Jeff McKay - Executive Director - North Eastern Strategic Alliance

This is Coffee with Cool People. I'm Chip Munn and I'm excited today to be spending some time with Jeff McKay. Jeff, how are you?

Great, hope you are.

Yeah, man. So first question, Jeff, I'm curious, who is Jeff McKay?

It's a good question and I wonder some mornings when I wake up exactly who I am, but I would say I'm just an average guy who has been fortunate to latch on to a career in economic development and enjoy the last 30-plus years of waking up and doing something different every day. You know, I would say that I'm that person that you get what you see. You know, grew up on a farm and learned how to work at an early age and just been introduced to a variety of people from all different backgrounds growing up and have tried to parlay that into a career in dealing with, you know, with a variety of people in my career path.

So that's neat, Ned. You said 36 years. So, I mean, you've been doing this right out of college?

Uh, pretty much so. I had, uh, my first job was in a small community in North Carolina about a year after I graduated from Western Carolina. And, uh, Proceeded to go from Polk County, North Carolina on up to working with the State of North Carolina Department of Commerce and worked in the Statesville, North Carolina area for roughly 14, 15 years and then moved to South Carolina about 18 years ago.

Oh wow. So now So for folks who don't know, economic development, like, what does that even— I mean, for the average person, what does that even mean?

So really, this— a simple explanation, I guess, would be our job is to go out and find opportunities for companies to grow and prosper in this region, which in turn would create jobs and investment. For the citizens of the area. And it sounds simple enough, but, you know, obviously there's, you know, 3,000+ other communities across the U.S. that's trying to do the same thing. So it's a competitive field, but really it's kind of like a jigsaw puzzle. You're trying to find all the factors that your community has that you can offer to a company that's looking to grow to fulfill all their needs and at the end of the day show them that they can make more money in your community than they can in a competitive community. And if you're successful in that, as I say, it in turn creates tax revenues for the community, it creates well-paying jobs for the citizens, and it creates a community advocate that can hopefully help you sell to the next company that may be looking around.

So how did you decide— you said 18 years ago you came to South Carolina— how did you decide— you were doing that for a different place— How did you decide to come here?

It's really accidental, to be honest with you. I was working with a regional organization in North Carolina, in Charlotte, and we had an opening for our regional organization. I was asked to serve on the selection committee, and at the end of that process, The lady, the consultant that was running the recruitment process said, have you ever thought about leaving North Carolina? And so we had a discussion. She was actually representing NISA at that time in their job search and said, if you would ever be interested in moving to South Carolina, great opportunity, would you be interested in talking to them? And I've been that person, always loved to talk to folks about, you know, job opportunities in different communities, even though I wouldn't, in a lot of instances, consider leaving. But it kind of opens the door into what my competition's doing. Sure. So that's how that transpired, and met Dr. Fred Carter and Fred DeBarr, Doug Wendell, just great folks that at the end of the day, you know, convinced me that this would be a great place to take the next step in my career.

Right, well, and it stuck. It must have been right.

It's been great. It's been great for me. It's been great for the, you know, my board.

Well, you're still here, you know, so it must have been. Now, you mentioned NESA because I didn't say that earlier. NESA stands for Northeastern Strategic Alliance. That's right. What is NESA?

So we're a regional economic development organization. We represent 9 counties in the northeastern section of the state. We cover everything from Chesterfield County to Georgetown County back to the coast. So our service This area is roughly about 800,000 people, 20% or so of the land area in the state, and probably the most diverse region in the state of South Carolina in that we have Florence, obviously, is the manufacturing center of the region. Then Myrtle Beach, Horry County, down at Georgetown would be the commercial tourism focus. It truly is a diverse blend of offerings.

Good product.

It is, absolutely.

So when I— because again, for the average person, I don't ever think about going out and looking for people for jobs because I would think one of the hardest people— you said earlier folks might think it's easy. I wouldn't even know how to go about finding people who are looking for places to put people to work. So I mean, I'm curious, how does that process work? How do you even find folks who are looking?

