economic development journal · economic development journal/ winter 2002 1 edjeconomic development...

Economic Development Journal / Fall 2002 1

Economic Development Journal / Winter 2002 1

EDjEconomic Development Journal THE IEDC

Volume 7 / Number 1 / Winter 2008734 15th Street, NW Suite 900 • Washington, DC 20005

The Calf Rarely Brands ItselfAnd Other Thoughts on Successful Place Branding

KCSourceLinkIntegrating Local Service Providers to ConnectEntrepreneurs with the Right Resource at the Right Time

Fort Knox 2005 BRACAn Opportunity for Regional Growth

Non-Traditional Economic DevelopmentA Southern City Takes a New Direction

From Main Street to the Governor’s OfficeAn Alliance for Economic Redevelopment

Historic Preservation and Cluster BasedEconomic DevelopmentBuilding the Future on the Foundation of the Past

Economic Development Journal / Winter 2008 / Volume 7 / Number 1 2

INTERNATIONAL ECONOMIC DEVELOPMENT COUNCIL

ABOUT IEDCThe International Economic Development Council (IEDC) is the premier international association

dedicated to leadership and excellence in economic development. IEDC can equip you with the tools

and resources that are helping to shape economic development throughout the country and around

the world. Our services include:

• ED Now, a twice-monthly newsletter• Economic Development Journal, a quarterly publication• Improved access to resources and information• Enhanced educational choices• Stronger advocacy and access at the Federal level• Expanded networks and alliances• Industry-leader publications• Expanded research and technical assistance• An international presence

THE IEDC

Economic Development JournalInternational Economic Development Council

734 15th Street, NW Suite 900 • Washington, DC 20005 • www.iedconline.org

Chair: Robin Roberts, FM

President & CEO: Jeffrey A. Finkle, CEcDEditor: Jenny Murphy

Editorial Board: Ronnie Bryant, CEcD, FM, HLM, chairman; William Beyers, Ph.D.; Janet Cypra; Donald Haider, Ph.D.;Mihalis Halkides, Ph.D.; Rick Loessberg; Phillip D. Phillips, Ph.D.; Ronald Swager, Ph.D.; Mark D. Waterhouse,CEcD, FM; Ben Williams; and Charles H. Wood

Manuscripts are invited and should be addressed to the editor. Articles contained in Economic Development Journalrepresent the authors’ views and not necessarily those of IEDC. No articles may be reproduced without permissionfrom IEDC. Copyright © 2008, the International Economic Development Council (202) 223-7800. Fax: (202) 223-4745. [email protected]. ISSN 1539-1922. Subscriptions $60 per year ; for individual issues —$20. Advertising is available. Contact IEDC for details.

OFFICERS AND BOARD OFDIRECTORS

OfficersRobin Roberts, FM,

ChairIan Bromley, FM, MA, MBA,

Vice ChairDennis G. Coleman, CEcD, FMMike Kirchhoff, CEcDBarbara K. JohnsonWilliam E. Best, FM

Secretary/TreasurerRonnie L. Bryant, CEcD, FM, HLM

Immediate Past ChairJeffrey A. Finkle, CEcD

President & CEO

Board of DirectorsCharles S. Alvey, CEcDAngelos G. AngelouIvan Baker, CEcDMark BarbashHoward C. BensonLaDene H. Bowen, CEcD, FMAustin J. BurkeTedra Cheatham, CEcDJoAnn T. Crary, CEcDGene DePrezKenneth E. DobsonBrett Doney, CEcD

Maurice D. Ewing, CEcDRobert FineKristen Fish, CEcDDaniel C. GundersenLynn Martin Haskin, Ph.D.Ted J. Hidinger, CEcD, FMDon A. Holbrook, CEcDDonald E. Hunter, FMDonald E. JakewayKevin D. Johnson, CEcDJames R. Kinnett II, CEcD, FMPaul KrutkoThomas A. Kucharski, CEcDGail LewisDiane C. Lupke, CEcD, FMWilliam G. Mannix, CEcDBarry Matherly, CEcDJudy McKinney-CherryJames E. MillsJay C. Moon, CEcD, FMFred MorleyEllen A. O’ConnorRobert PechePhillip D. Phillips, Ph.D., CEcDJoy M. Pooler, CEcD, FMLewis D. RichKarin RichmondWayne Schell, FMWilliam C. SproullWalter C. Sprouse, Jr., CEcD, CCE,

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dear colleagueLETTER FROM THE CHAIR

Robin Roberts, FMIEDC Chair

I am excited and honored to become IEDC’s newly elected chair. This is a distinct privilege toserve as chair of this great organization. My responsibilities will be challenging and simultaneouslyrewarding in helping to maintain the organization as the premier association for economic devel-opers. I am especially enthusiastic about working with IEDC’s outstanding staff and all of theBoard members.

Our Governance Committee members are Ian Bromley, FM, MA, MBA (vice chair of the Board),Ronnie L. Bryant, CEcD, FM, HLM (Immediate Past Chair), Dennis G. Coleman, CEcD, FM (Planningand Business Development), Mike Kirchhoff, CEcD (Performance Oversight and Monitoring), andBarbara K. Johnson (External Member Relations). William E. Best, FM, is the new Secretary/Treasurer.

All of these individuals will be providing their special strengths to the Board and guiding IEDCinto the future. The staff and Board are committed to maintaining the ongoing level of success thatwe have experienced, while striving to improve our value as an organization to our members.

It was a great pleasure to introduce IEDC’s 2008-2013 Strategic Plan at the Leadership Summitin Orlando. As many of you know, new domestic and global conditions offer unprecedentedopportunities as well as significant, still insufficiently understood threats to our communities andto our profession. The purpose of the Plan is to build off of our existing strengths while helpingus as professionals adapt to changing realities.

In particular, as set forward in the Strategic Plan, IEDC’s vision is to make sustainable econom-ic development a priority in all size communities and at every level of government. The organi-zation has established several strategic directions to attain this vision.

First, it plans to further strengthen the economic development profession and maintain the significance of the economic developer as a community leader. Second, IEDC will seek to provideworld class, customized services to help our members meet the challenges and seize the opportunities of working in an increasingly dynamic, volatile, global economy. Finally, the organization’s goal is to become the number one source of economic development knowledge andthought leadership worldwide.

The Strategic Plan offers numerous strategic objectives for each direction. These objectivesinclude extending opportunities for individual professional development and certification, tobroaden and deepen IEDC’s knowledge of new conditions and how best to respond to emergingthreats and opportunities, modifying our products and services to meet broadening membershipneeds, and revising our knowledge dissemination vehicles to meet diversifying membershipneeds and changing conditions.

In my role as IEDC chair, I look forward to assisting the organization with its mission of providing leadership and excellence in economic development for our communities, members,and partners. The Strategic Plan provides an excellent foundation upon which to accomplish thismission.

Robin Roberts, FMIEDC Chair


PAGE 38

PAGE 26

Economic Development JournalTHE IEDC

TABLE OF CONTENTS

The Calf Rarely Brands Itself ..................................................................5And Other Thoughts on Successful Place Brandingby Andy Levine“Place branding” has taken the economic development world by storm. This article puts forward five specific—and often counter-intuitive—recommendations for communities seeking to maximizetheir investment in building a powerful brand.

KCSourceLink. ......................................................................................10Integrating Local Service Providers to Connect Entrepreneurs with the Right Resource at the Right Timeby Maria MeyersThrough KCSourceLink, a group of 140 nonprofit business development organizations banded together to create a highly visible and easily accessible business development network in Kansas City.KCSourceLink received IEDC’s 2007 Multi-Year Economic Development Program Award for areas with a population greater than 200,000.

Fort Knox 2005 BRAC ..........................................................................18An Opportunity for Regional Growthby Brad RichardsonWith the nine-county area surrounding Fort Knox, Kentucky, facing unprecedented expansion related to the 2005 BRAC action, the region’s leaders seized the opportunity. They created a regional growth management agency, One Knox, to manage and prepare effectively for this growth. The Association of Defense Communities named the One Knox region the 2007 Active Base Community of the Year.

Non-Traditional Economic Development ............................................26A Southern City Takes a New Directionby James B. Gambrell and Agata P. ChydzinskiTo create new locally owned businesses, the city of Columbia and the University of South Carolina teamed up to start the USC/Columbia Technology Incubator. Because of the economic success, the city of Columbia received IEDC’s 2007 award for Technology Based Economic Development for cities of 50,000 to 200,000 residents.

From Main Street to the Governor’s Office ..........................................32An Alliance for Economic Redevelopmentby Ray Watson; Contributor: Christopher ShieldsThrough collaborative efforts, Windcrest, Texas, was able to spearhead a complex and innovative economic incentive package that allowed technology company Rackspace to relocate to a former mall property.

Historic Preservation and Cluster Based Economic Development ........38Building the Future on the Foundation of the Pastby John LaurieHistoric preservation has most often been thought of in terms of architecture and aesthetic appeal as opposed to a vehicle for economic development. Recently, it has been shown that a range ofindustries can be economically fortified by historic preservation.

IEDC News . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24IEDC Calendar of Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25

PAGE 18

all it “Jumping on the BrandWagon.”

Public and private leaders in commu-nities across the world want to stamp an

exciting, new brand on their city, region, state orcountry that will spur action. They want to attractgrowing companies that will invest in their com-munity. They want travelers to book a vacation.They want to motivate meeting planners to sched-ule a conference. And they want talented workersto relocate and fill open positions in their region.

On the one hand, it’s terrific to see so muchattention assigned to the subject of place market-ing. On the other hand, I believe the vast majori-ty of place branding campaigns are off-target,poorly executed, and collectively wasting millionsof dollars.

Looking to get started on a branding campaign?Or perhaps you want to refocus a current effortthat is not delivering desired results? Here are fiveagainst-the-grain recommendations to considerand share with the “powers that be” within yourcommunity:

1. Be Different – Really Different…It’s instruc-tive to take a look at advertising campaignsdesigned for economic development organiza-tions. Pick up the latest copy of Site Selection,Business Facilities or Area Development magazine.You will find yourself lost in a sea of sameness –with different communities touting near identi-cal assets including their quality of life (anadvantage that differs widely in the eye of thebeholder), access to key markets (with so manycommunities located within 500 miles of thebulk of the US population is this really a pointof distinction?) and a highly skilled labor force(clearly important but usually difficult toauthenticate). In many cases, you can simply“cut and paste” the name of one community


the calf rarely BRANDS ITSELF By Andy Levine

AND OTHER THOUGHTS ON SUCCESSFUL PLACE BRANDING“Place branding” has taken the economic development world by storm with communities spending literally millions of dollars to stamp an exciting brand on their city, region or state. But as the author asserts, the vastmajority of these campaigns are poorly designed and poorly executed and thus largely unsuccessful in advancinga community’s image. “The Calf Rarely Brands Itself” puts forward five specific – and often counter-intuitive –recommendations for communities seeking to maximize their investment in building a powerful brand.

Andy Levine is president/chief creative officer of DevelopmentCounsellors International, New York, NY. He welcomes allviewpoints/comments on the topicof place branding and can bereached at [email protected].

