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©2007 ViTAL Economy, Inc. 1 Southern Illinois: Garden of the Gods Readiness Assessment Chapter 6: Regional Perspectives January 27, 2008; revised February.

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Presentation on theme: "©2007 ViTAL Economy, Inc. 1 Southern Illinois: Garden of the Gods Readiness Assessment Chapter 6: Regional Perspectives January 27, 2008; revised February."— Presentation transcript:

1 ©2007 ViTAL Economy, Inc. 1 Southern Illinois: Garden of the Gods Readiness Assessment Chapter 6: Regional Perspectives January 27, 2008; revised February 17 CONNECT SI ViTAL Economy Alliance Frank Knott, Project Lead; Stan Halle, Senior Editor; Jim Haguewood, Rob Beynon, & Neil Gamroth, Principal Economic Researchers

2 ©2007 ViTAL Economy, Inc Demographic Picture 6.02 Economic Picture Across SI 6.03 Economic Picture by Sub- Region (COI) 6.04 Livable Community: Assessment 6.05 Infrastructure: Assessment 6.06 Healthcare: Assessment 6.07 Implications & Recommendations Table of Contents EXECUTIVE OVERVIEW: the Big Picture & Importance of Change in SI EXECUTIVE OVERVIEW: the Big Picture & Importance of Change in SI READINESS ASSESSMENT (RA) READINESS ASSESSMENT (RA) 1. State, National & Global Trends 2. Indigenous Resources & Industry Asset Mapping 3. Enabling Environment Necessities 4. Climate of Innovation, Incubation & Entrepreneurship 5. Southern Illinois Competitiveness 6. Regional Perspectives 7. Roadmap to Success APPENDICES

3 ©2007 ViTAL Economy, Inc. 3 Chapter 6: Regional Perspective 6.01 Demographic Picture ……………………………………………… Economic Picture Across SI ……………………………………… Economic Picture by Sub-Region (COI) ………………………… Livable Community: Assessment ………………………………… Infrastructure: Assessment ………………………………………… Healthcare: Assessment …………………………………………… Implications & Recommendations ……………………………… Southern Illinois "Garden of the Gods" This Chapter of the RA provides a regional and sub-regional perspective and analysis in preparation for an overall SI economic strategy. Each sub-region (aka geographic COI) contains unique assets that can be leveraged to support the achievement of the overall Connect SI community and economic development goals.

4 ©2007 ViTAL Economy, Inc. 4 Chapter 6: Regional Perspective 6.01 Demographic Picture Southern Illinois "Garden of the Gods" This Section provides a condensed overview of the demographic trends across SI, focusing on youth brain drain and educational attainment.

5 ©2007 ViTAL Economy, Inc. 5 SI: Sizeable Population... Over 419,992 residents in SI region, comparable to a major metropolitan area (as of 2006) Greater Egypt corridors of Highway SR13 & I-55 and the home of SIU contain most of the regions population Three rural sub-regions are approximately equal in geographic area SI represents 3.3% of total IL population Source: Census Bureau data 2002, 2006 % of the Total Population by Sub-Region 12% 61% 15% 6.01 Demographic Picture Critical mass exists in Southern Illinois!

6 ©2007 ViTAL Economy, Inc. 6 SI Youth and Young-Adult Brain-Drain-Gap Southern Illinois % Population Growth (census-to-census) +0.9% TOTAL POPULATION -7.2% YEAR OLDS Source: BEA and U.S. Census update data SI is losing tomorrows workers, year olds Over 18 population: 65.7% have high school education, 13.2% have Bachelors degrees Recent trends show that high achievers are leaving the area Recapturing departing youth is key to labor pool and economic growth Without the next generation of workers, Connect SI strategies will be much more difficult to achieve Without the next generation of workers, Connect SI strategies will be much more difficult to achieve 6.01 Demographic Picture

7 ©2007 ViTAL Economy, Inc. 7 We Loose the Best and Brightest: SI Adults Tell Our Children That There Will Be No 21st Century Opportunity in SI Losing Your Future Workforce SIU and the community colleges generate an above average year old population This young population leaves the region for more attractive opportunities, despite SI having the resources that should help retain them Increasing Your Burden SI is losing its most productive age group while increasing the resource-demanding demographic of retirees Source: U.S. Census Bureau – Table QT-P1: Age Groups and Sex: 2000 and RA Interviews Age Distribution Comparison Increasing Your Burden Losing Your Future Workforce The youth are already here they need to be proactively retained 6.01 Demographic Picture

8 ©2007 ViTAL Economy, Inc. 8 SI Educational Attainment Gap SI region lags Illinois in high school completion Bachelor and higher degrees of education, SI is less than half Illinois rate Trends run counter to modern need for increased levels of education and training Population with High School or Higher in SI Regions vs. IL Population with Bachelor Degree or Higher in SI Regions vs. IL Source: U.S. Census Bureau (2000 Census) 34% of adult workers in the U.S. have a bachelor degrees or more; almost three times the SI rate 6.01 Demographic Picture

9 ©2007 ViTAL Economy, Inc. 9 9 SI is the size of a major metro area but doesnt yet behave like one The entire region is suffering from significant youth brain drain m A declining youth demographic is a major challenge to developing successful economic development strategies The population is aging in line with the entire U.S. m This will have a larger impact on the region if SI cannot recapture the youth leaving and influencing this shift SIU and the community college infrastructure provides a key driver to shift the aging demographic trend in SI The overall educational attainment level will need to be increased for SI to compete in a global economy 6.01 Demographic Picture Demographics Summary

10 ©2007 ViTAL Economy, Inc. 10 Chapter 6: Regional Perspective 6.02 Economic Picture Across SI Southern Illinois "Garden of the Gods" This Section provides a condensed overview of the economic development assets, conditions and trends for all of SI.

11 ©2007 ViTAL Economy, Inc. 11 SI Regional Introduction SI population and economy are similar to that of a major metropolitan area oEven with this size Southern Illinois suffers from lack of political clout state-wide due to the Chicago-land influence The cities bordering SI in neighboring states are attractive and draw money and resources out of the region oA significant proportion of medical patient dollars from the region travel to surrounding states oAttractive job opportunities have been created in the neighboring cities that result in out-migration of disposable income expenditures oMany top management personnel live in these communities and work in SI From the SI region lost over 2,300 manufacturing jobs or 20% of that sectors employment Greater Egypt dominates the SI region with respect to population and GDP, but not in average wage levels Government transfer payments comprise 64% of the regions personal income The region possesses a strong and experienced social services infrastructure SIs land base is dominated by agriculture designation, but has been experiencing declining economic benefit (through 2005) 6.02 Economic Picture Across SI

12 ©2007 ViTAL Economy, Inc. 12 Economic Profile: Southern Illinois Overview: Employment: 207,297 m Labor Participation rate 66.5% GDP: $17.6 billion m Top three GDP producers 1.Government – 20% 2.F.I.R.E. – 18% 3.Natural Resources – 13% Number% Average Wage Wholesale & Retail28,91014%$29,339 Government26,59713%$51,139 Health22,21011%$29,363 Other20,32010%$29,649 Natural Resources20,24610%$35,097 Manufacturing18,0099%$54,310 Tourism16,8628%$16,332 Education14,9847%$28,285 F.I.R.E.12,5256%$59,720 KBEs9,0114%$57,617 Construction8,9964%$48,246 Transport & Utilities8,6274%$52,414 Total207,297100%$38,952 SI # of Jobs by Region Employment by Sector Source: BEA data; VE Economic Scenario Model F.I.R.E = Finance, Insurance & Real Estate 6.02 Economic Picture Across SI

13 ©2007 ViTAL Economy, Inc. 13 Greater Egypt Dominates SI Economy Population by Sub-Region Source: Census Bureau 15% 12% 61% 64% 14% 11% GDP by Sub-Region Source: Connect SI Economic Scenario Model Greater Egypt's economic progress should be linked to the other sub-regions Achieving a sustainable and growing SI economy, requires that all sub-region assets should be integrated and leveraged It takes critical mass to be globally competitive Collaboration is how SI gets there! Greater Egypt's economic progress should be linked to the other sub-regions Achieving a sustainable and growing SI economy, requires that all sub-region assets should be integrated and leveraged It takes critical mass to be globally competitive Collaboration is how SI gets there! 6.02 Economic Picture Across SI

14 ©2007 ViTAL Economy, Inc. 14 Population and Wages: SI versus Illinois & U.S. Population in Southern Illinois has seen a decline in the past 25 years a dramatic difference vs. Illinois and U.S. trends Total wage growth in SI has been slow, far outpaced by that of both U.S. and Illinois Source: Bureau of Economic Analysis Cumulative Population Trend (1980 – 2005) 30.5% 11.6% (-3.0%) 6.02 Economic Picture Across SI Growth in Wages Over 25 Years (1980 – 2005) 73% Higher Than SI 63% Higher Than SI

15 ©2007 ViTAL Economy, Inc. 15 Average Wages Lagging 2005 Average Wage by Sub-Region versus IL Source: BEA, Regional Economic Accounts SI region average wages are almost 30% lower than the state average While IL wages are above the U.S. on average, SI wages remain below Lower wages mean lower consumer spending power with additional impacts on healthcare, education and social services Greater Egypts economy is four times the size of the other sub-regions, has the largest base of innovation assets, and two of its counties are rated as Creative-Class Counties, yet its wages are no higher than rest of SI Greater Egypts economy is four times the size of the other sub-regions, has the largest base of innovation assets, and two of its counties are rated as Creative-Class Counties, yet its wages are no higher than rest of SI 6.02 Economic Picture Across SI

16 ©2007 ViTAL Economy, Inc. 16 SI Per-Capita Wages are Low and Per-Capita Transfer Receipts are High Source: Bureau of Economic Analysis Regional Bare Facts ; 2006 SI currently underperforms Illinois Connect SIs initiative would push transfer receipts down and push per capita wages up Southern Illinois 6.02 Economic Picture Across SI

17 ©2007 ViTAL Economy, Inc. 17 Where SI Personal Income Comes From GWGESES5SI Illinois U.S. Total Personal Income (% of personal income composition) 100.0% Earnings by Workplace57.0%69.0%54.5%52.0%63.5%79.5%78.0% Wage and Salary Disbursements35.4%48.8%36.5%35.1%43.7%57.3%55.5% Supplements to Wages and Salaries10.7%13.2%9.4%9.6%11.9%13.5%13.3% Proprietors' Income (Business Owners) 10.9%7.1%8.6%7.3%7.8%8.7%9.2% Adjustment for Residence8.7%-0.3%7.0%10.6%3.2%-0.3%0.0% Dividends, Interest, and Rent18.5%16.6%15.9%14.4%16.5% 15.8% Personal Current Transfer Receipts21.4%21.7%28.2% 23.3%12.8%14.7% Less: Contributions for Government Social Insurance 5.7%7.0%5.7%5.2%6.5%8.4%8.5% Source: Bureau of Economic Analysis Regional Bare Facts 2006; Connect SI Economic Model SI earnings by workplace are 25% lower than Illinois, 23% lower than US SI needs to grow the job base by at least 20% = 40,000+ new jobs SI earnings by workplace are 25% lower than Illinois, 23% lower than US SI needs to grow the job base by at least 20% = 40,000+ new jobs 6.02 Economic Picture Across SI

18 ©2007 ViTAL Economy, Inc. 18 SI Dependency on Government Transfer Payments Exceeds State & National Benchmarks SI regions income is comprised of 23.1% government transfer payments, compared with just 12.6% for IL and 14.2% for U.S. Highest dependency on government transfer payments in Southern Five and Southeastern percent of income through such payments exceeds 25% Dependence on government payments restrains regional economic development and hinders entrepreneurial spirit Source: Bureau of Economic Analysis Regional Bare Facts Government Transfer Payments as % of Total Earnings SI IL U.S. Transfer payments: income payments to persons for which no current services are performed payments by government and business to individuals and nonprofit institutions serving individuals 6.02 Economic Picture Across SI

19 ©2007 ViTAL Economy, Inc. 19 Only 46% of SI Personal Income is Generated by Private Sector Employment 54% 33% 36% 46% 67% 64% Increasing private sector percentage of personal income generation is crucial to building a climate of innovation Private Sector Payroll & Benefits by Sub-Region GW - 48% GE - 53% SE - 42% S5 - 38% GW - 48% GE - 53% SE - 42% S5 - 38% Source: BEA & ViTAL Economy Analysis 6.02 Economic Picture Across SI

20 ©2007 ViTAL Economy, Inc. 20 Income Sources: Impact on the Region SI needs a 30% increase in private vs. public sector earnings to equal the U.S. ratio between public and private earnings Majority of income received from the public sector reduces the climate of entrepreneurship in the region and creates a risk-averse environment Smaller amount of per-capital income generated through productive purposes versus a much larger amount received from public sources and other transfer payments results in a weak view of business and economic opportunity Income disparity creates negative opportunity image for youth in the region for productive work Income disparity fuels the youth brain drain in the region by suppressing any youthful sense of hope and opportunity With only 46% of income received from private sector earnings, SIs ability to afford the community and economy it wants is greatly limited 6.02 Economic Picture Across SI