It's, you know, we could spend an entire day talking about that, but a lot of it is, you develop a network over your career that includes consultants that are actually working for the companies that are looking, the real estate community that's representing companies. We also travel the globe knocking on doors. We'll try— and we try to be very strategic in that we do through our office at least one mission outside of the state of South Carolina every month. And we will pinpoint an area in the country that may be having some challenges with, you know, let's just say high corporate tax rates. Mm-hmm. You know, they might be having, you know, some regulatory issues that's putting a burden on business. And we will, you know, work with our data sets, in some instances lead generation companies, consultants, to say there are, you know, 100 companies in this area that would be suitable are or might be interested in a relocation due to XYZ. And then we'll try to hone in on, you know, what's the best way to approach these, who's the appropriate contact, and then set up a, it's really a sales mission around that to go talk to. We'll do trade shows, and trade shows today aren't as lucrative as they once were just because of a variety of things. But, you know, any opportunity that we can find that will allow us to get in front of C-suite leadership. Those are the opportunities we're trying to find. And then, you know, also working with our State Department of Commerce, who is typically the lead agency for a company that is looking to relocate.

It's interesting. So almost like the way that Myrtle Beach runs golf ads in Canada in the wintertime, or— in Atlantic City, and then when they're, you know, kind of a catch a spirit down to— I think it's fascinating. I never thought about doing it that way of finding areas. I think that's an interesting way to look at it of having a mission outside of the state to say, "Here are some issues people are facing," and it might be the kind of thing, you know, like Elon Musk, for example, moving Tesla from California to Texas. Like, all of a sudden, whatever the issue is, somebody's just had enough. And if you find the right people and can present the opportunity, I think it's interesting though to be, that's a much more proactive approach than showing up and hoping it works out at a trade show.

Right. And it's, you know, it is, as I said earlier, we try to be strategic. Everything, you know, there are some intangibles that you can't quantify, but for the most part, Everything in your sales pitch has to be quantifiable to say, you know, we're gonna be able to make you more money in this community than another community you may be looking at, or actually the community you're in. And, you know, we're blessed to have a lot of very fine companies in our community around here, all of them, you know, good corporate citizens, altruistic. But at the end of the day, if we can't show them they can make money in these communities, The fact of the matter is they're not gonna be here very long.

Right, well, you could be altruistic anywhere. Absolutely. And so, you know, there's always places to be involved and be charitable. Definitely. But, you know, I think it might have been in my fraternity days where somebody said charity begins at home.

That's right.

You gotta make sure that, I mean, you can't give away money or time that you don't have.

That's right. And so— And there, you know, there are also times when You know, part of our job, and this is the, I would say, the toughest part of our job, is know when it's not a good fit. You know, we've had companies, quite honestly, that have had a desire to, you know, look at our area, you know, further. And we've just pretty much had to say, you know, on our end, it's not going to work here. And it may be due to the fact they're putting something in the environment that would impact the citizens of the other companies, or, you know, they're coming in to, let's say, take advantage of a wage rate that we know is not going to work here. And the worst thing that can happen for us is to locate someone here that either, you know, damages, you know, the business environment that we currently have. Or that closes, and you have to answer the question, why didn't it work? Because that, that plants that seed of doubt in the next one that comes along.

Well, especially when you're in a relationship business, and a lot of that, like you said, is consultants and folks. Because again, my, my guess is that if you were out on a mission in Arizona and you found somebody who might want to move, chances are, rather than just engaging you directly, my guess is most those kind of people are going to involve somebody else in helping do the due diligence and things like that. And so it either becomes an opportunity to generate positive momentum and referrals and things like that with a new source, or you can easily poison the well.

