Living on the Edge, Part 2

One of the criticisms leveled against Beacon as the city has grown in recent years is that its development has been laser-focused on creating housing, a good chunk of it high-dollar, with not enough focus on job creation.

The perception has been that jobs, aside from retail and customer-service, are scarce, that you must commute to New York City to earn a decent living, and that, with the rising cost of housing, it’s becoming harder to live in Beacon and work here, too.

Studies such as those by the United Way described in Part 1 of this series that calculate the wage needed for more than a “survival budget” in the Highlands and other locations in New York point to a need for jobs that pay a living wage. According to calculations based on 2016 data, a person needs to earn $25,754 annually, or at least $13.88 an hour, just to get by in Dutchess County. A family of four needs $80,016 annually. In Beacon, about 43 percent of residents are in poverty or just getting by.

As Beacon’s population grows — a report on the city’s long-term water supply last year suggested that up to 2,000 new residents could arrive by 2022 — urban planners and residents argue it’s critical that there’s a balance of affordable housing and jobs people can afford to take.

With jobs, at least, it appears Beacon may be moving in the right direction. A half-dozen companies — from a new craft brewery to food manufacturing to software firms — have quietly moved to the city or are headed here soon, bringing projections for several hundred jobs with them. For a city of 15,000 people, that’s significant progress, if the projections pan out.

Several other metrics indicate that, economically, momentum has been building for a number of years.

In 2010, 15.5 percent of Beacon residents fell under the federal poverty level. By 2017, that figure had fallen nearly 40 percent, to 9.4 percent. (The poverty line is $12,490 annually for an individual and $25,750 for a family of four.) Over the same time period, the city’s workforce participation rate — the number of people with jobs — increased by 4 percent.

Conversely, 8.4 percent of Dutchess County residents were poverty-stricken in 2010; it had risen to 9.1 percent in 2017.

“Beacon bucking the trend and going the other way is pretty impressive for an urban center in the Hudson Valley,” says Jonathan Drapkin, president and CEO of Hudson Valley Pattern for Progress, a regional think tank. “Beacon is a walkable community, and there are a lot of people who think it’s a great place to live.”

Among the new (or new-to-Beacon) businesses are Docuware, a document management/digitization firm that’s in negotiations to come to the city; Industrial Arts Brewing Company, a craft beer brew house; Café Spice, an ethnic packaged-foods manufacturer; Ricker Lyman Robotic, a software company; Via Hero, a personalized travel-planning service; and Tightrope Interactive, a San Francisco marketing firm that’s moving its Cold Spring office.

Additionally, Urban Green Food was awarded development rights in May to create a campus with farming, a restaurant and a hotel, along with a network of public trails, at the former Beacon Correctional Facility. Organizers say it could bring up to 250 jobs.

Three Companies Bringing Jobs to Beacon

Docuware is a German software company with its U.S. headquarters in New Windsor. It is in negotiations to move to the 23-28 Creek Drive development off Main Street. Thomas Schneck is one of the company’s presidents.

How many employees will you bring?
We have 70 employees in New Windsor but anticipate growing to 120 to 130. If our negotiations are successful, it will take about a year to build the facility, so we could potentially move in early in 2021.

What attracted you to Beacon?
It checks a lot of boxes. If you want to attract people between the ages of 20 and 35, many times they want the ability to walk to work. That’s an important aspect we saw in Beacon, with the Beacon Free Loop and Metro-North — having that public transportation option, or being able to take a walk or ride a bike.

The site you’re looking at would be an easy walk to Main Street.
Yes. In a couple of minutes, I can go to an interesting place for lunch, or I can go shopping if I need to run errands. Instead of jumping into a car, it’s all close by. It all plays into this idea that in today’s office world, there’s office time and there’s play time, but it kind of bleeds in and out — so you need to have options. That’s what young people are looking for in an employer.

Industrial Arts Brewing Co. was recently approved by the Beacon Planning Board to open a second location on Route 52. (It’s based in Garnerville.)  Jeff O’Neil, who lives in Cold Spring, is the founder.

