©2007 ViTAL Economy, Inc. Executive Overview 1 Stay cool Southern Illinois: Garden of the Gods Readiness Assessment Executive Overview December 14, 2007;

©2007 ViTAL Economy, Inc.— 1 —

Executive OverviewExecutive OverviewStay cool

Southern Illinois: Garden of the Gods

Readiness Assessment

Executive Overview

December 14, 2007; revised Feb 14, 2008

CONNECT SI

ViTAL Economy AllianceFrank Knott, Project Lead; Stan Halle, Senior Editor;

Jim Haguewood, Rob Beynon, & Neil Gamroth, Principal Economic Researchers

[email protected]; http://www.vitaleconomy.com


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Executive OverviewExecutive Overview


Executive OverviewExecutive OverviewExecutive Overview Table of Contents

READINESS ASSESSMENT (RA) Executive OverviewREADINESS ASSESSMENT (RA) Executive Overview Slide #Slide #

Letter to Letter to ConnectConnect SISI Leaders .…………………………………………..…. 4 Leaders .…………………………………………..…. 4

m Understanding the Readiness Assessment Process ..………….. 6Understanding the Readiness Assessment Process ..………….. 6

m TheThe SI SI Opportunity and Dilemma Opportunity and Dilemma ………………………………….. ………………………………….. 1414

m State, National and Global Trends and Implications for State, National and Global Trends and Implications for SI SI . ..……. .……. 2121

m Assessing Assessing SI’sSI’s Climate to Support Growth …………………………. 25 Climate to Support Growth …………………………. 25

m Community of Interest (COI) Perspective and Goals ……….…… 36Community of Interest (COI) Perspective and Goals ……….…… 36

m Connect SIConnect SI: Crossing the Boundaries ……………………….……. 49: Crossing the Boundaries ……………………….……. 49

m How Does How Does SISI Organize to Succeed? ………………………………. 56 Organize to Succeed? ………………………………. 56

m Call to Excellence…a Destiny of Prosperity! ………………….… 61Call to Excellence…a Destiny of Prosperity! ………………….… 61

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Executive OverviewExecutive OverviewLetter to the Reader

This Readiness Assessment (RA) Executive Summary provides a condensed view of the readiness of Southern Illinois (SI) to successfully support and implement the Connect SI Phase 2 multi-year economic development strategy. It summarizes the key findings contained in the detailed RA issued to Connect SI on December 2007.

The RA is a multi-faceted assessment of SI economic history and current conditions. It involves more than 235 interview sessions with 940+ business, public sector, labor union, community and not-for-profit leaders living and working in SI. It includes a review of over 250 studies of the SI economy. The RA highlights global, national and regional trends critical to understand as Connect SI proposes a five year strategy for transforming the SI economy by 2012. The RA assessment process took place between Sept 2006 - Nov 2007.

The RA is an independent 360º view of all aspects of the SI economy designed to provide subjective and objective assessments of community vitality as well as economic opportunity. It enables uncomfortable but necessary realities to be reviewed openly, so that Connect SI leaders can plan for long-term success. The RA is the work product of ViTAL Economy, not Connect SI. The results of the RA provide both opportunities and challenges for SI.

Opportunities: SI indigenous resources are a perfect match for current global and national market trends. SI has the opportunity to grow its economy at an annual growth rate of 3.85% by 2012 versus its 1.34% growth rate over the past 25 years, resulting in $2 billion in new annual wages, $3.6 billion rise in annual GDP, 43,000+ new high wage jobs, 10,000 citizens lifted out of poverty and over $162 million more annual state and local tax revenue.

Challenges: SI has a major dilemma. There is a need to build a better climate of trust so that meaningful collaboration increases and the risk environment for visionary leaders improves. A pervasive willingness to accept mediocrity is evidenced by a lack of excellence in many aspects of SI life. There is an overarching belief that “the cavalry is coming” despite evidence to the contrary. Policies continue to prioritize & fund initiatives that emphasize declining sectors of the current economy rather than expanding into 21st century economic realities.

As discussed in this RA, SI has the opportunity to become a “regional gateway” for America’s Heartland to the global economy and for the global economy to America’s Heartland, if and only if SI chooses to believe it can.

Frank Knott, PresidentViTAL Economy, Inc.



— 5 —

We See A Bountiful Southern Illinois

Vital Economy’s View:

— We have fallen in love with SI. We see it as the land of the “Garden of the Gods” —

Prime central North American location in close proximity to over 11M people 425,000 population that produces a $17.6B economy — equivalent to a major metro-area Multi-directional Interstate highway, waterway and rail road infrastructure Major research university, robust community college system and workforce development

assets Modern and growing healthcare facilities Large national forest and numerous unique tourist attractions Extensive mineral, agricultural and unique natural environmental assets Rich soils, mild climate and abundant water resources Numerous innovative and leading industry companies and an entrepreneurship spirit Special, welcoming, talented and caring people who want better for their families Young and old who see SI for the treasure it is, and desire stewardship that reflects its value

ViTAL Economy Conclusion:Southern Illinois has more assets at its disposal than

any other region it has advised in 15 years

ViTAL Economy Conclusion:Southern Illinois has more assets at its disposal than

any other region it has advised in 15 years



Southern Illinois — "Garden of the Gods"

Section A: Understanding the Readiness Assessment ProcessUnderstanding the Readiness Assessment Process


The What, Why and How of a Readiness Assessment

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The Readiness Assessment is a 360° review of an economic region from two perspectives, including:

1. Community internal opinions and impressions

2. Outside-in perspective based upon years of experience and research in other rural communities and a review of national & global trends relative to SI asset mapping results

( )Internal Insights + External Insights x VE Analysis =•Interviews•Local Research/Reports

•3rd Party Observations•External Research

Connect SI 20-County Economic Strategy

Connect SI 20-County Economic Strategy



Phase 2 COI StrategiesPhase 2 COI Strategies

Greater Wabash COI

Southern Five COI

Southeastern COI

Greater Egypt COI

Healthcare COI

Network Provider COI



Readiness Assessment Process

The Readiness Assessment is built from the ground upThe Readiness Assessment is built from the ground up

Assess Economic Development Needs & Local Leadership Vision

COI Milestone Meetings

ConnectivityAssessment

AssessClimate ofInnovation

Livable CommunityAssessment

State, Nat’l, Global Trends

Primary &SecondaryResearch

Assess Knowledge, Service, Infrastructure, Finance, Leadership Gaps

Long TermInitiative

Readiness toConnect &Collaborate

Assess

VisionaryLeadership

DeterminePublicSector& NGOSupport

DeterminePrivate-Sector

SupportMeasureClimate ofSuccess

Ability & Will to

Collaborate & Fund at

Local Level

Connect SI Phase 2 Multi-Year Initiative

Developed High-Value Jobs Accelerated GDP Growth Transformed Economy

SI RA Components



The Job of the RA

Provide a mirror that reflects to leaders

what those they lead are thinking and saying

————

Highlight the opportunities that are before you

————

Communicate an unvarnished view of the challenges

————

Determine if the key ingredients are in place to achieve success,

despite the perceived difficulty of the challenges

————

Develop the RA as a qualifying filter for prioritizing choices for the completion and launch of the Connect SI long-term strategy

See: RA Chapter 6



Readiness Assessment Process in Context

June 2006

VISION

&

GOALS

Year One Year Two

PHASE 1COI Launch

COI Milestone Meetings & Goal Setting

Asset Mapping

Economic Scenario Models


PHASE 2Industry Cluster Analysis & Strategies

Integrated Finance Strategy

Youth Engagement Strategy

Collaborative Leadership Institute

Innovation Ecosystem

Action Implementation Through 2012

You Are Here Now!