21 ©2007 ViTAL Economy, Inc. 21 SI Land Utilization is Less Than 3% Urban & Built S5SEGEGWSI Agriculture47%59%65%80%63% Forests21%28%16%13%19% Urban & Built2%3%4%2%3% Wetland8% 10%4%8% Surface Water2% 4%1%3% Barren & Exposed Land20%0% 4% 1,581 Land Mass Utilization Sq. Mi. 5,229 8,306 Sq. Mi. SI developed land mass is only 57% the size of Shawnee National Forest Shawnee National Forest is 5% of SI land base 6.02 Economic Picture Across SI Source: Illinois State Dept of Natural Resources

22 ©2007 ViTAL Economy, Inc. 22 The Value of SI Land is Shifting *% Change Land in Farms (Acres)1,185,0001,192,0001% Market Value of Production ($)$184,331,000$151,092,500-18% Government Payments ($)$12,919,000$16,235,00026% Source: NASS 2002 Census of Agriculture *2007 Agriculture statistics will reflect higher market value per acre due to increased commodity prices, especially for hybrid ethanol corn Since 2000: oNumber of farms and acres being farmed has stayed relatively stable oValue of farmland and buildings has increased by 27% oCropland rent per acre has increased by 20% Up to 60% lower yield in crop value per acre compared to Central Illinois or Northern Illinois oSoil and moisture characteristics account for much of the lower yield 6.02 Economic Picture Across SI

23 ©2007 ViTAL Economy, Inc. 23 SI KBE: Professional, Scientific, Technical and Information (PST&I) Work Force Gap PST workers include those in establishments specializing in professional, scientific and technical activities engineering, computers, architecture, law, and accounting Information industry I workers work with telecom and information networks KBE success largely related to PST sector of the economy (90% of new jobs) PST workers as percent of economy indicates ability to benefit from this growth area SI has 50% fewer PST&I workers than IL and U.S. at a time when they are the fastest growing job sectors of the U.S. economy Sources: BLS, IDES, BEA RegionKBE Workers% of SI KBE Greater Egypt6,22769% Greater Wabash90710% Southeastern1,07012% Southern Five8089% SI Total KBE9,0124.3% 7.7% 8.5% 4.3% 6.02 Economic Picture Across SI

24 ©2007 ViTAL Economy, Inc. 24 Traditional Business Strengths Agriculture: corn and soybeans Energy: coal and oil Southern illinois university Manufacturing Marine transportation and logistics Traditional Business Strengths Agriculture: corn and soybeans Energy: coal and oil Southern illinois university Manufacturing Marine transportation and logistics People, Land & Jobs % of IL Land Mass = 15.0% % of IL Population = 3.3% % of IL Employment = 2.8% Dependencies Public sector employment Transfer payments Social security Pensions Farm subsidies People, Land & Jobs % of IL Land Mass = 15.0% % of IL Population = 3.3% % of IL Employment = 2.8% Dependencies Public sector employment Transfer payments Social security Pensions Farm subsidies Rising Business Stars Transportation and logistics Tourism, including ecotourism and vineyards Clean coal technologies Health services Advanced manufacturing Arts and artisans Young entrepreneurs Rising Business Stars Transportation and logistics Tourism, including ecotourism and vineyards Clean coal technologies Health services Advanced manufacturing Arts and artisans Young entrepreneurs Notable Home to 2 nd largest university in Illinois Shawnee National Forest Mississippi, Ohio, and Wabash Rivers Interstate highway system and CN Rail SICCM (Southern Illinois Collegiate Common Market) Mid-America geographic location Rich historical area and assets Proximity to five major metro areas Notable Home to 2 nd largest university in Illinois Shawnee National Forest Mississippi, Ohio, and Wabash Rivers Interstate highway system and CN Rail SICCM (Southern Illinois Collegiate Common Market) Mid-America geographic location Rich historical area and assets Proximity to five major metro areas Current State: Southern Illinois 6.02 Economic Picture Across SI

25 ©2007 ViTAL Economy, Inc. 25 Opportunities Natural resources Transportation & logistics Homeland security Recreational tourism Geography, climate & location Quality of life Proximity to markets Senior living KBE and innovation Opportunities Natural resources Transportation & logistics Homeland security Recreational tourism Geography, climate & location Quality of life Proximity to markets Senior living KBE and innovation Key Trends Youth population decline Hwy 13 I-57 corridor growth SIU declining enrollment Medical professional recruitment difficulties Coal economy rebirth Upscale tourism unaddressed Expanded internet infrastructure One Region – One Vision Aging population Key Trends Youth population decline Hwy 13 I-57 corridor growth SIU declining enrollment Medical professional recruitment difficulties Coal economy rebirth Upscale tourism unaddressed Expanded internet infrastructure One Region – One Vision Aging population Challenges Broadband coverage Geographic isolation Political climate Business attractiveness Curb appeal Regional identity Workforce availability Focus on sunset industries Self image and respect Limit climate of collaboration Challenges Broadband coverage Geographic isolation Political climate Business attractiveness Curb appeal Regional identity Workforce availability Focus on sunset industries Self image and respect Limit climate of collaboration Growth Enablers Emerging KBE businesses Business incubation structures Business startup capital, angel investor networks Regional branding Value-added manufacturing strategies Connectivity & collaboration Entrepreneur networks Business and industry clustering Technology transfer e-Commerce development Growth Enablers Emerging KBE businesses Business incubation structures Business startup capital, angel investor networks Regional branding Value-added manufacturing strategies Connectivity & collaboration Entrepreneur networks Business and industry clustering Technology transfer e-Commerce development Opportunities & Challenges: Southern Illinois 6.02 Economic Picture Across SI

26 ©2007 ViTAL Economy, Inc. 26 Chapter 6: Regional Perspective 6.03 Economic Picture by Sub-Region (COI) Southern Illinois "Garden of the Gods" This Section provides economic factors that were identified by each of the four geographic COIs, plus notable trends, and 2012 goals.

27 ©2007 ViTAL Economy, Inc. 27 The 20 Southern Counties of Illinois bounded by the Mississippi, Ohio and Wabash Rivers Connect SI includes 4 sub-regions: Southern Five Union, Johnson, Alexander, Pulaski, Massac Southeastern Pope, Hardin, Saline, Hamilton, Gallatin Greater Wabash White, Wayne, Edwards, Wabash Greater Egypt Randolph, Perry, Jackson, Jefferson, Franklin, Williamson Connect SI includes 4 sub-regions: Southern Five Union, Johnson, Alexander, Pulaski, Massac Southeastern Pope, Hardin, Saline, Hamilton, Gallatin Greater Wabash White, Wayne, Edwards, Wabash Greater Egypt Randolph, Perry, Jackson, Jefferson, Franklin, Williamson 6.02 Economic Picture by Region Connect-SI Region 130 Miles East-West 100 Miles North to South Population = 423,670 Workforce = 207,297 GE SE GWGWGWGW S5 Source: U.S. Census Bureau 2006; VE Economic Scenario Model

28 ©2007 ViTAL Economy, Inc. 28 Economic Profile: Southern Five COI Number% Average Wage Government 4,07617%$51,139 Wholesale & Retail 3,02712%$31,953 Natural Resources 2,93212%$22,236 Health 2,54110%$29,363 Tourism 2,44410%$16,329 Manufacturing 1,5686%$54,310 F.I.R.E. 1,3596%$59,035 Education 1,2285%$28,285 Construction 1,1455%$48,246 Transport & Utilities 9634%$55,430 KBEs8093%$57,478 Other 2,2259%$29,549 Total 24,317100%$37,641 Overview: Labor Participation Rate – 62.8% GDP: $2.1 billion oTop three GDP generators Government – 26% F.I.R.E. – 17% Natural Resources – 12% Employment by Sector Source: BEA Data and RIMS II multipliers 6.03 Economic Picture by Sub-Region S5 SI Number of Jobs by Region

29 ©2007 ViTAL Economy, Inc. 29 Southern Five Population Trends Prison Population Removed (None in S5 Open in 1980) est.Change 2004 est. No Prison Change No Prison Alexander12,2809,228(-24.9%)8,774(-28.6%) Johnson9,69113, %9,4312.7% Massac15,03615,2941.7%15,2941.7% Pulaski8,8476,950(-21.4%)6,950(-21.4%) Union17,85718,1951.9%18,1951.9% Southern Five Region 63,71162,696(-1.6%)58,644(-8.0)% Comparison during same period: USA +13.1%: Illinois +11.2%; Illinois (without Prison Population) +10.9% Source: COI Milestone and U.S. Census Data Alexander County has experienced the greatest population decline of any SI county, over 25% since Economic Picture by Sub-Region S5

30 ©2007 ViTAL Economy, Inc. 30 Region Losing Best Resource: Young Adults (No Prison Population included) IL S5 Fewer Children More Retirees Aging Population (2004) Young Adults as % of Population (2004) Source: U.S. Census, Prison Population Removed 6.03 Economic Picture by Sub-Region S5

31 ©2007 ViTAL Economy, Inc Economic Picture by Sub-Region S5 Intermodal Transportation Opportunity Strategic Position of Cairo, Alexander County: m Junction of the Mississippi and Ohio Rivers m Interstate 57 m Proximity to Interstate 55 and 24 m Major rail carriers Trends: m Large part of U.S. trade deficit is comprised as empty containers returning to Asia m Development of CN Rail traffic in the Midwest m Increasing container-on-barge traffic on the Mississippi m Production of export products in or in proximity to SI including cotton, soy, corn, pulp, silica m Active regional transportation providers engaged in river and barge traffic and trucking Opportunity: connect regional products with export markets via transportation infrastructure and services Projected annual economic impact of this Intermodal opportunity is estimated at ~$100 million in GDP (est. 1,182 direct, indirect & induced jobs) Source: ViTAL Economy Economic Scenario Model & Inter VISTAS Intermodal Study for City of Cairo, SIDEZ & USDA

32 ©2007 ViTAL Economy, Inc. 32 S5 Traditional Business Strengths Government Mississippi barges Forestry Transportation Recreation and tourism S5 Traditional Business Strengths Government Mississippi barges Forestry Transportation Recreation and tourism S5 People, Land & Jobs % of IL Land Mass = 3.3% % of IL Population = 0.50% % of IL Employment = 0.33% S5 Dependencies Government employment Transfer payments Government dependence on casino revenues S5 People, Land & Jobs % of IL Land Mass = 3.3% % of IL Population = 0.50% % of IL Employment = 0.33% S5 Dependencies Government employment Transfer payments Government dependence on casino revenues S5 Rising Business Stars Transportation and logistics Tourism, including ecotourism and vineyards Energy, including ethanol, bio-diesel Advanced manufacturing Artisans and arts Proposed coal gasification plant Harrahs Casino Metropolis Wineries Golf course & residential development Mermet Springs Diving Center LaFarge Concrete Plant S5 Rising Business Stars Transportation and logistics Tourism, including ecotourism and vineyards Energy, including ethanol, bio-diesel Advanced manufacturing Artisans and arts Proposed coal gasification plant Harrahs Casino Metropolis Wineries Golf course & residential development Mermet Springs Diving Center LaFarge Concrete Plant S5 Notable Mississippi and Ohio Rivers CN Rail North-South line Interstate 55 Tourism, heritage sites & events, e.g.: Ft. Massac Civil War Encampment Superman Festival Indian settlements Unique climate & long growing season Shawnee College Mermet Springs Wine, golf, B&B trails Extensive social service expertise S5 Notable Mississippi and Ohio Rivers CN Rail North-South line Interstate 55 Tourism, heritage sites & events, e.g.: Ft. Massac Civil War Encampment Superman Festival Indian settlements Unique climate & long growing season Shawnee College Mermet Springs Wine, golf, B&B trails Extensive social service expertise Economic Profile: Southern Five COI 6.03 Economic Picture by Sub-Region S5

33 ©2007 ViTAL Economy, Inc. 33 Southern Five COI: Goals Southern Five Region (23 Feb 2007) Baseline 2012 Same Trend 2012 Goal Change vs. Baseline Change vs Same Population (2004)58,64453,97163, %+16.7% Employable Population (16-64) (2000) 35,88733,01440, %+24.0% Labor Participation (16-64) (2000) 62.8% 71.0%+13.1% Employed 2004 All Ages24,31725,55026, %+5.1% Average Wage 2004$27,959$35,980$37,591+$9,632+$1,611 Total Region Wages 2004$679.9m$919.3m$1,010m+$329.7m+$90.3m Determination of specific measurable, wage & employment goals from change in regional wages vs trend NEW JOBS: 784 WAGE: $43,500 $34.1m NEW JOBS AT AVERAGE WAGE: 522 WAGE: $36,517$19.6m IMPROVEMENT OF EXISTING JOBS: 4,863 WAGE: $5,000$24.3m CLIMATE OF ECONOMIC OPPORTUNITY: $12.2m 6.03 Economic Picture by Sub-Region S5

