Latest / Real State / Inside Kentucky’s Economic Development Evolution, with Speaker Pro Tem David Meade

Transcript

Inside Kentucky’s Economic Development Evolution, with Speaker Pro Tem David Meade · Real State

• 0:00
  You heard it here, "Central Kentucky has a mega site ready for you. So they're open for business."
• 0:04
  This is Real State, a podcast from CSG South.
• 0:11
  Join us as we talk with policymakers and public leaders shaping state-level decisions across the
• 0:17
  South and explore how ideas move from policy to real impact.
• 0:28
  Hello and welcome to Real State. I'm your host, Lindsey Gray. Across the South,
• 0:33
  economic development remains one of the top priorities for state leaders. States are competing
• 0:38
  for investment, jobs, talent, and innovation while also working to strengthen infrastructure,
• 0:44
  grow their workforce, and ensure communities of all sizes can participate in that growth.
• 0:50
  In Kentucky, those conversations have included major manufacturing investments,
• 0:55
  infrastructure improvements, workforce development, housing availability, broadband expansion,
• 1:00
  and efforts to position the commonwealth for long-term economic competitive deaths.
• 1:06
  Our guest today is Speaker, ProTem, David Mead of Kentucky. Speaker ProTem Mead has served in
• 1:12
  the Kentucky House of Representatives since 2013 and currently serves as the second highest-ranking
• 1:18
  member of the House leadership team. He also currently serves as chair of the Council of State
• 1:23
  Government Southern Office and the Southern Legislative Conference, bringing both a state and
• 1:29
  regional perspective to today's conversation. Speaker ProTem Mead, thank you for joining us today.
• 1:34
  Thanks for having me, Vince. You've had a front-row seat to Kentucky's economic evolution
• 1:41
  over the past decade. Looking back to when you first entered the legislature in 2013,
• 1:47
  how would you describe the biggest challenges you've seen in Kentucky's economic development landscape?
• 1:53
  Well, I think when I first came in, it was a totally different scenario for me. I was in
• 1:58
  serving the minority at the time, served there for four years before our already became the majority.
• 2:04
  And at that time, we had a lot of ideas that were kind of, there was some thin-knit frustration,
• 2:10
  I guess you would say, and we passed a lot of that economic policy the first couple of years to
• 2:16
  get us on the pathway. A lot of reducing regulation on restrictions on some of these larger
• 2:22
  companies to try to bring them to the state. And so we really focused on that, but also on our small
• 2:28
  businesses and being able to give them some relief to be able to expand and hire for a visit with.
• 2:32
  As you look at Kentucky today, what do you see as the state's biggest economic opportunity
• 2:37
  over the next decade? Well, I think the aviation industry is growing with leaks and bounds.
• 2:42
  The automotive industry is well right now. We're doing a lot of things for both of those industries
• 2:48
  to try to grow that and stay to the techie. One thing that we have continued to do is make sure that
• 2:54
  we have sites ready for companies when they come and be prepared for that. A lot of times you don't
• 2:59
  know who's going to be coming to your state or who's from the arresting mistake that you want to
• 3:02
  be ready when they do, and that's what we've tried to do. You should prepare for that.
• 3:06
  Well, economic development looks very different today than it did even 10 years ago. So,
• 3:10
  Kentucky's experienced significant investment and job creation in recent years, but states are
• 3:16
  increasingly recognizing that economic growth depends on more than simply recruiting companies.
• 3:22
  So, when you think about economic development today, has the definition of success changed
• 3:28
  from when you first into the legislature and if so, how? I think it is. I think we have realized
• 3:33
  that what we have to do is prepare with our infrastructure, first and foremost, they need that
• 3:38
  infrastructure. When they're coming to do business in your state, you also have to prepare your
• 3:41
  workforce, get them educated in rating video. So, I think that those are probably the primary two
• 3:48
  things that we have been working on in getting everything ready. You also have to have a good
• 3:52
  tax structure for businesses to make sure that they're in a tax environment that they can actually
• 3:57
  make profits and want to come to the business in real estate. What do you think Kentucky's getting
• 4:01
  right right now when it comes to creating an environment where businesses want to invest and grow?