*

Phase 1 Strategy ApprovedPhase 2 Launch 2008

July 2007

July 2008



ACTUAL Client Communities Success Since 1992 (Average)

• 30-40% increase in regional job base over five years

• 25-35% growth in average wage

• 30-40% reduction in rate of poverty

• 20-25% of lowest wage jobs raised by at least $5,000/year

• 20-30% increase in families with health insurance

• 35-50% increase in average wage of new jobs

• 50-90% increase in annual rate of new business formation

• Above average acceleration in growth of gross regional product

• Expanded KBE based innovation economy enabling broadband expansion

• Improved economic diversification and lower economic risk

• Increased access to capital for financing of innovation



Connect SI – Overall Logic Flow

Asset Maps help us understand what makes SI

unique!

Opportunity Realized

Measures of Success

Short / Long Term Wins

Connect the Dots

Barriers

Barrier Strategies

Local Opportunity

Local Innovation

Global Innovation

Industry / State

Best Practices

Innovation

Who We Are

Knowledge

The foundation of sustainable economic

growth is building on what makes a region

unique, NOT copying what others are doing

Global Opportunity



Asset Maps Focus Opportunity Analysis

• Enables SI to define how indigenous resources make it unique and special

• Identifies resources in economic sub-regions to share across SI

• Helps to filter, prioritize and focus competing economic strategies

• Defines what industry clusters can be home grown based on local assets

• Identifies industry value chain assets to be connected across SI Region

•Natural•Human

•Knowledge•Cultural

•Geographic•Excellence

•Infrastructure•Government

•Natural•Human

•Knowledge•Cultural

•Geographic•Excellence

•Infrastructure•Government

Map Indigenous Assets

++ ==

•Agriculture•Healthcare

•Tourism•Energy

•Manufacturing•Education•KBE Firms•Logistics

•Agriculture•Healthcare

•Tourism•Energy

•Manufacturing•Education•KBE Firms•Logistics

Map Industry Assets

Priority industry clusters with the

greatest ability to deliver economic

growth goals

See: RA Chapter 2



What COI’s Learned from Asset Maps

SIU’s 138 year history with students from over 100 cultures positions SI to access expanding global markets which are seeking access to U.S. markets

SIU’s research ‘centers-of-excellence’ in energy, environment, materials and neuroscience perfectly align with global priorities for market growth

SI has a more significant base of workforce development and research university assets to respond to the 10 million worker shortage than other U.S. rural economies

There are more innovation, incubation and entrepreneur assets in SI than anyone imagined; this positions SI to build an Innovation Ecosystem fueling KBE growth

Intermodal logistics assets and heartland location align with the redevelopment and expansion of inland waterway logistics connecting to Midwest logistic gateways

Regional tourism assets are aligned with authentic and active lifestyle tourism trends involving 50-80 million annual tourists in the U.S.

SI’s region has the right mix of assets for attracting the financially independent active retirement demographic, which is fueling the growth of senior living opportunities

SI has a significant base of diversified alternative and traditional energy assets, which if collaboratively organized, provide a basis for a diversified energy sector

Asset Mapping proves SI already has what it needs to drive its own economic destinyAsset Mapping proves SI already has what it needs to drive its own economic destiny

See: RA Chapter 2




Section B: The SI Opportunity and DilemmaThe SI Opportunity and Dilemma

This section compares what SI has going for it versus what’s in the way — painting the picture of the enormous opportunity SI has to transform its economy

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Regional AssetsRegional Assets

• Heartland of America location, equidistant to 2/3 of U.S. markets, central to economic expansion of the Americas

• SIU - a major R&D university with 138 years of history serving students from over 100 world cultures supports global KBE growth

• Robust education and training resources position SI for global workforce training opportunity

• Mild climate, unique natural environment, active lifestyle assets, arts and culture amenities, and attractive quality of life characteristics are important factors for KBE, tourism and senior living growth

• Inter-modal logistics, transportation and distribution resources have a strong foundation in SI

• SI has plentiful legacy and alternative-energy assets. SI is a coal leader and is strong in 2 of 4 areas of projected alternative energy growth by 2030

• Heartland of America location, equidistant to 2/3 of U.S. markets, central to economic expansion of the Americas

• SIU - a major R&D university with 138 years of history serving students from over 100 world cultures supports global KBE growth

• Robust education and training resources position SI for global workforce training opportunity

• Mild climate, unique natural environment, active lifestyle assets, arts and culture amenities, and attractive quality of life characteristics are important factors for KBE, tourism and senior living growth

• Inter-modal logistics, transportation and distribution resources have a strong foundation in SI

• SI has plentiful legacy and alternative-energy assets. SI is a coal leader and is strong in 2 of 4 areas of projected alternative energy growth by 2030

The BIG SI Opportunity

>$2 BillionNew Annual

Wages


Wages

41,461 Existing Jobs>$5,000/Yr


27,298 NewHi-Wage Jobs27,298 New

Hi-Wage Jobs

$642 MillionNew KBE Activity

1,600+ Firms


1,600+ Firms

4,500+ Families with Healthcare

Coverage

4,500+ Families with Healthcare

Coverage

Lift 10,000 Citizens Out Of Poverty


$200 Million Information Technology Investment


Global & Nat’l TrendsGlobal & Nat’l Trends

• Global growth presents SI with opportunity to accelerate its economic growth from 1.34% to 3.85% per year

• KBE activity now accounts for 50% plus of GDP growth, 3x’s the growth in occupations and pays double the average wage of other jobs

• By 2010, the U.S. will have a 10M worker shortfall requiring strong workforce development resources

• 3 of 4 factors required to support KBE activity in rural America are SI strengths

• 58% of all U.S. and global tourists want authentic active, historic and cultural experiences (50-80 million)

• Logistics is a $900 billion U.S. industry in a global $3.43 trillion market growing at 10-15% per year

• 74% global increase in coal consumption, 138% in coal-to-liquid and 66% in bio-fuels by 2030

• Global growth presents SI with opportunity to accelerate its economic growth from 1.34% to 3.85% per year

• KBE activity now accounts for 50% plus of GDP growth, 3x’s the growth in occupations and pays double the average wage of other jobs

• By 2010, the U.S. will have a 10M worker shortfall requiring strong workforce development resources

• 3 of 4 factors required to support KBE activity in rural America are SI strengths

• 58% of all U.S. and global tourists want authentic active, historic and cultural experiences (50-80 million)

• Logistics is a $900 billion U.S. industry in a global $3.43 trillion market growing at 10-15% per year

• 74% global increase in coal consumption, 138% in coal-to-liquid and 66% in bio-fuels by 2030

++ ==

CSI 2012 Goals*

* These Connect SI Goals were announced to the Public 26 Feb 2007



Source: “State of Working Illinois”, by Northern Illinois University (Nov 2005); “21st Century Workforce” (May 2004); IMF; ViTAL Economy research

Ave

rag

e A

nn

ual

G

row

th R

ate

%

0

1

2

3

4

5

6

3.85%

“Stay the Course” vs. “Change the Course”

AAGR Connect SI Goals 2008 - 2012

0

1

2

3

4

5

6

AAGR 1977-2001

Worldwide USA State-wide Southern Illinois

1.34%

2.19%

3.14%

5.62%

2012: increase SI’s economy by $3.6B in GDP to $21.2B, which translates into $162M in additional State and Local tax revenue

