Well-Preserved Madison Looks to Attract More Than Just Tourists

Federal Reserve Bank of St. Louis - Regional Economist, Apr 2004 by Greene, Stephen

Community Profile

When the Ohio River overflowed its banks at Madison, Ind., in 1997 and water rose to the top of some rooftops, one century-old house was knocked off its foundation. After evaluating the damage, the federal government agreed to pay for the home to be torn down. But when Madison's Historic Preservation Board heard about this, it swooped in to save the house.

Welcome to Madison, where Mother Nature is no match for the local preservation movement. As one Madisonian says, only partly in jest, "When we see an empty building around here, we don't knock it down; we turn it into a museum." Madison's eight museums are located in 19th century buildings downtown, all 133 blocks of which arc listed on the National Register of Historic Places.

"The preservation consciousness here is part of the secret of why Madison is such a draw," says Gary McConnell, who operates the Lanham House Bed and Breakfast and Cafe Express coffee shop on Main Street. "Thear all the time from my guests, 'We can't believe what a Mayberryesque kind of town Madison is.'"

Situated within 90 minutes of Louisville, Cincinnati and Indianapolis, Madison is a tourist destination for many. With bed and breakfasts, cafes, antique shops, churches and a fountain lining Main Street and with a scenic riverfront featuring a park, brick walkways, visiting riverboats and regularly scheduled festivals, Madison holds much appeal for the workaholic in need of a recharge.

But many residents here share the sentiment of David Terrell, executive director of the Madison-Jefferson County Industrial Development Corp., who says, "Madison cannot thrive solely on tourism." To sustain itself economically, Terrell says Madison needs to build on its industrial base while also bringing higher-paying technological jobs to town.

"Two Cities in One"

Madison's quaintness is partly due to geographical quirkincss. One side of downtown hugs the river, while the rest is surrounded by rolling hills. But a three-mile drive up the hills reveals a different world, an area locals call the Hilltop.

"Madison, to me, is unique," says Matt Porrcster, president of River Valley Financial Bank, which sits on the Hilltop. "IKs truly two cities in one. You have the downtown area with its more old-world retail below the hill, and the more commercial and industrial parts of town up on the Hilltop." Adds McConnell, "It allows us to keep the historic flair going down here, untainted by new things."

The Hilltop includes a series of strip malls, fast-food restaurants and a Wal-Mart Supercenter. It also is home to a diverse group of manufacturers, including Madison's two largest industrial employers-Arvin Sango Inc. and Grotc Industries.

Arvin Sango produces exhaust system assemblies, vehicle body stampings and other automotive parts. The company, a joint venture created in 1988, has a majority of Tbyota's exhaust business, including supplying products to the automake/s two nearby assembly plants, in Georgetown, Ky., and Princeton, Ind.

Grote Industries is a leading producer of vehicle safety systems, mainly sophisticated lighting products for commercial vehicles, such as delivery trucks and tractor-trailers. The company moved its headquarters to Madison in 1960. Family-owned since it started operations at the turn of the 20th century, Grote's sales totaled $150 million last year, according to Bill Grote, company president. He says Madison offers an inviting business climate.

"Madison is a vibrant, thriving community with a really active chamber of commerce," Grote says. "The assets of the town, with the historic area and the river, make for a good living environment for raising children."

Seeking "Intellectual Capital"

Terrell of the industrial development corporation is aware that luring large manufacturers employing hundreds of people is much more difficult these days. Factors such as overseas competition contribute to this challenge. His strategy is to instead attract "intellectual capital," including people who work in computer programming, engineering and hightech manufacturing.

"Fifteen years ago, communities were willing to bring in any kind of company as long as it employed people-no matter what the skill level or the wage,"Terrell says. "Over time, we've gotten more sophisticated and come to understand how the economy is changing. We need to take a more strategic look at what we're about and what we want tobe. We may be better off looking for a company that employs 20 to 50 people and pays a much higher wage for jobs that are more technologically complex."

Looking down the road five years, Terrell says he knows Madison will be on the right track if the overall per capita income increases. "By what percentage, I don't know, but it needs to be better," he says. "To me, that's a measure of the proper type of success."

Terrell says that 50 percent of the workers in Madison are employed in the service sector. That serves as a good pool from which to draw candidates for jobs requiring higher skills, he says.