CONSTITUENT COMMUNICATION (CC) 124
ECONOMIC DEVELOPER IDEA
A candidate for mayor has said the city needs to hire an economic developer.
"(Allen) Thomas said it is time to create a position within the city to handle industrial and business development." (10/5/11, Daily Reflector, reporting about the previous night’s Candidates’ North of the River Forum)
"He (Allen Thomas) advocates for the hiring of someone dedicated to economic development and selling Greenville." (10/23/11, Daily Reflector, page A7)
At best, this is a questionable idea because it would cost taxpayers an estimated quarter of a million dollars, and it is not clear it would contribute to job creation and economic development in any significant way.
I have not publically endorsed specific candidates. However, I follow very closely their platforms and public statements, because ideas they promote for good or bad may very well gain traction and be offered as policy initiatives during my next two years on City Council.
This particular idea is major, and for about three weeks I have been researching it, because I am certainly a proponent of taking effective action to promote jobs in Greenville. I have come to the conclusion that this idea is at best problematic, at least in the very simple and general way it has been proposed. Here are some considerations.
First of all, with regard to "economic developer," it is helpful to make a distinction between an industrial developer and a commercial/retail developer.
INDUSTRIAL DEVELOPER
By a "gentleman’s agreement," going back to the 1950′s, our area has had an industrial park with the city agreeing it be located outside the city limits. To my knowledge, there is no interest or move to annex the industrial park.
We have a county economic development office, staffed by four people. City taxpayers help support that office with their county property taxes. That economic development team is focused on industrial development and, largely, their recruits come to the industrial park. "Industrial" recruitment, of course, has a broader meaning than in days past, and now can include what might be called "office-related activity" (e.g., data centers, call centers).
Since there is no move that I am aware of to annex the industrial park, then most industrial development that the city did would need to be recruited for our own industrial park inside the city limits, since we are not going to annex the existing industrial park. However, any industry would naturally want to go to the industrial park outside the city in order to avoid city taxes.
Hiring an industrial developer, probably a poor idea, is made even worse by the costs of outfitting such an office, as I discuss below.
COMMERCIAL / RETAIL DEVELOPER
The other kind of economic developer would focus on commercial/retail. This is not a new idea; it has been discussed in Greenville in the past and never took hold, probably for good reason. In a city our size, commercial/retail business generally comes when a company’s market analysis indicates it can make money here.
In addition, I would expect many business owners in Greenville to be concerned about their tax dollars likely going to recruit competition for their businesses.
Perhaps one could make some argument for attempting to recruit high end, niche type companies. We already do some of this in our uptown revitalization efforts. Any additional effort we made for these high end, niche type of companies would likely not merit a full-time person, in addition to what we now have.
The bottom line–if we grow a quality city where companies want to locate, the market will take care of traditional commercial and retail growth in accord with what can be sustained.
COST OF THIS IDEA
I have explained above why an economic developer for our city government is probably not a good idea–at least no carefully thought out case has been made that I have heard, and I am following the campaign platforms carefully. The cost of the idea only drives home this point.
My research indicates that to properly get an office up and running would cost an estimated quarter of a million dollars. To start an economic development office right requires staff, but it also requires databanks, a deep website constantly updated, travel, advertising, entertainment, and other costs. If this were a good idea, then the expense may be worth it, but at this point the case has not been made. In the current economic climate, I have a presumption against any additional staffing that isn’t absolutely necessary.
OPTIONS
Our unemployment rate is lower than the state average and lower than most cities that are our size and/or nearby, as I reported in last week’s newsletter. However, no matter how low our rate, we definitely need to do all we can to prudently promote job creation in our city. There are effective, reasonable things we can do, and I have discussed those in other contexts. And I am open to discussing any idea.
No effective strategy for job creation will be the result of any one person; it will come from a sound, thoughtful plan that entails working with economic development initiatives and offices already in place in the county and region.
But with regard to this idea–the city hiring an economic developer– the last thing we need to do is expand government bureaucracy at taxpayer expense without a good reason. I hope this idea does not get traction without a convincing argument, currently lacking.
One thing that can be considered is a research park. Raleigh, Chapel Hill, and Winston-Salem, in connection with research universities in their areas, have such parks. This is not a new idea, however, and there are discussions that have been ongoing for some time about this idea. I will continue to follow these discussions and evaluate the appropriate role the city should play. However, even if this idea were to materialize, no one should expect it to be a magic bullet to the current economic woes. Experts suggest that it could take 7-8 years to get such a park up and running.
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I have a vision of Greenville as a vibrant business, educational, health, and cultural leader in North Carolina; a powerful economic center with many biotech, green, ecotourism, and other industries; a beautiful, walkable, bikeable, inclusive, safe city with a dynamic uptown; and a city famous for its towering oak trees, flowered parks, clean air, and healthy citizens who know their neighbors. A beautiful city, serving our region, does not just happen. We must act today to make sure our city is a place where we and our children and our grandchildren will enjoy living, working, and serving. –Calvin
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