2012: increase SI’s economy by $3.6B in GDP to $21.2B, which translates into $162M in additional State and Local tax revenue

Result of Taking Control of SI’s Destiny



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 #1 #1 #1 #1 #1Highest % 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 #1 #1 #1 #1 #4Highest %

households lack

complete plumbing


lacking complete kitchen

Highest % commuting to

work from other IL counties

Lowest % population work and

live in same county


rent burdened

Highest % of Adults with no High School

Diploma

#1 #1 #1 #3 #3 #1

Source: IL Poverty Summit, “2004 Report on Illinois Poverty,” Based on U.S. 2000 Census or IL Dept of Employment Security data & Atlas of Illinois Poverty Spring 2003

Result Of Not Taking Control Of SI’s Destiny

Southern Illinois Ranking: 2004 Report on Illinois Poverty



“We lose the best and brightest, because 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 20-30 year old population

This young population leaves the region for more attractive opportunities, despite SI having resources that should help retain them

Increasing Your Burden Losing the most productive age

group while increasing the resource-demanding demographic

Source: U.S. Census Bureau – Table QT-P1: Age Groups and Sex: 2000 and RA Interviews

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

7.00%

8.00%

9.00%

under 515 to 1930 to 3440 to 4960 to 6475 to 79

90+

Proportion of Population (%)

SI Illinois

Age Distribution Comparison

Increasing Your Burden

Losing Your

Future Workforce

All is not lost — SI needs a Youth Retention Strategy

All is not lost — SI needs a Youth Retention Strategy



• Limiting mindset: willingness to accept mediocrity and lack of a sense of excellence

• Insufficient climate of collaboration and trust, making change very difficult

• Continued belief that “the cavalry is coming” despite proof to the contrary

• Losing the best and brightest — youth brain drain• Lack of participation in the global economy• Continued focus on traditional economic sectors

in decline rather than rising economic sectors• Climate of economic (and community) despair• Public policy reinforces & funds old economy

strategies, and inhibits new ones

SI’s Big Dilemma:Climate of Limited Opportunity

Resulted in only 1.35%

AAGR for last 25 Years

Resulted in only 1.35%

AAGR for last 25 Years

SI’s future hangs in the balance!SI’s future hangs in the balance!

• Fragmented and poorly leveraged

• Primary focus on local opportunities

• Insufficient # of visionary leaders

• Too many boundaries

Issues Weighing

Down SI

Indigenous

Resources &

Innate Talents



• Less willingness to accept mediocrity• Improving climate of collaboration and

trust making change less difficult• Losing fewer of the best and brightest• Less focus on traditional economic

sectors in decline • Less of a climate of economic despair• Public policy/funding priorities shifting

SI’s Potential:Climate of Unlimited Opportunity

• Linked across the region & highly leveraged

• Active visionary leaders• Collaboration abounds• Boundaries are being

crossed• New behaviors• Global focus

Issues Weighing Down SI Indigenous Resources &InnateTalents

Results in over 3.85% or

better AAGR for NEXT 25

Years

Results in over 3.85% or

better AAGR for NEXT 25

Years

Growth & prosperity realized!Growth & prosperity realized!




Section C: State, National and Global Trends and State, National and Global Trends and

Implications for SIImplications for SI

Translating the most relevant trends into potential new jobs for the region

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Chapter 1:State, National & Global Trends

1.01 Globalization: The World is Flat

1.02 eCommerce & Connectivity

1.03 KBE and Innovation

1.04 Livable Communities

1.05 Transformation of U.S. Economy

1.06 Manpower & Immigration

1.07 Aging Population

1.08 Tourism

1.09 Logistics, Transportation & Distribution

1.10 Energy

1.11 Sustainable Economies

1.12 Conclusions

Rural communities typically focus on their local geographic area and have limited insight into the larger world around them. This chapter provides key trend information and what it means for Southern Illinois. Each of these trends represents potential opportunities for Connect SI.

FYI: From the RA Itself



Potential SI Jobs by Sector (1 of 2)

• Global growth opens up opportunities to expand SI economy beyond its traditional growth rate

• 10 million U.S. worker shortage is an opportunity for SI workforce development resources

• Growth in services exports enable SI to move away from uncompetitive legacy economic activities

• Global growth opens up opportunities to expand SI economy beyond its traditional growth rate

• 10 million U.S. worker shortage is an opportunity for SI workforce development resources

• Growth in services exports enable SI to move away from uncompetitive legacy economic activities

ICT investments contribute 33% to U.S. productivity

growth…this validates importance of NPCOI

SI’s 64% increase in broadband access can better

leverage six-fold increase in e-commerce activity

4 of 5** factors in rural KBE growth are SI strengths

— need to be leveraged for SI economic growth Livable community assets present in SI are an

attraction asset for KBE, Senior Living and Tourism Alternative energy, global warming and “greening”

of society is creating innovation opportunities

ICT investments contribute 33% to U.S. productivity

growth…this validates importance of NPCOI

SI’s 64% increase in broadband access can better

leverage six-fold increase in e-commerce activity

4 of 5** factors in rural KBE growth are SI strengths

— need to be leveraged for SI economic growth Livable community assets present in SI are an

attraction asset for KBE, Senior Living and Tourism Alternative energy, global warming and “greening”

of society is creating innovation opportunities

See: RA Chapter 1

**Five Factors are: • High Quality Workforce• College or Universities• Local Amenities• Transportation Infrastructure• Size

KBE

8,023New Jobs

KBE

8,023New Jobs

Global Workforce

Opportunities

18,750New Jobs

Global Workforce

Opportunities

18,750New Jobs



Potential SI Jobs by Sector (2 of 2)

Climate of Economic Opportunity = an additional 10,210 new jobsNEW GRAND TOTAL = 50,789 Jobs (vs. 27,298 Jobs Feb ‘07)

Climate of Economic Opportunity = an additional 10,210 new jobsNEW GRAND TOTAL = 50,789 Jobs (vs. 27,298 Jobs Feb ‘07)

See: RA Chapter 1

• 77 million retiring baby boomers present an affluent

senior living growth opportunity for SI

• 77 million retiring baby boomers present an affluent

senior living growth opportunity for SI

• Preferred tourism growth sectors indicate SI is

positioned for accelerated tourism growth

• Preferred tourism growth sectors indicate SI is

positioned for accelerated tourism growth

SI energy assets and knowledge are in the sweet spot of energy priorities for growth

SI energy assets and knowledge are in the sweet spot of energy priorities for growth

Significant transportation labor shortages are moving transportation and distribution centers from the coast to the center of North America. SI location and logistics assets position it for growth

Significant transportation labor shortages are moving transportation and distribution centers from the coast to the center of North America. SI location and logistics assets position it for growth

Senior Living

3,676New Jobs

Senior Living

3,676New Jobs

Energy & Mining5,680

New Jobs

Energy & Mining5,680

New Jobs

Tourism4,450

New Jobs

Tourism4,450

New Jobs

Log/Trans//Dist1,675

New Jobs

Log/Trans//Dist1,675

New Jobs




Section D: Assessing SI’s Climate to Support GrowthAssessing SI’s Climate to Support Growth

There is good news and bad news about what SI has in place — focused onEnabling Environment, Innovation & Tech-Transfer, and Competitiveness.