ERASING THE TACOMA AROMALong considered an ugly step-child to Seattle,

the city of Tacoma, Washington, faced a seriousimage problem. Paper mills that emitted a pun-gent odor fostered the phrase “The TacomaAroma.” As the former director of economicdevelopment put it: “We were the RodneyDangerfield of Washington.”

The city set out to fix out-dated, negative per-ceptions with an aggressive branding campaign.After scores of interviews with public and privatesector leaders as well as location advisors, ameaningful “value proposition” was identified.Tacoma had dramatically built up its telecommu-nication’s infrastructure in recent years. In fact,the city could document that no other similar-sized community in the country had invested asmuch.

This insight led to the launch of the “America’s#1 Wired City” campaign. Marketing missions toSan Francisco, Los Angeles, New York, and Seattleannounced the campaign in meetings with seniorexecutives and location advisors. The New YorkTimes, Business Week, The Wall Street Journal andSeattle Times wrote favorable stories. The cam-paign helped spark a renaissance with the city ofTacoma reporting the attraction of more than 100technology companies over two years.

If you’re going to succeed in brandinga community, you need to stand out

from the competition.

c

into a different advertisement with little impact.

If you’re going to succeed in branding a community, youneed to stand out from the competition.

What communities have done a good job in being“really different?” Here are two examples that wouldbe at the top of my list:

• Memphis, Tennessee…With the combined advan-tages of a Federal Express superhub and theMississippi River, Memphis has touted its logisticsadvantages for the past 25 years with enormoussuccess. “America’s Distribution Center” may notbe terribly sexy to the average consumer but it istremendously meaningful to this target market.

• Huntsville, Alabama…Located in a state with a sig-nificant image challenge, Huntsville stands outwith the highest per capita number of engineersin the country. The community has successfullyleveraged its space program legacy to attractscores of defense contractors to a place where“The Sky Is Not the Limit.”

Among tourism campaigns,Austin, Texas (marketing itself asthe “Live Music Capital of theWorld”), and Las Vegas (whose“What Happens Here, StaysHere” campaign has successfullycommunicated an adult play-ground theme) have been enor-mously effective.

Is it easy to identify whatmakes your community differ-ent? Heck no…In the UnitedStates alone, there are 50 states,268 metropolitan statistical areasand nearly 20,000 cities or incor-porated areas. But defining whatmakes your community different– really different – is the first stepto success in place branding.

How can you discover this? Itstarts with interviews – lots ofinterviews. Schedule detailedsessions with your public sector leaders. Meet with cor-porate executives who are the captains of industry inyour town (as well as those who are new to the commu-nity). And be sure to get an outsider’s view via researchwith location advisors and executives outside of yourcommunity. It’s also important to review how your com-munity is portrayed by key rankings such as Fortune’s“Best Cities for Business” or Money magazine’s “BestPlaces to Live.”

Properly conducted, this research should lead to theidentification of a “value proposition” or “brand promise.”For Tacoma, Washington, the “America’s #1 Wired City”campaign emerged from a research exercise.

One final commentary on this – you not only have tofind your point of differentiation but it also has to be avalue proposition that is meaningful to your target audi-ence. Having the largest number of mosquitoes percapita is indeed a point of differentiation, but it is obvi-ously not a marketing advantage.

2. A Logo Is NOT a Strategy…At IEDC’s 2007 AnnualConference in Phoenix, I shared the stage with brand-ing expert Duane Knapp in a mock political debate onthe topic of “Place Branding.” I didn’t agree witheverything that Duane had to say but I sure agree withhis “a logo is not a strategy” observation.

In any major place branding campaign, I’m alwaysstruck by how much time and energy goes into thedevelopment of a logo and themeline. There is endless debate and mock-ups with advertising agen-cies racking up enormous fees. In one case, I canpoint to a state which spent over $200,000 to devel-op a logo that featured a two-word themeline. Thenew logo was rejected after three months of public

ridicule – obviously anembarrassing situation.

An effective brandingcampaign is much more thana logo. In simplest terms, aneffective branding campaignis about:

• Discovering your com-munity’s value proposi-tion (or brand promise).

• Identifying your targetaudience.

• Determining the best andmost creative tactics for

Is it easy to identify what makes your community different?

Heck no…In the United States alone, thereare 50 states, 268 metropolitan

statistical areas and nearly 20,000 cities or incorporated areas.

But defining what makes yourcommunity different –

really different –is the first step

to success inplace branding.


NAME THAT THEMELINEHere’s a brief challenge for economic developmentprofessionals: can you match the themeline with theright state? Below are seven states and their market-ing themelines.

State Themeline

1. Indiana a. State of Innovation

2. Louisiana b. State of Perfect Balance

3. North Carolina c. Accelerate Your Business

4. Ohio d. Life Elevated

5. Pennsylvania e. Innovation is in Our Nature

6. Utah f. The State of Minds

7. Washington g. A State of Opportunity

Answers: 1-c, 2-g, 3-f, 4-b, 5-a, 6-d, 7-e


delivering that value proposition to your target audience.

• Implementing the campaign.

Yes, you need a professionally developed, graphicidentity that reflects favorably on your organizationand your community. But it is really only a smallpiece of the overall puzzle.

3. The Calf Rarely Brands Itself….Marty Neumeir, theauthor of the popular marketing book “Zag,” has awonderful definition of a brand:

“What exactly is a brand? Hint: It’s not a company’slogo or advertising. Those things are controlled by thecompany. Instead a brand is a customer’s gut feelingabout a product service or company.”

Economic developers need to influence what industryleaders, influencers, and even your own corporate cit-izens are saying about your community. What otherssay about you – not what you say about yourself – willbuild your brand.

In today’s world of highly-competitive marketing,your own advertisements, printed materials, directmail packages, DVDs, and website are becoming lessand less effective. They are part of “the clutter” – anestimated 3,000+ marketing messages that the aver-age consumer is hit with every day. Only a very smallnumber of marketing messages actually get through.And the ones that do make it through are the onesthat come from highly credible sources.

PROMOTING TOLEDO’S BRAND VIA MEDIA RELATIONS

Toledo’s Regional Growth Partnership longed toalter its image from a poster child of a rust-belt,manufacturing community to a region thriving in thenew economy. At the center of Toledo’s story wasthe transformation of the region’s “old-style” glassmanufacturing industry to the production of photo-voltaic solar cells critical to the emerging renewableenergy sector.

A backgrounder was developed detailing the newindustry’s growth with specific company case histo-ries. Tailored “pitches” were written and e-mailed toa small number of top-tier journalists. Persistenttelephone follow-up identified reporter interest fromseveral sources.

A Newsweek reporter who had previously writtenabout the city was the first to take the bait. His visitto the region resulted in a two-page story titled “ThePower of the Sun,” featuring a number of theregion’s emerging solar energy companies, as well asthe University of Toledo.

The Wall Street Journal followed suit with theRegional Growth Partnership hosting a seasonedreporter for a two-day visit. “Toledo Finds theEnergy to Reinvent Itself” appeared on the frontpage of the paper’s “marketplace” section onDecember 18, 2007.

Four Stages of the Place Branding Process

Stage 1: Discovery

Interviews with ExternalExecutives/Location

Advisors

Face -to- FaceInterviews w/Local

Leadership

Review of KeyReports & Marketing

Materials

Stage 2: Brand Promise

Value Proposition Defined

Themeline/LogoDevelopment

Stage 3: Campaign Design

Target AudienceDefined

External Marketing ProgramDeveloped (potential tactics

i.e., advertising, direct marketing, editorial

placement, special events, telephone outreach, trade

shows, website)

Internal MarketingProgram Developed(potential tactics i.e.,

advertising, direct market-ing, editorial placement,special events, website)

Timeline/Line Item Budget

Defined

Stage 4: Campaign Implementation

StakeholderReview/Feedback



One of the best avenues for influencing corporateexecutive perceptions of a state, region or communi-ty, is to focus on the business media. Effective mediarelations – placing favorable stories about your com-munity and its business climate – is a powerful tactic.In DCI’s continuing survey of senior executives withsite selection responsibilities, “articles in newspapersand magazines” consistently ranks as one of the mostcredible information sources for corporate decision-makers.

Need evidence of this? Lookno further than the most suc-cessful consumer brands thathave been built in recent years.Starbucks, EBay, Google, andSouthwest Airlines are just a fewexamples of powerful brandsbuilt via effective media rela-tions and “word of mouth.”None relied on massive advertis-ing campaigns to build a power-ful brand (although it is true thatnearly all have turned to adver-tising to maintain their brandleadership).

(**Let’s give credit where creditis due. “The calf rarely brandsitself” is a phrase uttered by Chuck Alvey, president of the Economic DevelopmentAuthority of Western Nevada, ata marketing session at an IEDCconference in Philadelphia)

4. Find the Right Balance Be-tween the External Customerand the Internal Customer…In a perfect world, an economicdevelopment group’s focuswould be entirely on the external customer. This mightinclude:

• Corporate executives with site selection responsibilities,

• Location advisors who influence these investmentdecisions,

• Knowledge and other skilled workers you are seekingto attract to your community,

• The news media who are credible, third-party influencers of all of the above groups.

But we don’t live in a perfect world. And there aretwo key reasons that it is important to effectivelycommunicate your brand locally as well as to the out-side world:

1) Economic development organizations rely on acombination of public and private sector funding.So clearly it is important that your key stakehold-ers understand and support your campaign. It’s a

pretty simple formula: no funding…no brandingcampaign.

2) The second reason is a bit less cynical. The localbusiness community – indeed the entire citizenry –comes into frequent contact with the outside worldvia business colleagues, friends, and relatives. Ifthey have positive views on the hometown and itsprogress, they will undoubtedly reflect this in theirdialogue with the outside world. If their views arenegative, the opposite will transpire. And in

today’s world, there is nothingmore powerful and credible than“word of mouth.”

The “communicate your brandto the home team” strategy offers aunique opportunity. A number ofcommunities have operated“ambassador” programs that seek toarm local executives with key infor-mation and turn them into sales-people for the community. ThePhiladelphia region – via a now-transitioned, economic develop-ment group called GreaterPhiladelphia First – even went togreat lengths to educate area limousine drivers about the region’sbusiness advantages. Creating aneffective ambassador program is a difficult process to manage butcan be extremely successful when it works.

In today’s world of the blogs,podcasts and the Internet, there isan opportunity for especially inno-vative communities to build a simi-lar group of “electronic ambassa-dors.” This is an interesting ideathat we will no doubt see executedin the years ahead.

5. The Case Against a Single Brand….The vast major-ity of well-funded “place branding” campaigns focuson marketing a community under one single banner.Political leaders and the private sector quicklyembrace the concept of an overarching brand. “Weall need to work together” is the mantra and in theo-ry it makes a lot of sense.

But in practice it hasn’t worked at all and here’swhy: The needs of your different target audiences –potential visitors, corporate executives with site locationresponsibilities, meeting planners, location advisors, indi-viduals considering moving to your community – are com-pletely different. Attempts to speak to them with a sin-gle, coordinated marketing message consistently fail.

