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New Cal Poly research park could be the key to economic development on the Central Coast

BY TRACY IDELL HAMILTON

Costco jobs may indeed pay more than Wal-Mart jobs, as Costco’s representatives have suggested in their effort to build one of the behemoth retail centers here.

But anyone involved with economic development knows that the real gold ring of job opportunity is not retail or service-sector, but high tech.

That's why boosters of the Californai Central Coast Research Park, or C3RP as it's been dubbed, are so pumped. Although the park hasn't been much more than a concept for the last several years, a recent acquisition of $2.1 million in federal seed money has launched a partnership among educators, government, and business to make the park a reality. It's this partnership that proponents say will bring the area a slew of high tech and tech-related jobs.

Not just jobs, either. Backers of C3RP envision a research park where business and academic research can cross-pollinate, keeping both on the cutting edge–a crucial place to be in today's wildly-paced tech market.

Within that environment, Cal Poly (and Cuesta) students would have increased opportunities not only for internships and employment, but also to create their own high tech start-ups, say proponents. Faculty, too, would be encouraged to do more applied research. In addition to more traditional research and development activities, the park would also house a business incubator, where start-up firms–student-created and otherwise–could get the early expertise and support crucial for success.

Allen Haile, Cal Poly's director of community and government relations, was the first to agitate for such a partnership, more than five years ago. He wouldn’t say much before the idea started solidifying. "The fastest way to derail a train is to throw pebbles under it," he said last year. But now that initial funding has come through to really get the ball rolling, Haile is as voluble and excited as a proud papa.

"It's very exciting," he said. "The park is a way to translate academic research into economic development. It will give our faculty the opportunity to do more applied research, increase opportunities for student internships, and give them more hands-on experiences."

The possibilities are endless, he said. The university has a world-class business school and, according to Haile, is "the largest producer of engineers west of the Mississippi." The county is rapidly becoming a fiber optic hub due to its location halfway between Los Angeles and San Francisco. All that combined, Haile said, makes Cal Poly a natural place in which to translate engineering data into economic development.

Why send all the talent away, Haile asked, when we could keep it right here?

He said that while the Economic Vitality Corporation of San Luis Obispo County saw the value of such an operation right away, he initially had to sell the idea to the university. "I had to make the case to the academic senate," Haile said. "But that's all been done now."

Local attorney Bob Schiebelhut, who was executive director of the EVC when Haile made his pitch, liked the idea so much he took it on as his pet project.

As enthusiastic as Haile, Schiebelhut stressed the educational aspect of the park. "The idea is not to create some real estate endeavor that the university is barely a part of," he said. "We want to see the transfer of knowledge from the university to existing businesses and start-ups." The park will add a dimension to students' education, he said, in Cal Poly's "learn by doing" manner.

Indeed, an early feasibility study by the Bechtel Infrastructure Corp. found that while a traditional research park probably would not fly in this area, a park closely aligned with the university could. "The closer the affiliation, the stronger the chance for success," reads a company summary of its study. That affiliation must be both interest-based and geographical, according to the study: "Location, location, location. Each step away from the university is a step in the wrong direction."

Keeping that mantra in mind, park movers and shakers have identified several sites on Cal Poly property, the most popular so far being the "Goldtree site," located on 45 acres northwest of the campus, adjacent to the California Men's Colony.

Coordinating decisions about siting, park content, and staff–or, as Haile joked, "making a place and space for serendipity to take place"–is the third member of the park proponent power trio, Susan Opava, dean of research and graduate programs at Cal Poly. While not as mellifluous as Haile, she is just as aware of the kind of prestige and revenue a successful research park would bring to Cal Poly. She is currently negotiating with a potential private partner that could speed up site development and construction and "enhance operational revenues." For now, she's keeping details close to her vest. "I don't think I should reveal the name of the company yet–nothing has been signed." She did say the potential partner is a large, non-local tech company. Asked what this private partner would be seeking in return for its investment, Opava said it would be a philanthropic endeavor for the company. "It doesn't give them anything they need," she said. "But it helps them with what they want to accomplish."

Opava, like other proponents, emphasizes that the connections between Cal Poly's educational mission and the park are "clear and explicit" and drive all decisions relative to the direction and future of the park.

The second most critical success factor, according to the study, is widespread community support–and C3RP seems to have it in spades. The city of San Luis Obispo and the county have both signaled their support for the project–if not with cash, then at least with resolutions like the county's, "supporting and encouraging the California Polytechnic University leadership role in their [sic] continued effort to engender interest in and support for an initiative for the purpose of developing the proposed California Central Coast Research Park to attract research and technological incubator interests to the county of San Luis Obispo."