100%. And it's, you know, particularly in the consultant or the real estate community, you know, it's a small group that, you know, close-knit, they talk to each other. So if, you know, the worst thing you can do is try to hide your warts and then they get found out later on. So everybody, you know, If you've had one of these folks who had a bad experience in your community, they're going to let others know about it. So, you know, you talk about being forthright. Credibility is huge in our industry. And I would rather tell you something that's factual and may not put us in the best light and not have to explain it to you after you've made a, you know, a multimillion-dollar decision. And for a lot of companies, particularly the family-owned companies, this will be the biggest decision that they've ever made in their life and will impact the future of that company, you know, for decades.

So I'd have to guess that the decision maker, regardless whether it's the biggest decision they're going to make, particularly if it's the wrong one—

no, no doubt. I mean, it's a career-defining— if the person that's pulling the trigger on whether to make that in a relocation or not, it'll be the biggest decision they'll make in their career. And, uh, it will make or break them.

Mm-hmm. I would have to think the best case scenario for the average decision maker, the best case scenario is neutral. Yeah. The worst case is it lands you in a completely different industry or retired. And the best case scenario is they forgot who made the decision You know what I'm saying? For the average person, they forgot who made the decision. If it goes good, you catch all the blame. So, so again, I mean, it's, it's an interesting perspective to think about that person because again, you can think about all the jobs that you're going to have, but if you were to put too much lipstick on the pig, as they say, and that person makes a bad decision, I mean, like you say, it's life-changing for them too. So I mean, having a lot of integrity in that process, I would think.

Big deal. It's a true industry where, particularly on the community side, is you're much better off to undersell and overperform. Because if you don't, you know, the— and this sounds kind of hokey, but it's not. You know, the real work starts after the company makes an announcement that they're going to be there, because then you have to deliver all those things that you promised beforehand. And, you know, every company, when they make that announcement, the clock— I mean, you're on the clock. And it's a, you know, every day that they aren't in production, they're losing money.

So because to some extent, whether it's shovels or people, they're putting something on the ground once the commitment gets made, if not before, really.

But There's no revenue generated until something goes out the other end. Right. And it's huge. I mean, it's a huge decision on their part.

So how do you— I mean, what goes into that decision? So what do people normally, particularly in— and again, diverse product, I understand. But what goes into the decision when people are considering kind of that 9-county area relative to other places in the country? I mean, how do you— How do you pitch that?

It's a— every deal is different, and I'll say that there's no standard, you know, template of a relocation deal. So depending on what the desires, wants, and needs and must-haves of the company, you know, they will— they'll investigate that very thoroughly. Let's just say, and I'll give you an example, it's very typical to have a company that that you've met or that's coming through a consultant or whatnot that will issue an RFI. And an RFI is a request for information about your company relative to their needs. These RFIs can be 30 pages, they can be 50 pages, and it will deal with everything from, you know, do you have an industrial site that all the due diligence is done, that can handle, you know, water and sewer capacity of half a million gallons per day? You know, can they take an effluent with, you know, metals and such? Do they need to pre-treat? Do they need, you know, do you have natural gas at certain capacities? Do you have redundant electrical to serve the site at certain levels? Then you will have Another portion of it that'll deal strictly with the employees. Do you have, you know, 100 available CNC machinists in your community? You know, they'll go down the laundry list of every skill set needed under the roof. Can you meet that? If not, you know, how do you plan to train these folks? You know, just, you know, where are my suppliers located within a 100-mile radius? Transportation. Do you have of interstate access within 10 miles and how many trucking companies are serving this area. Seaports, rail, all those things go into this decision-making process, which will be their due diligence. And then at the end of the day, that's when the incentives, if you have all these things, then the incentives come into play. You know, can you offer are there certain tax benefits or tax instruments that will help reduce our burden? Are there regulatory issues that we need to talk about here versus another location? Once that's done, then that's, you know, a company will probably send an RFI out. It's not uncommon for them to send it to 25 different locations. Then if you don't meet all of their needs in those RFIs, You probably see 10 of them that are thrown out. So now you're down to 15. Typically then there's another round of information gathered. It's all— and this is all done, but it's truly a last man standing game. You know, you start out with 25. Your ultimate goal is to get down to the best one. But those companies are going to probably have 3 sites in 3 different locations that would work. Then they will make a visit. And then at that point is when some of the intangibles come into play. How does the community look? How do they feel when they're visiting the community? I've had companies before, and it's, you know, it's pretty common that they will come in, they'll tell you they'll be here on Tuesday, they'll get here on Sunday. They'll spend, you know, a couple nights. They want to talk to the person that's serving them dinner. How do they like it here? They want to talk to the cab driver. What are their thoughts? And then when they sit down at the table, you know, they want to compare what the message they've received over the last couple days with what you're selling. Right. So it's a, it's, I mean, it truly is one of those issues where your credibility is on the line all throughout the process. And as we said before, you know, if you're fortunate that the company decides to choose you, then the hard work starts because you've got to deliver everything that you promised or that you said you had during that search process. And for every day they're not putting product out the back end, they're losing money. So every you're on a time clock. But it's a complicated process, fun process, but it's, you know, we used to laugh back in the old days, we're the one, we're kind of like the weatherman, you know, if he's right 50% of the time, he's a pretty good weatherman. If we were playing baseball and we had a 100 batting average, we'd be superstars in economic policy.

