lions annually on research-mostly related to defense requirements—such an exhibit provided an opportunity not only to let businessmen generally in on the results of this research, but also provided a medium for the Department of Defense to broaden the mobilization base, to encourage civilian production capacity and know-how with respect to newly developed noncritical materials, new processes, and new items having defense significance in time of mobilization. Following the pattern of cooperation, the various units in the Department of Commerce worked with the Michigan Department of Economic Development. Michigan leaders formed a nonprofit corporation to undertake the detailed planning of the exhibit and encourage manufacturers from the region to participate. Funds were raised legally by voluntary contribution from business and labor organizations and private individuals.

Over 5,000 people, representing 1,258 firms located in 158 Michigan communities, viewed the exhibit. Representatives from 18 other States and 4 foreign countries also were present. On exhibit were some 25 displays of federally developed new products or processes and some 70 displays by private exhibitors. A number of months after the exhibit personal interviews were conducted with 269 businessmen who attended the show. Of these, 61 (over 20 percent) indicated that they had already adopted a product of process which they had examined at the exhibit, or had definite plans for doing so.

Because of this gratifying result, plans are being made to extend the exhibit to other regions under a similar cooperative pattern.

STABILIZING EMPLOYMENT IN A ONE-INDUSTRY TOWN

By assisting firms in single-industry towns to find and develop new products or to obtain manufacturing rights to products new to the company, the Office of Area Development helps communities to diversify and stabilize employment. How this program works can be illustrated by the case of a small community in Maryland. The only industry in this community, a manufacturer, employed 350 people and was the principal source of year-round income to the people of this community. Foreign competition and other factors so adversely affected sales of the plant's one product that most of the labor force was forced into unemployment.

Following a community request for assistance in restoring employment in the plant, the Office of Area Development sent representatives to meet with community and company officials. Before this meeting, the Office of Area Develop

ment took the following steps:

(1) Obtained directories of industries located within the State and in nearby industrial areas;

(2) Called Federal procurement officers regarding planned purchases of the type item being manufactured by the firm;

(3) Arranged for other agency representatives to accompany the Office of Area Development representatives to explain the loan and procurement assistance available from the Federal Government.

At the meeting, Office of Area Development representatives suggested that firms in nearby industrial areas be contacted for the purpose of securing subcontract manufacturing business. Directories of industries in Baltimore and Philadelphia were loaned to the company for developing information on firms to contact.

During the next month the firm contacted more than 100 firms for subcontract business. As a result the company obtained a 10-year contract to manufacture a line of small automobiles, a garden tractor, farm implements, and a power golf caddy from a large Baltimore company. The president of the firm which had been assisted reported that the new contract made it possible for the company to operate at a stable level throughout the year-the operation had previously been highly seasoned-and to increase employment by about 100 people. The plant is preparing for near-capacity operation.

In addition, the company is also following out other suggestions of the Office for securing subcontracts and other new products. Following several conferences, the community itself has initiated an area development program to develop additional industries. All these developments are resolving the unemployment problem with which this small community was confronted.

HELPING THE ANTHRACITE AREA

The Office of Area Development assisted the anthracite industry by cooperating with the Anthracite Information Bureau in its efforts to maintain and increase the use of anthracite for heating Government and commercial buildings. Following a request by the Northeast Pennsylvania Industrial Development Commission to the President to take action to alleviate the serious economic situation in the anthracite area, the President asked the United States Department of Commerce to examine the various proposals for Federal action made by the commission. Among them was a suggestion that in the heating of Federal Government buildings within the anthracite shipping area a greater use be made of anthracite coal.

Following the preparation of a report by the Office of Area Development responding to suggestions of the NPIDC, the Anthracite Information Bureau contacted the Office of Area Development. The AIB pointed out that there were many new developments in anthracite stokers and burning equipment which could effect economies in the heating of Government buildings which should be brought to the attention of heating engineers responsible for preparing heating specifications for Government buildings. The Office of Area Development then suggested that a meeting be arranged at which new developments in the burning of anthracite would be presented directly to Federal heating engineers by the Anthracite Information Bureau. The AIB accepted the invitation for such a meeting.