Simply put, the single, over-arching brand, “let’smarket our community together” approach producesmush. And mush doesn’t motivate anyone.


One of the best avenues for influencing corporate

executive perceptions of astate, region or community,is to focus on the business

media. Effective media relations – placing favorable

stories about your communityand its business climate – is a powerful tactic. In DCI’s

continuing survey of seniorexecutives with site selection

responsibilities, “articles innewspapers and magazines”

consistently ranks as one of the most credible

information sources for corporate decisionmakers.


So what can a community do? Adopt a graph-ic identify that is consistent and complimentary. Theeconomic development themeline and logo shouldcome from the same design playbook as the tourismgraphics. Even the logo on a community’s police carsshould share the same look.

Essentially you need to change your message to fitthe needs of your target audience but the look andfeel of the materials should be uniform.

Are there opportunities for collaboration andcoordination among different entities marketing yourcommunity? Absolutely. At the very least, the lefthand needs to know what the right hand is doing.

So there you have it – five specific recommendationsfor place branding, including several that go against theconventional wisdom. It is my hope that the views pre-sented here will generate debate within the economicdevelopment community.

Let me leave you with a final thought about placebranding which brings me back to the analogy of thecalf and a branding iron. When a rancher brands hiscalf, it is a mark that is with that animal for life. It is

important to look at any community branding exercisewith the same long-term view. A powerful brand shouldhave staying power – it needs to be with you for manyyears. Take the time to figure it out and get it doneproperly. The next generation of economic developerswho fill your shoes will thank you.

A powerful brand should have staying power – it needs to be with you for many years. Take the

time to figure it out and get it done properly. The next generation of economic developers

who fill your shoes will thank you.

www.ncdsinc.net


ansas City is a great place to startand grow a company and is currently ranked 1st in theMidwest for large size cities in

“Entrepreneur and NPRC’s 2006 HotCities for Entrepreneurs.”1

This is largely due to themore than 140 nonprofitorganizations that providesupport services for entrepre-neurs, prospective entrepre-neurs, and small businessowners.

Before KCSourceLink, those140 resources provided bothbenefit and frustration. Whatconsumed too much of entre-preneurs’ time and resourceswas finding out about theseservices and then figuring outwhich of these 100+ organiza-tions would be best suited tomeet their needs.

Studies in the late 1990’s inthe Kansas City market revealed the following:

• A perception on the part of small business own-ers that there are many resources for creatingnew businesses, but few, if any, services support-ing growth businesses.2

• Economic development and business supportgroups operate largely in isolation from oneanother. Despite similar client bases and mis-

sions, support organizations do not routinelyleverage and share resources to increase theirefficiency and the effectiveness of programs.3

• Small and growing firms were not championedas aggressively in Kansas City; economic devel-opers and civic leaders focused on retaining andrecruiting large corporations. Attempts to pro-

tect the traditional employ-ment base of the region madethe taxation, workforce andtransportation needs ofmajor employers more press-ing than those of smalleremerging firms.3

• Entrepreneurs are looking for a ”one-stop-shop” that does not duplicate service already available.2

Several of these studies provided suggestions and actions for improvement:

• Determine if there are a larger number of organiza-tions catering to the pre-venture and start-up entre-preneurial markets ratherthan the growth market.2

• Identify and widely market the componentswithin organizations that could and do assistentrepreneurs and small business ownersbeyond the start-up stage. 2

• Define an agreed-upon language between entre-preneurs and service providers that removes theconfusion regarding what is available and bywhom. 4

kcsourcelinkBy Maria Meyers

INTEGRATING LOCAL SERVICE PROVIDERS TO CONNECT ENTREPRENEURSWITH THE RIGHT RESOURCE AT THE RIGHT TIMEThe Kansas City region is blessed with a wealth of resources that support new business development and growth.Finding those resources proved to be problematic to the entrepreneurs that needed them. Through KCSourceLink,a group of 140 nonprofit business development organizations banded together to create a highly visible and easilyaccessible business development network. The model solved the problem in Kansas City and is being used inother areas of the country to connect entrepreneurs to the right resource at the right time. KCSourceLinkreceived IEDC’s 2007 Multi-Year Economic Development Program Award for areas with a population greaterthan 200,000.

k Maria Meyers is Network Builderfor KCSourceLink.([email protected])

Before KCSourceLink,those 140 resources

provided both benefit and frustration. What consumedtoo much of entrepreneurs’

time and resources was finding out about these

services and then figuringout which of these 100+ organizations

would be best suited tomeet their needs.


• Establish a clearinghouse for centralized resources:create an inventory of available resources, create asearchable online database, market for increasedpublic awareness, and create a hotline number forreferrals.5

What was missing was an integrated system that pro-vides entrepreneurs with a highly identifiable, reliablesource that provides connections to the right resourceswhen and where the entrepreneurs need thoseresources.

KCSourceLink was created to meet this need forsmall business owners in the greater Kansas City region.

Formed in 2003 by a powerful consortium among theEwing Marion Kauffman Foundation, the U.S. SmallBusiness Administration, and the University of Missouri– Kansas City’s Henry W. Bloch School of Business andPublic Administration, KCSourceLink has emerged as amajor component of the Kansas City region’s economicdevelopment strategy. It is now a program of the BlochSchool’s Institute for Entrepreneurship and Innovation.

KCSOURCELINK – THE EARLY DAYS In 1998, Dr. Patricia Greene came to Kansas City as

the Ewing Marion Kauffman/Missouri Chair inEntrepreneurial Leadership at the Henry W. BlochSchool of Business and Public Administration at theUniversity of Missouri – Kansas City. Dr. Greeneembarked on two courses of action: to improve thescholarship and instruction of entrepreneurship on theUMKC campus and to make the considerable resourcesof UMKC accessible to local entrepreneurs.

She lobbied for and received oversight of a nearlyempty UMKC-owned building on the outskirts of cam-pus which became home for the UMKC entrepreneurialoutreach programs. Other business developmentorganizations were invited to join. By 2003, with sup-port from the Ewing Marion Kauffman Foundation,about 20 entrepreneurial support organizations werecalling it home, creating a one-stop-shop resource forentrepreneurs.

Parallel to Greene’s work to unite service providers inone building, the U.S. Small Business Administrationwas also exploring the idea of linking together entrepre-neurial services in cities across the country. By fall of2002, discussions materialized among The BlochSchool, the U.S. Small Business Administration, and theEwing Marion Kauffman Foundation and began to focusaround expanding this small network throughout thecommunity.

A key planning team representing the three foundingsponsors was put in place, and conversations began inearnest. Early in the process, the idea surfaced that thisnetwork could be much more than a single building.Given Kansas City’s far flung geography, it was believed

Formed in 2003 by a powerful consortiumamong the Ewing Marion KauffmanFoundation, the U.S. Small Business

Administration, and the University of Missouri – Kansas City’s Henry W. Bloch

School of Business and Public Administration,KCSourceLink has emerged as a major component of the Kansas City region’s

economic development strategy. It is now a program of the Bloch School’s Institute for

Entrepreneurship and Innovation.

Amanda Mindham, President & CEOJ&A Traffic Products LLCBlue Springs, MOEstablished June 2002

J&A Traffic Products is a distribu-tor of traffic products, including

highway and street signs,cones, and construction signs.Customers include local andstate transportation depart-ments, private construction,

and traffic companies.

When Amanda Mindham initial-ly called KCSourceLink in July 2003she wanted to improve her ability torun her growing business. She wasalso interested in mentoring.KCSourceLink referred her to five dif-ferent resource organizations that

could meet her needs. She participat-ed in the Kauffman Foundation’sFastTrac Business Planning course,where she learned that “some thingsabout her business needed tochange.” She also expanded her

knowledge “about parts of the business that she needed totake into account that she had not been considering.” Shealso learned the value of writing and updating her businessplan on a yearly basis.

At the Kansas Women’s Business Center, Mindham par-ticipated in a financial mentoring program which helped herto realize that she needed to make some changes in thefinancial structure of her business. She still participates in aPeer to Peer Roundtable discussion group organized by theKansas Women’s Business Center.

J&A Traffic Products continues to grow and prosper. Thecompany moved from a 7500 sq.ft. warehouse to a new20,000 sq.ft. warehouse in July 2006. In 2007 it grew toseven employees – an increase from four employees in2005. The company’s sales are up, and were expected toreach $5 million in 2007.

Client Success Story

Amanda Mindham isa successful company

owner who wantedhelp managing a

growing business.


that any one location could never reach the entire poten-tial market. And, it would be much more difficult torecruit partners and build community-wide support fora building in Kansas City’s midtown.

Part of this new concept was based on the existenceof a rich base of entrepreneurship support organizationsall over the metro area. The challenge for entrepreneurswas that they often didn’t know where to start, and gotshuffled from place to place in search of the right serviceprovider. The idea began evolving that this could be anetwork, not a center, linking together partners from allparts of the metro area. In this model, wherever anentrepreneur started in the network, it would be theright place because entrepreneurs would be referred tothe right resource for their stage of business and needs.Thus KCSourceLink moved from being a one-stop-shoplocation to being a link to all the resources that helpentrepreneurs start and grow businesses.

Another defining part of the concept was the decisionto start with the partner organizations and to considerthem a key constituent, equal to the entrepreneur. It wasnoted many times that there couldn’t be a network with-out the nonprofit service providers and that they wouldhave to experience great value in order forKCSourceLink to work. It was also agreed thatKCSourceLink should be very diligent about not offeringservices directly to entrepreneurs, not competing withthe service providers, but focusing on assessment andreferral.

BUILDING COLLABORATIONA $487,000 grant from the Kauffman Foundation for

financial support of the network was approved in early2003. An ad hoc operations committee began meetingto outline the steps it would take to get a network ofservice providers launched. One-on-one and groupmeetings were held with key business developmentorganizations within the area to explain the network andgain consensus. A formal executive committee wasestablished to lead the program and a director selected.

More than 50 representatives from service organiza-tions in the greater Kansas City metro came together todiscuss the development of the network and begin todefine the mission. The group defined the challengesand concerns about creating the network.

The service providers were very clear about theirchallenges:

• Recruiting clients from target audiences with minimalor no marketing dollars.

• Eliminating the “run around” by better screening forreadiness prior to organization entry.

• Gaining a better understanding of what other serviceproviders offer; strengthening niches and minimizingduplicate services.

• Networking and establishing partnerships amongservice providers.

• Finding volunteers.

• Finding funding to increase staff resources.

• Finding support for the experienced, establishedentrepreneur.

• Finding bi-lingual agencies/resources.

• Increasing access to client capital.

• Increasing diversity of programs to better meet mar-ket needs.

They were also very clear on how KCSourceLinkshould help:

• Raise the visibility of service providers to the community.

• Assess the entrepreneur and make sure that entre-preneur is referred to the proper agency.

• Conduct follow up as the entrepreneur movesthrough system.

Mike Jackson, President & CEO MicroJekKansas City, MOEstablished 2005

MicroJek brings an exclusive line of microinjectionneedles to the cellular research market. The

company produces the world’s smallestcommercially-available microinjection

needles, a nanotechnology product.

