Jackson Lab wanted too much, local leaders say

The deal came down to this: give us $100 million directly and help us raise another $200 million from the state and charity, and we might help transform your economy.

In the end, Hillsborough County leaders balked. Jackson Laboratory of Bar Harbor, Maine, last week chose to place its prestigious research lab in Sarasota County, where local government and philanthropic leaders made promises Hillsborough leaders weren't ready to make.

Future leaders might second-guess Hillsborough's reluctance if Jackson Lab winds up creating a big, high-paying biomedical industry in Sarasota.

For now, though, most local leaders seemed to think Jackson Lab struck too hard of a bargain. They're still hoping to land the next big research lab that's looking for a home somewhere in Florida.

Hillsborough County Commissioner Ken Hagan said he had hoped to lure the lab to Tampa.

"That being said, I feel very strongly that they had really unrealistic expectations of the incentives that they wanted," Hagan said.

Jackson Lab tries to understand the genetic basis for disease. From its Maine headquarters, its researchers have created 5,000 strains of mice that medical institutes around the world use to test gene-based treatments.

It wants to create a Florida satellite campus that would team up with the University of South Florida and create treatments tailored to an individual person's specific genetics. However, building research labs from scratch doesn't come cheap.

Mike Merrill, Hillsborough County's administrator, said the lab was seeking $100 million from the county and Hillsborough's help in lobbying the state for another $100 million. Finally, it wanted support raising another $128 million from philanthropic sources - for a combined $328 million in public and private funding.

Hillsborough and Sarasota counties have scrambled in recent weeks to see if that was even doable. Hillsborough County didn't turn down the lab, but it wanted more time to see if it was a good return on the public's investment.

Sarasota County didn't hesitate, and voters there will be asked to support a new tax to pay for the lab's incentives.

In the aftermath of Jackson Lab's decision, leaders in Hillsborough County seemed fairly unified in thinking that the lab was asking for too much.

It wasn't realistic to seek a new tax referendum in Hillsborough, especially when voters just rejected a 1-percent sales tax for light rail and transportation improvements, said Hillsborough County Commissioner Kevin Beckner.

Hillsborough leaders were also concerned that the public wasn't getting a good return on its investment. The county's economic development staff determined the lab would've generated a direct return of $87 million for the county - less than the $100 million the county might've invested.

"Believe me, we looked at every single aspect of it," Beckner said of the Jackson Lab deal. "When we looked at the numbers, we just couldn't get the numbers to work."

Mark House, a Tampa executive with the Beck Group and former chairman of the Tampa Hillsborough Economic Development Corp., noted that Jackson Lab originally tried to locate its lab near Naples.

It only started looking at Sarasota and Tampa when residents in Collier County started complaining about the cost. The lab had been seeking $130 million from Collier County and another $130 million from the state.

House got skeptical when the lab withdrew its Naples plans.

"They had asked for so much down in Naples, so much," House said.

House and Bob Abberger, a fellow veteran of Hillsborough County economic development circles, said they aren't giving up on building a local biomedical industry.

The real hope is that researchers working in Tampa might find a new treatment for some disease and create a new for-profit company. If Tampa gets enough of these spin-off companies, it could spawn a high-paying industry.

"I think Jackson Lab is a tremendous case study for us," Abberger said.

But if Tampa expects to get in the biomedical game, it will have to shell out tens of millions. It hasn't always been willing to do so.

John Ray led the Life Sciences division of Enterprise Florida, the state economic development agency, until 2007. During the mid-2000s, at least eight prestigious biomedical institutions built satellite offices in Florida, lured here by the huge money that state and local governments were offering them.

They commanded enormous public subsidies. For example, Scripps Florida got $310 million from the state and another $269 million from Palm Beach County. In the Orlando area, the Burnham Institute for Medical Research got $155 million from the state and another $155 million from local government.

The Bay area landed a couple smaller-scale research labs near USF, called M2Gen and Draper Laboratory. However, it didn't seem willing to commit the vast sums of money needed to be competitive on the bigger ones, Ray said.

"To be very honest with you, I think Tampa Bay made that decision on some of these projects," he said.

The jury is still out as to whether a real biomedical industry will ever develop anywhere in Florida - despite the huge money it has spent.

Most states try to develop medical industries over decades by growing from within and developing their major universities, said Mitch Horowitz, a vice president at the Battelle Memorial Institute, a nonprofit research firm. Florida has tried to buy its way in over the last 10 years, he said.

That's not to say Florida won't succeed, but becoming a biomedical power requires more than just public subsidies. It requires attracting private "venture capital" investment dollars to help companies grow, among other support, he said.

"It was an unusual recipe," Horowitz said of Florida's approach. "But it's too soon to judge."

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