Faster Lane

Updates on business and economic news from across Kentucky compiled by the editors of the Lane Report.

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Hiring Outlook (PDF)

A new nationwide study reveals a significant year-over-year jump in percentage of companies hiring between July 1 and Dec. 1. What’s more, more than half anticipate offering higher starting salaries for new employees as a result of an increasingly competitive job market.

Check out hiring plans, who’s hiring and starting pay in this PDF.

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Louisville’s Weller Equity Partners acquires majority stake in Vogt Ice

LOUISVILLE, Ky. (Aug. 15, 2017) – Vogt Ice, a leading commercial and industrial supplier of ice equipment, announced today that an investor group led by Weller Equity Partners has acquired a majority stake in the company.

Terms of the acquisition were not disclosed. Louisville-based Weller Equity Partners is a private equity firm that invests in lower middle-market companies throughout the Mid-South with a focus on manufacturing, healthcare, information technology, food & beverage and business services.

Vogt Ice, a former division of Henry Vogt Machine Company, revolutionized the commercial ice-making industry in 1938 when it built the world’s first automatic sized ice machine, the Tube-Ice Machine. Prior to this, ice was made in block form. Vogt engineers designed the unique Tube-Ice Machine specifically to freeze ice automatically in vertical tubes, momentarily thaw ice loose from the tubes and then cut it into short cylinders with a hole in the center.

Today Vogt Ice designs, manufactures and distributes heavy duty ice making machines, chillers and parts to commercial and industrial customers worldwide. Vogt machines feature a tubular form of ice as well as plate ice technology, which produce ice at rates ranging from 1 ton to 110 tons per day. Commercial and industrial customers include packaged ice producers; food service, resorts and casinos; fishing, poultry and agriculture; and thermal energy storage, among others. The company currently has 100 employees with operations in West Louisville.

According to Dale Boden, managing partner of Weller Equity Partners, “As part of our investment criteria, we look for strong regional companies with identifiable competitive advantages in their industries, as well as experienced management teams that are vested in their company’s success. We are excited to back J.T. Sims and his team to provide Vogt Ice with capital to increase its focus on sales and marketing, expand its distribution and develop new products. This investment is a great fit for our growing portfolio of manufacturing investments.”

“This investment from Weller Equity Partners validates Vogt Ice’s competitive advantage and success in our industry,” said J.T. Sims, Vogt Ice’s Chairman and CEO. “Weller’s emphasis on developing collaborative partnerships with entrepreneurs, together with the ability to leverage their experience and access to critical resources to help us grow, makes them a great fit for Vogt Ice today. This recapitalization and partnership will be tremendously helpful in allowing Vogt Ice to expand our distribution and product offerings.”

Mr. Sims will maintain an ownership stake and continue with the business as an officer and member of Vogt Ice’s Board of Directors. Additionally, investors Bob Ayotte, Steve Sautel and Dan Ulmer have join the Board of Directors.

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Murakami plans $2.7 million warehouse expansion in Campbellsville

FRANKFORT, Ky. (Aug. 15, 2017) — Gov. Matt Bevin today announced Murakami Manufacturing U.S.A. Inc., which makes automotive vision systems, will build a more than $2.7 million, 20 employee warehouse on its Taylor County campus.

“This investment by Murakami highlights the increasing strength of Kentucky’s automotive sector, which employs more than 100,000 people statewide,” Gov. Matt Bevin said. “It shows ongoing confidence in Kentucky as a top location for manufacturing and supplying automotive products to customers. I am confident that Murakami’s new investment in Taylor County and its increased presence in Kentucky will position the company for success for many years to come.”

Murakami will expand its current facility at 575 Water Tower Bypass in Campbellsville by 50,000 s.f. to consolidate storage, increase manufacturing capacity and streamline product flow. In addition, the expected 20 hires will fulfill a total 50 new full-time jobs the company announced in a separate expansion project in 2014. The new construction will start in September with projected completion by March 2018.

“We are very excited about expanding the Campbellsville plant,” said Murakami North America President and Chief Operating Officer Michael Rodenberg. “The additional space will allow for future growth as well as an opportunity to realize improved efficiencies because we will have everything under one roof.”

The company, a subsidiary of Murakami Corp. Japan, established in Campbellsville in 2000 and manufactures rear and side-view mirrors and related systems for the auto industry. In Campbellsville, Murakami employs 256 team members in the assembly, injection molding and paint operations. Murakami Corp. is a family oriented company in business for more than 135 years.

