Northampton is known for its sophisticated and vibrant downtown, filled with a plethora of restaurants, small retail shops, and avant-garde art offerings. Although their presence and popularity help keep the city vibrant, there’s a bountiful other menu of economic-development plans sizzling on the burner.

The recipes for success, which have taken time, patience, and a lot of engineering to develop, have been put together by a team led by Teri Anderson. She’s the city’s economic-development coordinator, and the plans on her desk showcase a number of coming attractions that include educational, agricultural, commercial, and residential site developments.

“There is a lot going on in Northampton,” said Anderson. “We work quietly here, and the projects take a long time, as they are done in phases. But there have been lots of little successes.”

The most prominent is the transformation of the former Northampton State Hospital campus, where ghosts of the past have finally been laid to rest. After decades of talk and bureaucratic maneuvers — along with $28 million spent on the demolition of numerous buildings, environmental studies, new utility installations, and other necessary measures to prepare the site for development — new residential and industrial growth has taken root.

Route 66 divides the two campuses at the old state hospital. A new neighborhood is developing on the north side, with 70 new apartments and three homes already built. Forty of the apartments were completed recently, and about two-thirds of them are already occupied. Permits have been taken out to build an additional nine homes, which Wayne Feiden, director of planning and development, expects to happen when the economy improves.

Plans are also moving forward for 60 units of assisted living, which would bring new jobs and tax revenue to the city, and several developers have expressed interest in the site. “We expect the community to generate more than $500,000 in tax revenues,” said Anderson.

Roads are being constructed by private developers, and the Coach House, one of three of the hospital’s historic buildings left standing, could become a post office or community building, while a building in the rear of the campus is envisioned as an artist’s live-in workspace.

The south campus, named Business Park at Village Hill, is being managed by MassDevelopment and starting to blossom. This winter the park welcomed its first tenant when VCA Inc. moved into its newly constructed home — a 20,000-square-foot steel building with lots of glass. “They had their eye on the site when it was first discussed, but the state hoped to sell the entire parcel to one developer,” said Anderson. When that plan was abandoned, VCA jumped on the opportunity.

Two weeks ago, Kollmorgen Electro-Optical’s plans for a major expansion received a green light from the city, and a move from King Street to the campus was approved, which will generate $200,000 in property taxes and add between 30 and 100 new jobs.

Construction for a 140,000-square-foot building is expected to start during late summer or early fall. “It’s one of the biggest projects we have worked on over the past 10 years,” said Anderson. “This is important for us.”

New Fairgrounds

Another project, still in the early stages, is the redevelopment of the Three County Fairgrounds. The master plan is complete, which includes traffic assessments, infrastructure, and construction. Anderson said the city just received a $38,000 Cultural Facilities grant from the state, which will help with the undertaking.

The goal is to convert the seasonal site into a year-round entity. The city plans to build a brand-new, 80,000-square-foot, state-of-the-art exhibition facility where shows can be held during the winter, when the grounds sit empty. The existing building will also be renovated, and plans are on the table for new horse-show rings and horse barns with upgraded stalls.

Long-running events such as the Paradise City Arts Festival and the esteemed Morgan Horse Show are important, but Anderson said efforts will be targeted on bringing in specialty shows that fit with Northampton’s cultural bent. “We are not trying to compete with the Big E,” she said, referring to West Springfield’s Eastern States Exhibition. “We want to draw more equestrian, art, and agricultural shows.”

If all goes well, the fairground project could bring in an additional $35 million in revenue, which would flow over into surrounding towns, as Northampton lacks sufficient hotel rooms to accommodate the expected crowds.

“We are really excited about this. It will help support downtown and independent vendors such as electricians. A lot goes into developing a show,” said Anderson, noting that there are many other examples of business and economic-development growth in Northampton.

One is a new community-education consortium, the James Street Learning Center. It’s designed to provide alternative academic and employment training, and is a collaborative effort between the city and local colleges, adult basic-education programs, workforce training, and family-support services. It will feature a wide variety of courses and training along with on-site child care. Meetings have been held since December of 2006 to develop the learning center concept and initiate collaborative programs to meet community needs and gaps in services, such as the lack of a GED testing site in Hampshire County.

The lead tenant in the historic James Street building, which once served as the city’s Juvenile Court, will be the Center for a New America and Literacy Project.

The project has been well-received, and Anderson said donations have exceeded expectations. They include a $10,000 architectural design by Dietz Architects as well as labor needed to renovate the interior, supplied by members of the Franklin Hampshire Private Industry Council apprenticeship program and Westover Job Corps students from Chicopee.

The idea for the consortium was generated by Mayor Mary Clare Higgins in December 2006. “We are very excited about this,” said Anderson. “It will provide programs for the greater Northampton area where there are huge gaps in services in education and job training.”