The Office of Area Development then invited Federal agencies to send heating engineers to a conference on new anthracite heating equipment to be held under the Office's sponsorship in the Department of Commerce. The meetings purposely were kept small and informal so that there could be a ready exchange of ideas between the technical personnel on both sides. The AIB based its presentation upont he belief that anthracite, because of new and unpublicized technical improvements, was well able to qualify on both cost and suitability grounds in a variety of Government installations. The bureau made no special pleas but simply asked that the Government engineer give consideration to anthracite in seeking the most logical fuel for a given heating problem.

The main presentation was made by an independent fuel consultant, who called attention to the various factors that should be reviewed in a survey to select the proper fuel for a given situation. With the use of specially prepared charts and graphs (which were also made available in reduced size with his remarks to each attendee) the consultant called directly upon his experience with various fuels to show that anthracite did enjoy certain advantages, although a careful survey would need to be made in each case. Engineers from the bureau cited from their extensive experience numerous instances where heating deficiencies could be improved by inexpensive and practical means regardless of the fuels used.

Some of the immediate items of interest to the anthracite industry which resulted from the conference were:

A number of conversions to anthracite fuel have been made in Government installations. In most cases these were traceable to the contacts between Government engineers and experts of the anthracite industry made in the above conference.

Development of useful information on the nature of particular heating problems of individual agencies and installations.

Development of information on new installations in preparation.

Opportunity to present advantages of anthracite to a potentially large but widely dispersed and decentralized customer.

The Anthracite Information Bureau was also able to make preliminary arrangements with the National Bureau of Standards of the United States Department of Commerce for the conduct of certain heating efficiency tests to supply reliable data lacking on heating devices. The research would fill a present gap in which United States data actually lags behind that of Europe. The proposed investigation was conducted by the Bureau of Standards, with the anthracite industry furnishing equipment and sharing in the expense.

HELPING A COMMUNITY ORGANIZE AN AREA DEVELOPMENT PROGRAM

Each year several hundred communities and area groups request Office of Area Development assistance in outlining the steps which can be taken by communities to develop new employment opportunities. An example of the area development suggestions and technical aids provided by the Office of Area Development in response to requests of this type follows.

Industrial development suggestions for (the name of the Vermont community has been deleted)

The following suggestions are provided for

to assist

the community in providing new job opportunities. The closing of the plant indicates that a communitywide problem exists, and that the whole community should participate in its solution.

A. Formation of an industrial development corporation

Many communities throughout the Nation have found an industrial development corporation or foundation a valuable tool in handling the financing of a locally developed industry, the construction of a factory building, or the acquisition and subsequent sale or lease of industrial property. The enclosed publications, How To Organize an Industrial Development Corporation, Industrial Development Corporations and Foundations-Their Functions and Formation, and Community Experience With Organized Industrial Foundations describe the objectives, formation procedures, and operation of such organizations.

The employees of the.

plant and community leaders should examine the possibility of forming an industrial development corporation on a communitywide basis.

B. Examine alternative uses of plant facilities

The community of

and the employees of the

plant should carefully examine alternative actions that might be taken. If a corporation is formed and the plant is purchased at least two alternatives are open.

(1) The plant may continue producing the products now being made. This action, however, should be thoroughly investigated relative to the competitive position of the existing plant and equipment. If the present plant is now inefficient through reasons of obsolescence of plant or machinery, depletion of resources, the loss of market to competing products, or for other reasons the operation is not economically feasible, the community would then have to bear the cost of modernizing the plant and changing over to production of new products. For this reason, the community should have the plant and equipment carefully appraised before purchasing it.

(2) The plant buildings and property may be purchased by the community and held for sale or lease to other manufacturers who might be interested in locating a new manufacturing facility in The experience of

Manchester, N. H., may prove instructive in this matter. When a large manufacturing plant in Manchester closed down, the community formed a local development corporation called Amoskeag Industries, Inc. They purchased the buildings and property and developed a strong, program designed to attract new industry to the area to utilize the available facilities. Several small manufacturers are now in operation on the property formerly occupied by one manufacturer. The community leaders of might contact Col. W. Parker Straw, or Mr. John R. McLane, Amoskeag Industries, Inc., Amoskeag Savings Bank, Manchester, N. H., for any advice and information they might be able to provide.

C. How to finance the local plan

The principal advantage of a local development corporation is that the corporation can assume the risk in a business venture that normal lending agencies are unwilling to assume. For this reason, it is almost essential that some community funds be raised locally.

Local funds may be raised through public subscription, or through sale of stock in the corporation.