Kentucky’s automotive industry includes nearly 520 facilities across the state. This year through July, automotive-related companies committed to more than $3.87 billion in expansion and new-location projects. Those are expected to create more than 3,000 jobs in the coming years.

Sen. Max Wise, of Campbellsville, said the expansion falls in line with other auto-related growth across the state.

“I am pleased to hear of Murakami’s expansion in Campbellsville,” he said. “The automotive industry in Kentucky is rapidly expanding, and Murakami’s impactful contribution to both our city and our state’s economy has not gone unnoticed. I congratulate the company look forward to its continual success.”

Rep. John “Bam” Carney, of Campbellsville, noted that continued economic growth is what the legislature worked toward during this past session.

“Economic development, particularly new jobs creation, has been the number one priority of the House Republican Majority since we took office in January,” Rep. Carney said. “I am elated about the $2.7 million investment that Murakami is adding to its existing operation in Campbellsville. This job-creating expansion is just the most recent example of Kentucky being open for business.”

Campbellsville Mayor Tony Young said the project is evidence of the company’s dedication to the local workforce.

“We are so excited to have Murakami choose to expand and invest in Campbellsville again,” Mayor Young said. “The new warehouse and distribution center expansion and additional jobs proves their commitment to our community. This is a welcomed addition to our local economy.”

Taylor County Judge-Executive Eddie Rogers said Murakami is one of the community’s most trusted employers.

“I welcome Murakami’s expansion project and look forward to its positive impacts for our community,” Judge Rogers said. “We are proud Murakami continues to serve North America from their Taylor County facility. Murakami has always been one of our top corporate citizens.”

To encourage investment and job growth in the community, the Kentucky Economic Development Finance Authority (KEDFA) in July approved Murakami for up to $100,000 in tax incentives through the Kentucky Enterprise Initiative Act (KEIA). KEIA allows approved companies to recoup Kentucky sales and use tax on construction costs, building fixtures, equipment used in research and development and electronic processing.

In addition, Murakami can receive resources from the Kentucky Skills Network. Through the Kentucky Skills Network, companies can receive no-cost recruitment and job placement services, reduced-cost customized training and job training incentives. In fiscal 2016, the Kentucky Skills Network provided training for nearly 95,000 Kentuckians and 5,000 companies from a variety of industry sectors.

For more information on MMUS’ parent company, Murakami, visit www.murakami-kaimeido.co.jp/english/index.html.

A detailed community profile for Taylor County can be viewed at http://bit.ly/TaylorCoKy.

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Louisville company receives $3.7 million grant for heart disease research

NEW ORLEANS (Aug. 11, 2017) – The Exscien Corporation of Louisville, in conjunction with LSU Health New Orleans Cardiovascular Center of Excellence, has been awarded an SBIR Fast-Track grant in the amount of $3.7 million over three years by the National Heart, Lung and Blood Institute.

The funding will be used to study the company’s first in a new class of drugs that repairs DNA damage to reduce cardiac tissue injury and improve outcomes in cardiovascular diseases.

The grant will directly fund $1,441,643 to LSU Health New Orleans to study the potential efficacy of Exscien1-III, a patented three-part fusion protein designed to harness the body’s own mechanisms to control and repair disease pathways. The drug has demonstrated significant cardioprotective actions in rodent models of acute myocardial infarction, or heart attack, and the newly funded research will investigate its effectiveness in a model of heart failure. A goal of this research is to move this promising new drug toward human clinical trials.

Exscien CEO Dr. Ker Ferguson and Chief Scientific Officer Dr. Glenn Wilson, and LSU Health New Orleans Cardiovascular Center of Excellence Director David J. Lefer, PhD, are the grant’s principal investigators. They will work alongside LSU Health New Orleans Cardiovascular Center Translational Core Laboratory Director Traci Goodchild, PhD, to develop a pathway for Exscien1-III to restore fundamental cellular metabolic function and disrupt a root pathway for cardiac disease progression and heart failure.

While at an early stage of overall development, Exscien’s proprietary protein leads the way to finding a means to mitigate and repair the underlying tissue damage suffered from these devastating diseases.

“Exscien is able to deliver repair enzymes directly to the root of the damage and thus goes beyond the current standard of care of simply treating downstream symptoms,” says Dr. Ker Ferguson, Exscien CEO. “The therapy offers substantial commercial potential and has attracted large ‘pharma’ interest to date.”