• 4:07
  Well, one thing I believe that we did very well was then the COVID time period when a lot of federal
• 4:13
  money was coming into the states. A lot of states would end up spending a lot of that money once
• 4:19
  it first came in on recurring costs. We did not do that. What we did was make sure that the money that
• 4:26
  we received for one time funding, the spend on one time things, they're not recurring costs. And so,
• 4:31
  what we did was we prepared for infrastructure. We started updating that, our roads, our bridges,
• 4:36
  our water lines, our gas lines, those type of things to make sure that we had everything in order
• 4:42
  when companies were coming or expanding in our state. And I think that we have created now an
• 4:48
  environment that we're going to have everything is necessary for them to come as well as as I've
• 4:54
  mentioned before, we're starting to educate our workforce better, making sure that we are partnering
• 4:58
  with those companies and they come to make sure that the folks are prepared for jobs that they
• 5:04
  want you to need them. And that actually goes kind of into the next side of this conversation. So,
• 5:10
  increasingly states are recognizing that economic development and quality of life investments are
• 5:15
  deeply connected. So, this session, Kentucky Lawmakers, advanced significant investment in infrastructure
• 5:22
  and economic development projects across the Commonwealth. Additionally, housing has emerged as a
• 5:27
  growing policy discussion as states examine workforce availability and affordability challenges.
• 5:33
  How has Kentucky's approach to economic development evolved from simply attracting employers to also
• 5:40
  addressing infrastructure, housing and community readiness? Well, a lot of times what you see is these
• 5:45
  especially larger coffers are needing more land they spend on. Most of that land is going to be in
• 5:50
  a rural community. So, we have to prepare those communities for that. And what we've done is when
• 5:55
  you're a employer and you're looking for a place to put your business, you want to make sure that
• 5:59
  your employees are going to have a good quality of life. And there's going to be playing their housing
• 6:04
  available and it's going to be thanks for them to do in their all-time. There needs to be parts that
• 6:09
  needs to be things to spend time outside of that with your family. So, what we're trying to do is
• 6:17
  make sure that once we get past the infrastructure part and we've paired several of our sites. We have
• 6:22
  some megacytes in our state that are ready to go. So, when those companies come, once we move past that
• 6:27
  now we are working on that housing issue. It's become a crisis in many states. The affordability is a
• 6:33
  huge thing. We've seen the increased cost of real estate over the past few years and that's
• 6:39
  heard families especially when it comes to starter homes. So, we're trying to, we've been working
• 6:43
  on a housing bill. We didn't get a past this year. We couldn't come to a agreement with the Senate.
• 6:48
  It was kind of late in the session. So, we weren't able to get that done. We have already started in
• 6:54
  this interim working for us the next session to make sure that we can have a bill that it's going to
• 6:58
  help with affordability and availability for those homes for folks from the company.
• 7:02
  Big business here. I know Kentucky has invested heavily in site readiness and industrial development.
• 7:10
  So, being proactive rather than reactive when competing for those major projects, I imagine is
• 7:15
  extremely important to position yourself in that proactive stance. It is. May these businesses spend
• 7:20
  years trying to prepare for expansions or new businesses coming into a state. But when they're
• 7:27
  ready to go, they're ready to go. And so, we have to be up. I have your sites ready yet to be available.
• 7:33
  Yes, I had everything in order for them. You already need the infrastructure there. You already
• 7:38
  need the land there and the boot prepared together. So, we've been trying to do that over the past
• 7:44
  several years to make sure that Kentucky is right there at the top of the list and anytime
• 7:48
  anybody is building good breaks. Great. That proactivity. So, in businesses evaluate locations today,
• 7:55
  what do you believe are the biggest competitive advantages states need to offer that may not
• 8:00
  have been top priorities even 10 years ago? I think resources are a big thing.
