The fog outside was thick and cold, but nothing could dampen the show of enthusiasm Tuesday, as the city of Kokomo announced the arrival of Zuna Infotech, an information technology startup business.

“Don’t let the fog fool you, this is a very bright day for Indiana,” Indiana Gov. Mitch Daniels said in welcoming Zuna’s co-founder and chief operating officer, Jim Harter, to Kokomo.

“Thank you for the business. We’re so grateful you chose Indiana, and that you chose Kokomo,” Daniels said during remarks at Inventrek Technology Park. “[Kokomo Mayor] Greg Goodnight and I will work for a long time to make sure this business surpasses your expectations.”

Zuna’s launch, which included an announced goal of hiring 400 people at its new Kokomo headquarters during the next three years, comes in the midst of Kokomo’s worst economic downturn since the early 1980s.

Howard County and the city of Kokomo teamed up to offer at least $200,000 in local incentives — mainly forgivable loans — and the Indiana Economic Development Corp. kicked in $1.6 million in performance-based incentives to land Zuna.

Harter said he was overwhelmed by the turnout at the announcement meeting, which brought a who’s who of Kokomo business leaders and elected officials.

“This is truly humbling,” he said.

“I really want to build a company which will be an integral part of this community,” Harter said. “We want to establish ourselves and keep ourselves here in the long term.”

Harter said the company has three main goals: providing sustainable and long-term careers for employees, providing a real alternative for companies currently “offshoring” their IT needs, and growing the company to a scale that will make a difference in Kokomo.

Operations will begin Nov. 1, and part of the local incentive is based on Zuna hiring eight employees by March 1, 2010. Harter said he anticipates a capital investment of about $2 million over the next three years, and said the company is currently searching for additional office space in Kokomo.

He said he doesn’t anticipate competing with firms in countries that pay average wages of $5 an hour, but said he believes “there is a real need for businesses in the U.S. to have alternatives” to offshore IT call centers.

“Zuna Infotech is excited to be basing our operations in Kokomo. We are very impressed with the enthusiasm and commitment demonstrated by everyone we’ve worked with and look forward to becoming part of Kokomo’s long-standing tradition of innovation and firsts,” Zuna CEO Anju Bajaj said in a statement Wednesday morning.

According to the company’s Web site, www.zunainfotech. com its mission is to “offer comprehensive services in product engineering, IT services, and custom research in focus areas such as security, health care, and technical support.”

Zuna is part of a growing trend of bringing IT call centers back into the United States, and the company’s Web site notes it will offer a “U.S.-based model” and “on-shore delivery” of its services.

Harter, an Illinois native with family in the Kokomo area, said he first became interested in Kokomo during a family visit, when he happened to meet former Kokomo Mayor Matt McKillip.

McKillip ended up working as the company’s site search consultant, Harter said.

“He was a real advocate for Indiana and a mentor — he’s really an integral part of why we’re locating here,” Harter said.

Daniels said Zuna considered sites in Lafayette and Indianapolis, but finally settled on Kokomo.

The governor said the choice of Kokomo was a source of personal relief.

In the past four years, the state has had about 500 occasions to announce new jobs coming to the state, but none, until recently for two cities — Connersville and Kokomo.

“I’m so happy where you’re going,” Daniels told Harter. “I told the mayor, I’ve been so frustrated. There have been two towns that have been weighing on me for several years. There have been times when we’ve been so close [with Kokomo] but we couldn’t make it happen.”

Daniels said he thinks “there could have been some typecasting going on” among companies looking at Kokomo, but said things should begin to change for the City of Firsts.

“What’s really going to make a difference is getting [the U.S. 31 Corridor] built, when there’s a highway between here and Indianapolis. That’s why I’m going so hard on that project,” he said.

To Harter, Daniels said “the best thing we can do for Zuna is just working every day to make Indiana the best sandbox around — the most affordable cost structure, transportation and energy, keeping taxes down and watching the costs regulation can impose on businesses.”

Both city director of development Debbie Cook and Jeb Conrad, executive director of the Greater Kokomo Economic Development Alliance, praised the way city, county and state officials worked together in courting Zuna.

“I think we did a really good job of positioning this community, and being up front about the incentives we could provide, and then being able to deliver them,” Conrad said.

Local officials knew as early as June that Zuna was seriously looking at Kokomo, and by September, both the city and county councils had approved economic development incentive packages for the company.

Now, Daniels said, “the real work begins.”

“We want you to make a lot of money,” Daniels told Harter. “We want you to look at your business plan in a year or two, and say ‘We’re beating it. We’re ahead of the game.”

• Scott Smith is a Kokomo Tribune staff writer. He may be reached at (765) 454-8569 or via e-mail at scott.smith@ kokomotribune.com