Excerpt From: Economic Development Through Growth Management: Making The Vision Real Washington State Department of Community Development, July 1993

SUBJECTS › ECONOMIC DEVELOPMENT › Excerpt From: Economic Development Through Growth Management: Making The Vision Real Washington State Department of Community Development, July 1993

Excerpt From Economic Development Through Growth Management: Making The Vision Real Washington State Department of Community Development, July 1993

Part IV - Developing Your Economic Development Strategy

Introduction

"Change (can be) gradual, natural, non-cataclysmic and responsive to genuine economic and social needs. Cities do not deteriorate overnight, and similarly, are not reborn overnight. Quick fix responses at best camouflage problems and at worst exacerbate them. Cities respond most durably in the hands of many participants accomplishing gradually small bits, make small changes and big differences at the same time."

Roberta Brandes Gratz. "The Living City"

An economic development strategy provides a blueprint for achieving community objectives by translating a community's broader vision and goals into economic initiatives. However, preparing an integrated, targeted economic strategy presents a series of challenges to a community.

This section hopes to minimize those challenges by providing guidance on how to enroll the stakeholders and how to prepare an economic strategy. It suggests ways to incorporate existing plans and policies of the various stakeholders into the community's emerging strategy. Further, it describes the components of an economic strategy, identifies sources for required information, and provides tools for building and assessing your strategy.

Guidance for preparing the economic strategy is organized by the various sections contained in the strategy. These sections include community profile, inventories, analyses, economic development approach, policies, implementation, and relationship to other GMA planning requirements.

Stakeholders

Each member and organization within a community has a stake in its overall well being. It is, therefore, critical that all stakeholders be represented in the process of developing your economic strategy and reach consensus on the implications of their policy choices.

While local and county governments have responsibility for preparing GMA comprehensive plans, authority and resources for local economic development are dispersed among the variety of stakeholders described in Part II of this report. Most of these stakeholders prepare plans and policies to guide the activities of their organizations.

Stakeholder Plans

To be effective, your community's economic strategy and comprehensive plan must reflect the plans and policies of these other organizations. In turn, stakeholder plans and policies must be consistent with your comprehensiveplan and other GMA planning requirements such as Countywide Planning Policies, Urban Growth Areas. and community values and vision.

When conflicts exist among goals and policies of various stakeholder plans, they should be addressed and resolved. If these inconsistencies are overlooked or deliberately ignored in your comprehensive plan, they will most likely resurface during preparation of development regulations or worse yet, when a development permit is being reviewed.

A matrix that helps you organize other stakeholder plans and policies based on GMA planning requirements may provide a useful format for integrating them into your strategy and checking for consistency. Another approach would be to incorporate their plans and policies, in whole or in part, by reference. Or, you may generalize the common elements of those plans and policies and reflect their intent in the appropriate sections of your strategy.

Use the list of stakeholders presented in Part II, Economic Development Overview and Issues, to help you identify your local stakeholders and enlist their support in preparation of your economic strategy.

Profile

This component profiles the local community and documents existing community capacity. Much of this information has likely been collected for other of your GMA planning efforts. This section includes information on community setting, trends, issues and factors affecting economic development. Following is a summary of information that could be included in each section of your profile.

Community Setting

Geographic Setting-

Climate - including general description. amount and type of precipitation.

Natural Resource Base - including water, arable land, energy, mineral resources, forest and wildlife resources, etc.

Community Infrastructure - including water and sewer systems, power capacity, storm drainage, bond rating, housing supply and stock etc

Political Institutions - including types of government structure and other appointed bodies

Tax Rates - including property, business and occupation, retail sales, utility, special assessments, etc.

Community Institutions - including schools, advanced education, media, health care, religious, service organizations, community associations/councils, etc.

Economic Development Organizations - including Ports, Chambers, Downtown Associations, Main Street Programs, Economic Development Councils, tourism associations, community groups, etc.

Social and Cultural Resources - including cultural, arts, sports, recreational, etc.