• 8:06
  Water, sewer, electric energy is a huge thing across the south right now, especially as we've
• 8:14
  seen the expansion of industry across the south. I think all of our states are struggling a little bit
• 8:19
  with that and what we're going to do to make sure that they have enough energy. So, I think it's
• 8:23
  the biggest thing they're ready for right now is does this state have the resources that we need
• 8:27
  to operate our business? I think outside of that second, do they have the workforce that we need
• 8:33
  to make sure that we can operate part? Absolutely. Economic competitiveness often requires states to
• 8:39
  think ahead about emerging industries and future opportunities. This year, you sponsored House Bill 545,
• 8:45
  legislation designed to support alternative aviation fuel production while creating new opportunities
• 8:53
  for Kentucky's agriculture and transportation sectors. So, what opportunities did you see that
• 9:00
  led to you sponsoring House Bill 545? And how does it fit into Kentucky's broader economic development
• 9:06
  strategy? Kentucky's a large agriculture state. We have, cattle is one of our primary industry,
• 9:12
  but also crops is wailed. And one of the things that we look at is how can we help our farmers,
• 9:17
  but plus how are aviation community because it's our fastest growing industry. And our largest
• 9:22
  industry right now in the state is the aerospace industry. And so, we were trying to help them in
• 9:29
  that way. We worked with many of the airports, many of the airlines, UPS, Amazon,
• 9:35
  those cutters on making sure that we could give them what they need. And right now, a lot of them
• 9:42
  in their business plans are looking for alternative aviation for you. They're kind of forced into that,
• 9:47
  especially in the European market. Right now, our largest airport up in Cincinnati is looking to
• 9:53
  add some European flights into Germany. And Germany requires that those flights have that
• 9:59
  aviation fuel in them when they come into the cutters, sir. We're trying to help them with that and
• 10:04
  be a producer here in the state. What we did was we made a producing tax credit. So our refineries
• 10:10
  will get a credit for producing the fuel, but our farmers get a large credit as well for
• 10:15
  producing the soybean and the foreign that will go into this fuel. And so, we're trying to help our
• 10:20
  farmer for them anything right now as well as our industry. And I think we're on the right path.
• 10:25
  Yeah. And the South leads the way for aviation and aerospace also ag production. So it does seem
• 10:31
  like a great fit for Kentucky to have stepped out as one of the leaders in that space. And to your point,
• 10:40
  kind of forward looking and creating those opportunities that weren't available years ago, a decade
• 10:46
  ago weren't things that y'all are grappling with. But what does that next step look like? And I heard
• 10:52
  you blabbing clear and I agree. I've heard this across multiple southern states that, you know, our
• 10:58
  resources available in our states in order to support the industries that create the jobs that
• 11:05
  create innovation and the future. So thanks for taking the lead on something in Kentucky and
• 11:12
  we're watching. I'm sure you've got a couple other things up your sleeves as well for that. So in the
• 11:17
  future, your legislative work this year has also touched on higher education, workforce development
• 11:24
  and prison education programs. So looking ahead, what industries or sectors do you believe are most
• 11:31
  important to Kentucky's long term economic future? And how can the Commonwealth position itself to
• 11:36
  compete for those opportunities? Well, I think that as I'm already midgey, we have the aviation
• 11:43
  industry of course is going to continue to expand. I think you're going to see the automotive industry
• 11:47
  continue to expand. But it's not just about those larger companies either. It's our small businesses
• 11:52
  and we need to make sure that all those small businesses are on main streets in our small towns
• 11:57
  are successful as well. And they're primary, the ones that are going to be more and most of
• 12:02
  your people in your state are your small businesses. So we just need to create an environment that
• 12:07
  with our tax structure, with our policies and our procedures and our regulations in our state,
• 12:14
  to reduce those enough that these folks can operate in the way that government gets out of their
• 12:19
  way and that allows them to live their lives. And that's actually kind of the next direction is
• 12:23
  that rule economic development piece. So one issue that resonates across much of the South is ensuring
• 12:29
  economic growth reaches every region of a state. So you've been involved in effort supporting
• 12:35
  regional development projects, including major investments in economic infrastructure in central
• 12:40
  Kentucky. So Kentucky includes, let's start that question over, Kentucky includes major metropolitan
• 12:47
  areas as well as many rural communities. So what lessons has the Commonwealth learned about
• 12:52
  ensuring economic growth reaches every region of your state, every district? Well, like I said,
• 12:57
  a lot of your larger companies who are now starting to come back to the United States are going to
• 13:02
  need expansive areas to build on. And most of that is going to be in those rural areas. And so that's
• 13:08
  what we're doing is comparing that in my district, we at my district in Representative Josh Brage
• 13:14
  Difter, we established a very large industrial market, some megacytes of 1600 acres. We've got
• 13:21
  all the infrastructure there, it's there to go. We want to be ready for the future. And that site now is
• 13:26
  one of the top 10 sites in the nation as far as the data sites go. And so we're hopeful and
• 13:32
  we're in discussions with some folks now and hopefully thanks for paying out very soon. Okay,
• 13:36
  we heard it here. Central Kentucky has a megacytes ready for you. So they're open for business.
• 13:41
  So call speaker, protein, mead, oh, really probably call the economic development folks in Kentucky,
• 13:46
  but we're I can you treat contact with it, but they're ready. So that brings us to the broader picture.
• 13:51
  Kentucky has experienced significant economic momentum in recent years while continuing to navigate
• 13:57
  workforce, infrastructure and competitiveness challenges that many states are facing. Where do you
• 14:03
  see Kentucky leading or making the most meaningful progress right now when it comes to economic development?