Mike Jackson was referred toKCSourceLink by the KC Regional SBA

office in April 2005. He wanted to networkwith other business people to positionMicroJek within the high-tech, biotechcommunity in the KC region. He was alsointerested in developing angel investor

contacts.

At a 2007 KCSourceLink EntrepreneursHappy Hour, Jackson found a Web develop-ment company that is developing a new, e-

commerce enabled site for MicroJek.Other contacts developed throughKCSourceLink helped make it possible forJackson to be a presenter at theNovember 2005 Nanotechnology at the

Interface with Life Sciences Research conference in KansasCity, MO.

Recently, MicroJek’s products have been used in mouseRNA experiments at MIT and KUMed / Tufts University. Asa result of efforts at KU labs, a paper by Dr. Susan Barrettwas published in the June 2007 issue of Biology ofReproduction. The company has developed and continues todevelop specialty needles for projects at the University ofRochester, MIT, and Harvard. MicroJek has also assisted inclassroom experiments at “Frontiers in Reproduction,” aspecialized workshop at the Marine Biology Lab in WoodsHole, MA. MicroJek has experienced approximately 100 per-cent revenue growth per year since 2005.


Mike Jacksonsought contacts tohigh-tech, biotechbusiness leaders.


• Track the entrepreneur and services already received.(Service providers refer to each other but many timesthe next agency gives the same advice.).

• Provide intra-network knowledge of what is available.

• Create a database to help classify providers, identifycore competencies, client profile(s) and target marketfor each agency.

• Refer volunteers.

• Discover collaborative opportunities.

• Let service providers know what services the entre-preneur is asking for.

• Expand sources of funding.

The session also discussed what KCSourceLink couldaccomplish for the entrepreneur:

• Let entrepreneurs know that the services exist.

• Provide an updated list of educational opportunities.

• Provide order to chaos by performing triage: conduct-ing assessment and screening and getting the entre-preneur to the right service provider.

• Provide a resource library.

Some concerns also surfaced including: WouldKCSourceLink find too many overlaps in the networkand cause one or more organizations to close? WouldKCSourceLink provide programs and services that com-peted with the other organizations? How wouldKCSourceLink remain current on all of the activities ofthe participating organizations?

With more than 100 partners involved, a process andtool had to be developed that would provide an easy wayto organize the partners so that the entrepreneur had toaccess the right resource at the right time. KCSourceLinkcreated The Resource Navigator® to organize resourcepartner programs and services into a user-friendly,online database. Entrepreneurs and service providersalike can go online, answer a few questions about busi-ness needs, and get to the specific resources they need.

Once this tool was loaded with basic information andthe programs and services offered by each organization, itbecame apparent that there were few overlaps in servicesin the Kansas City area. Most organizations were restrict-ed to a certain geography or occupied a particular nichein an area of business development. Needless to say, thisdiscovery mediated a lot of concerns and opened the pathto partner collaboration.

A Web site was developed to bring together informa-tion about the partners in one easy-to-find place. Thesite includes a central list of programs, events and class-es provided by the partners, a resource library withdetailed information on frequently asked questions byentrepreneurs, an innovation center for the high-techand life sciences industry, and The Resource Navigator.

Many of the KCSourceLink partner organizations didnot have a method for managing clients and trackingimpact, which was hindering ability to report the impactof their efforts back to funding organizations. Fifteen ofthe partner organizations came together to brainstorm

Seth Meinzen, CEODigiRace, IncOverland Park,KSEstablished 2004

DigiRace gives fans an inside lookinto short-track auto racing. Believing

that mainstream news media oftenoverlook local and regionalspeedways, co-founders/partnersSeth Meinzen and SteveMeinzen created DigiRace toprovide fans of middle-tier auto

racing with a real-time mediaoption.

The technology company’s sys-tem captures racing broadcastswith a GPS-based tracking system.

Spectators have an aerial, bird’s-eyepoint-of-view of a race as icons repre-senting each racer or team movethrough the course in REAL TIME.

The software updates every secondand provides statistical data –including the racer’s speed, therace time elapsed, and the finishingtime and placement.

A skilled entrepreneurial network-er, Meinzen has used the services of severalKCSourceLink network resource partners, including theUMKC SBTDC and the SBTDC at the University ofCentral Missouri. He participated in the KauffmanFoundation’s FastTrac Tech Venture program in fall2007 and serves on the board of directors for anoth-er resource partner, the Small & Home BusinessConnection (SHBC). Meinzen also participated as ajudge in the Institute for Entrepreneurship andInnovation’s Enterprise Development Lab, and present-ed DigiRace to the InvestMidwest Venture CapitalForum in April 2007.

These collaborative resources provided Meinzenvaluable help with the management decisions neededto establish his business. But, he still lacked the finan-cial component vital to the successful development ofDigiRace. Then he attended the KCSourceLinkEntrepreneurs Happy Hour and met the person he hadbeen looking for – a DigiRace angel investor. Themonthly Happy Hour event offers networking opportu-nities to speed the formation and growth of life sci-ences and technology-based businesses in the KCregion.

In addition to the two founding partners, DigiRacehas three part-time employees and one full-timeemployee. The company has had a successful pre-launch, is about to open its series A round ofinvestments, and has set March 2008 as its tentativelaunch date.


Seth Meinzen connected with an

angel investor for hisnew technology

venture.


about a good management system and created Biz-Trakker®. Biz-Trakker is a versatile client managementsystem that makes referring among organizations easy,manages events, and has an embedded survey systemthat measures business growth and economic impact. Itcan also be used for in depth analysis across organiza-tions by region.

MISSIONToday, KCSourceLink connects a network of more

than 140 resource partners that offer business-buildingservices for small business success. The network is com-posed of many kinds of organizations: incubators, smallbusiness development centers, organizations such asSCORE, groups that provide microloans, angel net-works, chambers of commerce, economic developmentcorporations, and more.

KCSourceLink’s mission is to help small businessesgrow and prosper in the Kansas City region by provid-ing business owners easy access to needed services.KCSourceLink strengthens the network by connectingwith the resource partners to:

• Raise community awareness to bring more entrepre-neurs into the network and increase entrepreneurialactivity;

• Identify gaps in services and promote entrepreneurialgrowth by initiating innovative programs and strate-gic alliances;

• Create a continuously improving process for provid-ing quality services;

• Find new ways to increase funding for resourceprovider programs; and

• Measure economic impact.

THE PROGRAMKCSourceLink offers a referral service for Kansas

City’s small business owners. The service is accessible through a local or toll-free call, via the Web site, www.kcsourcelink.com, or by e-mail [email protected].

An aspiring or existing business owner can access theentire network of service providers in the Kansas Cityarea by calling the KCSourceLink hotline, or by sendinga request through the KCSourceLink Web site. AKCSourceLink “Network Navigator” will spend timeunderstanding the business goals and objectives, wherethe business is in the development process, and theunique aspects of the industry. The navigator then pro-vides a list of organizations, specific individuals andworkshops, seminars, and training classes across themetro-area that can help with the particular business.

Today, KCSourceLink connects a networkof more than 140 resource partners that

offer business-building services for small business success. The network is

composed of many kinds of organizations: incubators, small business development centers, organizations such as SCORE, groups that provide microloans, angel

networks, chambers of commerce, economic development corporations,

and more.

Barbara Graham, OwnerGifts EtceteraKansas City, MO Established November 2007

Gifts Etcetera specializes in gifts andparty supplies. This specialized retail

business grew from Graham’s firstventure in 2005, an upscaledollar store called Dollars &Sense.

After teaching second gradefor five years and serving in amanagement capacity at

Southwestern Bell for 27 years,Graham decided to look for a new

career as a small business owner of aretail operation. She first participated inthe Kauffman Foundation’s FastTrac NewVenture program, where she completed a

feasibility study and learned aboutKCSourceLink. Graham came toKCSourceLink for help in bridging thegap between her corporate manage-ment experience and ownership of aretail store – a transition from corpo-rate America to entrepreneurship.

KCSourceLink matched her with two SCORE counselorswith retail experience. She attended a SCORE pre-businessseminar and worked with the counselors on many aspectsof business development, including finishing her businessplan so that she could present it to a financial institution forfinancing. As a result, she obtained the financing she need-ed to open Dollars & Sense in 2005.

KCSourceLink also helped Graham find the informationshe needed on obtaining her business permits and licenseswithout incurring legal fees. She used the KCSourceLinkweb site, www.kcsourcelink.com, to research the necessaryinformation on her own, saving her both time and money.KCSourceLink also helped her find information on whole-saler resources for products. After operating Dollars & Sensefor two years in The Shops on Blue Parkway, Graham seizedthe opportunity to move to a better location in the sameshopping area, and at the same time change the directionof her retail enterprise.


Barbara Grahamsought help to bridge

the gap from corporate management

to a retail store.

www.kcsourcelink.com

www.kcsourcelink.com

The type of assistance the client needs affects the type ofreferrals made by the Network Navigator.

The network can also be accessed by approaching anyof the partner organizations. Because of the tools, train-ing, and networking facilitated by KCSourceLink, manyof the service providers have knowledge of and access tothe same information as the network navigator. This alsohelps save the business owner time and frustration by let-ting him or her know quickly the resources available.

As part of the hotline referral system, KCSourceLink’snetwork navigators follow up with the entrepreneur toassess appropriateness of referrals, quality of service,need for additional resources, and economic impact.Follow up is done at one, six and twelve month increments.

The first follow up occurs by phone, four to six weeksafter initial contact. This call determines if clientsreceived an appropriate referral, if they have had time toconnect with the suggested organization(s) and theirexperience with that organization. Later follow ups aree-mail or paper-based and request information on busi-ness development, such as growth in sales and numberof employees.

COMMUNITY AWARENESSAn early ad-hoc marketing committee for the network

suggested that instead of marketing each organizationindividually, consistently marketing the hot line numberwould bring more entrepreneurs to the network.

KCSourceLink uses grassroots techniques to increaseawareness and image in the community with specialemphasis on aspiring, emerging and existing businessowners and community referral sources. These includeattendance at local events, speaking in front of a varietyof organizations, articles in association newsletters, astrong partnership with local chambers of commerce,and exhibiting at business expositions and trade shows.Two e-newsletters, The Business SourceLink and TheTechLink, provide general business information andinformation on the technology marketplace for thosewho sign up.

A special emphasis on targeting referral sources suchas bankers, attorneys, accountants, and insurance agen-cies helps get the word out to entrepreneurs about theresource.

NETWORK CONNECTIONSKCSourceLink strengthens the network by educating

resource partners on network services, identifying gapsin service, and providing opportunities for program andfunding collaboration among network partners.

A monthly KARE (Kansas City Area ResourceExchange) meeting hosted by KCSourceLink bringstogether resource partners to exchange programminginformation and ideas. On a quarterly basis, networkpartners are invited to a larger meeting centering on aparticular topic or idea. One of the favorites was the“Incubator Crawl” when buses escorted partners to eachof the six business incubators in town, providing anopportunity to network and explore collaborations.