34 ©2007 ViTAL Economy, Inc. 34 Southern Five COI: Opportunities KBE m Process materials and piping, CO 2 in process piping m Mental health expertise, exportable mental health product m Wetland recovery, flood plains m Music production, college instruction and local artists m Local history experts m Artisans and products m Goal: Start 35 businesses with 10 employees each by 2012 Logistics/Transportation m Identify best practices and trends in trucking and transportation m Identify additional training funds for programs m Closure of Cairo Airport, best practices of airports in rural areas, location, operations, security issues, trends in air transport Energy m Learn from other communities that have gone through a large project development process m Improve communication between communities within 20 county area m Research switch grass cellulose potential m Nuclear power Tourism m B&Bs golf and wineries; build off of successful activities m Dining and restaurant needs in support of tourism m Aggregate demand with wineries and B&Bs m Define the specific regional tourism goals, quantifiable and measurable m Linking the different trails together 6.03 Economic Picture by Sub-Region S5

35 ©2007 ViTAL Economy, Inc. 35 Southern Five: Highlights S5 Opportunities Geography location; transportation & logistics 50% of U.S. market within 10 hours of S5 Community College System and SIU Increase healthcare availability Tourism, bed & breakfast, wineries Shawnee National Forest and state parks Agribusiness opportunities (e.g. ethanol and bio-diesel) Unique natural locations Significant historic site Senior services S5 Opportunities Geography location; transportation & logistics 50% of U.S. market within 10 hours of S5 Community College System and SIU Increase healthcare availability Tourism, bed & breakfast, wineries Shawnee National Forest and state parks Agribusiness opportunities (e.g. ethanol and bio-diesel) Unique natural locations Significant historic site Senior services S5 Key Trends Strong core of community leadership Growth of bed and breakfast facilities Expansion and growth of lodging facilities in Metropolis Investment in residential developments Region is receiving major investments attention Most high level executives do not live in the area Limited availability of workforce S5 Key Trends Strong core of community leadership Growth of bed and breakfast facilities Expansion and growth of lodging facilities in Metropolis Investment in residential developments Region is receiving major investments attention Most high level executives do not live in the area Limited availability of workforce S5 Challenges Lack of skilled workforce for current and future jobs Lack of cooperation, collaboration, and regionalism S5 lacks the assets to grow and retain tech-based jobs No sense of urgency K-12 system needs support Limited healthcare availability to Alexander, Johnson and Pulaski Counties Electrical rates There are so many problems, where do you start S5 Challenges Lack of skilled workforce for current and future jobs Lack of cooperation, collaboration, and regionalism S5 lacks the assets to grow and retain tech-based jobs No sense of urgency K-12 system needs support Limited healthcare availability to Alexander, Johnson and Pulaski Counties Electrical rates There are so many problems, where do you start S5 Climate for Growth Travel and tourism; history, experience Outdoor recreation activities and events Mississippi and Ohio river transportation Golf and wine trails Transportation and logistics Alternative energy S5 Climate for Growth Travel and tourism; history, experience Outdoor recreation activities and events Mississippi and Ohio river transportation Golf and wine trails Transportation and logistics Alternative energy Source: Connect SI COI, RA Interviews and VE 6.03 Economic Picture by Sub-Region S5

36 ©2007 ViTAL Economy, Inc. 36 Economic Profile: Southeastern COI Number% Average Wage Natural Resources 3,70617%$36,730 Wholesale & Retail 2,91913%$32,522 Government 2,76313%$51,139 Health 2,26410%$29,363 Tourism 1,5907%$16,329 F.I.R.E. 1,3366%$60,261 Transport & Utilities 1,1095%$51,629 Construction 1,1005%$48,246 Education 1,0215%$28,285 Manufacturing 8234%$54,310 KBEs10695%$58,134 Other 2,20310%$29,352 Total 21,903100%$39,458 Employment by Sector Source: BEA Data and RIMS II Multipliers Overview: Labor Participation Rate – 69% GDP: $2.0 billion Top three GDP generators 1. Natural Resources – 22% 2. Government – 18% 3. F.I.R.E. – 17% 6.03 Economic Picture by Sub-Region SE SE Number of Jobs by Region

37 ©2007 ViTAL Economy, Inc. 37 Southeastern: Population Trends est.Change Gallatin7,5906,152(-18.9%) Hamilton9,1728,301(-9.4%) Hardin5,3834,718(-12.3%) Pope4,4044,211(-4.3%) Saline28,44826,072(-8.3%) SE Region54,99749,454(-10.0%) Comparison during same period: USA +13.1%, Illinois +11.2%; (without Prison population 10.7%) Source: COI Milestone 6.03 Economic Picture by Sub-Region SE In the past 25 years, all five SE counties have lost significant population

38 ©2007 ViTAL Economy, Inc. 38 Shawnee National Forest Visit Profile and Projections Room for Increased Daily Spend Rates Characteristic Local Day Trips Non-local Day Trip MotelCampTOTAL Current Visitors46%12%27%9% Visitor Segment230,00060,000135,00045,000500,000 Shawnee Spend$27 /day $118 /dayEst. $113 /day$64 /day Estimated Expenditures $6.2 m$1.6 m$15.9 m$5.1 m$30.2 m National Spend$33 /day$ 52 /day$181 /dayEst. $143 /day$105 /day Potential Expenditures $7.6 m$3.1 m$24.4 m$6.4 m$41.6 m Potential Revenue Gain $1.3 m$1.5 m$8.5 m$1.4 m$12.7 m Current Impacts: Shawnee National Forest Annual Visitation 500,000 Source: NPS Spending and Payroll Impacts, 2005, Spending Profiles for National Forest Visitors, May 2005 Note: Total potential spend for Shawnee is based on totaling national spend category columns, not total visitors x average national spend 6.03 Economic Picture by Sub-Region SE

39 ©2007 ViTAL Economy, Inc. 39 Shawnee National Forest: Opportunity 6.03 Economic Picture by Sub-Region SE Increased spending leads to tourism jobs Achieving national averages of daily spend rate estimated to create 235 new jobs in Southern Illinois This is based on forest- related spending alone Increased non-forest spending would create more jobs Infrastructure and camp improvements are needed to achieve this result 25 New Jobs 30 New Jobs 160 New Jobs 25 New Jobs Non-local Day Trips Camp Motel Local Day Trips TOTALS Note: Analysis based on BEA RIMs II model analysis Increased Spend Rates to National Averages Would Create 235 Jobs

40 ©2007 ViTAL Economy, Inc. 40 SE Traditional Business Strengths Coal mining Agriculture Hunting Aggregate rock Historical sites and museums Barge and river industry SE Traditional Business Strengths Coal mining Agriculture Hunting Aggregate rock Historical sites and museums Barge and river industry SE People, Land & Jobs % of IL Land Mass = 3.07% % of IL Population = 0.40% % of IL Employment = 0.30% SE Dependencies Government jobs Transfer payments SE People, Land & Jobs % of IL Land Mass = 3.07% % of IL Population = 0.40% % of IL Employment = 0.30% SE Dependencies Government jobs Transfer payments SE Rising Business Stars Tourism, including ecotourism Recreational manufacturing Mining-related spin-offs Coal mining Guiding and Outfitting Disaster recovery knowledge SE Rising Business Stars Tourism, including ecotourism Recreational manufacturing Mining-related spin-offs Coal mining Guiding and Outfitting Disaster recovery knowledge SE Notable Ohio Scenic Byway Coal reserves Shawnee National Forest, Garden of the Gods Southeastern Illinois College Tourism & heritage sites & events, eg: Slave House, Trail of Tears, Milestone Bluffs Festivals: Fresh Water Shrimp Festival, etc. Undeveloped tourism sites Dixon Springs Ag Center Unique climate & long growing season SE Notable Ohio Scenic Byway Coal reserves Shawnee National Forest, Garden of the Gods Southeastern Illinois College Tourism & heritage sites & events, eg: Slave House, Trail of Tears, Milestone Bluffs Festivals: Fresh Water Shrimp Festival, etc. Undeveloped tourism sites Dixon Springs Ag Center Unique climate & long growing season Economic Profile: Southeastern COI 6.03 Economic Picture by Sub-Region SE

41 ©2007 ViTAL Economy, Inc. 41 Southeastern COI: Goals Southeastern Region (23 Feb 2007) Baseline 2012 Same Trend 2012 Goal Change vs. Baseline Change vs Same Population (2004)49,46547,83356, %+17.1% Employable Population (16-64) (2000) 31,11530,37336, %+19.8% Labor Participation (16-64) (2000)63.4% 70.0%+10.4% Employed 2004 All Ages21,90319,25625, %+32.4% Average Wage 2004$27,494$35,604$40,206+$12,782+$4,672 Total Region Wages 2004$602.2m$685.6m$1,027m+$424.8m+$341.4m Determination of specific measurable, wage & employment goals from change in regional wages vs trend NEW JOBS: 3,746 WAGE: $43,500 $163.0m NEW JOBS AT AVERAGE WAGE: 2,498 WAGE: $40,276$100.6m IMPROVEMENT OF EXISTING JOBS: 4,381 WAGE: $5,000$21.9m CLIMATE OF ECONOMIC OPPORTUNITY: $56.0m 6.03 Economic Picture by Sub-Region SE

42 ©2007 ViTAL Economy, Inc. 42 Opportunity What is the market opportunity? What unique assets are being leveraged? Lodging capabilities Expanded tourism stays, $175- $200/day Locating the facilities near unique areas Training facilities By linking resources and upgrading skills it will increase the visitor expenditures per day in the region The Outfitter experience, Ohio Scenic Byway, Festivals Teaching mine training A clear growing need to support the expanded employment need and also the near future retirement of miners SIC (potential link to Rend Lake) abandoned mines in the area to create a real life training center Correctional Officer Training Center Train our own CO, Police, etc. rather than 12 weeks of time and funds spent in Springfield Existing knowledge base of correction and law enforcement in SI and facilities Increase marketing access Bringing Producer closer to Consumer for SI products Shrimp, PM building materials, wines Drug Rehab Center NO existing program of its kind in SI; Termination of price per day or course needs to be researched. Connect to Tourism (trails) as part of rehab; knowledge base; lodging Shawnee National Forest Service participation Expanded tourism stays, $175- $200/day Shawnee National Forest as one of the most unique locations on North America Southeastern COI: Opportunities (1 of 2) 6.03 Economic Picture by Sub-Region SE Source: COI Milestone

43 ©2007 ViTAL Economy, Inc. 43 Opportunity What is the market opportunity? What unique assets are being leveraged? Lodging, Condos, Cabins Hundreds of visitors experiencing a variety of activities including hiking, biking, hunting, etc. Shawnee National Forest and Glen O. Jones Lake Food & Dining Improvement of the overall tourism and visitor experience and product in the region Existing facilities and programs that can be leveraged without large upfront costs Game Cuisine Unique culinary experience. Preparation of hunters game during their stay in the area. Deer-related products Large variety of game available in the region Market regional festivals together Master calendar and extended stays at $175-$200/day Leveraging visitors to meet local products bringing Producer closer to Consumer Team With Rend Lake Culinary Arts School Improvement of the overall tourism and visitor experience and product in the region Existing facilities and programs that can be leveraged without large upfront costs, Job Corps, RLC, SIC Garden of the Gods Expanded tourism stays, $175- $200/day One of a kind natural resource Southeastern COI: Opportunities (2 of 2) 6.03 Economic Picture by Sub-Region SE Source: COI Milestone

44 ©2007 ViTAL Economy, Inc. 44 Southeastern Tourism Goals Recognizing the extensive indigenous resources in Southeastern and under-tapped tourism industry potential, the COI set several goals: m Increase expenditures by $10m/yr m Increase lodging taxes by $85k/yr m Increase daily spending by 19% ($60 to $76) m Increase occupied room-nights in the region by 8,000 per year m Focus on three areas (take 19 areas through the filter): Fee-hunting Historical tours Eco-tourism Source: Southeastern COI 6.03 Economic Picture by Sub-Region SE