• 14:10
  I think that energy is one of our areas that we have always led in, you know, with the coal industry
• 14:16
  that is kind of transitioned open natural gas, most of our power plants and things like that.
• 14:20
  But it's something that we're facing in the future as far as the difficulty, do we have enough energy
• 14:28
  for these companies that are coming because a lot of these larger companies, the more especially
• 14:32
  things like data centers or some of our larger automotive industries, they're digging so much energy
• 14:38
  that we're trying to prepare for that. And part of that is making sure that your electric infrastructure
• 14:43
  was up to date as well. So we partner with our co-offs, we partner with our electric companies to try
• 14:48
  to make sure that we're advancing in that area. So I think that's something that a lot of our states
• 14:54
  are scurrying with all across the South is how are we going to have the easier for these companies
• 14:58
  that is needed. One of the greatest resources we have across the South of course, water and
• 15:02
  water these companies need, need that resources as well. So we're positioned very, very well,
• 15:07
  don't be in the South. And I think that as we come together, especially when we come to get at
• 15:12
  CSG South, all of our states come together and being able to work through these things and
• 15:17
  partner together and developing solutions. It's been a good thing for all of us and being able
• 15:23
  to reach out to each other and say, "Hey, what are you doing in your state to advance this? What are
• 15:27
  you getting doing in your state to be prepared for this?" So it's a good collaboration of states.
• 15:31
  Yeah, we're seeing energy bills pass across the Southern states. I know you all are talking and
• 15:38
  sharing that information and I think that we'll see more and more of those over the next several
• 15:42
  sessions, particularly to address the data concerns and opportunities around data centers as well
• 15:50
  as the energy usage that beyond data centers that we're consuming as individuals but also as these
• 15:57
  industries are consuming. So a lot of our states are working on that issue. So I'm glad that Kentucky's
• 16:02
  at the table being that you all are such a strong energy-producing state as well as to your point
• 16:07
  a water forward state. So where do you believe Kentucky still has the greatest opportunity for
• 16:13
  improvement when it comes to long-term economic competitiveness? I think that one of the areas that
• 16:19
  we continue to need to work on is preparing our workforce, making sure that they're educated,
• 16:24
  making sure that we have the perfect number of people out there. Kentucky is a heavily dependent
• 16:30
  Medicaid state. We're then cracking down on making sure that the fraud or the use of that program
• 16:36
  is cut out and that is what built on our focus is recently. And so we're trying to make sure also
• 16:43
  that we partner with our economic development and our health and family services can for those who
• 16:48
  are on the program completely able by that we partner in order to get them to training necessary
• 16:53
  and help them to get back out into the water force. And it's interesting. I don't think the just normal
• 16:59
  citizen would think about how Medicaid and economic development actually do have to work together.
• 17:05
  They are not two separate things with separate conversations that don't ever intersect in these
• 17:11
  really complex issues, really for a state. So when you think about the next five or ten years,
• 17:17
  what would convince you that Kentucky is not just attracting investment but truly building a
• 17:22
  strong and more resilient economy? Well, I think that we focus on who we're going
• 17:28
  partner here when it comes to economic development through our budget process and also through the
• 17:33
  camera for economic development. We look at long-term growth. We look at people that we're going to
• 17:39
  partner with that we're going to try to incentivize that we're going to introduce to this state
• 17:45
  are going to be long-time partners. And so when especially when we develop a plan for those
• 17:50
  companies or the incentive package or where it may be it's a long-term package they're going
• 17:54
  to actually be here for a while. And so we know that they're going to be good partners from
• 17:58
  again to stir. Nice. Well, kind of looking more at the regional lens right now as chair of CSG South,
• 18:06
  you have the opportunity to engage with leaders from across the region and really across the country
• 18:12
  who are facing many of the same challenges. So what economic development trends are you seeing
• 18:17
  across southern states that excite you the most? Well, I think you're seeing a large amount of
• 18:23
  growth across the entire southern region and I think it's because a lot of our policies line up
• 18:27
  with each other. We worked very hard to develop those policies and we've gotten feedback from these
• 18:34
  business leaders to say what do we do to help you? What can we do to make sure that growth
• 18:39
  is to suck these good for you, sustainable for you, how can we help? And so those are the I think
• 18:44
  that's the biggest thing that gives me hope across the South is because we're all most of us are
• 18:49