Another possible source of funds is the Small Business Administration. An industrial development corporation can, under certain conditions, obtain a loan from the Small Business Administration for construction of a factory buildings or for purchasing a business if the loan will materially affect the continuing successful operation of the business. For full details the Small Business Administration Regional Office, 131 State Street, Boston 9, Mass., should be contacted.

The Vermont State Development Credit Corp. may be able to assist financially. Also, financing arrangements may possibly be made through the State Development Commission with the largest banks and investment bonuses in your State. For further information, we suggest contacting the Vermont Development Commission, State Office Building, Montpelier, Vt.

D. Look into other opportunities

A community, of course, has an obligation to assist in the expansion and the welfare of its existing industries. However, it often happens that conditions within an industry, such as shifting markets, increased competition, or technological changes, render a plant in a particular locality obsolete or make the location of the plaut unsuitable for continued economical operation. The community then must look elsewhere for a replacement of the economic activity it has lost. It must seek new industries to replace the older, declining industries. Many communities throughout the Nation have developed strong, aggressive programs designed to attract new industries to their area. Usually a separate community organization is formed, composed of leading citizens, businessmen, labor, the press, civic officials, and other interested persons.

E. Make a survey

Once a community organization is established, one of the first projects it should undertake is to make a comprehensive survey of the community's assets and the industrial location advantages of the area. The survey is essentially a self-analysis of the community to determine what its strong points are and what improvements can be made.

The enclosed Checklist for Community and Area Development, suggests techniques and sources of information to advise community and area groups in their efforts to encourage industrial and trade development. It indicates how the community can organize its resources to establish new industry and trade, and improve opportunities for development of existing industry. It also points out what assistance in carrying out their trade and industrial development program is available for State and Federal agencies.

The enclosed Industrial Location Facts specifies types of information on area resources which a community should make available to manufacturers as an aid to appraising an area for location of a new plant. The release suggests what information the community should develop on such industrial location factors as: population and labor force; types of products presently manufactured; proximity to market; transportation facilities; power and water supply; available factory space; industrial tax structure; and general living conditions.

F. Contact prospects in growth industries

One of the most difficult jobs faced by industrial development groups is that of identifying and contacting firms which are planning new manufacturing facilities. The enclosed How To Locate Industrial Prospects for Your Community, suggests how a community can prepare and maintain an industrial prospects file.

Helpful in this respect are the enclosed publications, Expanding Industries in Manufacturing--A Source of Industrial Prospects and Expanding Industries: The Electronics Industry: The Electrical Machinery and Equipment Industry: The Conveyor Equipment Industry: and The Air Conditioning Industry.

Most community organizations prepare a brochure or "fact sheet" setting forth the pertinent economic facts of their community and describing the locational advantages of the area; emphasizing unique features which make the community particularly well suited for a specific industry. The brochure may be inexpensively printed and is useful as a mailing piece in contacting industrial prospects and arousing initial interest.

G. Investigate Federal programs useful in community development

The enclosed publication, Federal Programs for Community Development, catalogs some 30 Federal Government programs which can effectively supplement community development efforts. Of particular interest are the community planning grants and urban renewal program of the Housing and Home Finance Agency. Also, the business loan programs and products assistance program of the Small Business Administration may be particularly helpful to

[Publications, What Will New Industry Mean to My Town, Metropolitan Area Shits in Sales Growth, and Industrial Possibilities for Whitfield, N. H., were supplied for the record and will be found in the files of the committee.]

STATUS OF STATE DEVELOPMENT CREDIT CORPORATIONS

Information on the 11 State development credit corporations now in operation is provided in the accompanying tabulation. In general the authorized activity of these organizations is "any legitimate business." There is one exception: The New Hampshire Industrial Development Authority, which is supported by public funds, was set up to create industrial parks and erect one structure in each park. The Pennsylvania Industrial Development Authority, also is financed by appropriated monies, and may also be permitted to operate any legitimate business activity. The Vermont Development Credit Corp., although authorized, has not yet become active. * State credit corporations have been considered by seven other States and the Territory of Alaska. The Alaska Development Credit Corp. was proposed in a recent legislature but no action was taken. * Florida authorized a credit corporation and later abolished it on the ground of doubtful constitutionality. *** In Michigan, Minnesota, and New Jersey, credit corporations have been proposed by recent legislatures. In each case the status is unknown. In Montana the recent effort to establish a credit corporation was defeated by the senate. *** Finally, the Georgia Industrial Development Corp. is a private corporation that needs no legislative authorization.