45 ©2007 ViTAL Economy, Inc. 45 SE Opportunities Bring resources to SE through relationships and alliances Natural and small town environments are positive places to live, work and play Leverage the Dixon Springs Center, unique climate Grow reputation for entrepreneurship Grow tourism industry by leveraging unique location, heritage sites and natural features Unique small river towns Leverage coal mining knowledge base in new ways; disaster recovery, safety systems, training SE Opportunities Bring resources to SE through relationships and alliances Natural and small town environments are positive places to live, work and play Leverage the Dixon Springs Center, unique climate Grow reputation for entrepreneurship Grow tourism industry by leveraging unique location, heritage sites and natural features Unique small river towns Leverage coal mining knowledge base in new ways; disaster recovery, safety systems, training SE Key Trends Growth and prominence of Southeastern College Rebirth of coal industry Transportation of coal from Shawneetown terminal Regional recognition including videos highlighting the unique natural features Growth of the Ohio Scenic Byway Weak workforce availability SE Key Trends Growth and prominence of Southeastern College Rebirth of coal industry Transportation of coal from Shawneetown terminal Regional recognition including videos highlighting the unique natural features Growth of the Ohio Scenic Byway Weak workforce availability SE Challenges Overall limited resources in the area Declining tax revenue base Change age demographic Limited broadband penetration Lack of lodging facilities (187 rooms) Limited affordable housing Industrial water availability in Hamilton County for mine expansion Entrepreneurship support structures Quality housing stock SE Challenges Overall limited resources in the area Declining tax revenue base Change age demographic Limited broadband penetration Lack of lodging facilities (187 rooms) Limited affordable housing Industrial water availability in Hamilton County for mine expansion Entrepreneurship support structures Quality housing stock SE Climate for Growth Agriculture research and development Comfortable mild Midwest climate: senior living Tourism; unique natural environment & locations Vast amount of coal resources Variety of coal industry knowledge Processing of coal closer to raw material Mine to mouth energy production Growing need for coal workers & disaster training Entrepreneurship and innovations KBE workers in unique small towns SE Climate for Growth Agriculture research and development Comfortable mild Midwest climate: senior living Tourism; unique natural environment & locations Vast amount of coal resources Variety of coal industry knowledge Processing of coal closer to raw material Mine to mouth energy production Growing need for coal workers & disaster training Entrepreneurship and innovations KBE workers in unique small towns Southeastern Highlights Source: Connect SI COI, RA Interviews and VE 6.03 Economic Picture by Sub-Region SE

46 ©2007 ViTAL Economy, Inc. 46 Economic Profile: Greater Wabash COI Number% Average Wage Natural Resources 4,97419%$41,213 Wholesale & Retail 3,78914%$31,223 Manufacturing 2,70210%$54,310 Government 2,4529%$51,139 Health 2,3779%$29,363 F.I.R.E. 1,9497%$61,000 Tourism 1,3345%$16,345 Construction 1,2835%$48,246 Education 1,0454%$28,285 Transport & Utilities 9404%$54,220 KBEs9063%$57,349 Other 2,64110%$28,484 Total 26,392100%$41,009 Source: BEA Data and RIMS II multipliers Employment by Sector 6.03 Economic Picture by Sub-Region GW Overview: Labor Participation Rate – 71% GDP: $2.5 billion Top three GDP generators 1. Natural Resources – 25% 2. F.I.R.E. – 19% 3. Government – 13% Lowest % in SI region GW Number of Jobs by Region

47 ©2007 ViTAL Economy, Inc. 47 Greater Wabash: Population Trends est.Change Edwards7,9936,785(-15.1%) Wabash13,77612,601(-8.5%) Wayne18,15716,814(-7.4%) White17,96415,221(-15.3%) Greater Wabash Region 57,89051,421(-11.2%) Comparison during same period: USA +31.1%, Illinois +11.2% Source: Bureau of Economic Analysis and Census Bureau GW has the greatest population loss in SI from 1980 to 2004 more recent estimates show trend continuing 6.03 Economic Picture by Sub-Region GW

48 ©2007 ViTAL Economy, Inc. 48 Older Age Distribution Puts SI at Economic Disadvantage versus Illinois Dramatic loss of yr olds in GW region GW has a greater percent of people over 55 than the rest of Illinois Median age higher in GW (40) than Illinois (34.7) Source: U.S. Census Bureau – Table QT-P1: Age Groups and Sex: 2000 Age Distribution Comparison To grow economically, the region needs to retain younger workers and grow job opportunities To grow economically, the region needs to retain younger workers and grow job opportunities 6.03 Economic Picture by Sub-Region GW

49 ©2007 ViTAL Economy, Inc. 49 Out-Migration is Eroding GWs Future Out-migration of Healthcare Revenues * $32.9m of $55.5m Out-migration of Healthcare Revenues * $32.9m of $55.5m Out-of-Region Jobs & Disposable Income Spending * $14.7m-$23.6m per year * Worth Jobs Out-of-Region Jobs & Disposable Income Spending * $14.7m-$23.6m per year * Worth Jobs Youth Brain Drain (Future Workforce) * 16.3% drop in 10 years * $19.1m in lost wages Youth Brain Drain (Future Workforce) * 16.3% drop in 10 years * $19.1m in lost wages Economic Value Lost to GW: $56.7m-$75.6m EVERY YEAR! 6.03 Economic Picture by Sub-Region 49 GW

50 ©2007 ViTAL Economy, Inc. 50 GW Traditional Business Strengths Agriculture Mining Manufacturing, eg: Airtex, Champion Labs Oil extraction Education system GW Traditional Business Strengths Agriculture Mining Manufacturing, eg: Airtex, Champion Labs Oil extraction Education system GW People, Land & Jobs % of IL Land Mass = 3.0% % of IL Population = 0.41% % of IL Employment = 0.35% GW Dependencies Transfer payments High coal industry retirees Pension income Manufacturing employment GW People, Land & Jobs % of IL Land Mass = 3.0% % of IL Population = 0.41% % of IL Employment = 0.35% GW Dependencies Transfer payments High coal industry retirees Pension income Manufacturing employment GW Rising Business Stars Tourism, especially hunting Energy Oil industry supplies and equipment Outfitting/Hunting, eg: Campbells Outfitters Entrepreneur businesses: Elastec, Dinger Bats GW Rising Business Stars Tourism, especially hunting Energy Oil industry supplies and equipment Outfitting/Hunting, eg: Campbells Outfitters Entrepreneur businesses: Elastec, Dinger Bats GW Notable Wabash River Business connections with Indiana Interstate (I-64); proximity to Evansville, IN Nearby Toyota plant (Princeton IN) Postcard small towns College System: Illinois Eastern Community Colleges, Frontier, Wabash Valley Oil reserves Online education initiatives Major regional business owners live in the area Major source of water in the area Lower unemployment rate then the rest of SI GW Notable Wabash River Business connections with Indiana Interstate (I-64); proximity to Evansville, IN Nearby Toyota plant (Princeton IN) Postcard small towns College System: Illinois Eastern Community Colleges, Frontier, Wabash Valley Oil reserves Online education initiatives Major regional business owners live in the area Major source of water in the area Lower unemployment rate then the rest of SI Economic Profile: Greater Wabash COI 6.03 Economic Picture by Sub-Region GW Source: Connect SI COI, RA Interviews and VE

51 ©2007 ViTAL Economy, Inc. 51 Greater Wabash COI: Goals Greater Wabash Region (23 Feb 2007) Baseline 2012 Same Trend 2012 Goal Change vs. Baseline Change vs Same Population (2004)51,42149,56153, %+6.9% Employable Population (16-64) (2000) 31,98030,77732, %+6.9% Labor Participation (16-64) (2000)71.1% 72.5%+1.97% Employed 2004 All Ages26,40025,44527, %+9.0% Average Wage 2004$26,311$33,671$36,517+$10,206+$2,846 Total Region Wages 2004$694.6m$856.8m$1,013m+$318.9m+$156.4m Determination of specific measurable, wage & employment goals from change in regional wages vs trend NEW JOBS: 1,381 WAGE: $43,500 $60.1m NEW JOBS AT AVERAGE WAGE: 920 WAGE: $36,517$33.6m IMPROVEMENT OF EXISTING JOBS: 5,280 WAGE: $5,000$26.4m CLIMATE OF ECONOMIC OPPORTUNITY: $36.4m 6.03 Economic Picture by Sub-Region GW

52 ©2007 ViTAL Economy, Inc. 52 Greater Wabash COI: Opportunities 6.03 Economic Picture by Sub-Region GW Energy oBecome an Alternative Energy Capital of the World oMethane Gas, ethanol and bio-diesel, geo-thermal technologies, green coal concept KBE oRecertification programs oConnect with tourism to improve quality of the industry oContinuing education; lawyers, accountants, realtors, etc. oLocal PC support group Tourism oFour wheeler activities, racetracks, competitions, training track oHunting facilities and guide services, turkey and deer oLone Ranger Festival, Mt. Carmel oBeall Woods, trails, improvement of facilities oUnderground coal mine park view the fault oUnderground four wheel tours and adventures oDevelop a spillway for the Wabash River; 4 ft.

53 ©2007 ViTAL Economy, Inc. 53 GW Opportunities Leverage the community college system for high demand online areas such as nursing Attractive climate and environment for KBE workers Utilize the college system to attract young adults to slow the youth brain drain Unique small town atmosphere near Evansville Entrepreneurship and business incubation KBE opportunities from energy knowledge base Utilization and leveraging of the expanded broadband infrastructure; education, services, connections with external resources and customers GW Opportunities Leverage the community college system for high demand online areas such as nursing Attractive climate and environment for KBE workers Utilize the college system to attract young adults to slow the youth brain drain Unique small town atmosphere near Evansville Entrepreneurship and business incubation KBE opportunities from energy knowledge base Utilization and leveraging of the expanded broadband infrastructure; education, services, connections with external resources and customers GW Key Trends Significant youth brain drain Out migration of healthcare services to Indiana Employment opportunities in Indiana Substantial consumer spending in Indiana Expanded economic dependence on Champion Labs and Airtex Strong base of annual community events Large farmers purchasing additional land Limited availability of workforce Growth and improvements in Fairfield East of I-57 & South of Hwy 50 negative growth GW Key Trends Significant youth brain drain Out migration of healthcare services to Indiana Employment opportunities in Indiana Substantial consumer spending in Indiana Expanded economic dependence on Champion Labs and Airtex Strong base of annual community events Large farmers purchasing additional land Limited availability of workforce Growth and improvements in Fairfield East of I-57 & South of Hwy 50 negative growth GW Challenges Youth brain drain Uncomfortable attitude towards change Bedroom community (for out-of-state employment) and spending) Consumer spending trend in Indiana Residential curb appeal – risk of lowering value Lack of a clear regional differentiation in SI GW Challenges Youth brain drain Uncomfortable attitude towards change Bedroom community (for out-of-state employment) and spending) Consumer spending trend in Indiana Residential curb appeal – risk of lowering value Lack of a clear regional differentiation in SI GW Climate for Growth Unique small town atmosphere; bedroom community Low cost property values Export of educational programs Oil, gas and coal extraction knowledge Entrepreneurship strategy – business incubation linked with expertise and existing loan funds; GWRPC, SDC, City of Carmi, Wayne City, City of Fairfield KBE businesses and employment GW Climate for Growth Unique small town atmosphere; bedroom community Low cost property values Export of educational programs Oil, gas and coal extraction knowledge Entrepreneurship strategy – business incubation linked with expertise and existing loan funds; GWRPC, SDC, City of Carmi, Wayne City, City of Fairfield KBE businesses and employment Greater Wabash: Highlights Source: Connect SI COI, RA Interviews and VE 6.03 Economic Picture by Sub-Region GW

54 ©2007 ViTAL Economy, Inc. 54 Economic Profile: Greater Egypt COI Overview: Labor Participation Rate – 66% GDP: $11.1 billion m Top three GDP generators 1. Government – 20% 2. F.I.R.E. – 18% 3. Manufacturing – 11% Highest in SI region Jobs% Average Wage Wholesale & Retail 19,17614%$28,070 Government 17,30613%$51,139 Health 15,02811%$29,363 Manufacturing 12,91610%$54,310 Education 11,6909%$28,285 Tourism 11,4939%$16,332 Natural Resources 8,6356%$35,241 F.I.R.E. 7,8816%$59,430 Transport & Utilities 5,6154%$51,749 Construction 5,4684%$48,426 KBEs6,2275%$57,658 Other 13,25010%$29,947 Total 134,685100%$38,703 Employment by Sector Source: BEA Data and RIMS II multipliers 6.03 Economic Picture by Sub-Region GE SI Number of Jobs by Region

55 ©2007 ViTAL Economy, Inc. 55 Greater Egypt: Population Trends Prison Population Adjusted est. Change 2004 est. Adjusted Change Adjusted Franklin43,39339,498(-9.0%)39,498(-9.0%) Jackson (P)61,84658,186(-5.9%)56,031(-9.4%) Jefferson (P)36,83740,3239.5%38,4634.4% Perry21,79422,6914.1%22,6914.1% Randolph35,68633,242(-6.8%)33,242(-6.8%) Williamson56,84663, %63, % GE Region256,402257,0640.2%253,049(-1.3%) Comparison during same period: USA %, Illinois +11.2% Lowest % population loss in SI region from 1980 to 2004 Largest prison population in SI approx. 4,000 Population figures included SIU students = 21,000+ per year Lowest % population loss in SI region from 1980 to 2004 Largest prison population in SI approx. 4,000 Population figures included SIU students = 21,000+ per year 6.03 Economic Picture by Sub-Region GE

