Gov., agencies lure businesses to grow and stay

BYLINE: BENJAMIN KEPPLE New Hampshire Union Leader

CONCORD -- WHEN IT comes to wooing out-of-state companies, New Hampshire's bag of tricks is a bit lighter than those other states have at their disposal.

But a chance meeting on a plane with Gov. John Lynch and the subsequent diligence of New Hampshire Business Resource Center was enough to convince Bill Skelley to move his company FiberTech Medical from Massachusetts to Hollis two years ago.

And to keep him happy here and looking to expand.

The Granite State doesn't offer companies big subsidies or tax breaks, and doesn't throw lavish galas at trade shows. Even the few nice dinners state economic development officials hold each year to make specialized pitches to businesses are privately funded.

But because of the work of the New Hampshire Business Resource Center, a state agency that's part of the Division of Economic Development, 18 to 24 companies pack up and move here each year. In 2006, the center's efforts brought more than 1,100 jobs to New Hampshire.

Skelley, a former selectman in Belmont, Mass., where his business was formerly located, was shocked when his local Zoning Board of Adjustment was going to refuse his expansion request because it was 2 feet, 8 inches larger than acceptable.

"I was going to be denied so I withdrew my application. Being former selectman, I was surprised."

A month later, he met Gov. Lynch on a plane to Chicago where Skelley was going to a medical conference, and told him of his plight.

"He said was going to do something. To my surprise, he did," Skelley said.

Skelley, 59, now has seven full-time employees in New Hampshire and is looking to expand. His company buys and sells endoscopy equipment and repairs and refurbishes it in Baltimore, Md., and West Palm Beach, Fla. The company started in New Hampshire with 3,000 square feet.

"Now we are up to 10,000 and looking to hire and expand sales. People can call 603-578-2600, ext. 205 to apply," he said.

When he got back from the conference, he heard from Michael Bergeron, one of two business development managers with the Business Resource Center. "Within a day, I had 30 photos to pick from. Within two days, I picked two and they said, 'Let me negotiate a better lease for you.' I said wow. These are state officials who really help small businesses," Skelley said.

Skelley left Polaroid 10 years ago and worked as a consultant in the medical equipment field.

An Independent, Skelley said business matters.

"I have a very high opinion of Gov. John Lynch because he takes the time to listen and understands issues of small business." About the state folks who helped and continued to help: "They did an outstanding job."

Skelley said Paula Newton, president of the New Hampshire Biotechnology Council, recently helped arrange a meeting to help his business expand to Brazil.

"Just think of it, I had a meeting with two doctors from Brazil and also met with New Hampshire people who want to help us expand in Brazil. These are things they (state employees) are calling me about. Every month I get at least one call from someone in the state asking how things are going," Skelley said.

Despite the New Hampshire Business Resource Center's small staff and limited budget, it's able to draw these firms through a combination of smart marketing, good salesmanship and a heck of a lot of leg work.

"People are surprised New Hampshire is out there because we're a small state. But we're very aggressive in what we do," said John DiNapoli, one of two business development managers for the Business Resource Center.

While DiNapoli and his colleague Bergeron may not have a grand arsenal, they make the most of what firepower they do have. They organize mailings, do old-fashioned cold calls, keep in touch with leads, and get out and about at trade shows. Once in a while, they arrange dinners aimed at certain sectors, such as firms in or with ties to the insurance industry. All are key components in the long process of wooing a company to New Hampshire, an exercise that can take one to two years -- or even longer.

In a given year, the Center may attend five to eight trade shows, depending on budget cycles and when the conferences are scheduled. The trade shows they attend are tailored to the types of businesses the state wants to attract: good paying jobs in the high-tech, biotech and financial services sectors. Those in attendance at the shows may include top company executives and other managers, or it may include professionals who work for companies looking to relocate, such as site planners.

For instance, in a given year, DiNapoli and Bergeron may attend three real-estate shows, a medical products show, a high-end manufacturing show and one devoted to the insurance industry.

At the end of April, DiNapoli and Bergeron were in New Orleans, attending the annual conference of the Risk and Insurance Management Society Inc., a national trade group.

They were there to pitch New Hampshire as a good home for insurance companies. The state has a new law in place reducing the premium tax it charges insurers. Now at 2 percent, that will fall to 1 percent by 2011.

"We'll be lower than all the other New England states," Bergeron said. That even includes Connecticut, at 1.75 percent, where the city of Hartford is known as the insurance capital of the world.

And even if insurers don't move their headquarters here, the pair said, they might consider moving one of their many affiliated companies to the Granite State, a process known as "redomiciling" or "redomesticating."

With that goal in mind, the pair made the trip to New Orleans. Beforehand, they sent out about 1,500 mailings, and worked closely with the Department of Insurance to develop their pitch.

On April 28, the night before the RIMS conference, they made a presentation to about 25 firms at a top New Orleans restaurant. Along with insurers, they had a trucking firm, a grocery store chain, and a manufacturer there, among others.

"We had folks all across the country, from small enterprises to large multi-national corporations," DiNapoli said.

"We talked about the tax structure of New Hampshire," DiNapoli said. "That really piqued their interest."

The New Hampshire Advantage is a big selling point for the duo. In New Orleans, they talked about the state's reasonable regulatory environment, its tax system, and its highly-trained labor pool to companies. But they also discussed the state's quality of life and its lower real-estate costs.

"If you had to rank it, first would be regulatory environment, second would be labor and third would be the cost of the operation itself -- taxes," Bergeron said about what companies generally ask about doing business in New Hampshire.

To be sure, it's not a job DiNapoli and Bergeron can do alone. For instance, that dinner in New Orleans was funded by Public Service of New Hampshire, the electric utility. All the agency's dinners rely on private sponsors, as the Business Resource Center's budget doesn't allow for funding them itself -- in contrast to other states.

And that shows the importance of relationships to the agency's work. Those relationships aren't limited to business people, either.

"We also develop relationships with regional economic development people, real-estate folks in the state and the Governor's office," Bergeron said.

"We're a very frugal state, and we try to partner with as many people as possible to get a good return on investment," said DiNapoli.

But even seemingly fun events like trade shows are a lot of hard work.

"You see some people who just sit at the booth and don't go out there. These guys go out there," said Steve Boucher, a Division of Economic Development spokesman.

Nor is there any time for fun built in. There's no time for golf or sightseeing on their schedules: just flying in, working, and flying out. And forget about relaxing in some hospitality suite.

"There are some states that sponsor private parties," Bergeron said. "One time, we accidentally got invited to one."

Sadly, that invitation -- which the state of Louisiana had politely provided -- was rescinded once it was realized they had sent the invitation out to all those exhibiting at the event.

But even then, New Hampshire's frugality has a way of paying dividends.

"When we're meeting with these people, we say we're a state that uses tax money wisely," Bergeron said.

--Sunday News staff member Nancy West contributed to this report.