C3RP also has the backing of some powerful business interests: the SLO Chamber of Commerce, the Economic Vitality Corp., PG&E, and Softec–a large local trade association of high tech and tech-related companies.

Bob Dumouchel, president of On With Learning, which makes computer-based education products, is a board member of both Softec and C3RP. Dumouchel supported the project after he read a position paper Haile wrote. "When it started to grow legs, I volunteered for the board," he said.

As the head of a private business that has partnered with Cal Poly in the past, Dumouchel said it can be tough for businesses to figure out how to team up with the school, which he called the "800 pound gorilla" of the local economy. The research park, he said, will help create some "nice clean mechanisms" for working with the school, it's faculty, students, and research. "There's a lot of neat stuff going on over there," he said. "But they're not a huge influence in the business community yet."

The opportunities that will be created from such a partnership, he said, will ripple out through the entire economy. "It will raise wage levels, add head-of-household jobs to the economy."

With the creation of such an endeavor, Cal Poly would take its place beside more than a hundred other universities with research parks, including Stanford, Penn State, the University of Utah, the University of Texas at Austin, and Virginia Tech.

When researching the feasibility of creating a park here, Haile, Schiebelhut and others have criss-crossed the country ("on our own nickel," Schiebelhut says), visiting parks and communicating with schools about what has and hasn't worked.

"A lot of these parks fail," Schiebelhut said. Some communities or universities have seen a park as a growth vehicle, "a pawn for developers," he said. "They weren't connected enough, in a live way, to the university. We have to remain true to some ideals–enhancing education, not maximizing profit."

The Bechtel study noted that fully half of all parks "fail to reach incubation." Many others are forced to diversify into other functions, such as office, industrial or other mixed uses. "Only one park in four succeeds as a research park," the study warns.

In trying to determine reasons for success and failure, Bechtel identified two research park models, exogenous and indigenous. Exogenous parks seek to attract large branches of existing companies' plants. That model, Bechtel found, is "expensive, time-consuming, highly competitive, and demanding on the community."

Indigenous models, on the other hand, are those that attempt to create new, locally-owned businesses by "leveraging linkages to the community."

It is the indigenous model that Cal Poly will follow, said Schiebelhut. "We're not looking for large plants to relocate here," he said. "We want growth in business with minimum impact on the traditional infrastructure."

Having examples of established successes and failures to study has been a boon, Haile said. "All the mistakes have already been made," he quipped. One example is Penn State, which in 1994 built its park two miles from the university on 130 acres of university-owned agricultural land. With a regional economic development objective, the park first took an exogenous strategy. But, as the Bechtel study notes, the university "built it, but they did not come." When the university changed to an indigenous strategy, success followed.

The University of Utah's park, on the other hand, has been successful from the beginning. Created in 1970 on 275 acres of UU property near the campus core, the park's primary objective was to diversify the economy into high tech. It has state and city support, policies in place to support its indigenous strategy, and "prominent faculty and administrators [who] desired an entrepreneurial milieu to stimulate high tech growth."

Research parks connected to universities even have their own trade association, the 16-year-old Association of University-related Research Parks. Haile and Opava just recently returned from the association's biannual conference in Arizona. The goal of the association, said Tim Ford, AURP's executive director, is to help translate what is done at the university into new companies, creating jobs and wealth in a community. AURP helps by functioning as an information clearinghouse, offering ongoing education and support, networking opportunities, and legislative tracking in Washington, D.C.

Ford said at least two other California universities are in the early stages of creating their own parks, the University of California at San Diego, which aims to build a bio-tech park, and the University of California at Santa Cruz, which has partnered with California State University at Monterey Bay to create a park outside Monterey at Fort Ord, a decommissioned Army base. The park would be 40 miles from UCSC and one mile from CSUMB.

Lora Lee Martin, director of the fledgling University of California Monterey Bay Education, Science and Technology Center, or MBEST (park proponents love acronyms, it seems), said the park would house a variety of industrial sectors. "We don't want to put all our eggs in one basket," she said. Those sectors will parallel research already taking place at the schools, including marine biotech, information tech, and telecommunications.

The scope of the UC MBEST Center is broader than Cal Poly's park, she said. It will be trying to attract private companies, public agencies, and policy makers. Another component of the park is a business incubator located in the tiny town of Marina, on the edge of Fort Ord. MBEST is partnering with the town in that effort, which will provide services for fledgling businesses throughout the entire region, Martin said.