VE assessments are based on primary research (interviews), secondary research (regional, national & global studies), best practices, and our professional experience

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Enabling Environment: VE Assessment

Chapter 3 of the RA assesses several Enabling Environment Criteria

(summarized here)

Climate of Collaboration

Regulatory, Policy & Governance

Business Climate

Broadband Access & Penetration

Livable Communities

Adaptability to Change

Global Focus

Visionary Leadership Depth & Breadth

Climate of Opportunity

WEAK

IMPROVING

GOOD

AVERAGE

STRONG

See: RA Chapter 3



Enabling Environment: Implications

Lack of collaboration is hampering prosperity Creates a climate of distrust and conflict Results in an inability to fund or achieve project success due to lack of resources

Unattractive business climate for retention and attraction IL’s court system is rated as unreasonable to business Multiple government and taxing districts cause a confusing business environment

Telecommunications expansion is a marketable opportunity The recent expansion of broadband service, supported by a clearly defined goal is positioning SI

for KBE growth and attraction

SI’s natural environment is not valued enough or being leveraged The region has the largest concentration of natural environment assets in mid-America SI is missing out on substantial tourism, senior living, KBE and other revenues

Reluctance to change will perpetuate an atmosphere of dependency The global economy is changing faster than ever before, primarily driven by innovation and

technological advancements that will not wait for individuals and companies to keep pace Rural regional economies that can effectively meet the workforce needs and business demands

of a KBE economy will be the envy of others

Lack of visionary leadership will keep SI on the same low-growth economic path A larger core group of champions must step forward and lead the change for SI



Enabling Environment: SI Citizens See the Stark Reality

So many things in SI are one-person, one-business or one-organization thin

Local population does not want their neighbors to be too successful

SI is a risk-averse region — if you are too successful, we criticize you and assume success was obtained dishonestly; if you fail you are branded as a

failure for life

There is a significant lack of unity across the community, including churches, local governments, schools, business interests, etc.; at the municipal level,

decisions are based on emotion rather than facts

We lack a vision of success — we prefer to dwell on our failures

Overlapping government at the local and regional level gets in the way of success. Our parochial interests win out over our economic interests

People here seem to be afraid to take a chance. They have a great fear of failure. They are deeply concerned at how they will be perceived. This leads

to a lack of action. It maintains the status quo

If you going to be poor, this is the place to be

Source: RA & EF Hutton Interviews; See: RA Chapter 3Note: Quotes in this RA from interviews & other sources are shown as centered italics



Fertile Ground to Change

SI citizens across the Region do see the stark reality and understand what needs to change

The good news: Awareness of this reality goes far and wide Folks, young and old, want SI, as a region, to finally deal with this

The bad news: There is a deeply held belief that neither individuals, nor SI as a whole, will change Far too many lifelong SI residents have become numb to the decades of gradual

decline in so many communities SI is at a crossroads — and there are reasons for hope:

The concept of One Region-One Vision is gaining traction There are pockets of prosperity — so it can be done Short-term wins across SI are providing further “proof” that the collaborative

approach works — building momentum is key The TIME is now; the CHOICE is yours — all it takes is will and leadership

If you’re going to have a self-fulfilling prophecy, let’s make it a great one!If you’re going to have a self-fulfilling prophecy, let’s make it a great one!

See: RA Chapter 3



RA Chapter 4 provides a detailed assessment of SI’s Climate for Innovation and Entrepreneurship, summarized here:

Entrepreneurship Culture and Networks

Financial Literacy

Existence of Early Stage Capital for Startups

Rate of Business Startups

Partnerships and Community Outreach

Technology Transfer, Licensing and Commercialization

Entrepreneurship Development and Tracking

Space and Facility Support Services

WEAK

IMPROVING

GOOD

AVERAGE

STRONG

See: RA Chapter 5

SI Innovation, Entrepreneurship & Incubation: VE Assessment



SI Innovation, Entrepreneurship & Incubation: Implications

Entrepreneurship culture and networks Entrepreneurship is not seen as a “real job” — this suppresses a spirit of innovation

Financial literacy Limited risk assessment capacity for KBE soft asset business startups — this limits access to capital Entrepreneurs understanding of equity & debt is low — this results in poor deal flow quality

Partnerships and community outreach are centered in Carbondale A regional climate of innovation can not be achieved when the vast majority of resources are

centralized Underperformance of technology transfer, licensing and commercialization

SI cannot grow regional KBE innovation firms without regional access to SIU tech-transfer assets Disconnected entrepreneurship development and tracking systems

The Region’s business support services are not linked — result is KBE firms leave SI or innovations die on the vine

Lack of business startup-tracking demonstrates lack of policy commitment to entrepreneurship SI cannot manage what it cannot track or measure

Limited and unconnected incubation space and facility support services Incubation resources cannot supply diverse expertise needs of young emerging KBEs Incubator firms are not linked to potential value-chain partners in other parts of SI

Innovation knowledge is silo-based, not shared and, therefore, not leveraged

See: RA Chapter 5



Climate of Innovation, Entrepreneurship and Incubation

Climate of Innovation*:Zero-sum game mentality exists in the way of collaboration or

even basic idea sharing — we are fragmented, jealous and secretive and motivated by risk aversion

Climate of Entrepreneurship:• Entrepreneurship is not considered to be a “real job”

• Entrepreneurs exist but mostly underground

• Early stage capital is limited, access is not well known

• Research focus at SIUC: high potential for more tech transfer

• Entrepreneur development resources in SI are very limited

• Support systems for entrepreneurs need bolstering

Climate of Incubation*:There are too few, unconnected incubation resources and staff

— have limited budgets and business experience; several incubated firms left SI to get access to a system of support

SIU is one of the top 100 Research Universities in the U.S — 67% of SIU business and engineering students want to stay in SI —

SIU presents an opportunity to address SI’s KBE Worker Gap

SIU is one of the top 100 Research Universities in the U.S — 67% of SIU business and engineering students want to stay in SI —

SIU presents an opportunity to address SI’s KBE Worker Gap

*Source of Quotes: RA & EF Hutton Interviews; chart data from BLS; Note: quotes are shown centered in italics

0

2

4

6

8

10

U.S. IL SI

The KBE Worker Gap:SI is well below the State and National

Averages for KBE as % of total employment

7.7%

8.5%

4.3%

Gap



Economic Growth Can Be Greatly Stimulated by Implementing an Innovation Eco-System™

SI Incubator, Finance & Innovation Starfish Network

— the KBE-Engine of Connect SI —

SI Entrepreneurs Served by SharedRegional Network

Of Incubator Centers of Excellence

Life Cycle Equity and Debt

Finance Resources

Global Best PracticeTechnical Support

Teams

Broadband-Enabled

SI Entrepreneurs Served by SharedRegional Network

Of Incubator Centers of Excellence

Life Cycle Equity and Debt

Finance Resources

Global Best PracticeTechnical Support

Teams

Broadband-Enabled

W. FrankfortBusinessIncubator

GE IncubatorTech Transfer

Dixon SpringsAg-Tech Incubator

SWI Retail Incubator

Edwardsville

Ethanol Research

Center

SIU MedicalSchool

GW Incubator

Coal ResearchCenter

S5 SBDC

SE SBDC

EntrepreneurCenter

Centralia EC

SIUE-EC

IMEC

MedicalTechnologyIncubator

InternationalIncubator

See: RA Chapter 4



SI Competitiveness: VE Assessment

RA Chapter 5 provides a detailed assessment of SI’s competitiveness,

summarized here:

Global Market Readiness

Climate for Investment Attraction

Workforce

Knowledge Infrastructure

Location Advantages

Connectivity LiteracyWEAK

IMPROVING

GOOD

AVERAGE

STRONG

See: RA Chapter 5

The lack of Global Market Readiness is holding back the region from leveraging its Knowledge Infrastructure and Location Advantages to build a high growth economy

The lack of Global Market Readiness is holding back the region from leveraging its Knowledge Infrastructure and Location Advantages to build a high growth economy



SI Competitiveness: Implications

Limited Global Market Participation $1 billion export gap: 2.4% of SI GRP vs. 8.4% of the Illinois GSP participates in the global economy Global market niches exist in energy technologies, bio-ag, int’l innovation and incubation, logistics, etc.