56 ©2007 ViTAL Economy, Inc. 56 Comparisons with IL Industry Mix: Higher than State Average in Services, Govt Jobs Greater Egypt employs more workers than Illinois average in retail trade, lodging accommodation, food services and government jobs GE is below average for KBE related jobs** such as finance, professional and technical even with a major University Source: Bureau of Economic Analysis Percentage of Non-Farm Jobs by Sector Combined = 1/2 of State average 6.03 Economic Picture by Sub-Region GE IL (%)GE (%)Difference Wholesale Trade Retail Trade Finance and Insurance** Professional and Technical** Administrative Accommodation & food services Government (includes SIU staff) % Non-farm employment

57 ©2007 ViTAL Economy, Inc. 57 SIUC: an Economic Engine in SI 21,598 enrolled in 2006 $13,520/yr per student spent locally Every 100 students generate 18 local jobs Direct economic impact = $284 million R&D Research Spending $150 million R&D parks in the SI region $70 million impact on local economy SIUC is one of the largest employers in Greater Egypt with 5,042 FTE jobs Source: SIUC Provost & web site Total Economic Impact $653 million 5.8% of Greater Egypts GDP Total Economic Impact $653 million 5.8% of Greater Egypts GDP 6.03 Economic Picture by Sub-Region GE

58 ©2007 ViTAL Economy, Inc. 58 GE Traditional Business Strengths Wholesale & retail Healthcare Manufacturing Education Tourism Coal mining GE Traditional Business Strengths Wholesale & retail Healthcare Manufacturing Education Tourism Coal mining GE People, Land & Jobs % of IL Land Mass = 5.6% % of IL Population = 2.0% % of IL Employment = 1.9% GE Dependencies Public sector employment Transfer payments SIUC Large manufacturing companies and employment GE People, Land & Jobs % of IL Land Mass = 5.6% % of IL Population = 2.0% % of IL Employment = 1.9% GE Dependencies Public sector employment Transfer payments SIUC Large manufacturing companies and employment GE Rising Business Stars Tourism, including ecotourism and vineyards Minor league baseball; Southern Illinois Miners Alternative energy, including ethanol Health services Advanced manufacturing Artisans and arts Warehousing & distribution Marion Regional Airport Wineries Continental Tire Aisin Manufacturing Crownline Boats GE Rising Business Stars Tourism, including ecotourism and vineyards Minor league baseball; Southern Illinois Miners Alternative energy, including ethanol Health services Advanced manufacturing Artisans and arts Warehousing & distribution Marion Regional Airport Wineries Continental Tire Aisin Manufacturing Crownline Boats GE Notable Southern Illinois University Carbondale R&D knowledge base at SIU John A. Logan College Rend Lake College St. Louis residential impact on Randolph Co. Highway 13 – I-57 growth corridor World Shooting Complex Unique natural features; Lake of Egypt, Crab Orchard Lake, Rend Lake Winery growth Energy knowledge base Pockets of extreme poverty GE Notable Southern Illinois University Carbondale R&D knowledge base at SIU John A. Logan College Rend Lake College St. Louis residential impact on Randolph Co. Highway 13 – I-57 growth corridor World Shooting Complex Unique natural features; Lake of Egypt, Crab Orchard Lake, Rend Lake Winery growth Energy knowledge base Pockets of extreme poverty Economic Profile: Greater Egypt COI 6.03 Economic Picture by Sub-Region GE Source: Connect SI COI, RA Interviews and VE

59 ©2007 ViTAL Economy, Inc. 59 Greater Egypt: Goals * Jobs are the result of action plans related to industry cluster and workforce development strategies. Greater Egypt Region (23 Feb 2007) Baseline 2012 Same Trend 2012 Goal Change vs. Baseline Change vs Same Population (2004)253,049258,869274, %+6.0% Employable Population (16-64) (2000) 164,134167,909179, %+6.8% Labor Participation (16-64) (2000) 66.0% 71.0%+7.6% Employed 2004 All Ages134,685140,340157, %+12.4% Average Wage 2004$27,830$35,765$40,765+$12,935+$5,000 Total Region Wages 2004$3,748m$5,019m$6,432m+$2,684m+$1,413m Determination of specific measurable, wage & employment goals from change in regional wages vs trend NEW JOBS:* 10,468 WAGE: $43,500 $455.4m NEW JOBS AT AVERAGE WAGE:* 6,979 WAGE: $40,765$284.5m IMPROVEMENT OF EXISTING JOBS:* 26,937 WAGE: $5,000$134.7m CLIMATE OF ECONOMIC OPPORTUNITY: $538.4m 6.03 Economic Picture by Sub-Region GE

60 ©2007 ViTAL Economy, Inc. 60 OpportunityGlobal/National Trend Indigenous Resource Leveraged Securing Foreign Trade Zone for the region Relationship of the Americas to the rest of the world Location – interstate highway system, rivers Gain more inter-modal facilities and ports Short sea shipping & river Barge Mississippi and Ohio Rivers Letting Central and Northern IL know that you can ship to many cities to the south from here. Traditional ports (east & west) are too busy Our location Expanding logistics, transportation & storage in the Region Increased emphasis on inland intermodal logistics Mid-America location IL 24, 57 & 64 Increasing Freight and Passenger Air Service New transportation systems Our area airports Diversifying the face of the region Diversity SIU international student body, Tech Center, Community Colleges Health Care being tasked with caring for Spanish speaking Increased influx of Hispanics Bilingual individuals Net Energy Exporter High petroleum prices Biomass Crops, Coal, Steam, Research Centers Greater Egypt COI: Opportunities 6.03 Economic Picture by Sub-Region GE Source: COI Milestone

61 ©2007 ViTAL Economy, Inc. 61 Opportunity Global/National Trend Indigenous Resource Leveraged Become a National Leader in Water Recycling Possible water shortages Water Maximize our ability to offer affordable fuel Upward trend of transportation fuel Biomass hydrogen Ethanol-Bio-diesel Need for energy Corn-soybeans-coal water availability? Rend Lake - Tourism Opportunities: Randolph County, Crab Orchard, Linking State Parks (Bike Trails/Repair shops), Road Maintenance, Google: SI Tourism One stop shopping at a central website/the opportunity to find prospects and pay at one site Tourism opportunities: natural resource, regional package,Little Hot Spots/World Shooting Complex/Pyramid State Park (needs promotion) Call Centers Those jobs going overseas People & products competitive wages Tourism Support Booking an entire trip online Extensive tourism destination assets Mentorship: Business owners teaching our young people how to start a successful business Aging of the population Experienced successful retirees Commercialization of Regional Private Research/KBEs Growth of business innovation SIU Incubation (Needs to Cross COI boundaries) Network Action Team that works independently Growth of global incubation seeking access Existing incubators & research parks Greater Egypt COI: Opportunities 6.03 Economic Picture by Sub-Region GE Source: COI Milestone

62 ©2007 ViTAL Economy, Inc. 62 GE Opportunities Highly educated population Technology transfer from SIUC and SIUE Quality of place and proximity to St. Louis Energy sector: coal, alternative fuels, etc. Foreign student population at SIUC Workforce development resources - Man-Tra-Con SIU & community colleges Price of residential and commercial real estate Transportation Education Center at SIUC 1,000s of skilled dislocated manufacturing workers Young entrepreneurs and companies/creative class GE Opportunities Highly educated population Technology transfer from SIUC and SIUE Quality of place and proximity to St. Louis Energy sector: coal, alternative fuels, etc. Foreign student population at SIUC Workforce development resources - Man-Tra-Con SIU & community colleges Price of residential and commercial real estate Transportation Education Center at SIUC 1,000s of skilled dislocated manufacturing workers Young entrepreneurs and companies/creative class GE Key Trends Hwy 13 & I-57 corridor growth SIU Declining Enrollment Medical professional recruitment difficulties Growing population of young professionals Growth and investment in Randolph County Growth of Cedarhurst Center for the Arts in Mt. Vernon Growth of wine industry and winery destinations Turnaround of Continental Tire Growing artisan community including Southern Five Local leadership conducting Energy Symposiums Leadership understanding that GE can benefit from a regional SI economic initiative GE Key Trends Hwy 13 & I-57 corridor growth SIU Declining Enrollment Medical professional recruitment difficulties Growing population of young professionals Growth and investment in Randolph County Growth of Cedarhurst Center for the Arts in Mt. Vernon Growth of wine industry and winery destinations Turnaround of Continental Tire Growing artisan community including Southern Five Local leadership conducting Energy Symposiums Leadership understanding that GE can benefit from a regional SI economic initiative GE Challenges Culture of Poverty Comfort with being the dominate economy in SI Population decline even with a major University 2,000 recent dislocated workers Lack of quantity and commitment of leadership Weak region wide communication Limited access to public and private capital Cost of transportation for goods Anti-business climate Litigious environment Bureaucratic mind-set GE Challenges Culture of Poverty Comfort with being the dominate economy in SI Population decline even with a major University 2,000 recent dislocated workers Lack of quantity and commitment of leadership Weak region wide communication Limited access to public and private capital Cost of transportation for goods Anti-business climate Litigious environment Bureaucratic mind-set GE Climate for Growth Rebirth of coal industry Movement of high net-worth individuals from St. Louis to Randolph County SIU research and development departments Knowledge Based Enterprises working closely with SIU research departments Outdoor recreation activities Arts and culture linked with wineries Transportation and logistics hub; air, rail, interstate Senior living GE Climate for Growth Rebirth of coal industry Movement of high net-worth individuals from St. Louis to Randolph County SIU research and development departments Knowledge Based Enterprises working closely with SIU research departments Outdoor recreation activities Arts and culture linked with wineries Transportation and logistics hub; air, rail, interstate Senior living Greater Egypt: Highlights Source: Connect SI COI, RA Interviews and VE 6.03 Economic Picture by Sub-Region GE

63 ©2007 ViTAL Economy, Inc. 63 Regional Economic Summary Greater Egypt (64% GDP and 61% of SI population) dominates the SI region bodes well for GE, but weak neighbors impact the entire neighborhood SI possesses the economic critical mass ($17.6B GDP) and the population (419,992) to compete with many metro areas and especially globally SIU has a significant direct economic impact on the region ($284 million), but could have a much broader benefit The region has numerous major private sector employers that need to be engaged in Connect SI to support competitiveness; Continental Tire is a example The predominance and burden of government on the regions GDP (20%) needs to be reduced immediately to allow growth to occur including restructuring of tax base SI has a robust inventory of unique natural and knowledge assets that are not being leveraged The region possesses a vast variety of small town amenities and qualities that are in demand by KBE workers that can chose where to live 6.03 Economic Picture by Sub-Region

64 ©2007 ViTAL Economy, Inc. 64 Chapter 6: Regional Perspective 6.04 Livable Community: Assessment Southern Illinois "Garden of the Gods" This Section provides a condensed overview of the livable community assets, conditions and trends of each of the economic sub-regions of SI.

65 ©2007 ViTAL Economy, Inc. 65 Livable Community: Introduction In a Knowledge Based Enterprise (KBE) economy livable community elements are valued equally with economic development Development of a Livable Community is the foundation from which successful and sustainable economic growth becomes possible Highly successful regional economies have realized the value of well planned livable community programs in attracting new businesses and workers Highly skilled, mobile and well compensated KBE professionals can chose where to live and work 6.04 Livable Community: Assessment

66 ©2007 ViTAL Economy, Inc. 66 Resources Required for a Livable Community (1 of 2) Healthcare Meet the health and social needs (including physical, mental, spiritual and emotional) of the community citizens Arts/Culture/Heritage Support for enhanced arts, culture and heritage, assure they will stimulate and support the transition to sustainability in your community Recreation & Leisure Activities Provide recreation and leisure activities for both residents and visitors. Deliver or exceed expectations while protecting the environment Economic Opportunities Focus efforts on how your community will create a strong and sustainable local economy, innovative and resilient businesses supported by a strong skilled workforce Energy Resources Access to low cost, reliable, sustainable energy while managing greenhouse gas emissions and air quality Water Resources A dependable supply of high quality water in a way that maintains healthy aquatic environments and uses water efficiently Localized Food Systems Ensure a healthy, nutritious and sustainable food supply that maximizes opportunities to build the social, ecological, cultural and economic capital of the community, Grow and buy local campaigns help any community 6.04 Livable Community: Assessment Source: VE Alliance Research

67 ©2007 ViTAL Economy, Inc. 67 Natural Environment Seek ecosystem integrity and biodiversity will be protected and where possible restored in your community/region Built Environment Develop and renovate buildings, neighborhoods and facilities that will contribute to making your community unique, livable and sustainable Transportation Move residents, employees, visitors, and materials to, from and within the community in a more effective & sustainable manner Life-Long Learning Provide residents of all ages formal and informal lifelong learning opportunities both online and at physical locations Healthy Community Community culture that places superior value in health and promotes activities that support healthy living Affordability & Housing Make living and playing in your community affordable for residents, and also meets housing needs of diverse permanent residents Resources Required for a Livable Community (2 of 2) 6.04 Livable Community: Assessment Source: VE Alliance Research