KCSourceLink also publishes a monthly e-newsletter,the Network Link, that keeps partners up-to-date onactivities in the network.

KCSourceLink has facilitated a number of collabora-tions among network partners, including:

KCSourceLink uses grassroots techniques to increase awareness andimage in the community with specialemphasis on aspiring, emerging and

existing business owners and communityreferral sources.


Sharon Irvin, CFO and Mark Irvin, CEOKC MASS Services Grandview, Missouri Established June 2003

KC MASS Services is a construction and real estate company with a mission to provide safe, accessible andstylish housing for active, aging adults and persons withdisabilities.

Mark Irvin’s hip replacement surgery became the gatewayto this entrepreneurial venture. After surgery, he experiencedfirst hand the limitations of conventional home design for per-sons with temporary or permanent disabilities. So he and hiswife, Sharon, decided to launch KC MASS Services, a businessdedicated to helping people live at home as long as they areable. If remodeling is not feasible, they can build a new home orhelp find an existing home that meets the customer’s needs. Atfirst, through KCSourceLink, Sharon Irvin was looking forresources to help her with the basics of a start-up business, suchas marketing. As the company has grown and the business chal-lenges changed, she has continued to call KCSourceLink.

KCSourceLink has referred her to network organizations pro-viding training classes and counseling services, including:

• The Small Business Development Center (SBDC) at theJohnson County (KS) Community College, where aQuickBooks seminar helped with tax issues.

• The Small Business and Technology Development Center(SBTDC) at the University of Missouri-Kansas City, where Irvinhas formed a relationship with a business counselor and mentor. They help her work out operational problems andother business issues on an ongoing basis.

• Irvin also participated in the First Step Fund’s FastTrac program, which she says gave her “a clear vision of the direction to take in her business.”

KC MASS Services’ gross sales increased 60 percent in 2007as compared to previous years.



• Ten partners collaborated to bring Ameri-Corps*VISTA volunteers to their organizations.

• More than 20 partners are collaborating to reviewtraining classes available throughout the network andinvestigate training delivery systems to better meetthe needs of the entrepreneur.

• Ten organizations collaborate to host a monthly entre-preneur’s happy hour for the high-tech market.

• Seven organizations partnered to market services tothe Hispanic population.

ACCOMPLISHMENTSFour to six weeks after a contact is made,

KCSourceLink follows up with entrepreneurs to verifythey were connected to the resource they needed.Ninety-eight percent of feedback from these follow-upcalls is positive. In addition, KCSourceLink surveysclients to determine impact of the contact.

For example, 100 respondents to a client surveyreported that:

• 16 started a business;

• 13 expanded significantly;

• 20 are actively engaged in growing a new business;

• 12 solved an operational problem; and

• 14 made significant changes to the nature oftheir business, for example, moved into a dif-ferent market, changed staffing levels or oper-ational processes.

Since June, 2003:

• 140+ KC-area resource organizations havejoined the KCSourceLink network.

• 2,600 aspiring and existing business own-ers have accessed the KCSourceLink networkvia telephone hotline or e-mail.

• Over 6,700 online searches for resourceshave been made within the 25 service cate-gories of the Resource Navigator since its acti-vation in January, 2004.

• An average of 10,000 visitors per monthaccess the KCSourceLink Web site. Valuable onlineresources include a wide variety of research in theResource Library, a comprehensive list of networkand sponsor organizations in the Resource Directory,news articles, and client success stories.

• Partner surveys show that resource partner organi-zations also benefit from KCSourceLink:

– KCSourceLink raises community awareness,resulting in more clients.

– Clients are better matched to organizations, result-ing in increased productivity.

– Partners have more knowledge of other networkservices, resulting in new cross-referral and col-laboration opportunities.

NATIONAL EXPANSION The Kauffman Foundation grant that started

KCSourceLink included the charge to incubate a modelin Kansas City that could be used in other areas of thecountry. As the network was built, each step in theprocess was documented for future reference and toolswere developed to allow the concept to be easily trans-lated into a different area of the country.

The Web site, The Resource Navigator, and Biz-Trakker are software tools that support the partner net-work. Each is scalable, easy to maintain, and can beused by others to create a network. A set of manualsthat describe the processes needed to put a network inplace was completed in 2005. Other cities and regionsare now using the SourceLink model and tools to con-nect their entrepreneurs with resources for growth.

The model for staffing a SourceLink Networkincludes a Network Builder (executive director);Network Communicator (a public relations/marketingprofessional); professionals to help business ownersassess their needs and find the right resources in theNetwork, called Network Navigators; and an adminis-trative assistant, called Network Central Coordinator.Depending on the size of the community, these jobs may

be full- or part- time. The largest expense, other thansalary, is generally $15-20,000 per year to support mar-keting efforts. Most implementations are partnered withexisting organizations that support overhead costs. Oneof the first to adopt the SourceLink model was NetWorkKansas, a statewide initiative of the Kansas Center forEntrepreneurship.

NetWork Kansas was established as a component ofthe Kansas Economic Growth Act of 2004 to furtherestablish entrepreneurship and small business as a prior-ity for economic and community development in thestate of Kansas. Its mission is to connect entrepreneurswith the right resources – expertise, education and eco-nomic resources – when they are needed most.

The Kauffman Foundation grant that started KCSourceLink included the charge

to incubate a model in Kansas City that could be used in other areas of the country.

As the network was built, each step in the process was documented for future reference and tools

were developed to allow the concept to be easily translated into a different area

of the country.

Early on, the Kansas Center for EntrepreneurshipBoard recognized that SourceLink was a perfect fit for itsmission of connecting small business owners in far flungrural areas with the wealth of resources already operat-ing in the state. Since its inception and official launch in2006, NetWork Kansas has used Resource Navigator andBiz-Trakker while growing its network to more than 400resource partners statewide.

Using the SourceLink model, entrepreneurs and smallbusiness owners call a toll free number to speak with aNetWork Kansas Counselor. In this case, the ResourceNavigator database holds more than 400 resource part-ners located throughout the state. This allows NetworkKansas to refer clients to a resource close to home or tapinto expertise at the state government and universitylevel. NetWork Kansas also tracks the success of theentrepreneur throughout the process by utilizingSourceLink’s Biz-Trakker program.

Others across the country have begun experiencingthe benefits of the SourceLink model. The Toledo, Ohio,Regional Chamber of Commerce connects its area’sresources with the Resource Navigator, and theCharlotte, North Carolina, region uses both theResource Navigator and Biz-Trakker. The UrbanEntrepreneurship Partnership network uses the

SourceLink system in Milwaukee; Cleveland; Cincinnati;Jacksonville, Florida; and Atlanta to assist minority andurban entrepreneurs. The SourceLink model is beingadopted in a 37- county area of Mississippi and Alabamaas part of a regional entrepreneurial initiative, and is alsobeing expanded into other regions of Missouri asMissouri SourceLink.


ENDNOTES1 “Entrepreneur and NPRC’s 2006 Hot Cities

for Entrepreneurs” Entrepreneur Magazine, www.entre-preneur.com

2 Nancy Zurbuchen. The Kansas City Network of EntrepreneurialOrganizations: Strategies and Solutions for Reaching andStimulating Small Business [proposal], Kansas City, MO, 1999

3 Holman, Rhonda. Kansas City and Minority Business Ownership[master’s thesis]. Kansas City, MO: University of Missouri atKansas City; 1999.

4 Richtermeyer, Gwen. A Study of Latino/a Business Owners inGreater Kansas City, University of Missouri Outreach andExtension Business Research & Information DevelopmentGroup, June 2003.

5 Kansas City Women’s Entrepreneurship Brain Trust, April 24-25, 2003, Executive Summary. Sponsored by the EwingMarion Kauffman Foundation.

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Building on last year’s theme of American competitiveness, federal policy makers and economic development experts will discuss innovation, entrepreneurship, andcommunity/federal partnerships, and detail how both communities and economic developers can use each to reach their goals.

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entucky’s economic landscapebegan a significant and very positive transformation in 1986when Toyota Motor Manufactu-ring announced that it would

build an assembly plant in Georgetown,KY. The initial projections of 3,200 jobs, $180million in new payroll, and an $800 million capital investment by Toyota were more thanrealized, much more. In fact, by the late 90’sToyota’s expansion had resulted in nearly 8,000jobs, $470 million in new payroll, and a $4.5 billion investment by Toyota, nearly tripling alloriginal estimates.

The dramatic economic impact of this event wasfelt statewide with over 100 new automotive sup-pliers locating in the state and the eventual loca-tion of Toyota’s North American ManufacturingHeadquarters in Northern Kentucky. Clearly,Kentucky will continue to reap the benefits foryears to come.

Fast-forward two decades to Fort Knox,Kentucky, 2005. Fort Knox’s glory days, with over20,000 soldiers and civilians working and living atKnox, were thought to be in the past. When thelast combat unit left the Army post in 1994, theArmy’s Armor Center and School and tenantorganizations like Army Recruiting Commandwere all that remained of a once thriving installa-tion. Trainees, who seldom leave the installation,made up the bulk of the military presence. Manyof the remaining civilians worked in blue-collarpositions. This downward trend as the region’slargest employer, obviously, had a negative eco-nomic effect on the immediate Fort Knox region –and Kentucky.

To add to the anxiety, another round of BaseRealignment and Closure (BRAC) Commission rec-ommendations loomed. BRAC is the military’s wayof making itself more efficient by downsizing oreven closing some installations, while consolidat-ing assets at others. In the spring of 2005, BRACanxiety had local officials around Fort Knox actu-ally “war gaming” for the worst-case scenario – fur-ther reduction or even total closure. And then, inMay, came the announcement: 4000 plus new per-manent positions, an estimated $250 million innew payroll, an estimated 12,000 new residents (alarge percentage of whom would live off post), and$800 million+ in new construction on post.

The comparisons to Toyota’s initial projectionsare almost eerie. And what’s more these new jobsare dramatically different than those currently atFort Knox, where the largely blue-collar employeebase supports trainees who are here for short dura-tions for their basic or initial entry training. TheArmor Center, trainee population and the work-force that supports it will soon depart for Fort

fort knox 2005 BRACBy Brad Richardson

AN OPPORTUNITY FOR REGIONAL GROWTHWith the nine-county area surrounding Fort Knox, Kentucky, facing unprecedented expansion related to the 2005 Base Realignment and Closure (BRAC) action, the region’s leaders seized the opportunity. They created a regional growth management agency, One Knox, to manage and prepare effectively for this growth, whichincludes more than 4000 new employees, plus an estimated 8000 family members. Today, preparations are wellunderway, and the effort is seeing great success. For instance, the Association of Defense Communities named the One Knox region the 2007 Active Base Community of the Year. This article describes how North CentralKentucky is making the most of this ongoing, monumental growth opportunity.

k

Brad Richardson is executive direc-tor of One Knox. His e-mail addressis [email protected].

Gate to Fort Knox.

