Bouncing Back With Thorough Commercial and Industrial Investment
City of Janesville, WI
The city of Janesville, on the Rock River, is in south-central Wisconsin, approximately thirteen miles north of the Illinois state border and only thirty-five minutes from Madison, Wisconsin, the state capital. The population of Rock County is close to 180,000, and approximately 65,000 of those people reside in Janesville.
Janesville has historically been a manufacturing community. This began a century ago when General Motors announced that it was going to buy the Samson Tractor facility and convert it into an automobile manufacturing plant. Janesville remained a General Motors town until 2008 when the company decided to close the plant and shift production to its other locations due to the economic downturn.
Several investments in large-scale commercial and industrial projects have been made recently in Janesville as a result of its partnership with the Rock County Development Alliance, and the economy has improved as more people recognize the value of the city. Janesville has a plethora of ideal factors for distribution companies, like available labor and a great location to access many large markets within a day’s drive, including the Twin Cities, Omaha, Chicago, Indianapolis, and St. Louis.
In 2015, two noteworthy projects landed in Janesville: Dollar General and Castle Metals. Dollar General, a growing discount retailer based near Nashville, is building roughly one thousand stores a year on its current growth pattern, and it determined that Janesville was the right location to establish a one-million-square-foot facility to serve its new stores in the upper Midwest. The company exceeded its guarantee of creating 552 jobs in the city. Metal fabricator Castle Metals, meanwhile, consolidated its operations in Chicago and Minneapolis to secure one distribution point in Janesville in a 208,000-square-foot facility. It provides over ninety jobs.
In 2016, Janesville filled a speculative building with a company called IPM Foods, and by 2017 it worked with the same local developer to create a second building that would ultimately be the facility for Upper Lakes Foods, a food distributor for restaurants and hospitals. Upper Lakes Foods has provided more than the sixty jobs it guaranteed, and it is growing much faster than expected.
Local metal fabrication shop United Allow produces fuel tanks for large generators. After landing a big contract, its plant required an expansion to fully meet its clients’ needs, which led to the new 107,000-square-foot additional facility that will allow the company to produce more fuel tanks and complete more painting in-house. Overall, the city of Janesville managed twenty-seven industrial and commercial project deals over the last four years.
Start-up pharmaceutical company Shine Medical Technologies in the process of building a production facility in Janesville that will soon be producing molybdenum 99, an important component of the diagnostic tests for heart disease and cancer. This business venture is particularly beneficial because there is a shortage of the product available, and there are currently no suppliers of molybdenum 99 in the western hemisphere. Shine Medical Technologies will be operational in a little over two years and will put Janesville on the map for the medical technology industry.
“It’s been a long road for them [Shine Medical Technologies] to get where they’re at today with production but certainly well worth the wait. It’s very exciting that we can have something with that level of technology in those high-paying jobs here in the community,” says Gale Price, Economic Development Director for the City of Janesville.
Back in 1975, tax increment financing (TIF) was first adopted in Wisconsin to help cities redevelop rundown urban areas and to support industrial development. “TIF is our major tool in Wisconsin to work with. One of the unique things about the way we use it is the city serves as the primary developer for industrial land here in the community. We have a longstanding history of using TIF to purpose land, develop the land, and then market those parcels for new industrial users to come,” says Price.
TIF was a key component in attracting Dollar General to Janesville because the company wanted assurance that the land was ready to go with the necessary utilities in place. For obvious reasons, there is no profit margin built into these projects, so the city considers its return to be the taxes that are recovered over the long haul and the jobs that are generated in the community.
Two new hotel project developments only came to fruition as a result of TIF. There had been no new hotels built in town since 1996, lodging was in high demand, and room rates had not kept up with the cost of construction. The question of whether a hotel project would be profitable prevented the interest of developers, but the city’s ability to underwrite the project with a forgivable loan enabled the construction of two hotel projects.
The gap in the hotel market needed to be filled because of the city’s extremely high occupancy rates, particularly during the summer months and also because one of the new hotels will have an extended stay format. Various companies in Janesville rent apartments for short-term employees, rather than the employee having to find a temporary apartment. The city hopes that the addition of the extended stay hotel will free some apartment space to make room for potential new residents moving to Janesville for the available work.
One of the city’s main tasks right now is the development of residential housing. There have been no apartment projects in the last thirteen years because developers have been unsure about the future of the community since the departure of General Motors. The city plans to have at least two or three apartment building projects under construction by the end of summer to provide residents with an opportunity to move up in quality and allow room for newcomers.
“We’ve spent about $25 million to leverage about $150 million worth of investment in the community over the last four years, and that is important because our ability to adjust the tax rate is tied directly to what’s called net new construction,” explains Price.
As a result of all of this investment, the city has guaranteed over 1,100 new jobs in the community in the last four years, and this number does not include jobs generated by other local companies that have been able to grow without any assistance.
With Janesville hovering around a three percent unemployment rate, finding enough employees to fill positions as companies continue to grow is an ongoing challenge. The city has invested in significant targeted marketing efforts through online formats to promote its employment opportunities. The Rock County Development Alliance started a website under the name jobsinrockcounty.com for area companies to use for outreach and advertising, and it developed a high school internship program that introduces students to jobs in the manufacturing realm. This initiative helps to raise awareness of the options such as sales and accounting in the manufacturing sector beyond of the assembly work that is most often associated with the industry.
“It’s our hope that we’ll continue to match young men and women up with job opportunities here in Janesville and Rock County… and not have them leave the area as Wisconsin continues to be a donor state for workforce in other states,” says Price.
Downtown Janesville’s Town Square has an interactive water feature funded by Forward Janesville, the city’s chamber of commerce, and the city is holding a contest to name the ornamental landmark. “It’s all about placemaking and having an identifiable place in the community that people will recognize,” says Price. “We hope that our interactive water feature in the park area will be that identifiable icon to Janesville that people will recognize all throughout the world.”
Madison is home of the University of Wisconsin-Madison, and Janesville has great access to the flagship university of the University of Wisconsin system. This is a great community to have a family and raise children because of its strong schools and its continuously decreasing crime rate. In fact, the city was recently recognized for dropping its crime rate in 2018 to the second lowest it has been in twenty years.
Centrally located close to the larger cities of Madison, Milwaukee, and Chicago, the midsize town has proven to be resilient and adaptable over the years. “What’s really interesting is, so many Midwestern communities like us who have lost a major employer like General Motors just don’t recover from that, and we’ve been very fortunate and very successful with our recovery. It took time but we continue to embrace our manufacturing heritage here, and we really marketed the assets we had in place to be able to move forward,” says Price.