68 ©2007 ViTAL Economy, Inc. 68 Key Findings of 2004 Illinois Poverty Report 1. Poverty and its impacts are pervasive in Southern Illinois 2. The rural disadvantaged are typically older, less healthy and less active in the work force 3. Gaps in transportation, economic, health, housing infrastructure, and loss of population plague high poverty areas 4. Lack of education attainment in rural areas impedes improvements 5. Earnings of workers in rural areas substantially lag urban areas Source: Key findings of the 2004 Report on Illinois Poverty An Analysis of Rural Poverty, Heartland Alliance 6.04 Livable Community: Assessment

69 ©2007 ViTAL Economy, Inc. 69 Pervasive Poverty Only one SI county (Randolph) has a lower % of poverty than Illinois Only one SI county (Randolph) has a lower % of poverty than Illinois Source: 2000 US Census U.S. Average 12.7% Illinois Average 10.7% 6.04 Livable Community: Assessment

70 ©2007 ViTAL Economy, Inc. 70 Pervasive Poverty Impacts the Sense of a Bright Future for the Children in SI Children in poverty twice the rate (22%) than that of Adults 65+ in SI (11%) Children in poverty twice the rate (22%) than that of Adults 65+ in SI (11%) Source: 2000 US Census Children U.S. Average 17% Adults 65+ U.S. Average 9.6% 6.04 Livable Community: Assessment

71 ©2007 ViTAL Economy, Inc. 71 Highest % in rural region Highest poverty rate Highest unemployment rate since 09/03 Lowest % college graduates Highest % enrolled in Medicaid Highest % age 5+ with a disability #1 Highest % of population over age 65 Highest % age 65+ in poverty Highest % age 65+ with a disability Lowest % of population 0-10 Highest % age 0-17 in poverty Highest % households owner burdened #1 #4 Highest % households lack complete plumbing Highest % households lacking complete kitchen Highest % commuting to work from other IL counties Lowest % population work and live in same county Highest % households rent burdened Highest % of Adults with no High School Diploma #1 #3 #1 Source: IL Poverty Summit, 2004 Report on Illinois Poverty, Based on U.S Census or IL Dept of Employment Security data & Atlas of Illinois Poverty Spring 2003 High Poverty Rates Impact Many Quality of Life Elements in SI 6.04 Livable Community: Assessment

72 ©2007 ViTAL Economy, Inc. 72 Low Educational Achievement Impacts Other Economic and Community Factors; Healthcare, Social Services, & Poverty Illinois Average 11.1% Only two SI Counties (Jackson & Wabash) have a better than State of Illinois average of citizens without a high school diploma Only two SI Counties (Jackson & Wabash) have a better than State of Illinois average of citizens without a high school diploma Source: 2000 US Census 6.04 Livable Community: Assessment

73 ©2007 ViTAL Economy, Inc. 73 Youth at Risk & Youth Perceptions Southern Illinois has mixed youth risk factors: m SI counties have higher child abuse/neglect rates and higher divorce rates than Illinois average m Lower high school drop out rates and higher standard test scores than rest of Illinois m Other risk factors are comparable to State averages Source: IL Criminal Justice Information Authority Local High School Students: We want to stay in region, but see no good job opportunities Fear of being stuck here the female students defined: getting stuck means getting pregnant Local High School Students: We want to stay in region, but see no good job opportunities Fear of being stuck here the female students defined: getting stuck means getting pregnant 6.04 Livable Community: Assessment Source: RA and EF Hutton Interviews conducted by VE Team

74 ©2007 ViTAL Economy, Inc. 74 Youth: the Key to SIs future Young people are being told that working with your hands is a dead end as a result there are very few skilled trades people available Schools are outdated in their physical infrastructure and curriculum The SI entrepreneur group recognized and agreed that a top priority in the region was to implement a youth entrepreneur program From SIs youth themselves: Why should we kids care, when adults dont enforce the rules to keep our community safe, attractive and vibrant Most of us are leaving no apparent job or career opportunities most needed to work while in school and coveted a job at McDonalds! We want to stay but cant; this realization saddens us because the area is beautiful and would be a very nice area to live in This area is viewed as dead! Source: RA and EF Hutton Interviews conducted by VE Team 6.04 Livable Community: Assessment

75 ©2007 ViTAL Economy, Inc. 75 Affordable Housing With a Hidden Story SI Advantages m Home ownership in Southern Illinois is higher than in Illinois m Overall, housing costs are low SI Challenges m Much of housing stock is aging and small m Financing can be difficult since cost of construction is higher than final appraised value Southern Illinois vs. Illinois: More people own homes, fewer rent Despite low housing costs, over 21% of households pay more than 30% of income for housing Despite low housing costs, over 21% of households pay more than 30% of income for housing 6.04 Livable Community: Assessment Source: HUD Comprehensive Housing Affordability Strategy (CHAS) Data 2000

76 ©2007 ViTAL Economy, Inc. 76 Bankruptcy Rates Illinois m Low business bankruptcies m High personal bankruptcies m IL and the surrounding Midwest states among the worst in U.S. for personal bankruptcy Southern Illinois m Lowest business bankruptcies in Illinois If the region was a state, it would rank # 2 in the U.S. m Highest personal bankruptcies in the state If the region was a state, it would rank # 45 in the U.S. State Bankruptcy Rates, June BusinessNon-Business Per Business State Rank Per Person Sate Rank Illinois0.29%140.59%36 Indiana0.46%350.95%50 Kentucky0.38%230.71%44 Missouri0.25%90.66%42 Note: Rank of 1 is lowest rate, rank of 50 is highest rate IL Bankruptcies by District, June BusinessNon-Business Northern0.29%0.56% Central0.34%0.67% Southern0.16%0.73% Note: Southern District covers the 38 southernmost counties in IL Source: U.S. Bankruptcy Courts 6.04 Livable Community: Assessment

77 ©2007 ViTAL Economy, Inc. 77 Lower Crime Rates SI has 14% lower rate than Illinois for total crime index offenses 19% lower rate for general thefts – the most frequent Motor vehicle thefts, robberies, murders also lower in SI than Illinois SI has higher rate of burglaries and assaults, and sexual assaults 2005 Crime: Number of Offenses Per 100,000 Source: Illinois State Police Meth labs in Southern Illinois remain a crisis labs operate across the region and users are more common in rural than urban areas Source: Shane Koch et al, Southern Illinois Methamphetamine…, Livable Community: Assessment

78 ©2007 ViTAL Economy, Inc. 78 SI Environment Highlights Southern Illinois maintains a generally healthy eco-environment Water quality and quantity is high (state management is higher than neighboring states) Open pit mine areas need remediation Numerous vacant abandoned industrial & manufacturing sites now are brownfields requiring clean-up Mild climate year round Long growing season Useable waterways and many spring fed lakes Natural forests aplenty Ancient history untapped archeology throughout SI Source: EPA; VE Research & Analysis 6.04 Livable Community: Assessment

79 ©2007 ViTAL Economy, Inc. 79 SIs Rich Cultural Assets: Just a Short List A Range of Museums Offerings m Cobden Museum (Cobden) m Custom House Museum (Cairo) m Elijah P. Curtis Home/ Museum (Metropolis) m General John A. Logan Museum (Murphysboro) m Edwards County Historical Society Museum (Albion) m L. Haas Store Museum, Matsel Cabin Museum, Sen. Robinson Stewart House (Carmi) m Ratcliff Inn Museum (Carmi) m Superman Museum (Metropolis) m Flourspar Museum m Johnson County Courthouse m Jefferson County Historical Village (Mt. Vernon) An Astounding Variety of Annual Festivals & Events m Big Muddy Film Festival m Shrimp Festival m Superman Festival m The Archery Shooters Association Pro-Am m Little Wabash River Festival m Corn Days in Carmi m Wabash Ribberfest BBQ m Fort Massac Encampment m River to River Relay m Southernmost Illinois Birding Fest m Multiple wine and food festivals Unique Art Galleries Around the Region m Cedarhurst Center for the Arts (Mt. Vernon) m Southern Illinois Art & Artisans Center (Whittington) m Southern Illinois Art Gallery m Associated Artists Gallery (Carbondale) m Renaissance House: A Working Art Gallery (Eldorado) m Shawnee Hill Barn Antiques m Foxs Flea Market Antiques Entertainment Abounds! m Harrahs Casino (Metropolis) m SIU Salukis college sports teams (Carbondale) m Sesser Historic Opera House (Sesser) m Marion Cultural & Civic Center m Southern Illinois Symphony Orchestra (SIU) m World Shooting and Recreational Complex (Sparta) m Kornbread Junction m Southern Illinois Miners m Winery Entertainment The Art Trail of Southern Illinois 20 Distinctively Unique Galleries within a 70 mile radius The Art Trail of Southern Illinois 20 Distinctively Unique Galleries within a 70 mile radius 6.04 Livable Community: Assessment

80 ©2007 ViTAL Economy, Inc. 80 A Community Development Resource SI can be Proud of Led by Man-Tra-Con, Corporation, Access SI is an online community resource directory designed to support the SI region plus ten additional Southern Illinois counties with a community resource directory Community citizens have online access to a variety of resources including health, social services, education, governmental, cultural, recreation, civic, and workforce employment training and transition Unique Features: Over 80 service categories are available and searchable on the Internet site Semi-wiki format: The site allows or individual and organizational updates with content filtering by Man-Tra-Con Allows for volunteers to contact agencies and organizations for support Unique Features: Over 80 service categories are available and searchable on the Internet site Semi-wiki format: The site allows or individual and organizational updates with content filtering by Man-Tra-Con Allows for volunteers to contact agencies and organizations for support Qualities to emulate: Open access wiki-format that creates efficiency and constant quality improvement Achieves the one-spot access for individuals from anywhere in SI Creates a collaboration of related services that brings benefit to the citizens of the SI region Qualities to emulate: Open access wiki-format that creates efficiency and constant quality improvement Achieves the one-spot access for individuals from anywhere in SI Creates a collaboration of related services that brings benefit to the citizens of the SI region Livable Community: Assessment

81 ©2007 ViTAL Economy, Inc. 81 CriteriaRatingAssessment Rationale Healthcare and Social Services SI has a solid healthcare infrastructure and services in the GE area, but have limited extension into the rest of the region Arts, Culture and Heritage The region has a robust heritage and history that has not been leveraged. The arts are not well recognized currently, but growing in Recreation & Leisure activities SI has a strong variety of outdoor recreation venues; indoor leisure activity improvements needed to attract KBE workers Economic Opportunities SI has limited economic opportunities, but with a commitment to the Connect SI framework a transformation could occur Energy Resources Access to energy is good with localized electrical generation; cost of electricity has a negative impact on industrial business competitiveness Water Resources Quantity and quality of water is good for commercial and residential users. Multiple lakes is a recreational asset Livable Community Assessment: (1 of 2) = Weak to None = Improving = Average = Good = Strong 6.04 Livable Community: Assessment

82 ©2007 ViTAL Economy, Inc. 82 CriteriaRatingAssessment Rationale Natural Environment The SI regional environment is unique and varied with natural amenities in close proximity to cities and towns Governance SI governmental structures are in a complicated situation; there is a much larger than average number of entities, most with limited resources and expertise dramatic restructuring will be difficult to accomplish Transportation The region has complete package of above average transportation access and infrastructure, including interstate highways, railways, airports and waterways; however, outside of the GE area, public transportation is limited Education and Learning SI has a strong collection of educational assets that can be utilized to transform the regions workforce to meet global needs Housing The housing stock overall is aged; current economic climate hinders the development of new housing stock due to cost of construction versus market value; and lack of building standards results in reduced predictability Localized Food Systems The region has tremendous potential to build local food systems with vast agriculture knowledge, research facilities, optimum climate strategies need to be employed to expand farmers markets and farm to table initiatives Livable Community: Assessment (2 of 2) 6.04 Livable Community: Assessment

83 ©2007 ViTAL Economy, Inc. 83 Livable Community: Summary SI sits in one of the most desirable and livable natural environments in the mid-west, though lags in meeting 21 st Century livable community amenities, infrastructure and expectations m Most communities do not have building or zoning standards m Many communities do not have 911 emergency communications systems and in have recently voted them down m Access to basic healthcare services in many cities and towns outside of the GE region are limited m SI has a low curb appeal that hinders its ability to attract KBE businesses and workers SI has developed a vast amount of community and social service agency knowledge base that can be leveraged for greater benefit for the region 6.04 Livable Community: Assessment

84 ©2007 ViTAL Economy, Inc. 84 Chapter 6: Regional Perspective 6.05 Infrastructure: Assessment Southern Illinois "Garden of the Gods" Infrastructure is a key element of community development, which includes both above and below ground components. Infrastructure assets support safe and livable communities.

