Local Economic Development in CA is Under Siege

Communicating Our Worth to Public Officials, Businesses and the Community Sponsored by:
  Wells Fargo Bank Pacific Gas and Electric Company

We must help local leaders understand that the work of economic developers opens the doors for business and for tomorrow's city, county, and state revenues.  Economic development is not a draw on the budget. It's a revenue center for the community. In a misplaced attempt to save money and balance their budgets, the state, some cities, and counties are slashing funding for economic development activities. Within the past sixty days, appropriations for economic development in Calaveras, Tuolumne , and Napa counties have been reduced to zero.  This is just part of the picture. CALED is receiving calls from rural and urban economic development professionals (inside and outside of public agencies), who are also facing devastating budget cuts. As local governments' budgets are reduced even further, Similar ripples could reach all parts of California . There are serious implications for California 's business environment and the economic health of our communities. Our economies rest on healthy businesses providing good jobs.  As economic development professionals, it's our responsibility to help make this happen.  Cutting back on economic development can lead to negative impacts on city and county budgets and can have a significant snowballing effect on our quality of life. When resources are shrinking, our services are needed the most.. Why don't many public sector leaders understand this? Looking beyond the obvious effects of a slow economy and political turmoil, there are underlying issues that have seriously affected the health of both state and local economic development in California . Although "economic development" has become a popular buzzword, in truth, many public and non-profit leaders don't understand what we do and why it's important. Instead of being given more resources to address these challenges, economic development is now being placed on the chopping block.  Our economic development leaders are being asked to do more with less. Part of this crisis is our own fault.  On the whole:

  • We haven't done a very good job of monitoring and measuring the affects of our activities.
  • We haven't found the right words and support materials to describe what we do,  what we've accomplished, and why it's important.
  • We haven't clearly and consistently communicated our value to public leaders, local businesses, and the community.
  • We haven't made our case based on a Return On Investment.

As a result, the public sector's role in economic development is often misunderstood, particularly by policymakers, who may see economic development as just another program and miss the facts: Economic development is not a draw on the budget. It's a revenue center for a community. We must help local leaders understand that the work of economic developers opens the doors for business and for tomorrow's city, county, and state revenues. If we, as a profession, don't respond quickly to these challenges, our efforts will dwindle and our economies will suffer. More Challenges California is facing major challenges. Local public agencies and non-profit groups are being forced to work on new issues, while still being responsible for the significant problems already on their plates. The abilities of economic development professionals, inside and outside of government, are being tested by the convergence of new events, values, and trends, including:

  • Serious budget problems at the national, state, and local levels that are draining funding from local economic development at the very time these services are needed most
  • The threat and economic drain of potential terrorist attacks and the devastation caused by natural disasters such as fire
  • An erratic economy that is fraught with uncertainty and wavering consumer confidence
  • Growth, sprawl, affordable housing, and environmental preservation as increasingly contentious issues, dividing communities and their leadership

A good local economic development effort can make significant inroads into these challenges, but only if it has the support and funding to be effective.  As we've shown, the struggle to secure even a small percentage of local government resources has become increasingly fierce. Economic development programs must be understood to be funded.

  • They must be of obvious value.
  • They must have measurable results.
  • They must have a consistent professional mechanism for publicizing their activities.
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