  like minded, we're all taking the same way trying to work on the same type of policies and if you look
• 18:55
  across the nation right now the South is the leader in this industrial boom where the ones bring
• 19:00
  most of the companies to our areas. And still looking through that lens of CSG South chair,
• 19:08
  what is one economic development challenge that nearly every southern state seems to be talking
• 19:13
  about right now? I think I think energy, water, data centers is kind of that natural fit. Is there
• 19:19
  anything beyond that that you think is really taking center stage as a big challenge? Medicaid right now
• 19:24
  is drawing to hit us probably pretty hard in our budgets across the South, across the country, but the
• 19:30
  South there is a heavy dependence on Medicaid in our areas and so when that reduction in our budgets
• 19:39
  come we're going to have less money to spend on those economic development projects and things
• 19:44
  like that because when I back there are some holes. So we're going to have to do some some
• 19:49
  subdating on that and figure out ways that we can make sure that we are defining it ready for
• 19:56
  those economic development projects. That's also as I mentioned before is getting those
• 20:02
  folks that we can back out to work as the Medicaid roles decrease and making sure that we can help them
• 20:08
  and have a sustainable life that we're yeah and actually we have a data center session at the Southern
• 20:15
  Legislative Conference in July as well as we have our main policy planaries actually Medicaid
• 20:20
  and President Stivers is going to moderate that so we'll have a very thoughtful conversation
• 20:25
  about Medicaid so it's a great point and then we are also hosting on July,
• 20:29
  love it the first day of SLC the regional energy summit so we are very much though highlighting
• 20:34
  two of those big topics at SLC next month under your leadership so thank you for that and
• 20:41
  and you brought it full circle. So before we close I'd like to end with a question we ask all
• 20:48
  of our guests what is the best piece of professional advice you've ever received and how does it
• 20:53
  shape the way you approach leadership today? I don't know that it's just one piece of the
• 20:58
  advice that I've received I think it's over time folks pretty used as mentors who you know kind of lead
• 21:06
  you along and tell you how to conduct yourself I think one of the best things that I've been told
• 21:11
  is when I first came in the general assembly was that mood to sit back listen get a full grasp of
• 21:18
  the issue that you're talking about before you speak on it and be knowledgeable about it and so
• 21:24
  that's one of the things I'll be about but also I think that it goes back to how you know I was raised
• 21:30
  and it grew up and I believe that two of the three of the greatest qualities that a leader can have are
• 21:35
  kindness, compassion and humility and so I try to operate in that way with your kind to everyone
• 21:40
  show everyone respect there within willing to work with you work for you and so that's still I
• 21:46
  try to free everybody as good as possible can you compassion you have to have your heart in it you have
• 21:51
  to you have to make sure that you you do things in a way that you're caring I can't allow motions to
• 21:59
  drive policy but we do need to have a heart in it would know that we're helping people and why we're
• 22:04
  helping people with your and then of course humility is I don't think that though you know I think
• 22:11
  the greatest leaders are the ones who do create it there to want us and don't take that credit
• 22:15
  themselves so I try to make sure that my colleagues in the caucus or in the house get most of the
• 22:20
  good at anytime I speak ammunition well I can attest you being my chair you've led with kindness as
• 22:27
  well as your heart and I have watched your skill the art that you explained of sitting back and
• 22:33
  listening and really understanding and I've had several conversations that you're not aware of
• 22:38
  where people said he listens he is absorbing everything and then when he speaks he means it but
• 22:45
  he has been listening and learning so that's it's interesting that you that was your professional
• 22:51
  advice I have watched you live that many many times and it's working for you so speaker pro to
• 23:00
  mead thank you for joining us and for sharing your perspective on Kentucky's economic future and
• 23:04
  the opportunities ahead for the Commonwealth and the South also want to thank you for your
• 23:09
  leadership as chair of CSG South and for your continued commitment to strengthen collaboration
• 23:14
  among Southern states we can't wait for the Southern Legislative Conference in Lexington,
• 23:18
  Kentucky this July under your leadership. Well, if I get lazy and I can't say enough great things about
• 23:23
  even and our work working relationship this year and how much work you have done not just on the
• 23:29
  conference but for CSG South our year. I appreciate that sir and to our listeners thank you for tuning in
• 23:36
  to real estate for more conversations like this and to register in advance for the Southern Legislative
• 23:42
  Conference visit csg south dot org I'm Lindsey Gray let's keep it real.
• 23:47
  Thank you for joining us today on real estate where we keep it real about what really matters.