MOHAWK VALLEY EDGE: Reinventing the Mohawk Valley

The American flag at Griffiss Air Force Base was lowered for the last time in September 1995, marking the loss of thousands of military personnel and nearly 1,200 civilian jobs. Despite receiving notice of the closure two years prior, the base closing was a tragedy for Mohawk Valley residents who had already witnessed a decades-long declining economic base and outmigration of residents.

“Frankly, we were shell-shocked,” exclaims Steven J. DiMeo, president of Mohawk Valley EDGE, a private, not-for-profit, regional-economic-development corporation formed in 1995 to develop a long-range, regional strategy; to focus on strengthening existing area businesses and attracting new industries and talent; and to build a vibrant environment both for companies and their employees.

“Our organization was tasked with not only reinventing the Griffiss Base, but we were also charged with being the lead economic-development agency for the entire Valley. It was a daunting task to reach out to the various stakeholders and get them to agree on a plan and commit to what we knew would be a multi-year process.”

Getting the stakeholders to agree to an economic-development plan was just the first step. “We all knew the process could take decades,” says DiMeo, reflecting on the past 25 years. “The goal was to create a diversified and stable economy, create high-paying jobs, and attract both public and private investment. The key was to focus on our competitive advantages and leverage the area’s assets, with an eye on the long-term strategy. The plan began by identifying a few industrial clusters around which we could grow the Mohawk Valley’s economy.”

Clusters IT/cybersecurity

“One obvious cluster to develop was IT/cybersecurity,” avers DiMeo. “The Air Force Research Lab (AFRL), located on the former air base, served as an anchor to redevelop the base into a business and technology park. AFRL employed hundreds of the top scientists and engineers in the field and also housed hundreds of on-site contractors. Today, AFRL has grown to employ more than 1,200 people with a five-county, annual economic impact in excess of $467 million and an annual payroll exceeding $145 million. The lab’s annual $2 billion budget supports another 1,300 indirect jobs.

To say the lab has been a catalyst for IT/cybersecurity growth is an understatement. AFRL has attracted companies such as Booz Allen Hamilton, BAE Systems, and Peraton. “[The nonprofit technology-consulting company] NYSTEC now occupies its new corporate headquarters here in a 32,110-square-foot building and expects to double its Rome staff in the next three years,” continues DiMeo. “Currently, Booz Allen Hamilton, a Fortune 500 company, is building out the first floor of the NYSTEC building to add to its Rome footprint. The company has 158 local employees and anticipates hiring 60 new employees. The lab has also spun off companies such as AIS, which employs hundreds at the Park and in multiple offices around the country.”

DiMeo continued, “Bonacio Construction, the developers of Air City Lofts (a mixed-use development located at the center of the Griffiss Park), has a new 40,000-square-foot, class-A office building under construction to house two technology companies (the company held a beam-raising ceremony on Aug. 19). Also under development is the Innovare Advancement Center at Griffiss International Airport, a $12 million project. A partnership of the Air Force Research Laboratory Information Directorate, the Griffiss Institute, and SUNY Polytechnic Institute, the 40,000- square-foot building will provide a collaborative hub linking government, industry, and academia to produce revolutionary research from scientists and engineers on the forefront of cutting-edge technology. The campus should establish this region as a trailblazer in the emerging field of quantum information and support our growth in drone technology, cybersecurity, and AI research.”

Advanced manufacturing

Advanced manufacturing was another cluster identified in the original MV EDGE plan. “From the time I joined EDGE,” says DiMeo, “we have wanted to promote high-tech manufacturing, and developing a nanotechnology infrastructure to draw semiconductor manufacturers was at the top of the list. New York State committed decades ago to investing in … [this cluster], because it saw the long-term demand for chips. With the current demand for artificial intelligence, the rollout of 5G, and the growth of IoT (Internet of Things), current projections indicate that this industry will reach $1 trillion in global sales by 2025 … The Marcy Nanocenter was chosen not only to create a semiconductor-manufacturing site, but also a research center to develop next-generation chips. To date, we have invested $110 million to prepare the Marcy-site infrastructure.”

Patience and determination have finally paid off. Danfloss, a Danish corporation, is operating in the former QUAD-C building, just a mile from the manufacturing site. The company’s silicon-power division will eventually occupy 250,000 square feet, including 52,000 square feet of clean-room space, and, over the next few years, employ 300 people. In September of last year, Cree, Inc. (NASDAQ: CREE) announced its plans to build a $1 billion silicon-carbide fabrication plant at the Marcy Nanocenter. 