What are your hiring plans?
We have 30 employees and we’re expecting to double and triple that over the next few years. Ultimately it will be 30 to 50 new jobs [in Beacon]. We’re hoping to open as soon as possible; we’ve had a tremendous response. It seems like there’s a very active and engaged labor pool that’s well-indoctrinated into craft beer.

Will these jobs pay retail-type salaries?
We have made a point from the beginning to be generous with compensation and benefits packages. We think of ourselves as leaders not just in our industry but in the local employment sector. We’ve lost only one out of 30 people in three years.

How did the move into Beacon come about?
I originally wanted to locate in Beacon but a deal didn’t work out, so we found a space down here in 2016. We outgrew it faster than we expected. We were looking for Main Street locations for a small tap-room expansion and this building came up on Route 52. We figured out a way to phase it so it starts as a smaller satellite location and will grow into something bigger.

Was the city helpful in bringing you here?
The city went out of its way to change its laws. One of our tenants is going to be an arcade, maybe with a small bowling alley, but that was illegal [in Beacon]. The city has been pro-project from the beginning. They’ve been appreciative not just of the jobs but of the tourism component that we’ll bring.

How was the Planning Board process?
That was the real black box. Because the zoning did not allow for the arcade usage and because we’re going to be an event space, there wasn’t a tidy way to calculate the parking spaces that we would need. We devised a parking-sharing proposal for the manufacturing day shift, which transitions into a recreational space in the evening. There was a lot of calculation about how the site could handle the traffic that we hope will be there, and I think we came to a good compromise.

Café Spice makes all-natural prepared meals with a focus on Indian and Thai recipes. After 10 years in New Windsor, it has outgrown its facility and will move production to the former Mechtronics building on Route 52. Payal Malhotra is the company’s vice president.

How many employees will you bring?
We expect to have 180 to 200 employees but we’re not at that number now. We’ll probably add 30 jobs. We’ll definitely be hiring.

How have your interactions with the city been so far?
Great. If we run into an issue with contractors or anything like that while we’re in construction, we know there’s someone we can reach to mitigate the problems. It’s wonderful to have a friendly municipality. We love that Beacon is on a train line and new things are happening there, too.

What’s your timeline?
We need to retrofit the site so it’s up to standard and meets U.S. Department of Agriculture specifications [for food production]. We haven’t gone into any of that work but we’d like to be in there by May.

“They’re all here because their employees were living here,” notes Anthony Ruggiero, Beacon’s city administrator. “This is the type of culture they were looking for.”

A century ago, work in Beacon was dominated by its factories. By the 1930s and 1940s, and then later, in the 1980s, Texaco and IBM, respectively, provided jobs in neighboring communities.

With many people working reasonably close to home, there were ripple effects within the community. Volunteerism flourished. Today, with commuting much more common, Beacon’s volunteer fire corps — one casualty of that change — is about a quarter of what it was 40 years ago.

Mayor Randy Casale says people struggled to make ends meet years ago, as well.

“In the old days could people live here and work? My mother worked in the sweatshops and she had trouble paying her rent here,” the mayor recalls. “It’s not a novelty that people struggle to pay their bills. When I started with Public Works [in 1970], I had to live at home with my mother. I couldn’t afford to pay rent.”

As Beacon has grown in the last four to five years, zoning regulations have been put in place to ensure some continued commercial development. The City Council voted in 2017 that new projects in the Fishkill Creek development district, for example, must include at least 25 percent commercial usage.

Dutchess County Legislator Nick Page, a Beacon resident, believes the city must continue to address economic growth through its planning. “The onus is on zoning and the City Council. We have a paucity of commercial space. The next conversation is going to be how we can balance that out.”

Drapkin points out that some municipalities in the region — New Rochelle and Kingston, for example — have either hired a dedicated economic development officer or launched departments designed to create an environment friendly to businesses (see below).

“If somebody says they want to start a business,” he says, “the municipality needs to be able to help walk that person through all the necessary steps. They’ve got a roadmap ready to get that person up and running as quickly as possible.”

‘Shovel-Ready Downtown’
New Rochelle streamlines development to attract jobs, growth

In New Rochelle, in southern Westchester County, Luiz Aragon has in the last four years created what he calls a “shovel-ready downtown.”