Cloudy Climate for Investment Attraction Long history of a weak, trailing economy and reputation of inferiority limits SI’s ability to attract investment Livable community standards are a fundamental requirement for investment attraction Targeted, consistent & authentic communications/marketing can shift the internal and external perceptions of SI

Solid and Improving Workforce SI’s 66.5% labor participation rate challenges the region’s growth opportunities The incumbent workforce has a strong work ethic and desire to stay in the SI region SI’s extensive workforce development assets are positioned to help address the projected U.S. 10M worker shortfall

Robust Knowledge Infrastructure SI already has a broad array of knowledge assets, but needs to better align towards a common strategic direction An education Center of Excellence could coalesce regional KBE resources to pursue global workforce opportunities

Strong Location Advantages SI is in a geographic “sweet spot” to take advantage of major trends SI’s location advantage benefits Tourism, Energy, and Transportation, Logistics & Warehousing sectors

Improving Global Connectivity Readiness SI has begun to transform its connectivity infrastructure but has low connectivity awareness and literacy Linking NP-COI with all industry clusters can help identify applications to increase competitiveness and market-share

Only as a unified region can SI leverage the critical mass already in place to become a formidable force on the global stage

Only as a unified region can SI leverage the critical mass already in place to become a formidable force on the global stage

See: RA Chapter 5

GRP = Gross Regional ProductGSP = Gross State Product




Section E: Community of Interest (COI) Perspective Community of Interest (COI) Perspective

and Goalsand Goals

Laying out the key demographic and economic picture of SI as a whole and acknowledging thesignificant work from each of the six Communities of Interest (COIs), as well as “What’s In It for Me?”

Step back and think about SI as a major metropolitan community made up of individual neighborhoods —it is the uniqueness of each neighborhood, when combined to make a large whole,

that creates a unique sense of personality that we call Minneapolis, Memphis, Boston, San Francisco, etc. When you says these names and close your eyes certain images, impressions, and characteristics come to mind.

It is called the Voice and Personality of a Brand — this is where SI needs to go

Stay cool



Regional Perspective… SI is a Potential Giant if it Acts as a Unified Region

Population Over 425,000 residents in the region, comparable

to a single major city SI represents 3.3% of total IL population Median age higher in SI (37.5) than state (34.7) 61% of population is in Greater Egypt making SI

unbalanced 1980-2005 Cumulative Population Trend

SI = (-3.0%) Declined! Illinois = +11.6% U.S. = +30.5%

Labor Force Region average wages are almost 40% lower

than the state average SI region has a 66.5% labor force participation rate,

10% below Illinois Meaning that 24,995 are employable, but for one

reason or another they are not employed

Economy SI has a $17.6B economy

SI economy is 3.47% of State GSP Largest sector of SI GRP is government 20% (11% IL) 64% of SI GRP is in Greater Egypt 3% of SI landmass is urban & built

Exports Exports are only 1% of state level at $420M

8.4% of IL’s GDP is exports vs. only 2.4% for SI Matching IL’s level would mean +$1.06B

See: RA Chapter 6Sources: U.S.Census Bureau, BEA, & Dept of Commerce

2006 Government Transfer Payments as % of Total Earnings

0

5

10

15

20

25

30

35

% of Total Earnings

Southern Five Southeastern

Greater Wabash Greater Egypt

SI

IL

U.S.

-5%0%5%

10%15%20%25%30%35%

USILSI

Cumulative Population Trend (1980 – 2005)

30.5%

11.6%

(-3.0%)



Only 46% of SI Personal Income is Generated by Private Sector Employment

Conclusions:

• SI cannot afford the community and economy it wants

• A 30% increase in private vs. public sector earnings is required to equal U.S.

• Low % of at-risk sources of personal income creates a risk-averse environment

0%

10%

20%

30%

40%

50%

60%

70%

Private SectorPayroll & Benefits

Transfer Payments,All Gov't &

Education Earnings

U.S.

IL

SI

54%

33%36%

46%

67%64%

Increasing private sector % of personal income generation is critical to building a climate of innovation

Increasing private sector % of personal income generation is critical to building a climate of innovation


Executive OverviewExecutive OverviewSI Needs Investment Attraction: Exports

SI gap in exports (vs. Illinois) is its biggest opportunity to fill the pool

SI gap in exports (vs. Illinois) is its biggest opportunity to fill the pool

$$$

IMPORT ACTIVITIES— Take $ Out —

bring in goods and services to serve the needs and

desires of the community; but capital flows out

EXPORT ACTIVITIES*— Helps Fill the Pool —

bring money into the region by selling goods and/or services of value and

importance to national or international markets

SI Economy

*Exports are the only source of new

capital that the region can use to pay for goods and services to meet its needs and desires

$$$

CONSUMER SERVICES SECTOR— Circulates $ Locally —

activities that directly and indirectly address the consumption demands of

the local residents

$$$

0

2

4

6

8

10

12

Exports as a % ofGDP

U.S.

Illinois

SI

11%

8.4%

2.4%



Connect SI: Phase 1 Roadmap

See: RA Chapter 6

Greater Egypt COI Strategy

Southeastern COI Strategy

Southern Five COI Strategy

Greater Wabash COI Strategy

Phase 1 Outcomes

GIS Asset Maps

Broadband Strategy

Economic Benchmarks

Regional Economic Strategy

Healthcare Strategy

Regional EconomicFramework

Five-Year Measurable Goals

Implementation &Funding Plan

GIS Mapping Team Supports COI’s

Connect SIRegional CED COIStrategy

HealthcareProviders

COI Strategy

Network Providers

COI Strategy

VALUE-ADDED RESEARCH: Regional Economic Model, Healthcare Economic Model, Incubation, Research Park and Entrepreneurship Assessment, 20-county Readiness Assessment


Wages


27,298 NewHi-Wage Jobs


1,600+ Firms

+4500 Families with Healthcare

Coverage



2012 Goals



COI Perspective: Southern 5

Challenges:• Lack of skilled workforce for

current and future jobs • Lack of cooperation,

collaboration, and regionalism

• Does the region have the assets to grow and retain tech based jobs?

• No sense of urgency• K-12 performance

Opportunities:• Geography, logistics and

transportation • Community College System

and SIU• Local healthcare availability• Tourism, bed & breakfast,

Shawnee National Forest, historical assets, wineries

• Agribusiness opportunities (e.g., ethanol)

Sense of Urgency•Changing our mindset — how we view poverty!

•Stop the bleeding — put a triage process in place for the economy, now!

•How will your children grow up and where will they go?

Sense of Urgency•Changing our mindset — how we view poverty!

•Stop the bleeding — put a triage process in place for the economy, now!

•How will your children grow up and where will they go?