Benning, Georgia. Fort Knox will welcome the Army’sHuman Resource Center of Excellence, numerous othersmaller headquarters commands, and a deployable com-bat infantry brigade. Housed in a 900,000-square-footcomplex, the Center of Excellence will feature a highlyskilled, well-paid white collar workforce made up large-ly of human resource, information management, andinformation technology professionals.

This event has the potential to equalToyota’s initial economic impact – atruly fantastic opportunity for the FortKnox region and the entire state. Butwith fantastic opportunity comesdaunting challenge.

THE CHALLENGE Following the excitement after the BRAC 2005

announcement came many questions about how tomanage this regional growth effort. And the key word is“regional.” The challenges and benefits will not be con-fined to an individual community. Cities and countiessurrounding the Fort Knox area, with a population ofapproximately 250,000, will provide a majority of thenew workers for Fort Knox and provide the neededinfrastructure to support transferring workers and theirfamilies.

Community leaders in the private and public sectorsoon realized that to properly manage and capitalize onthis opportunity, it meant thinking and acting regionally.It became quickly apparent that a regional growth andnew economic development structure was needed toproperly manage this event. So with the hearty endorse-ment from military and community leadership, OneKnox was born to serve as the central coordinating com-

munity agency to help the local nine-county regionrespond in the most positive ways to the growth oppor-tunities associated with BRAC and Fort Knox.

One Knox, headquartered in Radcliff, KY, was estab-lished in January 2006, and its membership is com-prised of elected leaders from the Ft. Knox region andmembers from the Fort Knox Garrison Commander’soffice. Initial funding was provided by the municipali-

ties, with additional support from the NorthHardin Economic Development Authority.

Simply stated, One Knox’s goal is tomake this the most successful BRAC moveever. That means setting and managing theconditions for the smoothest possible transi-tion for the new workforce and their families,while helping the displaced workers from theout-going Armor school find their way. Fromtraining a new workforce, to identifying andfunding necessary improvements to local roadnetworks, or building new schools to meet theexpected demand, it is in the communities’and Army’s best interests to manage this

growth in the most constructive way. Change is going tohappen, whether the region prepares for it or not. Better,it decided, to be prepared.

DETERMINING GAPSAfter forming One Knox, the initial task was to eval-

uate current assets against future needs, and identifycritical gaps that needed to be addressed. To properlyanalyze the situation, it required funding. Clearly, thegood news from the 2005 BRAC decisions was that FortKnox and the surrounding area would be “gainers”. Butthe bad news was that local governments had beenhanded this challenge without funds to support it.

Fortunately, the federal Office of EconomicAdjustment’s (OEA) mission is to support such efforts,by funding Growth Management Plans. As aDepartment of Defense agency, one of OEA’s primaryresponsibilities is to assist communities that are signifi-cantly impacted by Defense program changes, includingbase closures or realignments, base expansions, and con-


Fort Knox will welcome the Army’s Human Resource Center of Excellence, numerous other smaller headquarters commands, and

a deployable combat infantry brigade. Housed in a 900,000-square-foot complex,

the Center of Excellence will feature a highly skilled, well-paid white collar work-force made up largely of human resource,

information management, and information technology professionals.

The “Ground Breaking” Ceremony for the main 900,000-square-foot Army HumanResource Center of Excellence Building. The group includes United States Senator MitchMcConnell and Lieutenant General Benjamin Freakly, Commanding General U.S. ArmyAccessions Command.

tract or program cancellations. But toget this funding, you need to have theauthority to write grant applications,which One Knox did not.

So, One Knox became an operatingunit of the Lincoln Trail AreaDevelopment District (LTADD).Organizationally, Kentucky’s AreaDevelopment Districts are afederal/state/local partnership, a coun-cil of governments, a sub-state plan-ning district, a regional clearing housefor public/private investments, aregional technical assistance center for the public/privatesectors, and a local/regional/state program and servicesorganizer and implementer. In essence, by aligning thetwo organizations’ (One Knox’s and the LTADD’s) efforts,it would provide One Knox with the necessary over-sight, staffing and fiscal agent support it needed to bemost effective. Almost immediately this alignment paiddividends, when more than half a million dollars in OEAfunds were appropriated for the development of aGrowth Management Plan. This money would be usedto do the necessary gap analysis that includes an eco-nomic impact analysis, a housing market analysis, and atransportation study.

Additionally, the LTADD Workforce InvestmentBoard’s partners at the state had the foresight to appro-priate $155,000 of their U.S. Department of Labor(DOL) funds to conduct a much-needed regional work-force study.

In all of these studies, experts are capturing currentdata with help from the local communities. To deter-mine future needs requires close coordination andextensive outreach to Army representatives both at FortKnox and at the locations from which people will bemoving to Kentucky. The collaboration with One Knox’smilitary partners has been nothing short of exceptional.

From Fort Knox to Alexandria, Virginia, One Knox hasbeen included in planning efforts, BRAC meetings, andoutreach to the workforce. And when data and input areneeded for the studies, the Army has provided it.

While much of the study and analysis is still ongoing,the regional workforce study has shown that upwards of1,400 job openings will need to be filled. Making surethe local labor force is trained and ready, and supportingthe local businesses that may lose personnel to Ft. Knox,rank high among the most important challenges.

RESOURCES FOR FILLING THE GAPS After identifying the gaps and solutions to fill those

gaps, One Knox needed to seek the resources to makepositive change possible. Whether it’s building newschools, expanding road networks or implementingworkforce-training programs, the cost of these improve-ments cannot solely fall on the shoulders of the localcommunities. The local tax base that will be generatedafter a significant population increase will not supportthe cost of these significant infrastructure requirements.The region is fortunate to have forward thinking leadersat the state and federal level who recognize this chal-lenge as well. In 2006, Kentucky Governor ErnieFletcher established a Governor’s BRAC Task Force(GBTF) made up of local, state and federal officials to


Artist’s rendering of what the Center will look like when completed.

The Army Human Resource Center of Excellence dining facility under construction.

After identifying the gaps and solutionsto fill those gaps, One Knox needed to

seek the resources to make positivechange possible. Whether it’s buildingnew schools, expanding road networks

or implementing workforce-training programs, the cost of these

improvements cannot solely fall on theshoulders of the local communities.


address these very same issues. Through collaborationbetween One Knox and the GBTF, the region will seekfunding for approximately $294 million from theKentucky 2008 General Assembly.

But it can’t stop there. One Knox must continuelooking for creative ways to help transform the regionand prepare for future growth. That doesn’t stop withthe growth at Fort Knox. In fact, what became apparentduring the assessment of current conditions againstfuture needs was that the region was truly a part of alarger regional economy, one that encompassesLouisville and its surrounding counties. And all are fac-ing similar workforce and economic development chal-lenges. Leveraging the resources to everyone’s benefitwill be the key to future economic development andprosperity.

Consequently, One Knox and the LTADD becameaware of a unique opportunity to enhance the transforma-

tion of the local workforce in order to foster further eco-nomic development. DOL’s Employment and TrainingAdministration’s (ETA) WIRED (Workforce Innovation inRegional Economic Development) grant program seemeda perfect fit for the workforce transformation occurringthroughout the region in and around the Interstate 65 corridor.

With One Knox, the GBTF and the LTADD leadingthe way, partnerships were formed with KentuckianaWorks and Greater Louisville Inc. (GLI) to mount agrant writing team effort with One Knox staff in support.The team had the basic parameters of the “I-65Corridor” regional proposal identified. It focused on theregion’s strengths, while laying out a complex plan forachievable regional transformation. The region includ-ed eight counties in the LTADD, Louisville, and sevenother Kentucky counties, all moving from a largely bluecollar manufacturing workforce base to a more diverse,high-tech driven economy. Even if it didn’t get the grant,the team still believed that it was doing some excellentthinking on how to move forward. Frankfort agreed,and Governor Fletcher chose the region’s submission asone of Kentucky’s two applications.

On June 14, 2007, the Department of Labor releasedthe results, and the I-65 Corridor proposal was one ofonly 13 recipients receiving grants of $5 million each.

These resources from OEA, DOL, and potentially thestate are just the beginning of the creative and innovativeways that the region must utilize to pursue funding fromboth the private and public sectors. This will be a con-tinuous effort.

THE INFORMATION EXCHANGE In addition to providing gap analysis and seeking

funding support, as the central coordinating agency, OneKnox also has a valuable public information role fornumerous constituents. Whether it’s providing commu-nity information to the relocating workforce and theirfamilies or keeping the local community apprised ofArmy unit arrivals and departures, One Knox sees itscommunications and outreach efforts as paramount. It

wants to have an engaged local citizenrycommitted to supporting the growthmanagement efforts. It also wants toprovide the relocating workforce andtheir families with valuable informationabout the region and overcome any mis-perceptions they may have aboutKentucky’s Heartland.

The first of many communication ini-tiatives included the establishment of auser friendly, state-of-the-art website(www.oneknox.com), with a compre-hensive listing of local communityresources, attractions, and amenities. It would be the first of many ways theregion would roll out the welcome matto those who would soon be making

the decision whether or not they wanted to relocate to Kentucky.

However, before the website was established, FortKnox officials and the One Knox team realized there wasno better way to make a great first impression than totake the welcome mat on the road. In March 2006,more than 50 representatives from the entire region,including elected leaders, school officials, chambers ofcommerce, and many more traveled at their ownexpense to Alexandria, VA; Fort Monroe, VA; FortMcCoy, WI; Indianapolis, IN; and St. Louis, MO, tomeet with military and civilian employees who wereslated to move to Fort Knox. Referred to as the “RoadShow,” this uniquely personal outreach initiative provid-ed relocating workers the chance to engage communityrepresentatives in one-on-one dialogue, answer ques-tions, learn about the One Knox region, and overcomeany misconceptions people may have had.

The Road Show was managed by Fort Knox’s GarrisonCommand, Public Affairs Office, and One Knox. Themeeting format was identical at each location.

• November 2005 BRAC recommendations approved

• January 2006 One Knox is formed

• January 2007 Labor Study begins (DOL funded)

• February 2007 Office of Economic Adjustment grant received

• March 2007 Several Growth Management studies begin

• November 2007 Groundbreaking for Army Human Resource Center of Excellence

• December 2007 Army announces additional expansion at Fort Knox

• September 2011 BRAC actions complete

Benchmarks


First, the Garrison Commander made an appeal to thecivilian workforce in each location to relocate to the FortKnox region when the Army presented them with theirTransfer of Function notice – the notice that their jobwas being reassigned to a Fort Knox facility. TheCommander’s appeal was simple – the Army needs youto move with your job to help make the transition workbest, and Kentucky is a great place to live and work.

Second, a video about Fort Knox and the One Knoxregion was shown and then various elected, education,and organization leaders introduced themselves andanswered questions from the Army civilian audience.Upon adjournment of that meeting, the civilians wereencouraged to visit booths at an “Information Fair.”Booths were manned by the various regional leaders andFort Knox personnel and featured information on sec-ondary and post-secondary education, health care,housing, transportation, and entertainment.