“This approach could potentially effect more than 20 million people worldwide with progressive heart failure,” said Dr. David Lefer, Professor of Pharmacology and Director of the Cardiovascular Center of Excellence at LSU Health New Orleans School of Medicine.

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Kentucky Airbnb hosts to earn at least $146,000 during solar eclipse

Home sharing platform Airbnb today released new data and issued a call to action to its host community to help Kentucky take full economic advantage of excitement for the upcoming solar eclipse.

At this time, Airbnb projects that the Airbnb host community in Kentucky cities along the path of totality will earn a combined $146,000 in supplemental income while welcoming over 900 guests during the eclipse. The data indicates a significant economic boon for Kentucky and its residents.

The 900 guest arrivals in those towns represent an 803% spike compared to a week prior.

Local media accounts have closely documented the lack of hotel availability as visitors flock to Kentucky. While the path of totality includes larger cities like Paducah and Bowling Green, most of the Kentucky cities lack any hotels at all. The rise of home sharing has allowed Kentucky to expand lodging capacity and empowered more traditionally rural communities to benefit from the economic activity during this event.

The expanded lodging capacity for Kentucky communities during the eclipse also offers significant economic value to local restaurants and shops.

According to the U.S. Labor Department’s annual Consumer Expenditure Survey, the average American tourist spends $106.50 a day while traveling (not including lodging). Multiplying that average by the number of Kentucky Airbnb guest arrivals, Airbnb hosts have the opportunity to direct a potential $96,000 in guest spending towards the Kentucky merchant community on August 20-21.

Airbnb is issuing a call to action to its hosts to help guide eclipse guests to local shops, restaurants and other small businesses that do not typically benefit from traditional tourism revenue. This is particularly important, because 72 percent of those hosting via Airbnb during the eclipse in Kentucky towns on the path will be doing so for the first time.

Kentucky cities with over 10 guest arrivals during the solar eclipse

Paducah: 227 guest arrivals

Bowling Green: 116 guest arrivals

Crofton: 28 guest arrivals

Grand Rivers: 26 guest arrivals

Eddyville: 21 guest arrivals

Oak Grove: 21 guest arrivals

Gilbertsville: 19 guest arrivals

Scottsville: 16 guest arrivals

Russellville: 16 guest arrivals

Madisonville: 15 guest arrivals

Dawson Springs: 13 guest arrivals

Kevil: 12 guest arrivals

Lewisburg: 11 guest arrivals

Marion: 11 guest arrivals

Kuttawa: 10 guest arrivals

Morganfield: 10 guest arrivals

Hardin: 10 guest arrivals

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Kentucky ranks 16th for growth in number of middle market companies

Kentucky has an estimated 2,177 middle market companies ($10 million-$1 billion in annual revenues), which make up 1 percent of all firms in the state according to the latest Middle Market Power Index from American Express and Dun & Bradstreet.

The newest report in the series finds that the middle market is an increasingly important sector. While middle market firms make up less than 1 percent of all U.S. businesses, they contribute about one in four dollars (27 percent) and employ a little more than a quarter of U.S. workers (27 percent) in the private sector. Overall, middle market firms were also responsible for more than half (51.7 percent) of the 51.8 million new jobs that have been created in the U.S. since 2011.

Kentucky ranks 16th out of all 50 states for growth in number of middle market firms from 2011-2017.

The below table outlines how the number of Kentucky’s middle market firms compares to national data as well as to large and small companies:

 

Number of Firms

Share of Firms

% Change, 2011-2017

Small (<$10M)

Middle Market

($10M-$999M)

Large ($1B+)

Total

Small (<$10M)

Middle Market ($10M-$999M)

Large ($1B+)

KENTUCKY

215,032

2,177

25

217,234

98.99%

1.00%

0.01%

84.8%

Total U.S.

18,294,760

179,782

3,150

18,477,692

99.01%

0.97%

0.02%

83.9%

 

Additional findings are in the press release here.

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Louisville Orchestra to perform free concert at Iroquois Amphitheatre Sept. 9

The musicians of the Louisville Orchestra.

The musicians of the Louisville Orchestra.

LOUISVILLE, Ky. (Aug. 15.2017) — The Louisville Orchestra will perform a free concert, led by Principal Pops Conductor, Bob Bernhardt, on Saturday, Sept. 9 at the Iroquois Amphitheater. The concert will begin at 7 p.m.  and will feature pieces and excerpts from the upcoming Classics, Coffee, and Pops concerts.

