Ideas and Implementations in Economic Development

windmillsfarmland.jpgIn the never-ending and always growing area of my life known as the “to-read list”, I recently worked through another item. It was a special section on economic development in the July 28th, Wall Street Journal.

The article looked at seven cities around the world showing visible signs of economic vigor. Lessons were drawn for those who might be interested in the subject.

Colorado Springs, Colorado followed a familiar paradigm. The public and private sector worked together to keep a major employer in town. In this case, they agreed to build two new downtown headquarters and upgrade a nearby training facility to win a fifteen-year lease from the United States Olympic Committee.

Rural Kentucky blazed a path toward a new paradigm. ConnectKentucky, a large non-profit, worked to expand the the availability and affordability of broadband internet connections in the state’s rural areas. In another private-public partnership, internet access increased from 60% to 95% in a drive to spur economic development.

Omaha, Nebraska in some ways reversed the demographic trends of the last fifty years. The community “swallowed suburbs” and invested hundreds of millions of dollars in arts and entertainment. The article noted that “lots of other cities have tried similar strategies, but Omaha had a singular advantage: strong civic leadership”. Omaha also has many Warren Buffet-made millionaires, a reputation for wholesome Midwest values and top-notch schools, and follows a strict annexation policy: tax revenue from any annexed district must exceed its debt service.

Wismar, Germany focused its economic investment on addressing transportation issues. The territory in the former East Germany was relatively unconnected to the rest of the country by road. Germany’s investment in a new autobahn opened up markets for existing businesses. Economic-development experts credit the highway for doing much of the “heavy lifting”.

Kobe, Japan shifted economic focus after a devastating earthquake. Instead of concentrating on rebuilding the shipping industry, public and private leaders decided to create Japan’s premier bio-medical center. Interestingly enough, they traveled to the Mayo Clinic to get ideas.

El Paso, Texas, is pursuing the old fashioned route. Private investors are putting their own money at risk. They first hired a consulting firm to create a downtown redevelopment plan, which envision different zones for entertainment, history, housing and shopping. The City Council voted to form a downtown tax-reinvestment district where increased tax revenues would help finance new streets and sidewalks. It appears to me that the jury is still out on this example.

Kalamazoo, Michigan has pursued perhaps the most non-traditional approach. They’re investing in their school children. Through a program called The Kalamazoo Promise, the community is providing from partial to full college tuition to all graduating seniors. Corporate executives credit the program for attracting 150 jobs from Kaiser Aluminum, 400 jobs from MPI Research, 160 jobs from Fabri-Kal, 25 jobs from W. Soule & Co., 12 jobs from Tourney Consulting Group, and 50 jobs from Polymer Solutions Inc. As a Kaiser Vice President said, “we are building a sophisticated facility with new technology, and we want well-educated people who will work with us and want to live in Kalamazoo”.

Northfield will soon hire it’s third Economic Development staff person in the past two years, the fourth if you count the interim work done by Brian O’Connell between Deanna Kuennan and Charlene Coulombe-Fiore. A Comprehensive Economic Development Plan has been in place during that period, and the EDA has moved steadily forward on one, rather substantial, piece of it: annexation.

There has been some continuity of leadership, both on the EDA and other economic development groups within the city. Ideally, there is some clear, stated and transparent agreement among our community’s leaders on the five plus or minus two top priorities for economic development, including the necessary capital investment, as well as the required political support and social capital behind those leaders and their priorities, for the new permanent staff person to implement.

Perhaps Northfield can be one of the Wall Street Journal’s “Success Stories” for 2009.

6 thoughts on “Ideas and Implementations in Economic Development”

  1. Ross, You’re on quite a roll: three posts in less than four hours–time for you to get out there in the world, my man, and off the computer!

    I’ll say it again, as I said in another recent comment on one of your posts:<blockquote>I also believe that the transition to a post-fossil-fuel (and post-nuclear) economy represents the greatest OPPORTUNITY available to our society (and to Northfield as a community and local economy) in the early 21st century. We can make this a model community not only for Minnesota, but for the entire US, just as Samsø has become a model community in Denmark. The tens of millions of energy dollars that currently leave the local economy annually could ALL recirculate right here, and we could create and support green infrastructure businesses galore, if we make this commitment.</blockquote>

    I believe wind energy, solar energy, energy efficiency retrofits of existing homes and commercial/industrial/institution/civic buildings, new zero net energy buildings, next-generation transportation infrastructure (electric transit, bike/ped infrastructure, roundabouts), clean energy service/manufacturing, etc. represent a tremendous economic development opportunity. Is Northfield ready to make it happen? Should we be? If not, why not? I’d love people’s comments and opinions.

