Notre Dame looks to help create jobs in South Bend

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In this April 29, 2011 photo, the former Studebaker engineering building is demolished making way for the development of Ignition Park. The high technology park is being touted as a place for new innovative companies to set up shop. (AP Photo/South Bend Tribune, Marcus Marter)

Updated: October 30, 2011 1:33AM

SOUTH BEND — Backhoes clear the rubble and debris from what used to be the Studebaker engineering plant. In the background, the building that used to be the automaker’s foundry waits to be demolished nearly 48 years after the final car rolled off the assembly line.

The remnants of what used to be the lifeblood of this northern Indiana city are reminders of South Bend’s struggles as it tries to transform its economy and attract and grow high-technology companies to replace what once was. The buildings are being cleared to make room for Ignition Park, a high-technology park the city bills as a place for innovative companies to set up shop.

“The old Studebaker buildings became a blight, not only on our landscape, but also on our psyche,” Mayor Stephen Luecke said. “It reflected that whole Rust Belt image of the Midwest. So as we’ve been able to clear those dinosaur buildings, it provides us new ground to build on what was so positive about Studebaker.”

For decades, South Bend relied on research and development personnel from Studebaker, Bendix Corp. and other industrial companies for innovation and job creation. That stopped when the businesses closed or were bought up by bigger companies that moved the headquarters elsewhere. Now economic leaders hope ideas springing from the University of Notre Dame, with its recent emphasis on research, can rev the economic engine of the city and region.

“The process isn’t new. This part of the country was tremendous at it for 100 years. The problem is the structure that did it isn’t here anymore. So we have to replace it,” said Pat McMahon, executive director of Project Future, a not-for-profit corporation that encourages business development in St. Joseph County.

McMahon said he approached Notre Dame several times over the past three decades about using its research to try to help jump start South Bend’s economy, which tends to fare worse than the rest of the state because of its dependence on manufacturing. In May, the city had an unemployment rate of 9.2 percent, a full percentage point above the state average.

But the school didn’t express an interest until recently. Notre Dame said in a 2002 economic impact study that it was committing itself to a new era of local activism and cooperation and said the university “would become an increasingly important source of technological expertise and support for the region’s businesses.”

Robert Bernhard, Notre Dame’s vice president for research, said the university is in a better position to get involved in economic development now because of the school’s increased research efforts. Those efforts also can help the university, he noted.

“We want to be a force for good — and for some of our research here, being a force for good is to commercialize,” he said.

Purdue University, 100 miles southwest of South Bend, netted $4.5 million in royalties in 2009 for sales of its research. Mitch Roob, Indiana’s secretary of commerce, calls Purdue University the “gold standard” when it comes to economic development.

An economic impact study on Purdue Research Park, which has four locations around the state, found that if the companies in the parks were a single company, its 4,101 employees would have ranked as the 20th largest employer in Indiana based on the Indianapolis Business Journal’s 2010 list of largest Indiana employers. The report, prepared by Indianapolis consulting firm Thomas P. Miller & Associates, also said the park had a $1.3 billion annual impact on the state, contributing $48 million in state and local taxes.

The study also found the average annual salary for people who worked at companies in the park was $63,000, 65 percent higher than the Indiana average.

Joseph Hornett, senior vice president of the Purdue Research Foundation, said that although the research park has been around for 50 years, it has vastly expanded since the late 1990s, adding satellite parks in Merrillville in 2004, in New Albany in 2008 and in Indianapolis in 2009. Hornett said Purdue’s success stems from its research.

He said the foundation’s business incubation complex also has been key.

“That has allowed us to continually have a strong stream of startup companies based on Purdue technology that wind up developing as businesses and then staying as tax-paying citizens of the state,” he said.

Notre Dame opened its business incubator in October 2009 and now has about 30 startups. The hope is that some of the businesses that start in Innovation Park across the street from the Notre Dame campus will eventually move a few miles away to Ignition Park. Data Realty, a data center company, is scheduled to become the first private tenant of Ignition Park later this year.

“We can’t control where companies go, but we are going to try to get companies to consider the South Bend region,” said Dave Brenner, Innovation Park’s president and chief executive officer.

McMahon said Project Future won’t be depending on Notre Dame alone and will work with organizations across the region.

“We don’t care if the idea comes from Bethel College or somebody’s garage in Nappanee,” he said.

But he isn’t sure there would be enough ideas available if Notre Dame weren’t involved.

Bernhard, a former associate vice president for research and professor of mechanical engineering at Purdue, said the collaboration with other economic development groups will give Notre Dame ways to get research to the marketplace.

“We don’t have the resources to pursue all of the intellectual property that we think has merit. We also don’t have the resources to really find the best markets for some of this intellectual property,” Bernhard said.

Only three people work in Notre Dame’s Office of Technology Transfer, which is in charge of trying to commercialize Notre Dame’s intellectual property. In an average year, Notre Dame faculty submit 40 to 50 proposals for the school to pursue commercial projects. Of that, the tech transfer staff chooses about a dozen to submit for patent applications. The school usually receives five or six patents a year, Bernhard said.

By comparison, Purdue’s Office of Technology Commercialization receives about 250 innovations a year, will seek between 150 and 175 patents a year and receive between 80 and 100 a year. The process generally takes three to five years.

McMahon acknowledged that Notre Dame program won’t provide an instant answer.

“The biggest challenge will be not to raise expectations to the point where they think the jobs will be here next week. It won’t present massive change overnight,” McMahon said.