Tech park bounces back; CEO wants to build, diversify economy

MORGANTOWN — The West Virginia High Technology Foundation is bouncing back from its recent bankruptcy case and moving ahead with its mission to expand the I-79 Technology Park, said President and CEO Jim Estep.

The park occupancy is at a 10-year high, and a new grant will open space for new federal anchors that can help diversify the state’s economy, he said. “That’s where we’re headed. We’ve got some momentum. We just want to keep having that success going forward.”

Estep explained that the foundation filed for bankruptcy in August 2016 in response to a Huntington National Bank lawsuit that sought, in part, receivership to allow the bank to sell off the park’s assets in pieces.

The two sides were unable to come to terms on debt restructuring on two facilities in the technology park, he said. The shortfall occurred because two longtime tenants in one facility ended their leases, which created a cash flow problem for paying the full debt service.

The bankruptcy, he said, gave the foundation time to find new tenants and address the lawsuit. It filled the spots in early 2017. Last February, the foundation sought and was granted dismissal of the case as part of an undisclosed settlement.

Looking ahead

Moving forward, Estep said, in the spring, the foundation received a $4 million federal Abandoned Mine Lands grant to begin roadway and infrastructure work into what’s called Phase III of the park. Because it’s a grant and not a bank loan, the foundation can offer three to five site pads to specifically targeted federal anchor operations for free.

Federal anchors, as has been reported here before, are Estep’s vision for building and diversifying not only the local but the whole state’s economy.

Federal anchors, he said, offer contracting opportunities that draw high tech, knowledge sector businesses to serve them.

“Each time we can recruit a federal operation that provides substantial contracting opportunities,” he said, “it helps build a business case for more companies to want to do business in our region. The small business contracting requirements of the federal government allow us to build an ecosystem conducive to entre-preneurism and small business development.”

One obstacle to diversification, he said, is that West Virginia ranks dead last among the states in educational attainment — people with bachelor’s and graduate degrees — according to a study by the Wallet Hub financial website.

This is due, he said, in large part to our reliance on a single industry that doesn’t require an advanced degree to earn good pay. The lack of diversity and low educational attainment creates a sort of vicious circle: People can’t find good jobs, and businesses that can supply good jobs don’t come here because we lack the people trained to fill them.

“This imbalance has created a substantial handicap for the state’s participation in the fastest growing segments of the national economy,” he said.

He appreciates that the state’s Community and Technical College System is aware of the need for more technical training and responding to that, he said.

Building on success

Apart from the bankruptcy, Estep said, “We’ve really had incredible mission success over the last decade.”

As reported here before, the park has some major anchors, such as the National Oceanic and Atmospheric Administration Env-ironmental Security Computing Center. In the last few months, Estep said, NOAA awarded a $553 million contract to General Dynamics for support of its supercomputing, of which this site is the flagship.

There are also the GOES-R satellite system that provides weather and climate research data to the National Weather Service; NOAA Security Operations Center; and the Department of Commerce Enterprise Security Operations Center.

In addition, “We’re building out space now for one of the most significant cybersecurity operations in the United States. It has the potential for hundreds of people.”

Estep said he shares the concern that there’s too much federal operation concentrated in the D.C. area, which subjects it to terrorist vulnerability. Fairmont sits at essentially the sweet spot of a circle of “far enough but not too far” from D.C. Because of that, he was able to convince NOAA to designate the park as Continuity of Operations Site C, which will make it NOAA head-quarters in the event of a major event.

The anchors already here, he said, have the potential to build “birds of a feather” synergy, drawing more cybersecurity, satellite command centers to a park with federal level built-in infrastructure already available and federal Contin-uity of Operations compliance recognition.

He hopes to get that word out to other agencies. But the foundation lacks resources. Federal sequestration dried up much of its research and development contracting revenue.

“One of the things I’ve been thinking to get the state more involved in is helping with that recruitment function.”

He understands the state’s budget crunch, even with the small surpluses starting to emerge. But he’d like to get the state to invest at some point. “I don’t know of any other initiative in the state that comes close to providing the potential for the kind of economic diversification we have to have.”

West Virginia Forward

One problem Estep has faced — a problem not unknown to leaders across the state — is parochial-ism: The prosperous north versus the depressed south; the I-79 Tech Park versus the West Virginia Regional Technology Park in South Charleston.

But Estep sees his federal anchor vision as an answer for the whole state. For instance, the Hobet mine site development, still in its infant stages, would be a prime site to offer the federal government 100 acres or so to build more anchor sites to draw contractors. “Imagine how transformative that would be to southern West Virginia and that part of Appalachia.”

WVU’s West Virginia Forward program touts cybersecurity, cloud services and data centers — all key elements of the tech park — as a significant job growth and diversification sector for the whole state.

“West Virginia has existing assets in the industry and structural advantages that make it an attractive destination for cybersecurity and cloud services companies,” the West Virginia Forward report says.

“Growing a cybersecurity sector is a long term investment that will require growing the state’s talent pool and fostering an innovation environment that allows for creation and growth of startups, as new business creation is the major driver of the sector’s growth,” the report says.

“Over the short term, West Virginia can consider attracting anchors that can help progressively grow an IT services sector in the State, including new federal anchors whose long term presence can create opportunities for local graduates, as well as for private sector contracting services.”

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Article originally published by The Dominion Post on September 17, 2018