    On an unrelated but cosmically significant note, Liriano has just completed six scoreless, three-hit innings in his much-anticipated return to the Bigs. Go Twins!

  2. Ross…where you going with this?

    Your comments state….

    There has been some continuity of leadership, both on the EDA and other economic development groups within the city. Ideally, there is some clear, stated and transparent agreement among our community’s leaders on the five plus or minus two top priorities for economic development, including the necessary capital investment, as well as the required political support and social capital behind those leaders and their priorities, for the new permanent staff person to implement

    My first week on board, The heroin story hit the News.
    My first month, or soon thereafter….an EDA Board member left and two others mentioned leaving as well. Eventually they both did leave….

    ” Continuity of Leadership? ”

    The Mayor and Administrator began their power struggle, and placed staff in an awkward position.

    The paperwork in the office was distributed all over the floor in boxes.

    I can provide you with a ton of reading opportunities when it comes to Economic Development and positive case studies that could put Northfield on the Map.

    One staff person cannot create a positive Economic Development environment alone. ..no matter how many hours they may work or how successful they are.

    The staff person needs support from the community, the leaders, the council and the EDA Board.

    They all also need to be on the same page…or at least in the same book.

    Again, it is unclear to me where you are going with this blog. At the very least, the new EDA Manager needs to have a team of people to work with who get along and are willing to move forward in a positive way.

    Focus on the strengths of the community and the leaders and investments that are in place and move forward with that. I created a list of the opportunities and options the City can move forward with.

  3. Charlene –

    Sometimes Griff and Tracy tell me that my posts are so full of facts, rhetoric or sheer force of will that they don’t feel inviting to comments. Other times they tell me that I try so hard to not reveal my personal biases that my posts are a bit obscure. Looks like I erred on the side of the latter fault this time.

    I was interested to see which of these examples elicited comments. Personally, Colorado Springs and El Paso seemed a bit old paradigm to me and, in fact, the El Paso article was about 33% negative. Omaha has Buffet money and Wismar has Federal money and although I think that investing in the arts and culture or transportation infrastructure are good strategies for Northfield, I’m not optimistic about the community’s culture being conducive to assembling the necessary private or public capital. Rural Kentucky’s determination to increase the market and/or community penetration of an infrastructure of the future and Kobe’s vision of backing a winner in a future economy were the most inspiring examples, at least to me.

    Perhaps I was seeing the glass half full when saw some hope of continuity in economic leadership. On the other hand, in addition to the EDA, there are also the Chamber, the NDDC, and the NEC. Finally, there are citizens who have lived here for over 30 years and have seen booms and busts and newcomers who have been here for only a couple of years but have seen other places and other ideas; both of these groups can contribute too.

    I guess the lesson that I drew from all the examples is that there was agreement, at least to a cultural consistent degree, between the business leaders, the government staff, and the private citizens on the priorities. If we had agreement from this three sectors of our community on the top five plus or minus two priorities for economic development, and the supporting capital investment necessary, I believe that Northfield could become a success story of note.

    – Ross

  4. Ross…I understand now where you are going with this and I agree with you.
    Thanks for explaining.
    If you ever need more Economic Development examples or reading materials feel free to contact me.
    Northfield has alot of positives so moving forward with the glass half full is a good approach.

  5. When we welcome new businesses to town, we don’t often think of the affect on existing ones. One of the employees says Central Valley Coop is closing the store part of the Cenex station on Sept. 1. Fast food prices were undercut by Kwik Trip. We can use our Cardtrol cards to buy gas only.

    My husband preferred his breakfast dog and coffee at Cenex. Also, Kwik Trip entrance is dangerous, harder to negotiate.

  6. An Economic Development Professional will always (or should always) address the impact of new businesses coming in on the old ones. In fact, I normally ask the new business to address this in their business plan. Who they will affect, how they may affect them and what they provide that is better or different.

    Unfortunately, this is something we may not always be able to control or predict at times. However just wanted to clarify that it is not ignored.

    Not sure if this helps or not.

    Another common ED practice is to work with the current business owners to keep competitive and continue to update their business plan and listen to what the customers need/want.

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