The spirit of uniting for a common cause can also be seen downtown. In recent moths, businesses decided to pool their resources and create a Business Improvement District Council. The board of directors is being formed, and the plans are to use money generated by fees assessed from property owners for marketing and maintenance of the area.

“It’s a really important step,” said Anderson, adding that the council will work to create new venues and activities to attract visitors and increase business.

Officials say the downtown storefront vacancy rate is slightly higher than in the past, but part of that is due to high rents.

Feiden said the price of downtown real estate has continued to rise despite the recession, and people are buying. “It’s a sign of faith in downtown Northampton,” he said. “People are purchasing buildings for prices that don’t make economic sense. It’s like buying gold.”

Stable Economy

The economy in Northampton remains stable, and the city has suffered less unemployment than other municipalities in recent months. Feiden points to the restaurants and retail shops, which offer many service-related jobs, as well as employers such as Cooley Dickinson Hospital, Smith College, and the Veterans Adminstration. There is also a large number of community-care facilities, which include the Department of Mental Health, housed in the renovated Haskell Building on the campus of the old state hospital.

Small businesses are also helping to sustain the economic base. A Lia dealership rebuilt its showroom on King Street two years ago, while the former Price Chopper building on King Street was purchased by a Connecticut developer two years ago after sitting vacant for about 18 years. The developer has installed traffic signals at the site at a cost of $200,000 and is actively seeking tenants. A Walgreens is also under construction on King Street and should be open by the end of the year, said Feiden.

Also, Easthampton-based Raynor Door just received the needed permits to relocate on Route 10, and Wilson Plumbing has also moved from the town to Northampton.

In the city’s industrial park, businesses such as Microcal are expanding. “It’s a difficult site to expand, but they were committed to staying here,” said Feiden, adding that the lack of available land in the city has made Village Hill so important to the city’s future.

Smith College is also adding a 146,000-square-foot science building, which is under construction.

A new business park has also been proposed along the Route 10 Easthampton line. “We have done feasibility market studies, and it will be our next big project, along with the state hospital and fairgrounds,” said Anderson. The site has 116 acres and is intended for a mix of industrial and commercial use.

Renovation of the old mill buildings in Florence is ongoing. The majority are privately owned, but Anderson helps owners find tenants. She points to one particularily successful venture — the sale of the old 50,000-square-foot Pro Corporation factory that closed in 2007 and was once one of the city’s biggest industrial employers. The owner and his partners invested in renovations and replaced the roof, elevators, new windows, and more, Anderson said, adding that new tenants will soon move in.

Another success is the 80,000-square-foot Wireworks Building on Federal Street, the home of the former TechAlloy wire manufacturing plant. It is empty now, but space within the brick, mid-19th-century industrial building is slated for mixed use, and the owner is actively marketing the space, Anderson said.

A giant, crescent-shaped bike path is being built in stages, and three sections are under construction. When the paths are finished, they will wind from Easthampton to Village Hill, to downtown, King Street, Florence, and Leeds.

While achieving progress on many fronts, Northampton is still facing a number of challenges, especially with its budget. The city has been hit hard by federal and state budget cutbacks. The combination of cuts, rising costs in health-insurance premiums, negotiated pay raises for city employees, and soaring utility costs resulted in a $6 million deficit for fiscal year 2010.

Higgins said balancing the budget has been much more difficult than she imagined. She cut her own salary, city staff has been reassigned, and hours have been cut in the planning and auditor’s offices. Voters also recently approved a property-tax hike that will raise an additional $2 million for education, public safety, and public works.

City employees have also made real sacrifices, and Higgins applauds them. “In the past few months, we negotiated a pay freeze with the city’s unions. They all agreed to it, except the police, who are already losing money in their pay due to cuts in the Quinn Bill,” she said, adding jobs were also cut in the fire and police departments and schools.

Competitive bidding on health insurance saved the city more than $1 million, and the city has asked voters for a $2 million override, which would cover the remaining deficit and restore some jobs.

The Bottom Line

“Sustainable Northampton” is the city’s motto, but Higgins said the days of providing services paid for by state and federal money is a thing of the past.

“Government is not sustainable as we knew it,” she said. “There has to be a larger dialogue now to provide services. The days of revenue sharing are all but gone, and state aid is gone forever. While we can look at sustaining Northampton in terms of land use, which we are doing, it will be a more difficult talk about fiscal sustainability.”

She supports the state’s proposed hotel and meal taxes, still being debated, which could bring the city increased revenue.

Overall, Northampton is doing its best to present a new menu of economic-development options, with input from those it serves. Palettes may have to be adjusted, but officials, business owners, and residents are pitching in to create a bright, new landscape.