About the Keweenaw Economic Development Alliance
The Keweenaw Economic Development Alliance. . . (KEDA) is a 501(c)(4) non-profit corporation with a volunteer Board of Directors and a paid Executive Director. Membership includes 350 business, municipal, educational and other community leaders interested in promoting economic development in Baraga, Houghton, and Keweenaw Counties. KEDA relys upon the financial support of area businesses, governments, agencies and organizations for operating funds, and holds monthly meetings on the second Wednesday of each month, except for July and August, to review current economic initiatives and to provide presentations on important economic development topics.
Why was KEDA Created?
KEDA was created by community leaders in 1969 following the closure of the area's copper mines to diversify and expand the manufacturing, tourism, service and technology sectors in the Keweenaw region. This is accomplished by focusing on providing tailored, hands-on services to local businesses to help them expand, by encouraging local entrepreneurs to start new businesses, by attracting businesses to the Keweenaw, by assisting local governments to plan and address all types of infrastructure, and provide leadership and support to all efforts to attract and retain talent of all types in our region.
What does KEDA do?
KEDA provides direct assistance to companies including:
- assisting with business plans through our partnership with the Small Business Development Centers of Michigan (SBDC)
- arranging financial packaging
- providing financial and other management advice throughf our partnership with the SBDC
- structuring business expansion and start-up projects
- arranging for public infrastructure in support of business expansions
- partnering with other agencies to implement workforce training programs
- developing incentive packages to attract outside companies and entrepreneurs
In addition, assistance in the commercialization of technologies developed at Michigan Technological University, one of the premier engineering schools in the U.S. is available through the MTEC SmartZone, an incubator and support service provider for high-tech companies created by KEDA in partnership with Michigan Tech and the Cities of Houghton and Hancock.
KEDA also takes on projects that will set the stage for future job creation. Projects included creating three local revolving loan funds used as "gap" financing for business expansions and start-ups; establishing a high technology park, establishing two tax-free industrial renaissance zones in Houghton County; and sponsoring training workshops to assist the business community to upgrade employee skills and increase productivity.
What has KEDA accomplished?
KEDA has a number successes, including the expansion of over 25 local companies, the start-up of both "off-the-shelf" and "high" technology companies, the creation of three revolving loan funds, establishing a tax-free renaissance zone for Houghton County, and the creation of a high-tech incubator SmartZone. These successes have significantly diversified the local economy, reduced its susceptibility to economic downturns and helped create a number of new jobs..
The Keweenaw Economic Development Alliance completed a comprehensive economic development strategic planning process in 2015. The process culminated with two leadership summits that crafted the plan and implementation strategy.
Basis for this plan
Economies are by their very nature regional.
Economic development is a team effort. And most importantly, where economic development is played successfully, it has required active leadership and participation of business and community leaders.
Economic development will entail change. Change requires vision, leadership, resources, and a focus that anticipates where change is needed, communicates and leads the effort to make it happen.
In order to maximize use of available resources as well as attract new resources there must be a sound economic development investment strategy.
We are a community driven by our leaders to be the best at utilizing our technology, education, and business assets to build a diverse economic base that leverages and develops the unique strengths of each county and its people.
Engage community leadership to start, retain, grow and attract companies that will increase the wealth of the region through a holistic and collaborative strategy that builds on the assets and opportunities present in the region.
Foster Business Growth. Foster the startup, retention, expansion and attraction of small companies that increase the diversification of the regional economy and take advantage of its unique resources and complement efforts in the attraction and retention of talent.
Improve Infrastructure. Ensure that the infrastructure needed by business and community is in place and at a level and cost to meet current and future demands.
Revitalize Our Communities. Create communities in Baraga, Houghton and Keweenaw Counties that are attractive to recruiting and retaining talent.
Develop and attract Talent. Develop a comprehensive attraction, retention, and education system that seeks out, attracts, and retains skilled talent and allows area residents to develop the talent and skills most appropriate for them and the local economy.
Enhance Cultural and Recreational Opportunities. Develop and market the region's cultural and outdoor oriented and family friendly lifestyle.
Prior to the late 1960s, the economy in Houghton and Keweenaw Counties was dominated by natural resource extraction including copper mining and forestry. Most local manufacturing businesses devoted the majority of their productive capacity to providing products and services to these two industries, yet neglected to expand their customer base either geographically or by industrial sector. Furthermore, the local wood products industry performed only a very low level of value-added manufacturing activities. Most harvested roundwood was shipped out of the area as pulp or saw logs, or was cut into green lumber by local sawmills. These low value products were, and to some extent still are, sent to other areas primarily in the Upper Midwest to be processed into higher value-added products, thus allowing those areas to capture the economic benefits.
From 1968, when the last copper mine closed, until the mid 1980s the local economy underwent a readjustment in which many manufacturers either closed their doors or downsized. The Keweenaw experienced severe annual business cycle swings and was very susceptible to downturns in the national economy. Tourism provided some employment in the summer months, but the winter months saw unemployment rise to double digits, sometimes as high as 20% or more.
In this economic environment, few companies were willing to take on additional debt as the economy went into periodic upswings since they were afraid of being unable to pay off that debt during the inevitable economic downturns. Even had manufacturers been willing to expand, local lending institutions were hesitant to lend to either existing businesses or to new ventures, even with the availability of federal loan guarantee programs, due to economic uncertainty and to past business failures. Nor had local governments created local revolving loan funds or other instruments that could be used to induce business expansion.
During the mid to late 1980s, the Keweenaw Peninsula's economic fortunes began to change due to an improving national economy and to the efforts of local governments as they took a more aggressive approach to economic development. In particular, the Keweenaw Industrial Council (KIC), a private coalition of local municipalities, businesses, banks and utilities that had been largely inactive since its creation in the late 1960s, was reinvigorated in 1985, when Michigan Technological University (MTU) and the local community joined together to provide long-term operating funds to the KIC. The KIC has since taken the lead on providing retention, expansion and start-up assistance to local companies and has, together with the Keweenaw Peninsula Chamber of Commerce, the Western Upper Peninsula Planning and Development Region and Northern Initiatives led efforts to strengthen and diversify the local economy.
The local community decided to concentrate its economic development resources on retaining and assisting local companies to expand, and to encouraging and assisting local entrepreneurs to start-up new businesses, including the spin-off of research products from MTU. Since the mid-1980s three revolving loan funds have been created. Local development organizations have successfully provided direct business and financial packaging assistance to base industry firms, local lending institutions and investors have provided an increased amount of capital to local business ventures and telecommunications companies have extended high speed Internet access to most areas of the community.
This strategy has paid off handsomely: most local manufacturing companies have undertaken significant expansions in the past five years; a large number of new home-grown businesses have started up, including the spin-off of new technologies from MTU; wood products companies are performing a higher level of value-added activities; and in general, the local economy has made itself less susceptible to local or national economic downturns because of increased sector diversification and extension of customer markets.
Consequently, the Keweenaw Peninsula has begun growing companies utilizing its competitive advantages including the technical resources available through MTU, a first rate telecommunications network, an available labor force including MTU engineering graduates, a commitment by the local community to provide continuing assistance to local industry and a quality of life that provides some of the best outdoor recreation in the Midwest.