The program is as diverse as the LO’s 80th season and ranges from Beethoven to The Beatles.

Here are the selections for the concert:

• Ludwig van Beethoven Symphony No. 7, Mvt. IV (Finale)
• Ludwig van Beethoven Symphony No. 7, Mvt. II (Funeral March)
• Pyotr Ilyich Tchaikovsky Symphony No. 5, Mvt. III (Waltz)
• Gioachino Rossini “Largo al factotum” from The Barber of Seville, Chad Sloan, baritone
• John Williams “Harry’s Wondrous World” from Harry Potter and the Sorcerer’s Stone
• Samuel Barber Adagio for Strings
• Leonard Bernstein Overture to West Side Story (arr. Maurice Peress)
• John Lennon/Paul McCartney Yesterday
• Teddy Abrams Unified Field, Mvt. IV
• Gustav Holst “Jupiter” from The Planets

The free concert is due to the generosity of Caldwell Tanks. Parking is $5.

Single tickets for the Louisville Orchestra’s 80th season are now on sale. Call 502.584.7777 or click here for a schedule of concerts.

Multiple subscription options are also still available for discount ticket packages for the upcoming season. Call the LO Patron Services at 502.587.8681 or visit LouisvilleOrchestra.org. LO staff will be at the event to fulfill all subscription needs and answer any questions about upcoming concerts.

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Kentucky Chamber president highlights need for balanced approach to pension reforms

By Jacqueline Pitts, The Bottom Line

dave-ket-pensions-300x139With a special session to address the state’s underfunded pension systems quickly approaching, a panel of groups from different perspectives discussed what could and should be done to address the persistent pension problems the state faces Monday night.

On KET’s Kentucky Tonight program, host Renee Shaw was joined by a panel including Kentucky Chamber President and CEO Dave Adkisson, Kentucky Education Association President Stephanie Winkler, Kentucky Center for Economic Policy Executive Director Jason Bailey, and William Smith, representative for the Bluegrass Institute for Public Policy Solutions to discuss pension reforms.

The Kentucky Education Association (KEA) would like to see more funding placed into the system to ensure that benefits that have been promised to teachers can be paid, Winkler said. Winkler also stated that changes to the system—even ones that could total $30 million—won’t save enough money to fix the system.

Similarly, Bailey maintained his position that his group does not believe the pension system problems are at crisis level and money is what is needed to fix the system rather than making structural changes for future hires. Bailey noted the legislative reforms made in 2013 and said no savings have been seen from those changes. However, when the legislation was implemented, PEW Charitable Trust, who advised the legislature, stated it would take years for the benefits to be seen as the hires were being placed into a new system.

Adkisson noted the differences of opinions among the panel with the KEA and Kentucky Center for Economic Policy representatives saying more money is needed to fix the systems and the Blue Grass Institute stating that the focus needs to be on the structural changes and how benefits are administered.

“Our position is in the middle of that. We feel like it is going to take more money, but there have to be some structural changes,” Adkisson said. “I think almost anybody that has been fairly objective knows that it’s going to take some of both. And trying to find that middle is what’s going to play out in Frankfort over the next six months.”

In terms of what structural changes could be on the table, the panel discussed the items widely considered to be outside of the inviolable contract including paid sick day spiking the final pension payments, retirement age before receiving full benefits, and other items.

The panel had differing opinions on what could work and what is even an option due to the legal nature of the inviolable contract and the political will to make changes.

But in conclusion, Adkisson said this issue impacts the state and its citizens in too many ways for the problem to not be taken seriously and just say we need more money or only changes to benefits.

“We have a problem to fix. We need to do it in a balanced, rational way. The last figure I saw said there are 550,000 Kentuckians affected by this issue. Those who are retirees, those who are active teachers, those who are active police and fire, etc. So this is not a small deal to 550,000 people and their families,” Adkisson said.

The panel also discussed much more in the hour long program. Watch the full Kentucky Tonight segment on pension reforms on KET.


For more state government news go to the Kentucky Chamber of Commerce’s The Bottom Line blog.

