Manufacturing company relocates to Pflugerville

By Amy Stansbury Friday, 05 June 2009

After a concerted, three-year effort by the city council and Pflugerville Community Development Corporation to recruit primary employers to the area, the city has a win. Directed Manufacturing relocated its offices from Carlsbad, Calif., to Pflugerville in May after PCDC provided an incentives package funded by 4B money totaling up to $75,000. The offer was approved by the PCDC board May 14 and by the city council May 26.

The parent company, Forecast 3D, will remain in Carlsbad, near San Diego, where it will continue to service the 3D printing and rapid prototyping customers. Its three-year-old subsidiary, Directed Manufacturing, uses a plastic and metal laser centering technology, which is a process of melting nylon powder to fuse it together and create products layer by layer. Products made using this process can include parts for airplanes, jet engines, specialty medical equipment and even toys and tennis shoes.

Operations President Alex Fima said manufacturing commenced at the new Pflugerville plant in May and started with eight employees — three who relocated from California and five new hires.

“We’ll probably add about six [employees] a year for the next couple of years, and then probably 10 a year for a couple of years,” he said.

Employees include manufacturing engineers and project managers, and the average annual salary is $40,000.

Directed Manufacturing occupies 10,659 sq. ft. at Wells Point One, located at the corner of Olympic and Heatherwilde Boulevard. Fima said the company expects to expand to 25,000 sq. ft. within five years.

Why Pflugerville?

As the company ran out of space at its facility in Carlsbad last year, Directed Manufacturing executives began considering a move. Fima said Austin was at the top of employees’ list of preferred places to relocate, and upon investigating the area, he found it was a great fit for the company’s needs.

“We found some very positive things — great potential workforce employees, some good building locations and the cost of doing business is a lot less than in San Diego,” he said.

Not only is it cheaper to do business in Central Texas than on the West Coast, but Pflugerville is also the only area in Travis and Williamson counties that can boast triple Freeport Exemption, which is offered by local tax authorities to promote trade. Pflugerville ISD, the City of Pflugerville and Travis County offer Freeport Exemption, allowing companies to ship goods and merchandise in and out of the state within 175 days without having to pay taxes on them.

Directed Manufacturing’s workers must be well-versed on a technology called selective laser centering that was developed at the University of Texas at Austin in the late 1980s. Fima said UT licensed the technology to a company called DTM, which was acquired by California-based 3D Systems Corp.

“Some of the DTM employees are still in Texas, and it wound up being super conducive to our business to bring them aboard,” Fima said.

One of those ex-DTM employees is Ken Rather, who was hired in January to manage operations at the new Pflugerville manufacturing facility. He said the Austin area talent pool was a perfect match for Directed Manufacturing.

“With this type of work, you don’t really just pick people off the street,” he said. “It’s kind of an acquired skill set. I’ve been doing it for 12 years now.”

Daytime population

Until recently, Pflugerville residents had no other option but to leave the city to shop and to work. But Darelle White, city councilman and PCDC board member, said that since 2006, one of the main economic development goals of the city has been to create a daytime population where citizens can do more than just live in Pflugerville.

“Having Directed Manufacturing here will help us attract and retain other manufacturing and retail businesses,” White said. “And having a daytime population that can purchase goods and services here also bolsters the businesses that are already in Pflugerville.”

Fred Velarde, PCDC board president, said it is important that Pflugerville be able to offer incentives packages like the one provided to Directed Manufacturing.

“One of the reasons it is important is because we want to show whether you’re a big business, a small business or whatever, we will do whatever we can to bring primary jobs to the city of Pflugerville and build our daytime population,” Velarde said. “People working and shopping in Pflugerville only helps our city.”

Primary employers in Pflugerville

Primary employers introduce new money into the local economy by bringing in money from outside the community. For example, goods and merchandise created by the companies listed below are not typically purchased by local companies or individuals living in Pflugerville. Once a dollar enters a community, economic theorists believe it is turned over, or spent, an average of seven times at local stores and restaurants.

• Austin Foam Plastics
  • 2933 A.W. Grimes Blvd.
  • www.austinfoam.com
  • Industry: Computer packing material
  • Number of employees: 250
• EVS Metal
  • 400 Heatherwilde Blvd.
  • www.evsmetal.com
  • Industry: Sheet metal fabrication
  • Number of employees: 72
• Directed Manufacturing
  • Wells Point One
  • 1007 Heatherwilde Blvd., Ste. 700
  • www.directedmfg.com
  • Industry: Plastic and metal laser centering
  • Number of employees: 8
• Banister Tool
  • 3009 A.W. Grimes Blvd.
  • www.banistertool.com
  • Industry: Medical device manufacturing
  • Number of employees: 30
• Progressive Manufacturing, (formerly PE Ceramics)
  • Verde Springbrook Corporate Center
  • 828 New Meister Lane, Ste. 100
  • www.promtinc.com
  • Industry: Technology Ceramics manufacturer
  • Number of employees: 25
• SPAN International
  • Verde Springbrook Corporate Center
  • 900 New Meister Lane, Ste. 300
  • www.spanltd.com
  • Industry: High technology distribution
  • Number of employees: 25
• Laser Manufacturing
  • 1801 Rowe Lane
  • www.lasermfg.com
  • Industry: High-precision manufacturing
  • Number of employees: 9

*As of the first half of 2009 when businesses were surveyed by PCDC.

Source: Pflugerville Community Development Corporation

Daytime population

In 2006, the Pflugerville City Council designated creating a daytime population as the top goal for the city.

Pflugerville Economic Development Director Charles Simon said Directed Manufacturing’s move to the area supports the city’s effort toward achieving that goal.

“In theory, retail just moves the money around so we haven’t been really working toward getting retail,” Simon said. “But our real goal is to get daytime population here with primary employment to support the retail.”

– Charles Simon, Pflugerville Economic Development Director

Incentive agreement details

The contract between the Pflugerville Community Development Corporation and Directed Manufacturing includes the following details. The money provided by PCDC is 4B funds, which are generated by a half cent of the sales tax generated by retail sales in Pflugerville. Any expenditure of 4B funds must be approved by the PCDC board of directors and the Pflugerville City Council.

Directed Manufacturing will:

• complete move into Pflugerville facilities by June 15;
• employ at least 10 full time employees paid at least $15 per hour for all skilled and professional positions;
• provide health and dental benefits to all full time employees.

PCDC will:

• pay Directed Manufacturing $1,500 per job created in accordance with details listed in contract;
• pay Directed Manufacturing an additional $1,500 per full-time job in excess of 10 jobs, up to 50 total qualifying employees, provided that those additional jobs pay at least $15 per hour, have health and dental benefits and are maintained at least two years;
• not exceed $75,000 in payments to Directed Manufacturing as part of this agreement.

Source: Pflugerville Community Development Corporation