S5 COI 2012 Goals

$90.3 M in New Wages

784 New Jobs @$43,500

4,863 Existing JobsRaised by $5,000/Year

522 jobs at New Average Wage $36,517

Increase Youth Retention:6.9% to 7.2% (15-19yrs)

18.7% to 21.5% (20-34yrs)

Reduce PovertyFrom 14.5% to 12.5%

S5 COI 2012 Goals

$90.3 M in New Wages

784 New Jobs @$43,500


522 jobs at New Average Wage $36,517

Increase Youth Retention:6.9% to 7.2% (15-19yrs)

18.7% to 21.5% (20-34yrs)

Reduce PovertyFrom 14.5% to 12.5%

2004 2012

Population 58,664 63,000

Total Employed 24,317 26,856

Average Wage $27,959 $37,591

Total Wages $679.9M $1.01B

Regional Economic Benchmarks

See: RA Chapter 6



COI Perspective: Southeastern

Sense of Urgency• We MUST stop the decline, we are

asleep at the wheel.

• Shock Value: “If you are going to be poor, this is the place to be!”

• What is our legacy going to be for our children? There is declining infrastructure, tax base declining, demographics getting worse

• WHAT CAN BE? We need to paint a compelling picture of the future

Sense of Urgency• We MUST stop the decline, we are

asleep at the wheel.

• Shock Value: “If you are going to be poor, this is the place to be!”

• What is our legacy going to be for our children? There is declining infrastructure, tax base declining, demographics getting worse

• WHAT CAN BE? We need to paint a compelling picture of the future

Challenges:• Get local gov’t officials involved • Reverse population decline• Increase tax revenue base• Increase average wage• Change age demographic• Increase incentives for broadband

penetration in the rural areas• Low awareness of ICT benefits• Create a more diversified economy• Overcome apathetic attitudes• Limited affordable housing

Opportunities:• Get county boards & city councils

engaged• Show local stakeholders that they

have a “VOICE”!• Further enhance working

relationships with other communities

• Become a positive place to live, work and play

• Promote area as an affordable place to live

• Challenge negative thinking• Promote and develop self-reliance

in our community• Foster entrepreneurship

2004 2012



Average Wage 27,494 40,276

Total Wages $602.2M $1,027B


SE COI2007-2012 Goals

2,158 New Jobs @$43,500


1,438 jobs at the new average wage

$40,276

34% Private Payer Healthcare %

$500M EAV Tax Base

Broadband Penetration Rate – 50%

$44,420,000 Tourism Expenditures

$180,000 Regional Room Tax Revenues

SE COI2007-2012 Goals

2,158 New Jobs @$43,500



$40,276

34% Private Payer Healthcare %

$500M EAV Tax Base

Broadband Penetration Rate – 50%

$44,420,000 Tourism Expenditures

$180,000 Regional Room Tax Revenues

See: RA Chapter 6



COI Perspective: Greater Wabash

Sense of Urgency• Population decline — educate them but

they leave• More jobs outside of the area• Lost appreciation of the area• Rekindling the romance for the area:

o The Beauty of the place that we liveo Our quality of lifeo The positive attitude of the area

• “Live, Work, Play and Stay in Southern Illinois” — and create excellence generation to generation

• Prosper in spite of Springfield!• Stop the population drain — what we can

do now!

Sense of Urgency• Population decline — educate them but

they leave• More jobs outside of the area• Lost appreciation of the area• Rekindling the romance for the area:

o The Beauty of the place that we liveo Our quality of lifeo The positive attitude of the area

• “Live, Work, Play and Stay in Southern Illinois” — and create excellence generation to generation

• Prosper in spite of Springfield!• Stop the population drain — what we can

do now!

Challenges:• Spirit of poverty!• Youth brain drain• Need to change our attitude• No collaboration between risk

takers• Lack of discussion due to

territorial battles• Lack of appreciation of

business by public officials

Opportunities:• Take control of our own destiny• Tap our youth — get them

engaged in this process• Publicize our great assets —

what makes us unique• Tie colleges to skill needs;

educate our parents! • Leverage our renewable

resources in this area; not just raw exports — invest in non-renewable as well

• Fill key gaps (e.g., need Pediatrics, Obstetrics); lots of ripple effects

GW COI2007-2012 Goals

1,381 New Jobs @$43,500


920 jobs at the new average wage

$36,517

$36,406 Per Capital Income

GW COI2007-2012 Goals

1,381 New Jobs @$43,500


920 jobs at the new average wage

$36,517

$36,406 Per Capital Income2004 2012



Average Wage $26,311 $36,517

Total Wages $694.6M $1.013B


See: RA Chapter 6



COI Perspective: Greater Egypt

Challenges:• Culture of poverty• Increase average wage• Reverse population decline• Youth brain drain• 2000 recent dislocated workers• Lack of quality and

commitment of leadership• Weak region wide

communication• Limited access to public and

private capital

Opportunities:• Highly educated population• Technology transfer from

educational facilities• Quality of place• Energy sector: coal, alternative

fuels, etc.• Value-added agriculture• Foreign student population• Workforce Development

•Man-Tra-Con•SIU & Community Colleges•State and Federal programs

Sense of Urgency•We have got to break the cycle of hopelessness!

•Don’t tell me what we can’t do – tell me what WE CAN do!

Sense of Urgency•We have got to break the cycle of hopelessness!

•Don’t tell me what we can’t do – tell me what WE CAN do!

GE COI2007-2012 Goals

10,468 New Jobs @$43,500



$40,765

Educational Degree Attainment

High School 85.3%Bachelor 25.2%

17.1% Youth Retention (20-29 age group)

12% Poverty Rate

GE COI2007-2012 Goals

10,468 New Jobs @$43,500



$40,765

Educational Degree Attainment

High School 85.3%Bachelor 25.2%

17.1% Youth Retention (20-29 age group)

12% Poverty Rate

2004 2012

Population 253,049 274,432


Average Wage $27,830 $40,765

Total Wages $3.7B $6.4B


See: RA Chapter 6



COI Perspective: Network Providers

Source: Organization for Economic Cooperation and Development (OECD) Broadband Statistics Dec 2005 (Survey of 14 Countries);Pew Internet and American Life Project — Rural Broadband Internet Use Feb 2006

COI Observations:• Competitors have become collaborators• Through collaboration, Connect SI has identified

even more resources and possibilities to improve broadband penetration

• Resources are greater than originally perceived• Connect SI is the focal point:

• Sharing maps and resources• Common goals

COI Results (2006-2007):• Created a demand driven customer aggregation

model generating thousands of open-access sales leads (www.iwantmybroadband.com)

• Over 35+ small towns have received broadband

• Over $24M+ in new private sector broadband infrastructure

• Reached 16% Penetration and 41% Broadband Coverage after only 18 months (starting point was 12% and 25% respectively)

COI Results (2006-2007):• Created a demand driven customer aggregation

model generating thousands of open-access sales leads (www.iwantmybroadband.com)

• Over 35+ small towns have received broadband

• Over $24M+ in new private sector broadband infrastructure

• Reached 16% Penetration and 41% Broadband Coverage after only 18 months (starting point was 12% and 25% respectively)


See: RA Chapter 6

25-to-85% Broadband

Coverage

12-to-54% Penetration

25-to-85% Broadband

Coverage

12-to-54% Penetration

2012 Goals:

0.00

10.00

20.00

30.00

40.00

50.00

60.00

2005

Southern Illinois USA-rural

USA-average #1 in World

% P

enet

rati

on

of

Po

pu

lati

on

12%

24%

34%

54%Network

Provider COI has set an ambitious

goal to increase the

SI penetration rate to world class levels!