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Foundation asking for entries to its 2017 statewide directory of Ky.-based health coaltions

HK_logo_V_CLR_CMYKLOUISVILLE, Ky., (Aug. 10, 2017) — The Foundation for a Healthy Kentucky will issue its 2017 statewide directory of Kentucky-based coalitions and other groups that are working to improve health in their communities, and is asking groups wishing to be listed to enter their contact information in an online form by Sept. 8. The Foundation and other organizations use the directory to offer training, share funding opportunities, and connect to people with shared interests.

The current version of the directory, found here, includes more than 300 groups representing all 120 counties, as well as coalitions working at the statewide level.

“The Foundation’s Health Coalitions Directory raises awareness of efforts to improve health in local communities and across the state and fosters sharing and collaboration,” said Ben Chandler, president and CEO of the Foundation for a Healthy Kentucky. “These coalitions are largely local groups comprising neighbors and colleagues who are working together to identify and solve health-related issues in the communities where they live, work and raise their families.”

Whether the groups listed in the directory call themselves community coalitions, collectives, collaborations, groups, networks or partnerships, they are examples of people joining forces to improve health and health care in Kentucky. Some coalitions work to increase access to healthy food and physical activity; others plan needed screenings and education for people at risk for serious health problems such as cancer, diabetes and other chronic diseases; yet others are working to enact smoke-free or complete-streets ordinances.

The directory is a living document, and the Foundation welcomes established coalitions to enter their information and suggest new coalitions for the 2017 edition. Contact Rachelle Seger, rseger@healthy-ky.org or 502-326-2583, for more information.

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Ky. Power warns of scam asking customers to make immediate payment

ASHLAND, Ky. (Aug. 15, 2017) – Small business owners and residential customers of Kentucky Power are among the latest targets of scam artists seeking to extort cash. The scam, which instructs customers to make immediate payment or have their service disconnected, has been used in other states. Victims often are directed to purchase prepaid debit cards.

Utility company scams, unfortunately, are common. While there are instances when Kentucky Power will contact customers over the telephone, the company does not demand payment in this manner, said Del Borden, Kentucky Power’s director of Customer Service and Business Development. A non-profit agency in Prestonsburg was one of the more recent targets but did not fall for the scam.

“Scammers are targeting local businesses, senior citizens and other customers,” Borden said. “We’re sharing this information so customers can protect themselves from this fraudulent activity. We also want our customers to know our employees will never demand immediate payment, insist a payment be made with a prepaid card or ask you to meet us in a parking lot to make a payment. If customers receive suspicious, urgent, demanding phone calls from someone claiming to be with Kentucky Power or AEP, we suggest they hang up and contact us at the toll-free number on their bill, that’s 1-800-572-1113, or call local law enforcement.”

Scammers are calling Kentucky Power customers and:
· Threatening to shut off power unless an immediate payment is made;
· Telling customers they need a new electric meter, but must make a payment before the new meter is installed;
· Offering a discount on their Kentucky Power bill if they sign up for auto-pay;
· Demanding a deposit is paid immediately.

More Red flags for scam activity
· The scammer instructs the customer to purchase a pre-paid debit or credit card – widely available at retail stores – then call him or her back to supposedly make a payment to Kentucky Power.
· The scammer asks the customer for the prepaid card’s receipt number and PIN number, which grants instant access to the card’s funds.
· The scammers often call from numbers that names Kentucky Power on the Caller ID. And they have a recording that sounds like Kentucky Power’s phone message.

How to protect yourself
· Call Kentucky Power at 1-800-572-1113 to verify your account balance and the date your payment is due. Customers can make payments online, by phone, automatic bank draft, mail or in person.
· Confirm that you are speaking to a utility representative. If you have any concerns, tell the caller that you will independently check the phone number for the utility to verify the caller’s identity and information.
· Kentucky Power will notify customers by mail that their account is past due and their electric service will be disconnected – never a single notification one hour before disconnection.
· Never give your credit card, debit card, Social Security, ATM, checking or savings account numbers, or any other personal identification numbers to anyone who comes to your home, calls or emails requesting information.
· Never allow anyone claiming to be a utility service person into your home unless you have scheduled an appointment and the person has proper identification. Lock the door and contact police if you become concerned about your safety.
· Customers who suspect or experience fraud, or feel threatened during contact with one of these thieves should hang up and call the local police and then Kentucky Power at 1-800-572-1113. Never dial the phone number the scammers provide.

On average, more than 90 percent of customers who receive a call and report it to Kentucky Power indicate they did not fall for the scam. In the initial stages of the scam activity, it is estimated that at least 50 percent of customers contacted were tricked.