Sure. It's interesting because as I was listening to you talk, how many or how much you have to know about the area. Thank goodness you've been here 18 years because it would take a long time. I mean, again, I'm sure folks can give you stat sheets, but that's a lot. That's a lot of information. And what I— again, as you were talking, I remembered that scene in I Think It's a Beautiful Mind where Russell Crowe Crow is looking at the camera and you see all the calculations, kind of the calculus and all, and just so many things that go into it. Take a long time. It sounds, for somebody like me, it'd be really interesting because it is like putting together a puzzle, but that's 30 pages of information or everything from ports and rail to are there 100 machinists. I mean, you gotta know an awful lot.

Well, you know, the old adage in our business is, you know, an economic developer's an inch deep and a mile wide. So I think the successful folks in the business will try to— we know our lane, and our lane is to have a great Rolodex. And well, I should say contact list. I remember Rolodex. I do too. But to be familiar with the people who can answer those questions specifically to the companies. It's their industry, you know. I don't try to get into the wastewater and water analytics, but I do know, you know, the folks that can do that and have a relationship with them where you can pick up the phone and when you call, they realize that somebody's on the other end asking for that information.

Sure. I think it was Ford. I heard a story one time about Henry Ford that talked about he didn't necessarily— he wasn't the smart person. They were asking him how he was so successful, and he said, "Yeah, I hire, or I have smart people." And the guy said, "Well, shouldn't you be the smartest?" And he said, "Ask me a question." And he could press a button on his desk and somebody would come in, an expert in whatever. And I do think that it is nice to have that contact list to be able to say, "All right, well, I can get this answer." I can— you have to know who it is to get ahold of to be able to go, 'cause not everybody can go a mile deep, you know?

Well, the worst, you know, I keep going back to that credibility thing. The worst thing you can do is try to BS your way, you know, with somebody who's asking you that. That specific question. And the majority of the people we come across, they'll give you time to get the right answer. Sure. Because, you know, like we said earlier, they're making a life-changing decision that they want the best information they can get. And it's my job to provide that for them. Not for me, but from the expert that's in that field.

Sure. What's the hardest part of doing that?

I think the hardest part's probably, you know, we have folks that always come in with a preconceived notion. They may be including you in their search just because someone else, you know, And this sounds trivial, but I've seen it work. You know, the owner of the company has a cousin who lives in an area that says, you know, you need to be looking here, it's a good community. Well, the consultant may say, look, we're giving you a cursory look just because the ownership does. Well, the hardest part is to change that person's mind on the front end who really already has it made up. But, and then the other thing that's hard is knowing, you know, you may work tremendously hard to get somebody to look and then find out through the process they're not a good fit. So you have to be honest and tell them, I don't think this is going to work here. And, you know, I'll say again, one of the worst things that can happen is if someone locates in an area and then has to close shop within a couple of years because of bad information that we provided or that, you know, we could have been honest or better informative to them and let them know that it's probably not a good deal.

