Governor visits with Springfield execs, tours BKD

Gov. Jay Nixon was in Springfield on Sept. 15 to talk with business leaders about the opportunities and challenges their companies face. The common themes were needs for capital for growing businesses and investment in education and training programs.

Nixon met with a group of nine Springfield businessmen at the recently completed headquarters of accounting firm BKD LLP, and after a brief tour of the $21.5 million facility, the governor asked those gathered to talk about the biggest issues they face daily.

'No man's land'

Jack Stack, president of SRC Holdings Corp., said that while funding for education and related programs is important, the most difficult task at hand is creating revenue.

"When you talk about increasing expenses and making more investments, where are the revenues going to come from?" Stack asked.

He suggested increased state investments in existing small businesses that have showed steady growth in recent years; those businesses, he said, often face the "capital gap" - the situation where successful small firms have tapped their access to capital and can't grow.

"We have all these ideas to fund education and create expenses, but unless we figure out how to invest in those fastest-growing businesses, the whole society will be in no man's land," Stack said.

Joe Reynolds, chief financial officer of Springfield-based Digital Monitoring Products, echoed the woes of available capital. He relayed a story about having to change to a new bank because his existing financier had to pull some of his company's funding.

"I had a banker tell me, 'I'm so sorry, but I have to tell you no. Now I have to go next door and talk to a guy who can't pay his bill and find a way to work through it and maintain this payment structure.' It doesn't make sense," Reynolds said. "I think it's important for some of the capital to get back in the pipeline - that's key."

To counteract the increased spending on capital investment, Stack suggested freezing spending on other state programs that don't offer immediate or tangible returns, such as the historic preservation tax credit program or brownfield redevelopment grants that provide money to redevelop potentially contaminated property.

Nixon agreed that return on investment is important, though he was hesitant to talk about cutting money to brownfield programs, saying that there is a lot of property currently sitting empty because it cannot be developed.

"And we're going to get a lot more because there's no capital," Stack replied.

Nixon noted that balancing spending with return is going to be difficult with budget restrictions. He said the state's current general revenue totals are nearly $900 million behind last year's mark.

Education ROI

Jim Anderson, president of the Springfield Area Chamber of Commerce, said his biggest push is for more investment in higher education.

"To make us competitive as a state, and allow the innovation and training and brains to stay here rather than face continual brain drain, there's nothing more important we can do than to fund higher education," Anderson told the governor, noting his support for the idea of a capital bond issue to create money for investment in higher education.

BKD CEO and Managing Partner Neal Spencer agreed with the need for education funding, specifically for technical and community colleges. Spencer, who serves on the Ozarks Technical Community College Board of Trustees, said the school's 15.5 percent increase in enrollment to 12,900 is creating new challenges.

"They're busting at the seams - there's no space for students," Spencer said. "I think we need to keep an eye on that level of education as well. In many cases, that can be a feeder opportunity to the other institutions."

Nixon said he is not against bonds for capital improvements or, in part, for training. He noted the Prepare to Care initiative, which provides funds for technology upgrades and program expansion to schools offering health care-related education.

Nixon added, however, that other areas of the state also face dire capital funding issues. He pointed to the state's mental health department, much of which he said is housed in facilities that are "beyond decrepit."

"We're looking at making sure this is seen as a clearly bipartisan effort to do something, and in that process we need to make sure there is discipline in the spending," Nixon said.