While there are many differences between New Rochelle and Beacon — the former is twice as large, with nearly five times as many residents — there may be components of Aragon’s plan that could be implemented here.

Aragon, who was hired in 2013 as New Rochelle’s development commissioner, says the city began to attract meaningful job growth in 2015 after it created a partnership between the local government and developers.

“We wanted to understand why development was not occurring in New Rochelle when it was in other cities, like Yonkers and White Plains,” he recalls. “We’re 25 minutes from Grand Central Terminal, but investment was not occurring.”

In return for providing developers with “the privilege of developing on our land,” New Rochelle set out to “create certainty for the investor” by revising zoning laws to streamline approvals. “We wanted them to know that they’re coming into a city that was open for business.”

The city issued a request for proposals before selecting a “master developer” charged with helping to plan the build-out (and developing a portion) of a 300-acre section of the city set aside for density and growth. In just a few years, the outcome, Aragon says, has been development within the district — including retail, office space, hotels, housing units and restaurants — that’s “designed for the pedestrian,” with its focus “on the shape of buildings rather than what’s going on inside of them.”

Not everything that occurred in New Rochelle — 48-story buildings, for one — would translate well in Beacon, but Aragon noted a series of “give-back” agreements the city made with developers that provided significant public benefits.

One, a “fair-share mitigation fund,” is used for municipal infrastructure improvements. Another, a community benefits fund, pays for city parks’ upkeep and helped create a community performance theater. That fund also pays for a job training center where the city has partnered with two organizations to provide help with resumes, interview skills and other assistance to residents.

In a year and a half, Aragon said, nearly 500 people have come through the center, and more than 200 of them have been placed in jobs ranging from construction to office managers to positions in law firms.

Aragon says there’s a critical balance that municipalities must strike when managing development.

“Developers are not just going to give you money,” he explains. “Know your assets and understand how to leverage them. You have to be able to have a project that will provide enough return on investment to enable them to give that gift.”

Casale says he’s not sure Beacon is ready for a full-time person in that position. “If they ever decide to build a transit-oriented development at the train station and they get it right, then I’d like to hire an economic development person to go into New York City to bring some of their business here, to create a reverse commute,” he says. But he says he and Ruggiero take on the responsibilities of vetting and assisting companies that are interested in Beacon.

That means scheduling meetings with the building inspector and other city staff; finding locations with adequate parking and office space; and connecting businesses with developers.

Docuware, for instance, needs 20,000 feet of office space, Ruggiero says. The company in early 2018 considered creating an industrial complex at the corner of Main Street and Route 9D; it is now negotiating with developer Rodney Weber to become part of his mixed-use project at 23-28 Creek Drive, the site of the city’s former highway garage.

“You have to have space, and it’s hard to find that,” Ruggiero says. “For a while we didn’t even have housing for [employees]. There were no vacancies.”

That’s no longer the case; more than 1,000 housing units have been approved for construction in recent years.

What Beacon shouldn’t do, Casale says, is try to find the next IBM. For one, he says, Beacon doesn’t have the space for a company like that, and “those days are gone anyway. When you put all your eggs in that basket and then they leave, you’re left with an empty basket.”

Ruggiero explains: “Places like us have to be more creative. We’re not New York City. We’re not going to get Amazon, but we’re going to get 20 companies with 20 people, and that’s going to have a real impact on Beacon.”

Those additions may indeed be the future of job growth in Beacon. Docuware, if it reaches an agreement with Weber, could eventually add around 60 jobs to its existing workforce. Café Spice and Industrial Arts both say they have plans to expand once here, too (See Page 12).

At just under 5 square miles, and with much of it developed, the city probably doesn’t have room for an “anchor institution” like a hospital or a university. But even if Beacon can’t attract a 300-acre college, Ruggiero says, it could get a satellite campus. Flexibility, he believes, is the key. Fewer major hospitals are in expansion mode now, too, “but they’re all looking for urgent care centers. That’s where we could do something, and we’re working on that.”

This series was made possible by donors to our Special Projects Fund. Thank you.

Click here to read Part 1 of the series.

Logo illustration by Tim Teebken