Other Descriptive Data - including historical facts, heritage resources, unique features and attractions, major community events, previous community surveys, etc.

Trends

The Trends section provides a detailed description of the historic and current condition of the local economy. It documents which industry sectors provide the most jobs, highest wages, and the most sales. It includes demographic, income, and ethnic information, and provides data on employment and economic activity by industry sector. It usually looks at this information over a twenty year period.

If this component is prepared for a city or town, it compares the data with that of similar, nearby communities and the county. If it is for a county, the data is compared with that of adjacent counties. The data may also be compared with national information. The purpose for comparing local data with that of similar communities, the county and the nation is to help determine how the local economy is doing based on regional and national trends. It also helps to clarify a local economy's place in the regional economic structure.

Issues/Factors

A variety of issues and factors affect local communities as they work to maintain and improve their economies. Not all communities face the same challenges. This section of the Profile discusses the particular issues and factors your community must deal with. It provides the basis for determining your community's strengths, weaknesses, and opportunities for future economic development activity.

Part II of this report described a variety of issues local communities must face as they prepare their economic strategies. The following list provides examples of key factors that could affect your strategy:

Communities are documenting Profile information in different ways. For example, the City of Everett prepared an "Everett Community Profile" and a "Background Report" for economic development as a separate documents. Alternatively, the City of Tacoma has prepared an Economic Development element for its comprehensive plan and included the Profile data in the "Factors Affecting Economic Development" section.

Data Sources

Local Planning Department; Weather Service; city or county Finance Office, Assessor, and/or Treasurer; School District; Local EDC or Chamber; Census; Washington State Departments of Revenue, Employment Security, Community Development, and Trade and Economic Development; city or county business licensing divisions

Inventory

This section identifies and maps the businesses that currently make up your economy. It categorizes these businesses by industry sector, those businesses that make up the economic base, and by the types of public revenue they generate. This section could also document use of public services and facilities such as water, sewer, power, natural gas and telecommunications by business, and industry sector.

The inventory should include the following categories:

Economic Base including Non-local Government Services
Local Traded Sector
Local Retail, Commercial, and Government Services

Data Sources

City or county business licensing divisions; County Assessor; local PUD: local Dower or telephone utility; Chamber of Commerce; EDC

Analyses

This component evaluates the Profile and Inventory data. It provides a framework from which to define economic development options. Further, it documents the analyses your community conducts in determining how to manage its future economic development efforts. The following list identifies types of analyses communities may conduct to better understand their local capacity and opportunity for economic expansion:

Assessment of how well potential economic activity reflects and implements your community values and vision;

Assessment of growth potential for businesses within your community as well as the opportunity for new business formation;

Evaluation of community capacity for increased economic activity;

Evaluation of the comparative advantage offered by your community or that could be created to Support increased economic activity; and

Assessment of trade-offs considered in defining your local economic strategy.

This is by no means an exhaustive list but provides some examples of analyses that assist communities in shaping their economies. As with issues and factors, the required analyses will vary by community. The goal is to provide you with a practical guide for analyzing choices.

While some of these tools may be unfamiliar to local government planners, they are commonly used in economic planning. They will likely be familiar to your local EDC, Chamber of Commerce, or Port District. By working together, you can decide which analysis tools make most sense for your community.

Tailor your analyses to your community's specific concerns, and to provide you with the information necessary for prudent decision making. In addition, not all analyses need to be conducted at the same time nor prior to the development of your strategy.

Examples

For example, the City of Tacoma built its economic strategy from an analysis of current economic condition, and the community's values and vision as expressed in the city's Growth and Development Concept. These analyses were reflected in their plan. The city's strategy calls for further evaluations, such as a community capacity study for designated economic development areas and trade-off analyses, as part its Economic Development Plan implementation efforts.

The City of Everett, on the other hand, is preparing its strategy based on previously developed studies, plans, and reports. These documents include "City of Everett Economic Development Priorities"; "Background Report of the Economic Development Element of the Everett Comprehensive Plan of February 1993"; and the "Everett Community Profile". Everett's draft Economic Development Element draws from the analyses contained in theseother reports but does not repeat it in the draft Economic Development element.