COI Perspective: Healthcare

COI Vision:Supporting the collaboration and interconnection among healthcare providers and patients to improve:

Healthcare access Health outcomes Provider profitability The qualified healthcare

workforce in Southern Illinois

COI Vision:Supporting the collaboration and interconnection among healthcare providers and patients to improve:

Healthcare access Health outcomes Provider profitability The qualified healthcare

workforce in Southern Illinois

Jobs Earnings GDP

Direct SI impacts 4,676 $214.7M $260.3M

Indirect and induced 2,408 $75.4M $156.3M

TOTAL 7,084 $282.3M $424.5M

COI Results:• Two state healthcare pilot

projects initiated and managed locally

• Collaborate nursing workforce solutions underway

• Prescription Drug Monitoring System

COI Results:• Two state healthcare pilot

projects initiated and managed locally

• Collaborate nursing workforce solutions underway

• Prescription Drug Monitoring System

Potential Impact of New Healthcare Positions by 2012:

Impact of Healthcare GoalsImpact of Healthcare Goals

Desired SI Future State 2012

Desired SI Future State 2012

1. Economic growth will

improve payer mix

1. Economic growth will

improve payer mix

2. New health jobs will promote

economic growth

2. New health jobs will promote

economic growth

Insured population +10%

Medicaid -26%

Medicare +18%

Uninsured -32%Uninsured -32%


See: RA Chapter 6



COI Views: What’s In This for Me?

My family gets to stay together, my kids don't even think of leaving because of all the opportunity, self-esteem, and pride in our community

We go from surviving to thriving

The inhibitive walls ALL come crashing down — the boundaries created by narrow-thinking, local rivalry, fighting over crumbs and the belief that

‘poverty-is-an-unaddressable-fact-of-life’

I will be linked into this wonderful collaborative network & infrastructure, yet feel this amazing sense of creative freedom

I want my three valedictorian sons to come back home!


See: RA Chapter 6; quotes are from RA & EF Hutton interviews


Executive OverviewExecutive OverviewPerspective — Connect SI

Bottom Line:

“Until everyone involved sees and believes that this effort is the most important initiative that Southern

Illinois has ever undertaken, it will be relegated to a hobby that folks do in

their spare time”- RA Interview





Section F: Connect SI: Crossing the BoundariesConnect SI: Crossing the Boundaries


• Summarizes key findings of RA • Assesses SI readiness to pursue a long term strategy that will transform the SI economy

• Provides recommendations for moving forward



Progress Towards One Region-One Vision: Last 16 Months

1,000+ Connect SI participants have worked toward building a foundation for hope through investment of tens of thousands of service hours

Collaborative funding from local governments, corporations, NGO’s, higher education institutions, small and large healthcare systems, state and federal agencies attests to the desire to achieve a regional vision for a robust SI future

Network provider collaboration has increased broadband availability by 64% across the Connect SI Region through over $24 million of private investments

Healthcare provider collaboration has achieved significant progress towards addressing critical skills shortages and improved health outcomes by prioritizing cooperation over competition

Connect SI asset mapping has enabled COI’s to uncover opportunities to collaborate across the SI region that would have never before been possible. This has led to numerous short term wins and long-term strategies for growth




Barriers to One Region-One Vision: Last 16 Months

Breaking old behaviors in terms of continued reliance on state and federal resources as primary sources of capital to fund long-term initiatives rather than prioritize collaborative funding alliances at the local level

Critical mass of Connect SI champions has not yet been achieved — need to triple its champions to >3,000 active participants, who believe that a climate of economic opportunity is possible for Southern Illinois

Imbedded focus of funding, policy and behaviors on industrial attraction, and big employment announcements as the solution to economic growth vs. growing small employer KBE firms (21st century growth engines) that don’t garner big headlines

Limited recognition of the depth, breadth and length of commitment needed at the leadership, citizen, government, business and media levels to transform a limited growth old economy into an innovation growth economy of unlimited opportunity

Insufficient commitment of the time, talent and resources of existing leadership to the expansion of next generation leadership and to growing the skills necessary to collaboratively lead Southern Illinois to become One Region with One Vision




Actions Fundamental to SI Economic Prosperity (1 of 2)

Address SI Dilemma — transition from a climate of limited potential to unlimited opportunity

SI citizens must believe that they have the ability to take control of their destiny Education of SI uniqueness and opportunity is critical to turning belief into action

Increase SI’s private sector contribution from 46% to national level of 65%; reduce SI’s dependence on public sector income from 54% to national level of 36% by 2012

Critical to establish an SI climate of innovation versus a climate of risk-aversion Requires a 30% increase in private sector wage contribution to personal income

Improve global export literacy and double global export value in SI’s economy Required to increase flow of external capital into SI…Investment Attraction Leverages SI indigenous resources…Sow Our Own to Grow Our Own

Implement economic strategies to grow SI economy at 3.85% vs 1.34% annually Increased prosperity is dependent on accelerated growth SI infrastructure investments cannot be met without increasing economic growth




Actions Fundamental to SI Economic Prosperity (2 of 2)

Change economic development focus from legacy (manufacturing & commodity agriculture) to KBE global products and services

This is where the high value, high wage job growth opportunities abound

Emphasizes growth of firms not negatively impacted by Illinois weaknesses

Grow breadth and depth of Connect SI visionary leaders and champions Commitment to passionate long-term vision by more leaders is critical

Critical mass of 3,000+ champions is critical to sustainability of change

Expand base of collaborative funding support for Connect SI strategies Long-term consistency in strategy focus is dependent on regional control

“Cavalry-is-coming” mentality must be dispelled to transform expectations

Support a long-term regional framework to guide regional growth Regional collaboration can only take place through a regional framework

Access to a broader base of financial, data and human resources is assured




LOOKLOOK FEELFEELACTACT

Source: Milestone Visioning Exercise from GW, GE and S5

CSI Participants Vision of the Future

Construction is going onDowntowns look niceSense of pride in our

properties; less trash, more flowers

More ideal retail availableBroadband is everywhereNatural beauty, farmlands

are preservedNew housingMaintain our historical

buildings; respect our heritage

Good mix of industry and business

Healthcare is widely available

Smart use of the brownfields

Construction is going onDowntowns look niceSense of pride in our

properties; less trash, more flowers

More ideal retail availableBroadband is everywhereNatural beauty, farmlands

are preservedNew housingMaintain our historical

buildings; respect our heritage

Good mix of industry and business

Healthcare is widely available

Smart use of the brownfields

More educational opportunities

People are doing business outside of the area; world markets

Intentionally acting in a collaborative manner

Street talk has changed to newest activities and additions to the community

Business able to compete in the global economy

People are proud of their community

“Walk the Talk”Comfort with risk and

entrepreneurship and innovation

Middle-aged and older folks are not afraid of IT

More educational opportunities

People are doing business outside of the area; world markets

Intentionally acting in a collaborative manner

Street talk has changed to newest activities and additions to the community

Business able to compete in the global economy

People are proud of their community

“Walk the Talk”Comfort with risk and

entrepreneurship and innovation

Middle-aged and older folks are not afraid of IT

Positive perception of the area

Pride in the communityNew people feel welcome,

open door feelingWe are a “20 county” regionSI is a world recognized

regional brandValue education and a

sense of communityHigh school students feel

good about staying in the region

A new cultural atmosphereMore young people bring a

vibrancy to the regionStrong small town

environment

Positive perception of the area

Pride in the communityNew people feel welcome,

open door feelingWe are a “20 county” regionSI is a world recognized

regional brandValue education and a

sense of communityHigh school students feel

good about staying in the region

A new cultural atmosphereMore young people bring a

vibrancy to the regionStrong small town

environment




VE Vision of SI Tomorrow

Southern Illinois is the global location where inter-generation active lifestyle families, visitors & KBE workers choose to live work and play — growth abounds