“Construction of the 454,000-square-foot fabrication building with 112,000 square feet of cleanroom space is underway,” asserts DiMeo. “There is an 85,000-square-foot administration building connected to the plant and a separate 113,000-square-foot, central-utility building connected via a trestle with the FAB. The construction is expected to be finished by Q2 in 2021, and production of the first silicon-carbide wafers is scheduled to start in early 2022. Cree, which will over time employ 614 people at the facility, has already started hiring for the Marcy site, and the company has taken over the SiC tool line at SUNY Polytechnic Institute in Albany, qualifying its processes on the tool set there. This state-of-the-art plant has the capability to produce 200mm power and RF (radio frequency) wafers that are driving the transition from silicon to silicon-carbide technology in order to support the growing electric-vehicle, 5G, and industrial markets.”

The MV EDGE leader continues, “Cree will invest $1 billion to build and equip the plant and provide research. The company has signed a 49-year lease with MV EDGE for approximately 56 acres, which includes enough space to potentially double the current fabrication capacity. As part of the deal, Cree is leasing the former PEMC (Power Electronics Manufacturing Cleanroom) at SUNY Poly’s Albany site, which includes the 200mm tool set. The PEMC tool set will be relocated to the Marcy site when construction is finished. MV EDGE projects that CREE will generate an annual payroll of $46 million and produce a $3.4 billion regional-economic impact yearly. Cree’s commitment also includes promoting student internships and scholarships at SUNY Poly, where the company just made a $3.5 million gift to establish a scholarship program and endow chairs.”

Unmanned aircraft systems

Another critical cluster is unmanned aircraft systems (UAS). Better known to the public as drones, this cluster was not foreseen in the regional original economic-development plan. “Our region is on the ground floor of a new industry that will fundamentally change the way businesses operate,” opines DiMeo. “Just imagine, farmers can sit in their kitchens and now determine the condition of their acreage, whether certain areas need water or how the crops are developing, and sight insect infestations. Inspectors no longer need to climb under bridges to determine what repairs are needed, insurance … [representatives] can quickly assess damaged property, retailers and restaurants can deliver food and packages quickly to your door, rescue teams can aid stranded or injured people safely, and surveyors can plot large areas quickly with pinpoint accuracy. Think of the multiple uses for police, firefighters, and the military. This is just a partial list of the uses for drones.” 

DiMeo notes that the current usage will expand exponentially once the industry develops the final rules and technology of flying beyond visual line-of-sight (BVLOS).

Driving the development of UAS is NUAIR (Northeast UAS Airspace Integration Research), a nonprofit organization that provides UAS operations, aeronautical research, safety management, and consulting services. Headquartered in Syracuse, NUAIR manages the operations of the UAS Test Site at Griffiss International Airport, one of only seven FAA-designated UAS test sites in the U.S. and is responsible to the FAA and NASA to conduct operations for UAS testing. The organization leads the development and commercial advancement of the 50-mile UAS corridor between Syracuse and Rome, which facilitates BVLOS testing, commercial operations, and the integration of UAS into the national air space. Since its inception, the test site has witnessed more than 2,700 test flights of small, medium, and large unmanned aircraft. The Griffiss site will soon boast Sky Dome, planned as the nation’s largest, indoor, instrumented, drone experimental site, which allows for year-round testing. Last year, New York State announced the creation of a UAS Center of Excellence, which will operate under the management of NUAIR. The center brings together New York and Israeli companies, higher education, and UAS companies — all working together to advance the industry and the region. 

“I believe that our region will be at the forefront of UAS growth and should become the ‘underwriting laboratory’ for creating and certifying UAS standards for drones,” asserts DiMeo.

Other clusters

Utilizing the former air base for aviation maintenance and inspection was an obvious focus of the economic-development plan. 

“Strategic Global Aviation is setting up its operation here with 70,000 square feet of hangar space and a runway that’s more than two-miles long,” notes DiMeo. “The company performs programmed depot maintenance and inspection of both military and civilian aircraft and also maintains an aviation-consulting business. The maintenance programs include both field support and heavy maintenance performed here at Griffiss.”

The transportation/distribution cluster was another early focus because of the Mohawk Valley’s geographic location and proximity to one-third of the U.S. population. 

“Orgill, Inc. has purchased 64 acres at Griffiss and recently broke ground for a distribution center designed to service its Northeast customers,” says DiMeo. “The $71 million project will encompass 790,600 square feet and employ an estimated 225 people when the project is completed in early 2022. Orgill is the world’s largest, independent hardware distributor serving more than 6,000 retail hardware stores, home centers, farm stores, and professional lumber dealers in the U.S., Canada, and in 50 other countries. The company’s decision to build here in the Mohawk Valley is confirmation that this is an important cluster positioned for more development.”