Use the following list of questions to help you decide which analyses may be most useful to you:

Questions

What key changes have occurred over the past 20 years that are likely to affect your economic choices?

Population/demographic
Social
Local Business Mix
Local Employment Patterns
Local Political Structure

What external pressures (state, federal, technology, global market place, base closures) have impacted your community over the past 20 years?

Are current pressures on your economy new or a continuation of past trends?

What do you perceive your community's greatest strengths for economic development to be?

What do you perceive your community's greatest weaknesses in economic development to be?

What do you perceive your community's greatest opportunities for economic development to be?

Approach

The answers to the above questions will help clarify a vision for your community's economy and provide the context for your economic initiatives. The Approach section of your economic strategy identifies your community's concerns and goals for economic development and describes how you will address those concerns and reach your goals. It provides the basis for local economic policy and defines the roles of various stakeholders in sustaining and strengthening your local economy.

Vision

Yakima County begins the economic development section of "Vision

2010 - Planning for Yakima County's Next Twenty Years" this way:

Economic development in our Yakima Valley is inevitable. What is uncertain is the rate of growth and what form it will take By enhancing the business and economic environment of our valley, we will also enhance the quality of life of our citizens. These planned efforts to expand and stabilize our economy can be accomplished without sacrificing the existing benefits we enjoy or the environmental interests of our citizens "

Tacoma has expressed the following vision for its economy:

"To achieve a diversified, globally competitive, sustainable economy that provides family wage jobs for Tacoma residents, increases per capita and business income, protects the environment, improves the qualityof life and makes full use of human financial, capital, and natural resources in the creation of marketable goods and services."

A community's vision establishes the framework for its economic development strategy. The Approach section of the economic strategy defines how the community will implement its vision. Considerations of a market economy, community values, and factors affecting economic development shape the economic development approaches available to a community.

Market Economy

How much control does a community really have over its economic future in a market economy? For example, Moses Lake, due its location, will continue to attract the interest of motel/hotel developers to that area. This market trend places certain limits on the future tourism opportunities for the adjacent towns of Soap Lake and Ephrata.

Community Values

Or consider the concerns of the City of Seattle. It desires certain types of manufacturing and industrial users to locate in its Fremont/Ballad area and would benefit from the higher wages and tax revenues those types of businesses produce. But why would a manufacturer locate in this area when land costs alone are four to five times higher than fully served. vacant and available property in Redmond or Kent?

Maintaining a rural community; having strong schools; providing affordable housing, health care and social services; preserving a quality environment; and ensuring a safe community are examples of community values. Community values often greatly influence economic choices.

For example, as a part of its comprehensive planning process, the City of Mercer Island conducted a research survey among its residents about the future of their downtown. Nearly a quarter of the City's residents felt strongly that the City should not encourage off-Island residents to use the downtown and nearly 45% agreed that there should not be better signs identifying downtown, especially from Interstate 90. These values have significant implications for the future growth of Downtown Mercer Island.

Factors

As discussed earlier in this section, there are several factors that influence economic development. How a community responds to these factors determines whether they act as strengths or weaknesses in local economic development efforts.

Economic Options

The intersection of a market economy, community values, and factors affecting economic development within your community defines a finite set of economic development options available to you. It is from this set of options that your community begins to build its economic strategy. As the strategy takes shape, the community can forecast the amount of public revenue likely to result from its implementation.

By considering the potential for public revenue, you can protect whether the range of economic development opportunities available to your community is likely to generate sufficient revenue to achieve your community's vision. If it is not, your community will need to reconsider community values and local factors affecting economic development to determine what, if any, adjustments can be made to increase your economic development options.

As your community grapples with the dynamic tension created by the demands of a market economy in the context of your community values, local factors, and other concerns, your approach to economic development will emerge. Use the following list of questions to help you refine your approach to one that has community concensus and the greatest likelihood of providing adequate revenue to implement your vision.