SI’s historic liability of remoteness and lack of access becomes an asset; instead of forgotten by Chicago, Springfield and Washington, SI is a land and lifestyle treasured, respected, sought after and envied — there is only one SI in the World

SI communities see themselves in a new light; they are respectful of their place; they see themselves as gateways to a land that is "The Garden of The Gods"

Tourism venues, town centers,rural lands, business locations and neighborhoods all demonstrate by their look and feel that SI is a very special place to be preserved and enhanced for all time

SI is a place of welcome for people of all cultures whether visiting or living here; in the land of "The Garden of the Gods” all are welcome and of value

It is a place many want to be, but only the fortunate choose to take advantage of this unique opportunity; SI becomes a place that is worth a premium, rather than one that feels it must offer a discount to be desired

Source: ViTAL Economy Alliance





Section G: How Does SI Organize to Succeed?How Does SI Organize to Succeed?

Suggests the framework to progress into Phase 2

Stay cool



All new jobs created byIndustry Clusters will be

targeted to include private payer health benefits for

workers and families

All new jobs created byIndustry Clusters will be

targeted to include private payer health benefits for

workers and families

Phase 2 Framework is Built Around Industry Clusters

Tourism Bio-Agriculture Knowledge Based Enterprises (KBE)

Healthcare Technology Products & Services Advanced Manufacturing Recreational, Marine, Hunting, Technology Products & Services Visual Creative & Performing Arts and Services International Incubation and Innovation Green Technologies Homeland Security Response and Services Life Sciences, Plant and Animal

Global Workforce Opportunities Energy Mining Technology Transportation, Logistics & Warehousing Senior Living



Phase 2 Priorities for Success (1 of 2)

1. Expand NP-COI connectivity broadband deployment with professional support for an additional twelve months — including expansion of enterprise applications for healthcare, education, R&D and tech transfer research collaboration with private sector

2. Broaden base of Connect SI champions and gain re-commitment of Phase 1 champions — repeat January-June 2006 road show using RA data to garner additional support

3. Invest robust resources in a collaborative funding strategy to raise $1.5 million in cash and in-kind resource commitments to Connect SI for each FY 2008 and FY 2009

4. Establish Connect SI as a regional data portal for SI — Local municipalities are already benefiting from regional data assembled by Connect SI, which has helped local economic development professionals attract businesses to SI — there is no other long-term reliable source for consistent, accurate and integrated data for the SI region

5. Select four industry clusters for Phase 2 research and implementation in 2008. Recruit private sector leadership teams during first quarter of 2008 for each industry cluster — identify experienced rural industry cluster research teams to guide cluster teams

6. Commit to a sense of urgency that is communicated region wide — educate citizens and leaders of the economic realities of the need for change today rather than tomorrow — invest in Connect SI marketing strategy in support of broadband, champion development, collaborative funding and private sector recruitment goals



Phase 2 Priorities for Success (2 of 2)

7. Leadership Advisory Committee agrees to resource the Healthcare COI to aggressively achieve the transformative qualitative and quantitative goals it established in Phase 1

8. Focus four regional COI’s on recruitment of industry cluster participants for prioritized SI-wide industry clusters — have COI leadership guide implementation of at least two short term win opportunities every six months, which are connected to achieving COI goals

9. Fund and establish a collaborative leadership institute to address critical shortage of visionary leadership across SI — include youth engagement in this, so that youth brain drain can be successfully addressed for the long-term

10. Review RA findings and work with ViTAL Economy to integrate RA findings into the SI-wide economic strategy to be released in 1st quarter 2008

11. Commit to obtain and invest resources required to implement Connect SI Phase 2 economic strategy and achieve qualitative and quantitative goals starting April 1 2008 — including approval of Connect SI Phase 2 implementation timelines, funding and professional resources

12. Develop a 501(c)3 framework for Connect SI, so that independent government and foundation funding that cannot be received by SIU or Man-Tra-Con can be accessed — particularly critical with regard to approved legislation dealing with digital divide funds from state and federal sources



Immediate Action Items

1. Utilize this Readiness Assessment as a resource tool and foundation in support of the Connect SI COI’s and strategic actions underway — Now!

2. Promote this Readiness Assessment report around the region in a variety of forms; web-posting, presentations, hardcopy, CD’s, etc. — Now!

3. Assemble and expand the Connect SI Leadership Team to completely understand the Readiness Assessment — Ongoing!

4. Commit to a sense of urgency to staff, fund, and lead this initiative through Phase 2 and beyond — Ongoing!

See: RA Chapters 6 & 7




Section H: Call to Excellence…a Destiny of Prosperity!Call to Excellence…a Destiny of Prosperity!

Stay cool



What SI’s Future Can Become

It’s Time to Go Global!

0

2

4

6

8

10

12

Exports as a % ofGDP

U.S.

Illinois

SI

11%

8.4%

2.4%0%

10%

20%

30%

40%

50%

60%

70%

Private SectorPayroll & Benefits

Transfer Payments,All Gov't &

Education Earnings

U.S.

IL

SI

54%

33%36%

46%

67%64%

SI Becomes

an Innovation Economy

0.00

10.00

20.00

30.00

40.00

50.00

60.00

2005Southern Illinois USA-RuralUSA-Average Best in World

% P

enet

rati

on

o

f P

op

ula

tio

n

SI is a Global Broadband Leader

12%

24%

34%

54%

Insured population +10%

Medicaid -26%

Medicare +18%

UninsuredUninsured -32% -32%

Healthcare Economics are Transformed!



Source: “State of Working Illinois”, by Northern Illinois University (Nov 2005); “21st Century Workforce” (May 2004); IMF; ViTAL Economy research

Ave

rag

e A

nn

ual

G

row

th R

ate

%

0

1

2

3

4

5

6

3.85%

“Stay the Course” vs. “Change the Course”

AAGR Connect SI Goals 2008 - 2012

0

1

2

3

4

5

6

AAGR 1977-2001

Worldwide USA State-wide Southern Illinois

1.34%

2.19%

3.14%

5.62%

2012: increase of $3.6B in GDP to $21.2B SI economy, which translates into $162M in additional State and Local tax revenue

2012: increase of $3.6B in GDP to $21.2B SI economy, which translates into $162M in additional State and Local tax revenue

SI Becomes the National Model forRural Economic Transformation



“A Return to Love” by Marianne Williamson

Our deepest fear is not that we are inadequate Our deepest fear is that we are powerful beyond measure

It is our light, not our darkness that most frightens us We ask ourselves, who am I to be brilliant, gorgeous, talented, fabulous?

Actually, who are you not to be? You are a child of God

Your playing small does not serve the world There is nothing enlightened about shrinkingso that other people

won't feel insecure around you We are all meant to shine, as children do

We were born to make manifest the glory of God that is within us It is not just in some of us, it is in everyone

And as we let our own light shine, we unconsciously give other people permission to do the same

As we are liberated from our own fear,our presence automatically liberates others.

The future of Southern Illinois is in your hands!The future of Southern Illinois is in your hands!

Documents

©2007 ViTAL Economy, Inc. Executive Overview 1 Stay cool Southern Illinois: Garden of the Gods Readiness Assessment Executive Overview December 14, 2007;