SKOWHEGAN – James Batey looks at Somerset County and he sees a place in transition.

Once a county whose economy was wood-products based, there are just three sawmills left and no wood-turning facilities. Shoe manufacturers are nearly gone. After the Sept. 11 terrorist attacks, even tourism took a huge nosedive.

But Batey, director of the Somerset County Economic Development Corp., says the signs are clear that diversification is taking place and will be the future of the county’s economic base.

“My crystal ball is no better than anyone else’s,” Batey said Thursday. “But I am definitely optimistic.”

Alternative wood-fiber products, tourism and diversification of existing business all have him looking forward to 2007.

Somerset County bounces back and forth with Washington and Piscataquis counties as the county with the highest unemployment rate and the lowest per capita income.

“But it is much better than just three or four years ago,” Batey said. “My sense is that, in general, over the last five years the economy has seen some transition.”

And that’s a very good thing, the director said, since putting all the county’s eggs in one basket – manufacturing – certainly didn’t pay off.

Batey said that broadband Internet access certainly will help. The entire Route 201 corridor has access, mostly because it is an international route and service is required at the Jackman border crossing.

But slide a few feet off the main corridor, like onto the shores of Parlin Pond or deep in the Caratunk woods, and no service is available.

“This needs to be a priority,” Batey said. “We need … broadband access in the county to be competitive.”

Batey said that although tourism is growing, a better infrastructure is needed. Whitewater rafting, the natural beauty of remote Somerset County, and the upcoming Run of the River whitewater kayaking and canoe park project in Skowhegan will continue to draw tourists, he said.

The rafting industry grew so quickly, he said, that the businesses themselves were forced to build housing for their customers as none was available.

“And, if we ever get snow again, many Somerset County businesses rely on the snowmobile and skiing tourists,” he said. “Last year was a disaster and today [Thursday] it is 45 degrees.”

A side benefit of the tourism industry, he said, is that many people choose to relocate in the area. “They certainly will not be making $100,000 a year in a remote Somerset County town,” Batey said, “but they are willing to exchange that for a more rich lifestyle. These people are also enriching the area by bringing their skills and ideas with them.”

He said a new wood-pellet fuel company locating in Athens and a major greenhouse tomato producer in Madison are prime examples of the diversification and transition he sees taking place.

Batey said he is also optimistic for the wood-fiber industry. “There are many opportunities still to be had,” he said. “My sense is that the future is good for biotype products. It is amazing how many things, including fuel, can be made from wood fiber,” Batey said.

SEDC is updating its economic strategy and a new plan should be ready by May, he said.