85 ©2007 ViTAL Economy, Inc. 85 U.S. Infrastructure Is Failing American Society of Civil Engineers (ASCE) created an Infrastructure Report Card m U.S. infrastructure is failing m The ASCE gives a D- grade to Americas infrastructure Total U.S. infrastructure needs $1.6 trillion over 5 years 2005 Report Card for Americas Infrastructure AviationD+ BridgesC Drinking WaterD- EnergyD Navigable WaterwaysD- Public Parks & RecreationC- RoadsD Solid WasteC+ TransitD+ WastewaterD Infrastructure: Assessment Source: Report Card For Americas Infrastructure 2005, American Society of Civil Engineers and Infrastructure 2007: A Global Perspective, Ernst & Young

86 ©2007 ViTAL Economy, Inc. 86 Illinois ASCE Report Card 39% of major roads are in poor or mediocre condition Motorists spend $2.2 billion a year in extra vehicle repairs; roughly $271 per motorist 17% of bridges are structurally deficient or functionally obsolete 31 state-determined deficient dams 176 high-hazard dams Dam rehab costs estimated at $171.3 million Drinking water infrastructure needs $6.15 billion over next 20 years $11.89 billion in wastewater infrastructure needs Top three infrastructure concerns in Illinois: roads, bridges, wastewater Top three infrastructure concerns in Illinois: roads, bridges, wastewater Source: Report Card For Americas Infrastructure 2005, American Society of Civil Engineers and Infrastructure 2007: A Global Perspective, Ernst & Young 6.05 Infrastructure: Assessment

87 ©2007 ViTAL Economy, Inc. 87 Applying the Report Card to SI If SIs infrastructure is proportional to Illinois ASCE Report Card: m Roads: Poor conditions cost $40.7 million per year in lost time, additional fuel consumption, and vehicle repairs m Bridges: Approximately 20% of bridges are deficient m Water Systems: SI drinking water infrastructure requires $130 million over five years m Wastewater: $260 million repairs in wastewater infrastructure are needed Assumptions: 75% of area residents are motorists. Infrastructure requirements allocated as proportion of total population Given the relatively small population in SI and limited political clout historically in Springfield and Washington, SIs infrastructure may be in greater disrepair Given the relatively small population in SI and limited political clout historically in Springfield and Washington, SIs infrastructure may be in greater disrepair Source: Report Card For Americas Infrastructure 2005, InterVISTAS Development Economics Infrastructure: Assessment

88 ©2007 ViTAL Economy, Inc. 88 SI Infrastructure: Summary Nine primary water producing Water Districts serve SI SI water supply is in good shape with excess capacity in most systems Most sewer systems were built during the coal age; well built then, but many dont meet current design criteria year old systems need repair USDA & IL-EPA have funded rebuilding a number of systems serving person communities Most systems can absorb additional population of 20-30% and small business growth of persons per location out-migration left excess capacity Any major industrial expansion will require additional capacity and existing sewer system upgrades Road systems are maintained by either township road districts, county, state or federal governments annual maintenance of township roads take a backseat to capital improvements USDA has invested heavily in repaving & upgrading road systems in SI while many roads have been improved, a lot more needs to be done Energy supply is reliable with a choice of providers throughout SI Source: USDA Rural Development Regional Water Systems & Community and Business Program Analysis, GE, SE, S5 & GW CEDS 6.05 Infrastructure: Assessment

89 ©2007 ViTAL Economy, Inc. 89 Chapter 6: Regional Perspective 6.06 Healthcare: Assessment Southern Illinois "Garden of the Gods" Chapter 6.06 provides a review and assessment of the health of SI citizens, access and conditions within the healthcare industry, and the work of the Connect SI Healthcare COI. This Section recognizes the enormous amount of investment and effort already done by the healthcare industry in addressing major fundamental challenges.

90 ©2007 ViTAL Economy, Inc. 90 Healthcare Assessment: Intro Good physical and emotional health of the regions workforce is required to build and sustain a vibrant economy Healthcare is often viewed as a social service, however, it is an important industry that often supports the economic well being of a region through high paying, high skill level jobs Access to high quality healthcare services is a predominate decision factor for KBE companies and also for workers when deciding were to live. Healthcare will continue to be a growth industry as the healthcare needs of 77 million aging boomers increases Many rural regions are challenged more than urban centers with rising age of residents, diminished resources for care, and declining infrastructure. Rural regions with high levels of poverty result in elevated demand for mental health providers and services The CSI Healthcare COI has focused on five measurable improvement targets; m Improved health outcomes m Provider profitability m Regional skills shortage m Connectivity 6.06 Healthcare: Assessment

91 ©2007 ViTAL Economy, Inc. 91 SI Healthcare is Big Business Healthcare Jobs % of Healthcare Jobs of Sub- regional Economy Total Wages % of Healthcare Wages of Sub- regional Economy % of Total SI Healthcare Economy GDP Southern Illinois 22,21011%$652M8%100% GE15,02811%$441M8%67.6% SE2,26410%$66.4M8%10.2% S52,54110%$74.6M8%11.4% GW2,3779%$69.0M6%10.7% National employment in healthcare and social services averages 10.9% In SI, $93,000 of healthcare spending creates one local healthcare job Healthcare industry is the third highest employer in the SI region SI Healthcare has a 1.5 economic multiplier on wages 49% of healthcare employment is Registered Nurses, Licensed Practical Nurses and Nursing Aides and Attendants Over 50% of these jobs have a higher wage than the SI average wage Source: Connect SI Health Scenario 6.06 Healthcare: Assessment

92 ©2007 ViTAL Economy, Inc. 92 Healthcare Is Very Complex: SI Is Missing Many Industry Components Payers Fiscal Intermediaries Providers (SI Focus) PurchasersProducers Government Employers Individuals Employer Coalitions HPublic Health Districts Insurers HMOs Pharmacy Benefit Managers Medicaid Medicare NGOs HHospitals HPhysicians HPharmacies HIDNs** HPharmacies HAlternate Site Facilities HCommunity Health Sites Wholesalers Mail Order Distributors Group Purchasing Organizations Drug Mfrs Device Mfrs Medical Surgical Manufacturers Health Information System Firms Source: Wharton School Study of Healthcare Value Chain - Commissioned by The Center for Healthcare Management Research * IDN= Integrated Delivery Networks 6.06 Healthcare: Assessment In order for SI to achieve the goals set by the Healthcare COI, many more organizations along the Healthcare Value Chain need to be brought to the table

93 ©2007 ViTAL Economy, Inc. 93 Out-migration of Healthcare Services Are an Economic Opportunity for SI Regional HospitalsAdmissionsPatient DaysCharges GE16.5%23.2%26.2% SE23.3%31.9%42.8% S549.0%58.9%62.7% GW45.2%50.8%62.1% Total SI Leakage25.5%33.1%37.2% The total value of healthcare charges being paid outside of SI region =$1.06 billion Missouri Hospitals – 19.8% Indiana Hospitals – 8.1% Kentucky Hospitals – 7.4% St. Johns Hospitals – 1.4% Memorial Springfield -.6% Source: Connect SI Health Scenario, CSI Healthcare COI Causes of Out-Migration Misconceptions re type and quality of healthcare services offered in SI Lack of certain healthcare specialists in SE, S5 and GW. Population chooses Indiana over GE healthcare facilities Follow-ups are also done outside SI a ripple effect A perception that bigger hospital provides better service Referrals by SI physicians to hospitals outside the area to protect their business clientele Successful marketing strategies by hospitals outside SI SI Regional Healthcare Services Leakage 6.06 Healthcare: Assessment

94 ©2007 ViTAL Economy, Inc. 94 SI Has Higher Incidents of Serious Illness Than Illinois SIIL Higher Rate of Deaths Coronary Heart Disease % Cerebrovascular Disease (Cancer) % Lung Cancer % Colorectal Cancer % Local Hospital Executives: We have people with worse health and less access to care Increased Deaths per 100,000 Population in SI vs. State of Illinois Source: IPLAN Incidence of many serious illnesses resulting in death are much higher in Southern Illinois than in Illinois Lifestyle & preventative improvements are required to address public health 6.06 Healthcare: Assessment Source: RA and EF Hutton Interviews conducted by VE Team

95 ©2007 ViTAL Economy, Inc. 95 Heart Disease in SI Greater Wabash Southern Five Southeastern Greater Egypt Primary Cause of Death 15 of 20 SI Counties Above State Average Source: IPLAN 6.06 Healthcare: Assessment

96 ©2007 ViTAL Economy, Inc. 96 Coronary Heart Disease in SI Source: IPLAN Greater Wabash Southern Five Southeastern Greater Egypt Primary Cause of Death 9 of 20 SI Counties Above State Average 6.06 Healthcare: Assessment

97 ©2007 ViTAL Economy, Inc. 97 Malignant Neoplasms in SI Source: IPLAN Primary Cause of Death 5 of 20 SI Counties Above State Average Greater Wabash Southern Five Southeastern Greater Egypt 6.06 Healthcare: Assessment

98 ©2007 ViTAL Economy, Inc. 98 Cerebrovascular Disease in SI Source: IPLAN; *Note: 8 counties showed not reported Primary Cause of Death 9 of 12* SI Counties Above State Average Greater Wabash Southern Five Southeastern Greater Egypt 6.06 Healthcare: Assessment

99 ©2007 ViTAL Economy, Inc. 99 Lung Cancer in SI Source: IPLAN;*Note: 4 counties showed not reported Primary Cause of Death 7 of 16* SI Counties Above State Average Greater Wabash Southern Five Southeastern Greater Egypt 6.06 Healthcare: Assessment

100 ©2007 ViTAL Economy, Inc. 100 Poverty Places Pressure on the Healthcare System People in poverty are less able to access preventative care, have limited opportunity to engage in health promotion activities, and are less likely to be offered health insurance through their jobs. These issues, compounded by rising healthcare costs, leave low-income SI residents struggling to meet their health needs. ** People in poverty are less able to access preventative care, have limited opportunity to engage in health promotion activities, and are less likely to be offered health insurance through their jobs. These issues, compounded by rising healthcare costs, leave low-income SI residents struggling to meet their health needs. ** Individuals Below PovertyPercentage# in SI Southern Illinois16.4%71,584 Greater Egypt15.2%45,117 Southeastern16.9%7,938 Southern Five18.4%10,838 Greater Wabash16.2%7,691 United States (overall)12.7% Illinois10.7% Implication: High poverty = High Medicaid Services 6.06 Healthcare: Assessment **Source: 2004 Report on Illinois Poverty, IL Dept of Employment Security data & Atlas of Illinois Poverty Spring 2003

101 ©2007 ViTAL Economy, Inc. 101 SI Has a Higher Amount of Medicare and Medicaid Payments for DRGs Payor Breakdown Percent Connect SI Hospitals Missouri Hospitals Indiana Hospitals Kentucky Hospitals St. Johns Hospital Memorial Springfield THIRD PARTY PAYOR17.2%2.7%28.1%14.9%10.1%18.2% MEDICAID13.7%11.4%7.2%4.1%9.5%19.6% MEDICARE60.2%44.6%56.9%50.3%62.6%34.1% OTHER6.1%38.3%2.8%27.6%16.5%13.8% SELF PAY2.9%3.0%5.0%3.1%1.2%14.3% TOTAL100.0% Average Per Day Charges Connect SI Hospitals Missouri Hospitals Indiana Hospitals Kentucky Hospitals St. Johns Hospital Memorial Springfield THIRD PARTY PAYOR$4,514$8,937$4,507$4,761$6,973$5,628 MEDICAID$3,122$2,424$2,741$2,940$4,903$2,863 MEDICARE$3,454$4,326$4,328$4,275$7,864$6,561 OTHER$3,721$4,566$2,257$5,233$7,366$6,794 SELF PAY$3,458$4,801$5,723$3,179$4,922$5,805 TOTAL$3,562$4,112$4,143$4,436$7,222$5,059 Connect SI hospitals have a 23% higher rate of Medicare and Medicaid patients than neighboring hospitals Note: slide data has been averaged and may not be precisely accurate; DRG – Diagnosis Related Group Source: Connect SI Healthcare COI Medicare and Medicaid payments in SI are 25% less than commercial private payor Medicare and Medicaid payments in SI are 25% less than neighboring hospitals Connect SI hospitals only receive 71% reimbursement levels of what other neighboring hospitals receive for medical services 6.06 Healthcare: Assessment