Sure. Yeah, no, I can see how that would be hard. So I'm curious, you've been doing this here 18 years. What would you say you're most proud of?

That's an easy one. The collaboration of the counties that we represent. And I think without exception, if you sat in one of— we meet the 9 counties that we represent all have economic developers. So we try to meet at least every other month.

Florence County's is the best. Yes, I won't make you say that on—

Yeah, absolutely. And I'll tell you, Greg and his staff, great to work with. But when we get in a room, there's no hesitation about information sharing. Everybody gets along. It's like, you know, it truly is like a family. And I have been in situations before outside the state of South Carolina where, you know, if you've got 9 different counties in a room together, There were daggers that were thrown across the table with this relationship. You've got to realize they're all competing for the same deal, but the collaboration that we have in this region right now with our local communities is fantastic. And I would like to say that NISA has facilitated that to some degree. And it really, you know, it makes a difference when, you know, when we're looking at the success of Sure.

Well, I would have to think at least from your end, it does help that the product offering again is for you is different to some extent in some of the different regions. So I would hope that that would help being able to pull all these different people together. Because while they are competing, at least somebody looking for something on the coast and somebody looking for something, you know, in an area like Florence, There is a difference.

And so, you know, you think about, you know, if you put yourself in the position of the company or the individuals making that decision, they don't care about geographic boundaries. They care about economic boundaries. Right. And sometimes we get too territorial and, you know, it's either got to be in Florence County or it's got to be in Darlington County, got to be in Marion County. But those people, if you If you took all the people that didn't live in Florence County out of the Florence County workforce, you wouldn't be able to staff the companies that are here. So the workforce is mobile and fluid. The company doesn't really care about geographic boundaries. And, you know, that's the way we need to think sometimes is, you know, maybe it's a better fit in County A, B, or C, but County A, B, or C around them is still going to benefit from that location because people are going to be able to have jobs.

For sure. Yeah, well, again, I'm from lower Florence County, and most of the places, you know, far more people worked in Florence than did in Pampliken. Right. You know, so I, again, a smaller scale version of the same thing, and I would have to think part of the job, it sounds to me. Having met a few economic developers in my day, they're not shy people. So getting those folks to get along and to share information, I would have to think having an entity to help with that, to have reason to facilitate that, I would have to think does go a long way.

Yes. I get told no for a living, you know, and if you're too shy to ask the question, you're in the wrong business.

For sure. So, yeah, I'm curious, kind of the last question, because as interesting as all the economic development stuff is, for me, you know, doing this is about people, and I find this last question to be one where I learn a lot. So Jeff, I'm curious, if you could pick a fictional character, book, superhero, movie, if you could pick somebody you feel like best represents Jeff McKay, who would it be and why?

Wow, that's, uh, that's probably one of the toughest questions I've had.

Thank you, my wife gave it to you.

You know, I would like to say, you know, it would be a cross between Mr. Magoo and MacGyver.

Okay.

Because I think in a lot of instances we stumble around and bumble around until we find an opportunity. But then if you're not, if you don't have a little MacGyver in you that you can take a piece of chewing gum and a paperclip and make something out of it, then you won't be successful. Well, uh, that's a tough question.

Well, I've done this a bunch of times and I hadn't gotten MacGyver yet, so, uh, I think it's, uh, I think that's a good one. Um, and again, like you said, combining it with Mr. Magoo, kind of the stumbling, bumbling, a little bit like Columbo maybe, where all of a sudden we kind of get right as I'm putting my hand on the door to leave, we get where it is that we're going and we figure it all out. That's cool. Jeff, I really appreciate it, man. Thanks for spending some time with me.

Sure, thank you. Thank you for the—