down and talk about this idea of a life sciences cluster in Massachusetts. What does it mean? Is there such a thing? If there is do we want to grow it and if so how do we grow it? For the folks who were there, it was an awful lot of homework that was done, so that when Governor Patrick came in office and said, “Hey, this stuff sounds exciting to me. I would like to do something.
One of the reasons he was able to move so quickly on it is he didn’t have to say, “All right, I am going to put a team of people to decide what we should do. You folks have been thinking about this for two or three years. I don’t know if you had a governor who was enthusiastic about what you’re doing but I am telling you that I am a governor who is enthusiastic so assuming that I am with you, what should I do?” That is how a lot of those ideas flow in life science (act). We realized that we were not in the same place so when we talked to the folks in the IT industry. We said, “We would like to do this even though you are represented by trade associations and so forth. That’s not really the same thing as the collaborative. So we would like to start to build a similar collaborative of industry leaders, academic leaders and government folks to create a forum to talk about what is most helpful to promote the industry.” We said we didn’t know if it is going to lead to the idea that we need another billion-dollar initiative but let’s not worry about that upfront. Let’s do it the same way the life science, the life sciences people didn’t start with the idea we want to spend a billion dollars, how should we spend it? We went with the idea of saying what was the concerns of our industry and obviously as you know part of the reason where there was the focus on the billion dollar initiative in Massachusetts was a bit of the part of the reaction of what California had done this big thing and we have got to keep up. That we need to do something the message the Governor got is I am not saying that you have to spend three billion dollars but that was a big deal and we have got to do something that is similarly captures people’s imagination.
In IT, the main work we have done really is the ground work in working to form the collaborative. We now have an organizing committee. Pat was actually involved with the Life Sciences Collaborative so we are following that model. If you look at the elapsed time for people who started to think about life sciences when Governor Patrick came in, they would say that was really quick. The people who were there, they said the first meeting, the first organizing meeting of the Life Sciences Collaborative was I think was in 2002 or 2003.
It was a five-year process. What we talked to the folks in IT about is we want to do the same thing. We are going to try to do it much faster than that. So we moved to have an organizing committee and we have got a and we are now working with that group to identify what are the most important needs for that industry and what we are trying to do and that actually and so far really and we are beginning to develop some working groups around that. So because of the importance we place on the value of the collaboration, we really are saying we are not going to tell you where we want this to go. We are going to listen to you about where we want to go. I am not going to tell you that a re-branding effort was what I anticipated was the number one thing that would come out of that group but I will tell you that it did come out as a very high profile issue and the view of a lot of the folks involved in the industry was even though whatever the statistics were that kind of the buzz and the energy that Massachusetts had about being the place to be where innovation was happening in the industry that meant that — was passed to California. The people feel that there is a new wave, people in the business as well as a new wave of innovation happening here in Robotics and Global Communications and Video gaming.
MHT: You mentioned branding and a new wave of innovation happening here in robotics, global communications and video gaming.
BIALECKI: But that it is not capturing people’s attention and, frankly, we are not even that concerned about spreading that message around the country and around the world. For the most part we are actually just interested in spreading it to the college and universities in Massachusetts.
I think some people when they talk about a branding campaign they think of it as marketing to outsiders, and that’s not even really the spirit in which it was intended. It was primarily coming up with a way to make sure that folks locally here, whether you want to join a company or start a company or whatever, it is that you think about Massachusetts as being as exciting and promising a place to do that as anywhere else in the country.
MR. BANKS: So I talked to Paul Sagan, the CEO of Akamai and one of the things that he mentioned to me was if you were able to put a sign up out on the front of his building saying Akamai, that would help brand his company and let MIT kids see that his company is there but because of rules in places like Cambridge, he is not able to do that. So what I don’t understand is how can you have a marketing campaign for a region when you can’t get a sign on your building for a multinational global company that is hiring right now? Do you see that disconnect?
BIALECKI: I think the point is that, the group that we are, the group that we formed really started to form in the middle or third quarter of last year is really developing that so the answer is if you were sitting in on those meetings I assure you that comes up.
For the time being, we are trying to take it one step at a time and we do think that in addition to addressing particular concerns that the more important thing for the moment, we are trying to do is to create the vehicle to address these things going forward. So what we are doing again, is get an organizing committee to get this structure in place. Then what (Pat??) hopes to do in the next couple of months, there will be a series of working groups that will come out. But absolutely one of the issues that we hear as well is simple things, why can’t you have signs along Route 3 North from Burlington and so forth? That will be part of the mix. We are not going to shy away from that. I think that is going to be part of the conversation, but for us it does tie a little bit into the growth district notion because I do think there are certain communities where the fact that we are organizing the business voice to send a clear message is still not going to make a huge difference.
MHT: Maybe not.
BIALECKI: But we are focused, that is why it ties back to the growth districts, because we are also focusing our energies. For example, we have one of the working groups that I have is with the local officials of five towns up Route 3 from 128 to 495 from Burlington and Bedford to Lowell. Those are communities that by and large get it, and want the companies to be there. I have reason to think that those conversations we can create the megaphone and say it’s not a complaint of Akamai or any single company.
This is what the ITS Collaborative Business is saying. If you want us to promote ourselves, we are. It’s that we need to have a higher profile. and similarly I just started, that one went on the Route 3 that I have been working on a little while. I just started one with Westford, Boxborough and Littleton because you have another great cluster of companies there. It is just going with RedHat and IBM and so forth. But then again those folks get it so I have some reason to think and that’s what we actually the meeting we had earlier this week is a bunch of business folks and the local officials and the legislative delegation just for the business people to say, the purpose of the meeting was to develop a shared sense of priorities about what was most important. One in that case out there is how do you shuttle the young kids who want to live in Cambridge and Arlington and get them out to Littleton every morning and get them home everyday. The process is to hear what the business, what the collective demands are, what are the priorities? Have a common voice, and then work in particular with the communities that are interested in that. Part of it is about the signage. It is actually a lot of other ripples to that as well because it is not just about getting a sign on the wall. It’s also about what we learned when we were out in California is if you are a IT entrepreneur out in California you are a rock star.
MHT: We celebrate entrepreneurs but we ultimately are not the mass media. You are preaching to the choir now.
BIALECKI: No, no, no. No I am not, I am saying that I am acknowledging that’s a problem that we have and the sign is really an aspect of that. It is not just about the sign, it is about why don’t in general we say, “Oh My God Akamai here is a great thing for the Commonwealth of Massachusetts.” This is to some extent when you get people talking about when Google was in California or Apple or those other companies. Part of the thing is it is not that those companies are that much greater than our companies. It is that they are celebrated there and we don’t celebrate. We have great companies. Why aren’t we celebrating Harmonics and Akamai and all these incredible companies?
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