There were two general sessions per day at each loca-tion. The Information Fair booths and regional represen-tatives were available to answer questions and provideguidance throughout the entire day. The RoadShow proved so successful that military officialssaw a sharp increase in the number of civilianemployees in favor of moving and asked the OneKnox team to do it again in 2008, as the decisiontime draws closer for those facing the relocationdecision.

One Knox made sure to capitalize on the pos-itive results realized during the Road Show witha full-scale communications effort that builtupon the established relationships. Among themany communications and outreach initiativesthe One Knox team employed were continueddialogue with Army organizations and their relo-cating workforce as well as web site updates, electronicnewsletters, newspaper columns, community speakingengagements, active participation in Fort Knox installa-tion BRAC meetings, planned community tours for rep-resentatives of the relocating organizations, and a sundryof media engagement initiatives.

LESSONS LEARNED While this effort remains a work in progress, One Knoxhas already learned many lessons.

1) Ongoing communication is key. Every day, the OneKnox team discovers new constituents – local real-tors, the construction industry, the education com-munity, the list is endless. And while they all seeksimilar information, their particular needs and con-cerns vary based on the service they provide.

While One Knox quickly established a web site toserve as the centerpiece of its communications efforts,it soon learned that flexibility and functionality of thesite could always be improved. To that end, OneKnox will soon award a new contract for web sitesupport, upgrades, and general maintenance that ithopes will take the site to the next level. Further, a

web site alone does not make a communicationseffort. Ongoing grass roots face-to-face outreach tothe local communities and the affected workforce isalso critical.

2) It will be here faster than you realize. That oldadage that time is of the essence couldn’t be moretrue. The BRAC announcement was made in 2005with all actions to be complete by 2011. Six yearsmay seem like a long time but roads aren’t improvedovernight. School construction and renovation cantake years. Workforce training programs take years tobuild an adequate labor pipeline from which torecruit and hire. And those are just a few of the manyexamples that could be named that will require everysecond of the six years to accomplish.

One Knox’s advice? Act immediately. Procure thefunds to do the analysis and seek the resources tomake the necessary changes. In this case, waitinguntil the 2010 state legislative session to seek fundingwill be too late.

3) Having the right team. This is an economic devel-opment opportunity, so regardless of who is in thejob, economic development professionals must be acritical part of such an effort and ideally lead it.Economic development professionals will see thisgrowth as an opportunity for additional developmentand increased economic prosperity for the region.

It is critical to have present and former military pro-fessionals be an integral part of the process. They canhelp economic development professionals who aren’tmilitary veterans, navigate the sometimes confusingArmy bureaucracy, structure, language, and generalprotocol issues that will foster positive collaborationbetween both parties.

4) Close coordination with the military has beeninvaluable. It’s to everyone’s benefit to make thisprocess work. The Army has jobs to fill, and theregion has job seekers that need them. At the end ofthe day, the Army needs to complete its mission. Itcan’t do it without a highly motivated, well-trainedworkforce. If they fail, the region fails.

Today, the One Knox region has Army personnelexperts talking with the folks in Kentucky responsible

The Road Show proved so successful that military officials saw a sharp increase in the numberof civilian employees in favor of moving and askedthe One Knox team to do it again in 2008, as the

decision time draws closer for those facing the relocation decision.


for building curriculum at Kentucky colleges and uni-versities. They’re going to make sure regional stu-dents have the opportunity to take the courses thatcan help them qualify for the new jobs. At the sametime, the region will be building a local workforcethat can positively respond to a changing job market,both at Fort Knox and throughout the region. OneKnox talks to the Army on a daily basis, while forgingand strengthening relationships that will last wellbeyond BRAC. And that’s good for everyone.

NURTURING THE OPPORTUNITY There’s a new wind blowing through Kentucky’s

Heartland, and the BRAC action is just the beginning.The region is poised to take advantage of a great location,a vibrant workforce, and the expanded opportunities ofthe new regional economy. Successful execution of thetransformation at Fort Knox and the changes that comefrom the implementation of the WIRED program will setthe stage for future success. And others are taking noticeof the work that’s being done. The Kentucky Associationfor Economic Development recognized One Knox withthe 2006 Award for Community Innovation, and theAssociation of Defense Communities named the regionthe “Active Base Community of the Year” for 2007.

Recognition is nice, but One Knox realizes muchwork remains to be done. With the Army, it wants toposition the region for future growth. If the Army ranksgrow 30,000 or more soldiers as predicted, there is thechance to attract some of this additional growth to FortKnox. But the region is in competition with a lot ofother hard-working locations. The priority is for theregion to continue doing the good things that it hasalready achieved and look for ways to improve theprocess. As all economic development professionalsknow, improving your regional presence and buildinginfrastructure – with or without BRAC actions – willform a solid foundation for attracting new investmentand encouraging regional business expansions.

There’s a new wind blowing through Kentucky’s Heartland, and the

BRAC action is just the beginning. The region is poised to take advantage of

a great location, a vibrant workforce, and the expanded opportunities of

the new regional economy.

2008 ANNUAL CONFERENCETHE NEXT BILLION: MOBILITY, FLEXIBILITY, AGILITY, LIVABILITY

OCTOBER 19-22, 2008 ■ ATLANTA, GA

In their article “The Next 100 Million”, ArthurC. Nelson and Robert Lang note that “the U.S. is alone among industrialized nations in experi-encing substantial growth… Only India will add100 million people more quickly than the U.S.”

Preparing for such accelerated growth requiresa new approach to economic development, the provision of infrastructure, environmentalsustainability, and workforce development.Economic developers will have to embody mobility, flexibility, agility, and livability.

Join IEDC in Atlanta for the world's largestannual gathering of economic developers, asindustry leaders break down the current issuesand new models essential for communities looking to capture the growth brought by thenext billion.

Hyatt Regency Atlanta

IEDC room rate: $189single/double265 Peachtree Street NE Atlanta, GA 30303(404) 577 1234

For more information and to register, please visit: www.iedconline.org

www.iedconline.org


NEWS FROM IEDC2008 FEDERAL FORUM

The 2008 Federal Forum,to be held April 13-15 in historic Alexandria, Virginia,is centered on the Innovative andEntrepreneurialEnvironment: Where It’sGoing and How to GetThere. Advancing on lastyear’s theme of keepingAmerica competitive, the2008 Federal Forum takesthese issues to the next level with different trackson the techniques used to attain a competitiveenvironment for communities, and ultimately,America.

The forum will take a fresh look at what toexpect from a new presidential administration and how the White House will work with Congress.With no incumbent president or vice president running for the presidency in 2008, the opportunityarises for a new dialog of ideas, especially in thearea of economic development.

Listen to the insiders and experts on what toexpect with the transitioning administrations andhow it will affect the economic development community.

BE AN AMBASSADOR FOR IEDC

Help grow your IEDC network and representIEDC at conferences, courses, local chamberevents, etc. We depend on you for your sphere ofinfluence. For details contact Mary Helen Cobb [email protected] or 202-942-9460.

ECUADOR REGIONAL DEVELOPMENT AGENCYAND BUSINESS ATTRACTION ASSESSMENT

IEDC staff Rebecca Moudry and IEDC memberRobert Gonzales, CEcD, worked with an interna-tional team to assess regional economic develop-ment organizations in Ecuador, focusing onincreasing organization capacities for regionalcompetitiveness, investment promotion, and busi-ness attraction. Along with organizational assess-ment site visits, the team presented a symposiumabout good practices in international investmentpromotion programs and activities.

The project concluded with an action plan todevelop an investment generation program andoffer professional development through IEDC. The

project was conducted for the Carana Corporationthrough the USAID Productive Network initiative,which seeks to tackle the root obstacles to tradeand investment-led growth and identify and pro-mote progressive leadership across a wide spec-trum of key stakeholders.

NEW CONFERENCE FOCUSES ON BUILDING CUTTING-EDGE PUBLIC-PRIVATE PARTNERSHIPS

IEDC will showcase a newconference on “BuildingCutting-Edge Public-PrivatePartnerships,” June 8-10 inCharlotte, NC, at the WestinCharlotte. The conferencewill focus on public-privatepartnerships in real estatedevelopment. Tracks includeRural and Small Towns,Urban and Mixed-UseDevelopment, and Sportsand Cultural Facilities.

Program highlights include sessions on sustain-able development, finance, brownfields, “dead”malls, major attractions, arts and cultural facili-ties, and downtowns in smaller markets. The con-ference will also showcase award-winning bestpractices in each track on June 10.

2008 WEB SEMINARS

Back by popular demand, IEDC is offering multi-ple web seminars throughout 2008. Without travel-ing, you can hear from industry experts who discuss the latest trends. Whether you close youroffice door and absorb the detailed information byyourself or invite your colleagues and staff to joinyou in your conference room, the choice is yours.

The 2008 Web Seminar topics include:

• Creating Next Generation Websites

• So You’re Targeting Biotech, Now What?

• Incentives Delivering Quality Jobs, How to Do It?

• Revitalizing Downtown Districts in Smaller Markets

Visit www.iedconline.org for dates and additionalinformation.


www.iedconline.org/PPPConference/index.html


CONFERENCES

2008 Federal ForumApril 13-15, 2008Alexandria, VA

Building Cutting-Edge Public-Private PartnershipsJune 8-10, 2008Charlotte, NC

2008 Annual ConferenceOctober 19-22, 2008Atlanta, GA

TRAINING COURSES

Technology-led EconomicDevelopmentApril 16-17, 2008Alexandria, VA

Managing Economic Development OrganizationsApril 24-25, 2008Baltimore, MD

Real Estate Developmentand ReuseMay 5-6, 2008Billings, MT

Economic Development Credit AnalysisJune 4-6, 2008Charlotte, NC

Business Retentionand ExpansionJune 25-26, 2008Savannah, GA

Workforce Development forEconomic DevelopersJuly 24-25, 2008Baltimore, MD

Real Estate Development and ReuseAugust 7-8, 2008Monterey, CA

Business Retentionand ExpansionAugust 26-27, 2008Oklahoma City, OK

Entrepreneurial & SmallBusiness DevelopmentStrategiesSeptember 8-9, 2008Louisville, KY

Economic Development CreditAnalysisOctober 6-8, 2008Butte, MT

Real Estate Development andReuseOctober 16-17, 2008Atlanta, GA

Entrepreneurial & SmallBusiness DevelopmentStrategiesNovember 6-7, 2008Baltimore, MD

Business Retention and ExpansionNovember 17-18, 2008New Orleans, LA

CERTIFIED ECONOMIC DEVELOPER EXAMS

June 7-8, Charlotte, NC(Appl. Deadline: April 7)

October 18-19, Atlanta, GA(Appl. Deadline: Aug. 18)

CALENDAR OF EVENTS

RECERTIFICATION FOR CERTIFIED ECONOMIC DEVELOPERS

Fulfill a recertification requirement without tapping into your budget! Earn two credits towards your next recertification by having an article published in the Economic Development Journal, IEDC’squarterly publication.

This is one of a number of ways that you can pursue recertification credits. Submissions are acceptedthroughout the year. The Journal Editorial Board reviews all articles and determines which articles areaccepted for publication.

For more information contact Jenny Murphy, editor, at [email protected] (703-715-0147).