MBEST is also looking beyond the two public universities and local government. "We'll be serving the entire Monterey Bay crescent," Martin said. "We've got 25 institutions of higher learning right here, including the Naval Postgraduate School and The Monterey Bay Aquarium Research Institute."

Martin said that although MBEST has only one physical structure so far, it has received more than 140 inquiries about locating there.

C3RP, too, has already had inquiries from businesses and start-ups both locally and outside the area, according to Opava. As of yet, she said, she does not feel comfortable releasing the names of those companies, since no agreements have been finalized.

Opava did say that preliminary criteria have been developed to determine the eligibility of businesses looking to locate in the park. First, a business must be technology-based, with a focus "complementary" to Cal Poly's existing programs. It should also be able to demonstrate how its location on campus and access to students and faculty would be beneficial to both the business and the university. Additionally, a "significant" aspect of the business must be on applied research and development.

While her department focuses on research and graduate programs, Opava said the main beneficiaries will be undergraduate, not graduate, students.

Haile agreed. He said that while it's true that Cal Poly's role is as an undergraduate teaching school, and conventional wisdom posits that research parks should be located at research universities, "teaching universities are now the prime target for research parks."

Cal Poly will continue what it's already doing, he said, which is research on the applied end of the spectrum. He also trotted out the school's creed–"Learn by Doing"–as added justification.

The park would not just benefit undergrads, of course. Faculty, too, would benefit. It's crucial that professors have the latest knowledge and skills, Opava said, especially since, with tenure, they're technically hired for life. Partnering with business can help achieve that end, she said.

"We already encourage faculty research," Opava said. C3RP would just broaden those opportunities–even to the point of faculty-created new businesses, which will be encouraged, she said. The university would be able to hire more faculty, she explained, to actually do the teaching for those professors who would be teaching less, busy as they would be doing research and creating their own companies.

Opava said scientists and engineers from businesses located at the park would also be encouraged to teach, "enriching the program."

The park would also offer faculty spouses more career opportunities. Cal Poly has seen professors turn down positions at the university, and even leave, because there were so few places for their wives or husbands to work, Opava said.

One thing the park is not addressing is housing, and how the influx of new businesses and additional faculty will impact the perpetual crunch. While the MBEST Center is working with the Fort Ord Reuse Authority to make sure housing matches job creation, neither Cal Poly nor the city has the luxury of thousands of acres of land already earmarked for housing.

"We're not addressing housing separately," said Opava, "but the university is, in its Master Plan." That plan includes an additional 3,300 beds on campus in the next 10 years. Additional housing on campus should mitigate impacts on the off-campus local housing market, according to the plan. There has also been talk of trying to create some faculty housing across Highway 1 from the college, although nothing formal is in the works.

The city did consider housing when it passed its resolution supporting C3RP, said Mayor Allen Settle. He said the council identified the Margarita expansion area, northeast of Prado Road, as one place families from incoming businesses could locate. That expansion, he said, will add between 800 and 1,100 new homes. The DeVaul housing project, 250 homes near Froom Ranch, has also just been approved, he said.

There's still plenty of time to work out many of the details related to C3RP, as much as proponents would like to get a move on. "It takes some time for them to sign the check," said Haile of the $2.1 million federal gift. The first step, once the money is here, he said, is to hire an executive director. The organization already has nonprofit status, he said, under the moniker "Technology R&D, Inc." "But that may not be the final handle," Haile said. "Branding is vitally important."

Details surrounding the siting of the park may also be sticky. Opava said several sites are being studied, but the Goldtree site "is the only politically correct one." She declined to name other areas where C3RP could go.

The Goldtree site would represent leapfrog development for the university, located as it is away from the already-developed campus core. That means infrastructure and environmental mitigation will be more costly. And while Haile and Opava believe initial construction could begin within a year, one thing MBEST's Martin said they've learned is, that the process takes a long, long time. "We've been at it for almost 10 years," she said.

But for those who've been nurturing the idea of a research park and business incubator that would create educational and job opportunities for so long, for those who believe C3RP will offer the community the kind of wealth creation that would allow us to continue the lifestyle to which we've all become accustomed, the investments that must be made by the university are little more than exciting new challenges.

"There are more challenges ahead, that's true," said C3RP board member Dumouchel. But the job landscape is changing, he said, and the Central Coast must keep up. "What happens when we lose all those jobs at Diablo? Where are our kids going to work? The answer is not Costco." Æ

Tracy Hamilton is looking for an acronym that jauntily but accurately describes her. Suggestions may be e-mailed to [email protected]