Few New Frontier tech grants awarded to small towns Written by Jessie Balmert
CentralOhio.com
mansfieldnewsjournal.com Eleven years ago, then-Gov. Bob Taft rolled out his Third Frontier Commission to bring high-tech companies to locations across the state, but grants rarely go to businesses outside of Ohio’s largest cities. Taft pitched his program in the 2002 State of the State like this: “From Ashtabula to Zanesville, from the rolling hills of Appalachia to the bustling corridors of our great cities, the spirit of the early pioneers breathes within us. We stand on the doorstep of Ohio’s third frontier. The great challenge of our time is to summon the courage and ingenuity of those who have come before us, to protect our citizens, and reclaim our place as a global home of discovery and innovation.” However, the Ohio Third Frontier program, which has awarded more than $1.1 billion to Ohio businesses, incubators and universities since 2002, has funneled no dollars to Ashtabula, Zanesville or many of the other small- to medium-sized cities in the state. City Awards issued* Amount awarded* Cleveland 151 $411,361,153 Columbus 104 $280,018,067 Dayton 61 $140,348,457 Akron 40 $83,907,790 Cincinnati 39 $115,985,257 Toledo 38 $89,878,852 Athens 10 $23,093,055 Mansfield 4 $4,000,000 Youngstown 4 $3,850,000 Canton 4 $2,877,988 Stow 2 $1,999,877 Elyria 2 $749,571 Beavercreek 2 $550,000 Portsmouth 2 $510,000 Kent 2 $98,109 Vandalia 1 $7,612,500 Total Awards 482 1,188,535,349 Source Ohio Third Frontier Program *Only top 11 cities listed out 32 listed Totals reflect all cities About nine in 10 grants were awarded to entities in Ohio’s largest cities: Cleveland (151 awards), Columbus (104), Dayton (61), Akron (40), Cincinnati (39) and Toledo (38), according to Ohio Third Frontier awards from 2002 to mid-2012. Even when grants were awarded, few positions were created in smaller cities. Although Third Frontier touts 15,945 jobs created or retained statewide and almost 80,000 created indirectly, grants awarded to Mansfield-based Energy Technologies Inc. created four jobs, a 2011 award to Stoneridge Inc. near Mansfield yielded one job and funds awarded to Waverly-based Third Millenium Materials LLC created no positions, Ohio Development Services Agency spokeswoman Katie Sabatino said. In 2012, Third Frontier phased out programs that awarded funds to those businesses in favor of ones with higher expectations for job growth and a greater investment from the companies, Sabatino said. “We weren’t seeing a strong enough return,” Sabatino said. Third Frontier officials recognize funds are disproportionately distributed to metropolitan areas, but most applications come from those cities, which have the research entities, medical centers and investment capital needed to fuel technological advancements, Chagnon said. “A lot of the money naturally goes to those areas because of the concentration of entities,” Chagnon said. However, there are benefits for businesses that overcome the challenges of a manufacturing-focused culture and limited number of investors. Technology companies help a small city diversify its economy and bring higher paying salaries into the area, said Barrett Thomas, microfinance manager at Braintree Business Development Center, a Mansfield-based regional entrepreneurial assistance organization. Thomas said bringing technology companies into a small town creates economic diversity and can draw new people to the area. Entrepreneurs and business leaders need to push for technology-based industries, because there are few local government dollars to support them. Mansfield used to invest in Braintree Business Development Center, but stopped after cuts to their budget, Thomas said. Louis Luedtke, CEO of Waverly-based Third Millennium Materials LLC, said innovative ideas can come from small towns, but making them marketable often requires big-city resources. In 2010, Third Millennium Materials received a $1 million Third Frontier grant that the business matched with a $1.3 million investment to create new metals through covetics, which bonds carbon to base elements such as silver, copper, aluminum and tin to create a new class of materials. “I think the small- or medium-size towns are still the place we’d rather live. I like space, I like small-town America,” Luedtke said. However, Luedtke said he based the business’ laboratory in Dayton to take advantage of patent attorneys and scientists located there. Entrepreneurs need to reach out to areas with more resources to get their projects going, he said. Highly technical individuals typically flock to bigger cities with amenities such as theater and restaurant variety, said Tim Lowe, vice president of Mansfield-based Energy Technologies Inc. That doesn’t mean companies from smaller cities can’t take advantage of Third Frontier dollars. Energy Technologies Inc. received three $1 million grants, which it matched between a third and all dollars, to fund fuel cell technology. The commission treated the company the same as those from Cleveland and Cincinnati, he said. “I felt like we all had an equal shot at it,” Lowe said. “You didn’t have to be from a big city.” Although few grants are distributed to companies outside the three C’s, the dollars are funneled to smaller businesses in other ways, such as internships, business incubators and partnerships, Chagnon said. Richland Community Development Group received $100,000 from Team Northeast Ohio to survey area businesses about training and employment needs. Emerson-based Therm-O-Disc received Third Frontier dollars from its Columbus business partner NexTech. Biogas plants were constructed along U.S. 22 near East Fultonham in Muskingum County after Quasar Energy Group, of Cleveland, received $2 million in assistance to build a test bed for its biogas process in Wooster. Medium- to small-sized cities can benefit from pooling resources with one another, as well, Thomas said. Impact Angel Fund LLC applied for Third Frontier funds to help create industries in smaller cities from Richland and Crawford counties to Columbiana County, he said. This e-mail address is being protected from spambots. You need JavaScript enabled to view it