Questions

How well does your community vision and capacity for development meet business requirements and corporate profiles?

What is the relationship of your local economy to the regional economic structure?

What are the potential environmental impacts of your economic strategy?

How will your strategy affect your existing economic base and tax base?

What opportunities and limitations do your community values present to economic development?

What opportunities and limitations do the factors affecting economic development present to your options for economic development?

What opportunities and limitations does the market present to your local economic development efforts?

What modifications can you as a community make in these areas to increase your economic development options?

If you make these modifications, will the likelihood of achieving your community vision improve?

What is your community's economic development mission?

How will this mission statement accomplish your community's vision?

What are the implications of this economic choice?

What will the outcomes be in terms of jobs created, infrastructure requirements, growth, public investment, or required partnerships?

What types of policies, management systems and incentives do you or should you have in place to ensure that you are able to achieve your economic objectives and make your community vision become a reality?

Policies

Policies translate your community's concerns and goals for its economy into clear statements of public intent. These policies will guide public and private investment in your local economic development activities and further refine the roles and expectations of key stakeholders. Your economic policies will also provide the framework for integrating the needs of your economy into your comprehensive planning efforts.

The City of Tacoma developed policies to guide its economy in four key areas. These policy areas include Economic Diversity, Business Vitality, Growth and Development, and Community Resources. These policiesprovide the basis for the city's economic development implementation measures.

The City of Everett identified eight key policy areas including Economic Growth and Diversity, Central Business District Development, Waterfront Development, Redevelopment, Quality of Life, Human Resources, Information Base for Economic Development, and Meet Growth and Development Needs. Everett's policies identify goals and objectives but a e not tied directly to specific implementing measures.

Implementation

Implementation measures convert the goals and policies for your economy into specific actions. It is through these actions that you will achieve your economic objectives. These measures also clearly define how public investment will be made in your local economic development activities. Some of these measures will be dependent on or affect your GMA planning activities, and others will not.

The City of Tacoma's Economic Development Plan identified implementation measures for each of its policy areas. FIGURE IV- 1, an excerpt from the Implementation section of Tacoma's Economic Development Plan, presents an example of how the city structured that section.

FIGURE IV- 1

Tacoma Example

Strategy: Support expanded Port of Tacoma economic development activities.

Activities: Support the Port's continued lease and sale of industrial sites of Port owned property.

Support increased economic development activities of the Port through area-wide evaluation, to the extent possible, of Port owned and leased land within the city in advance of receiving a specific development proposal.

Support the Port's participation in the city's other economic development activities

Strategy: Support redevelopment of the Thea Foss Waterway. The Foss Waterway provides one of the city's most important redevelopment and economic expansion opportunities. Its redevelopment will change the image, appearance and vitality of Tacoma's downtown waterfront and will increase jobs. The city, along with other public and quasi-public entities, can stimulate development of the Waterway through five key initiatives. Those initiatives include environmental clean-up, land packaging, construction of infrastructure, development of public amenities, and marketing.

Activities: Participate with other land owners in environmental remediation efforts.

Continue land packaging efforts.

Develop financing plan for infrastructure construction, development of public amenities, and marketing.

Sponsor a design and development competition to attract developers for private sector redevelopment activities.

Strategy: Expand health care and medical services.

Activities: Target the existing health care corridor adjacent to the Hilltop area for development of additional health care and medical services.

Relationship to GMA

This component identifies the relationship of your economic strategy to other GMA planning requirements. It describes the impacts your strategy is likely to have on facilities and services addressed in other comprehensive plan elements. Further, it discusses how those elements can be used to implement your economic strategy, and suggests policies that would achieve that goal.

Excerpt From: Economic Development Through Growth Management: Making The Vision Real, Washington State Department of Community Development, July 1993 Related Resources
MRSC Index – Economic development planning process, contracts, studies and surveys, business location
MRSC Index – Sample economic development plans, economic elements, comprehensive economic development strategy (CED strategy)