Building a foundation

“The renaissance in the Mohawk Valley didn’t just happen because we focused on a few clusters,’ DiMeo points out. “You can’t attract and grow businesses unless you have an environment in which they can flourish. This starts with an educated workforce eager to help companies be successful. What I hear repeatedly from businesses is that their primary concern is attracting and retaining an educated and motivated workforce. This means developing an educational system from kindergarten through university. Fortunately, the region hosts a number of institutions of higher education which graduate thousands of students annually in the arts, science, and technology. Area companies have also embraced student internships, which highlight the area’s employment opportunities and encourage some students to stay here. Encouraging entrepreneurship is another part to developing economic growth. The Mohawk Valley has created a number of incubators ranging from MVCC’s (Mohawk Valley Community College) downtown thINCubator; the Griffiss Institute’s GIBI, designed as an intermediary between AFRL’s research and area marketplace; and IDEA NY, a business accelerator targeting entrepreneurs in cybersecurity, UAS, and IT.”

DiMeo emphasizes that the concern for education is just one of many components necessary to build a community’s foundation. “We’re also concerned about the quality of life here,” he says. “We are developing vibrant downtowns in cities like Utica, Rome, and Sherrill. Continuing development in Utica’s Bagg’s Square neighborhood, Harbor Point, and the new downtown hospital are transforming the city into a place that attracts people to both live and work. In Rome, the city is developing the Floyd Ave. corridor to connect downtown to the Griffiss Park. Work is underway on the Air City Lofts, a mixed-use development which, in phase one, will include two four-story buildings. The 84-unit, market-rate apartment complex will also include 25,000 square feet of commercial space on the ground floor. Bonacio Construction [of Saratoga Springs] is developing the property and has an option for future site development. A new YMCA is another important development project planned along the corridor. Downtown, Rome is moving ahead with the renovation of the Capitol Theatre and the development of Copper City Lofts across from City Hall, while the Cold Point Co. is building a new factory to manufacture heat pumps. Varflex, which makes electrical-insulating sleeving, is adding 12,000 square feet to its current 200,000-square-foot factory. In Sherrill, 600,000 square feet of the old Oneida Ltd. factory have been renovated and leased, which has revitalized the city.”

The impact of COVID-19

Over the past quarter century, Mohawk Valley EDGE has overcome the community naysayers, regulatory hurdles, and multiple setbacks. For DiMeo, COVID-19 is one more obstacle in the region’s economic expansion. “For the business community, COVID-19 is turning out to be both a positive and negative development,” he observes. “On the negative side, a number of industries such as travel and leisure, health care, and education have been severely impacted by the lockdown. Manufacturing has seen disruptions to the supply chain, and worker illness has often interrupted or even shut down production. Small businesses, especially retail, are feeling the financial pinch because they normally don’t have large cash reserves to maintain operations and many customers are reluctant to venture out.

“On the positive side, many businesses relying on online sales are thriving as the shift from bricks and mortar to the Internet accelerates. We’re also seeing some signs where corporations are looking at bringing manufacturing back to the area. It’s too soon to tell, but ‘onshoring’ could be a boon to our economic growth. I think there is a likelihood of federal initiatives based on concern for national security that will mandate onshoring for certain industries … This pandemic has also brought out the innovation spirit in business owners and managers to adjust quickly to a new environment and in many cases to reinvent themselves. Restaurants, for example, converted to takeout venues, and [spirits] distillers started manufacturing hand sanitizer. I also see a heightened corporate social responsibility to their employees, consumers, and the community. Many companies are donating to support the front-line workers and those negatively affected by the virus.”

MV EDGE is also adapting to the pandemic’s impact. DiMeo explains that “… the staff at MV EDGE has been busy working with area companies on how to reopen their businesses, establishing safety protocols, and explaining to more than 200 businesses the resources that are available including financing. In conjunction with Oneida County, we have sold and distributed 100,000 masks, partnered for the first ‘Oneida County Shop Small Business Week,’ and distributed over 200 ‘Restart Oneida County Reopening Kits.’ But these activities have not diverted us from the basic mission of constructing a favorable operating environment in which businesses can continue to locate and grow here, creating a range of new job opportunities. We continue to capitalize on the region’s strengths to build an economically diverse, competitive industrial ecosystem.” As proof, despite the impact of COVID-19, DiMeo points to the $2 billion in public-private investment currently underway in the Mohawk Valley.