102 ©2007 ViTAL Economy, Inc HOSPITAL VISITS % of VISITSGOAL Third Party Payer10, % + 5% to 21.2% Medicaid11, % - 5% to 13.0% Medicare32, % Other8, % Self Pay2,4093.7% TOTALS65, % Changing the Private Insurance Proportion in Payer Mix Source: CompData, Connect SI Healthcare COI, Illinois Medical Insurance Underwriters, 2005 Proposed 5% Swap: Increase commercial clients +5%, Reduce Medicaid clients -5%, Proposed 5% Swap: Increase commercial clients +5%, Reduce Medicaid clients -5%, 72% of SI healthcare payments are Medicare and Medicaid in SI Medicare and Medicaid reimburse medical providers 7% less than third party payers Co-pay insurance has increased 11-to-14% in the last five years in Illinois Nationally, 24.4% of medical services are not paid for by the patient 6.06 Healthcare: Assessment Achievement of CSI economic growth goals will expand 3rd party revenues, increase access to healthcare, and reduce the n umber of patients/families using Medicare, and dramatically reduce the percent of uncompensated & under-compensated medical services

103 ©2007 ViTAL Economy, Inc. 103 Mental Health Issues and Challenges Are Greater in a Region With High Poverty Child & adolescent psychiatric services are generally limited in SI Lack of transportation has been determined as the #1 issue facing patient access, resulting in missed appointments Services for the underserved and low income are lacking and typically individuals are placed on waiting lists while waiting many decided not to engage services SI has a strong perceived stigma of seeking mental health services that creates a barrier to entry Depth-of-enterprise limits the ability for patients continued counseling in SI Source: RA Interviews, Rural Health Association, Illinois Delta Network Summary Getting children out of poverty can improve their mental health, but does not fix everything improvements were seen in behavioral problems, but depression and anxiety remained largely unchanged - Journal of the American Medical Association; Duke University 7-yr Study Rural North Carolina, 2006 Getting children out of poverty can improve their mental health, but does not fix everything improvements were seen in behavioral problems, but depression and anxiety remained largely unchanged - Journal of the American Medical Association; Duke University 7-yr Study Rural North Carolina, Healthcare: Assessment

104 ©2007 ViTAL Economy, Inc. 104 Complications Within the Healthcare Industry Impact Cost, Profitability and Quality of Care Bad debt and uninsured patients – bills for service that cannot be collected High level of publicly insured patients: Medicare and Medicaid Level of publicly-insured patients likely to rise due to Illinois Covered Rising costs from the delayed and declining reimbursements Limited physician control and professional assessments when referring Account receivables over 90 days are approximately 25% of billings causing excessive burden on operational cash flows Abuse and fraud within the entire system for Medicaid and Medicare Diminishing physician access for Medicaid patients is compounded by limited transportation to other counties or states Lack of skilled workforce especially in nurses with college degrees 6.06 Healthcare: Assessment Source: Blue Cross-Blue Shield of Illinois 2004 Study

105 ©2007 ViTAL Economy, Inc. 105 Projected Health Skills Shortages Will Challenge Connect SI Goals The U.S. is facing a health skills shortage and so is SI The Connect SI Healthcare Community of Interest (COI) identified projected needs in many job types m The table below reflects projected job needs in the region – a 47% increase in key health personnel Areas of Critical Skill Shortages 2004 Employee Levels 8-Year Change Based on COI 2012 Goal % Change Registered Nurses3,2491,7765,02555% Nursing Aides, Orderlies …2, ,88230% Licensed Practical Nurses ,06634% Medical Assistants % Pharmacists % Total Jobs9,9764,67614,67647% Projected Health Skills Needs of Select Occupations for SI Potential Opportunity Potential opportunity 6.06 Healthcare: Assessment

106 ©2007 ViTAL Economy, Inc. 106 Potential Critical Skills Goal Impact: New Health Positions JobsEarningsGDPOutput Direct SI impacts4,676$214,688,000$260,284,000$469,836,000 Indirect and induced2,408$75,371,000$156,289,700$253,371,000 TOTAL7,084$282,265,000$424,506,000$688,194,000 Total Potential Impact of Critical Skills Goals Indirect Employment: Employment in down-stream industries that result from the presence of a particular business, activity or industry. Indirect employment is generally generated in industries that supply or provide services the direct business, activity or industry. Induced Employment: Employment generated because of expenditures made by individuals employed directly or indirectly by the particular business, activity or industry. Source: Calculated using BEA RIMS II multipliers SI Healthcare industry has the potential to supply 30% of the Connect SI job goals, but will require tapping existing under-employed and leveraging the regions vast workforce training and education resources SI Healthcare industry has the potential to supply 30% of the Connect SI job goals, but will require tapping existing under-employed and leveraging the regions vast workforce training and education resources 6.06 Healthcare: Assessment

107 ©2007 ViTAL Economy, Inc. 107 Local Physicians Priorities Expand broadband connectivity for providers & health facilities Connections needed in short-term between hospitals, outpatient surgical centers, ambulatory care centers and clinics Connections needed for practitioners at home and at office in near-term Route 13 physician practices meet with NP COI to advance connectivity across all health centers Network Provider meetings in COI regions need to include healthcare providers who can identify connectivity gaps & solutions linked to COI broadband rollout Implement regional secure exchange of healthcare information Critical and urgent care sites, radiology groups, FQHCs, labs, hospitals, nursing homes, pharmacies, rehab centers, health departments, free clinics, physicians in the office, at home and on the go throughout SI Critical need to simplify and improve healthcare system inter-operability for physicians whose patients are served by multiple independent healthcare sites Improve patient outcomes, safety and convenience, reduce liability and malpractice premiums, increase reimbursement, help physicians be more efficient Source: RA interviews and Healthcare COI 6.06 Healthcare: Assessment

108 ©2007 ViTAL Economy, Inc. 108 Healthcare Practitioners Suggestions for Change Get doctors to think as a group & establish an identity we are Southern Illinois, not a suburb of any other region Share our expertise within the region Market within our region and to each other (cross referrals), changing referral patterns Make paperwork easier, more common sense & logical create a solution that is beyond individual hospital mentality Change competition perception to collaboration model. Receiving hospital compliments the referring physician. This relationship builds confidence in patient opinion and within the healthcare system. Compliment rather than tear down Ensure immediate and accurate access to health information Enable new physicians in setting up their practices e.g., a business incubator or welcome wagon. An outside entity is necessary to work within the Stark laws 6.06 Healthcare: Assessment Source: RA interviews and Healthcare COI

109 ©2007 ViTAL Economy, Inc. 109 Impact of Addressing Physician Priorities Improving access to medical records Spending more time with the patient by reducing paperwork Providing real-time, continuous loop of patient health information Integrating best practice for the patient, including preventative health for the general population Helping practitioner to do his/her job by providing them information about the cases so better care decisions can be made Reducing medical errors Reducing missed preventative opportunities Reducing unnecessary costs, thereby expediting diagnosis and treatment Working within pay-for-performance initiative Source: Healthcare COI 6.06 Healthcare: Assessment

110 ©2007 ViTAL Economy, Inc. 110 Healthcare COI Believes Connectivity Enables Reaching Goals Connectivity positively impacts health outcomes and industry profitability 50 individuals representing 30 different healthcare organizations within the Connect SI region reviewed 14 different connectivity applications Five priority eHealth applications were identified: m Electronic master patient index m Linking hospitals and physicians with electronic health records m Mental health primary consulting m Workforce education and training m Tracking system for drug seekers 6.06 Healthcare: Assessment

111 ©2007 ViTAL Economy, Inc. 111 Healthy Living Strategies: the Key Goal A shift in thinking is required because medical services alone cannot make people healthy Healthy living behaviors are the key to healthy lives, and a healthy economy Healthy People 2010 has identified two key goals m Increase the quality and years of healthy life m Eliminate health discrepancies Healthier U.S. identified four pillars m Be physically active m Eat a nutritious diet m Get preventive screenings m Make healthy choices Medical services alone do not create a healthy community SI citizens have the personal responsibility for healthy living habits and, therefore, improved health outcomes 6.06 Healthcare: Assessment Source: Health People 2010

112 ©2007 ViTAL Economy, Inc. 112 CriteriaRatingAssessment Rationale Retention of medical service revenues SI has a very high out migration of services to neighboring states, over $1 billion, 37.2% focus of the Healthcare COI Profitability Healthcare service provider profitability is under extreme pressure with 72% of patients covered by Medicare and Medicaid Skilled Workforce Availability The SI healthcare industry is currently challenged with workforce availability and it will become greater in the future Specialist Availability SI has limited specialty healthcare services outside of the GE region which drives out-migration Access to Patient History Physicians and medical service providers cannot access patient records easily Mental Health Services SI has a shortage of mental health services and professionals Healthcare Education & Training SI has an immediate need for increased healthcare training Cost of healthcare services The cost-to-value ratio must be competitive with neighbors Improved health incentives Providers, insurers, employers and regulators need to collaborate to expand preventive programs VE Assessment: Healthcare 6.06 Healthcare: Assessment

113 ©2007 ViTAL Economy, Inc. 113 Healthcare COI Outcomes: 2012 Goals The Healthcare Outcomes group identified one key, overarching measure to identify better outcomes through healthy living: Reduce cardiovascular disease mortality from 215 to 166 deaths per 100,000 population by 2012, a 23% reduction based on the Healthy People 2010 goal The group identified four strategies to reach this goal and increase healthier living in Southern Illinois; these are: Increase physical activity levels (exercise) Improve eating habits Decrease tobacco use Increase diabetes management Source: Connect SI Healthcare COI 6.06 Healthcare: Assessment

114 ©2007 ViTAL Economy, Inc. 114 Potential Impacts of Connect SI Job Goals: Improved Healthcare Revenue Mix Insured population 10% Medicaid 26% Medicare 18% Uninsured 32% Uninsured 32% >$2 Billion New Annual Wages 41,461 Existing Jobs >$5,000/Yr 27,298 New Hi-Wage Jobs $642 Million New KBE Activity 1,600+ Firms Families with Healthcare Coverage Lift 10,000 Citizens Out Of Poverty $200 Million Information Technology Investment Note: 60% of the US population had employment-based insurance in 2004 Current State 2004 Desired Future State 2012 A Far Better Payor-Mix than Today A Far Better Payor-Mix than Today Insured Medicaid Medicare Uninsured Source: Estimates based on IPLAN, and Census Bureau data 6.06 Healthcare: Assessment

115 ©2007 ViTAL Economy, Inc. 115 Healthcare Summary The SI healthcare industry is big business with even bigger opportunities m 11% of SI jobs are in healthcare with an average wage of $36,617 m Over 37% of each healthcare expenditure is spent outside the 20 county SI region (over $1 billion) m 74% of patient services inside-SI are only being reimbursed at 71% of the outside patient services rates Opportunities: m 5% shift in Medicaid to Third Party Payer insurance means +$4.5 million in increased reimbursements, adding 50 healthcare jobs m $21.9 million in healthcare services recapture, adding 239 healthcare jobs The overall SI citizens health is lower than Illinois with higher levels of chronic disease Opportunity: m Education and healthy living strategies are a key component of a robust economic development strategy 6.06 Healthcare: Assessment

116 ©2007 ViTAL Economy, Inc. 116 Chapter 6: Regional Perspective 6.07 Implications & Recommendations Southern Illinois "Garden of the Gods"

117 ©2007 ViTAL Economy, Inc. 117 Regional Perspective: Implications SI is below the Illinois average in key community sustaining areas; educational attainment, population health, poverty, and income The below average elements are balanced by: m Many positive natural resources of the area m Strong education facilities m Geographic location m Economic size m Skilled workforce that have great untapped potential Continued predominance of public sector income dependency stifles entrepreneurship and lowers the chances for growth and economic improvement to occur Unless private sector business development and incomes increase, the tax base to fund infrastructure improvements is hampered If the age group continues not to see future opportunity in SI and decide to stay, then economic stagnation will very likely continue Without improved curb appeal, quality housing and sound community infrastructure, attraction and retention of skilled workers is challenged Continued loss of healthcare revenues to surrounding providers, when equal services are available locally, severely limits healthcare expansion Limited entrepreneurial structure and incubation facilities restrains SIs adaptability to global market opportunities 6.06 Implications & Recommendations

118 ©2007 ViTAL Economy, Inc. 118 Regional Perspective: Recommendations Use Connect SI as the vehicle to bring the 20-county region together under a common strategy with critical mass equal to a major metro area Expand healthy living initiatives and preventative programs Healthy People = Healthy Economy Implement a more robust communication strategy designed to recognize the uniqueness and many positive aspects of SI, share short-term wins helps reorient thinking & build momentum Focus on private sector business development and income supported by linking entrepreneurship, incubation and finance resources strengthens the tax base Implement a Youth Engagement Strategy designed to train and retain this key population sector Implement a region-wide Crossing Boundaries Institute to bring together individuals from across the region to focus on a common vision for SI collaboration needs to be a guiding principle for all aspects of SI life! Develop and form a Livable Community Forum to address key challenges of curb appeal and address other elements contained in the livability index Develop new and innovative financing mechanisms to deal with aging infrastructure Refocus education and training to ensure alignment with new KBE and healthcare workforce demands as well as address skilled labor shortages Expand and continue the great work of the Network Providers and Healthcare COIs to collectively achieve the goals that will enable overall economic improvement 6.06 Implications & Recommendations


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