IEDC sponsors an annual conference and a series of technical conferences each year to bring economicdevelopment professionals together to network with their peers and learn about the latest tools and trendsfrom public and private experts. IEDC also provides training courses throughout the year for professionaldevelopment, a core value of the IEDC. It is essential for enhancing your leadership skills, advancing yourcareer, and, most importantly, plays an invaluable role in furthering your efforts in your community.

For more information about these upcoming conferences and professional development training courses,please visit our website at www.iedconline.org.


www.iedconline.org/PPPConference/index.html

www.iedconline.org

www.iedconline.org/FederalForum/Technology-led_Development.html

www.iedconline.org/?p=Training_Managing_MD

www.iedconline.org/?p=Training_Real_Estate_MT

www.iedconline.org/PPPConference/Credit_Analysis.html

www.iedconline.org/?p=Training_BRE_GA

www.iedconline.org/?p=Training_Workforce_MD

www.iedconline.org/?p=Training_Real_Estate_CA

www.iedconline.org/?p=Training_ESBDS_KY

www.iedconline.org/?p=Training_BRE_OK

www.iedconline.org/?p=Training_Credit_MT

www.iedconline.org/?p=Training_RealEstate_GA

www.iedconline.org/?p=Training_ESBDS_MD

www.iedconline.org/?p=Training_BRE_LA

www.iedconline.org/?p=Certification_Calendar


n many ways, the last five decadeshave been half a century of the dramatic change in the South. From amajor depression that slowed economicgrowth in the entire country, the South has

now grown to become the fourth largest econ-omy in the world. It has also been the nation’sfastest growing regional economy throughoutthe 1990’s, with an unemployment rate lowerand job growth rate stronger than those of anyregion in the United States.

South Carolina was historically a leader in thisgrowth, and had one of the nation’s most success-ful economic development programs, attractinglarge capital investments from both foreign anddomestic companies. During the past 10 years,companies have invested more than $30 billion innew or expanded South Carolina facilities.

At the same time, South Carolina has been oneof the nation’s least successful states in building abase of locally owned, entrepreneurial focusedcompanies. What made it unsuccessful is that untilthe last half of the 20th century, South Carolinawas an agricultural state where the major industrywas textile. At the brink of the new century, thestate needed to look at new industries to providejobs for its citizens and to diversify its economy.This became possible with the recognition of theposition of South Carolina’s research universities.

Before the beginning of the 21st century, SouthCarolina had successfully lured jobs and invest-ments from other regions with a simple, but provenformula: inexpensive land, low construction costs,cheap labor (not influenced by labor unions),excellent training support, tax incentives, and

manufacturing infrastructure. That strategyworked until manufacturers found even lower-costregions i.e. Mexico, Puerto Rico, China, Korea, andother (off-shore) locations.

Columbia, the state capital of South Carolina,has continued to attract new jobs and investmentto the city, but hasn’t made significant progress dueto several important factors. One of the mainobstacles is the community’s lack of an existingindustrial base with the infrastructure that is need-ed to attract additional growth to the area.Columbia’s regional economy was mainly based onthe government and the finance and insurance sec-tors. The small industrial base did not have thecritical mass of manufacturing workforce. Second,the city’s appeal is not centered on a “low cost ofdoing business” advantage, which is actually high-er in the city than in the suburbs or other areas ofthe county. Finally, due to recent bank mergers,Columbia has lost a significant number of financial

non-traditionalECONOMIC DEVELOPMENTBy James B. Gambrell and Agata P. Chydzinski

A SOUTHERN CITY TAKES A NEW DIRECTIONDuring the past few decades, the South has undergone extreme change by becoming one of the world’s largesteconomies. Columbia, the capital of South Carolina, has struggled to keep up with the economic progress of therest of the region. In an effort to create new locally owned businesses, the city of Columbia and the University ofSouth Carolina teamed up to start the USC/Columbia Technology Incubator. Through nurturing and financialsupport, the incubator has succeeded in creating 334 new high paying jobs. Because of the economic success, thecity of Columbia has received IEDC’s 2007 award for Technology Based Economic Development for Cities of50,000 to 200,000 residents.

James Gambrell Is Director ofEconomic Development for the Cityof [email protected]

Agata P. Chydzinski is AssistantDirector of the USC/ColumbiaTechnology Incubator [email protected]

The first incubator outside USC’s campus was located in Columbia’s City Center.

i


jobs and local and state governments are no longerexpanding, creating government jobs. Meanwhile, otherregions such as Raleigh (NC), Austin (TX), Birmingham(AL), and nearby Charlotte (NC) have become leaders increating a large base of rapidly expanding, locally ownedfirms. And, not by accident, these regions have alsoexperienced well-above-average economic prosperityand growth.

A NEW APPROACH IS NEEDEDIn 1999, Bob Coble, mayor of Columbia, formed a

“Mayor’s Technology Council” to study the problem andfind a solution. The council decided a new direction ineconomic development was needed to keep pace with theother dynamic cities in the region. Columbia, it was felt,should change direction and move away from trying tosupport an industrial economy, and instead, concentrateefforts on the coming knowledge based economy. To becompetitive with cities from the neighboring regions andstates, Columbia needed to grow and support its ownassets, including: local entrepreneurs, ready to developknowledge based businesses; a top quality workforce;great technology infrastructure; and a business climatethat supports technology-oriented companies.

Clearly, it was determined that small entrepreneurialfirms would create the bulk of new jobs and wealth intomorrow’s economy. A great example would be a citylike Austin, Texas, that has been extremely successful inefforts to develop an information-based economy. Thechart above illustrates just how much of an impact thistype of transition can have on a regional economy that inmany ways is similar to the Columbia region. Note also,this success did not happen overnight. This growth wasthe result of years of focused efforts by Austin’s businessand political leaders.

Columbia’s Office of Economic Development, work-ing with the mayor’s council, saw the change in Austinover a 20-year period, and recognized the need to devel-op a long-term strategy to transition the Columbia econ-omy into a growth mode economy and to provide a base-line for a plan to effect that change. The following chartillustrates the same statistics for the Columbia regionfrom 2001 to 2007 as did Austin in 1980 to 2000.

Austin experienced 20 years of tremendous growth, as itsaw the importance of a technologybased economy atthe beginning of the 80’s, earlier than many US cities. Incontrast, Columbia’s economic growth was stagnantuntil the city realized the importance of a technologydriven industry and used Austin as a model.

The target goal was to achieve gains similar to Austin’sby the year 2008. In order to accomplish this goal, it wasclearly understood that the active participation andengagement of every possible resource in the area wasgoing to be needed, and that a clear “vision” and actionplan was going to be necessary.

To achieve this, the Mayor’s Technology Council,working through the city of Columbia’s Office ofEconomic Development, embarked upon an extensiveoutreach program to solicit ideas from key groups andindividuals from all sectors of the community. The resultof this outreach and subsequent study was a comprehen-sive strategic plan focused on transforming theColumbia region into a successful high-tech communitywhere a coalition among business, government, andeducational institutions would enable the community todevelop and capture high-paying, technology-orientedjobs, resulting in significant investment and growth inthe local economy.

The goals, strategies, and metrics outlined in this newplan required the support of the business community,the education community, and local governments(including both Richland and Lexington Counties andthe city of Columbia). Only through partnerships andcooperation would it be possible to develop and imple-ment the strategies that would unify and energize theefforts. The goal of these efforts was to leverage the assetsof the region to meet tomorrow’s economic developmentdemands while building a solid foundation for the infor-mation-based economy that would be critical to theregion’s economic future.

It was clearly understood that the successful execu-tion of this plan could not be accomplished by the cityalone. It would require the coordinated efforts of theentire community, including local businesses, education-al institutions and organizations, and all levels of govern-


ment. The challenge was to sustain the vitality of thecurrent economy, and at the same time aggressively pre-pare for the strategic use and investment in technologythat would drive the region’s long-term economic suc-cess to higher levels. The city of Columbia and itsregional partners – Richland and Lexington Countiesand the education community – were all committed tomeeting this challenge, and are still committed today.This plan was a first step on the road to securing a moreprosperous economic future for the entire area.

To develop this plan, an approach was taken thatassumed a vast amount of knowledge and insight wasalready available within the com-munity and that critical “buy-in”would be needed to make the planwork. Many reports and recom-mendations had previously beenmade by consultants that touchedon “traditional” aspects of leverag-ing assets to further develop theregion’s economy, but now, a new

approach was needed. Consequently, more active inputwas sought. Initially, an electronic survey of businessleaders, along with direct interviews, was undertaken.Information was also gathered from numerous techno-logical reports and from meetings of several associatedtechnology groups and committees. Throughout thisprocess the input of key individuals was critical to the

buy-in and future success of the plan. Initially, valuableinput was certainly missed, and follow-up interviewswere incorporated into a “living plan” that was used toguide decision makers into action.

In 1999, the city of Columbia adopted the RegionalTechnology Strategic Plan as the framework aroundwhich to build a new economic development strategy.With an overall goal of achieving long-term social, polit-ical, and economic success through the strategic use andinvestment in technology, the city made a commitmentto build and support a coalition among local govern-ment, local businesses, and local educational institutions

with the singular goal of transi-tioning the greater Columbiaeconomy into the informationage. A key objective of thisplan was to facilitate businesscreation and growth in orderto provide increasing num-bers of higher paying jobs forthe citizens of Columbia andthe surrounding area, and cre-ate additional economic activ-ity (wealth) for the regionthrough increased taxes andfees.

The Columbia City Councilembraced the plan and recog-nized that traditional economic

development activities would not achieve a cost benefitreturn on investment that would make a significant dif-ference in the lives of its citizens. City Council led thecharge and set out to effect changes through the imple-mentation of this plan. The city‘s Office of EconomicDevelopment began working with its partners to imple-ment three key recommendations of the plan:

• Embrace a Culture of Innovation,

• Mobilize Higher Education, and

• Facilitate Business Creation and Growth.

THE USC/COLUMBIA TECHNOLOGY INCUBATOROne of the key elements of the plan was to create new

technology-focused, locally owned businesses, using theresearch and technologies being developed at theUniversity of South Carolina. Following the basic prem-ise that commercializing research leads to the creation ofnew companies with high paying jobs which benefit theentire state, the USC/Columbia Technology Incubatorwas born.

This strategy focused on a new business incubatorformed at the USC School of Engineering in 1998. Theinitial investment in the program was made by Donald R.Tomlin Jr., a real estate developer and entrepreneur, inthe amount of $200,000. The first incubator company,Kryotech, INC., became a success and when the compa-ny graduated from the incubator program in 2001, itrelocated with 85 highly paid employees whose salariesranged from $45K to $125K. The concept of commer-cializing technology developed at USC through an incu-

Students at the University of South Carolina have internship opportunities at the USC/Columbia Technology Incubator.

Entrance of the USC/ColumbiaTechnology Incubator


bator program had been proven, andUSC, with a new goal of becoming amajor research university, was committedto commercializing its intellectual prop-erty into thriving companies that createdjobs for its graduates and the Columbiaworkforce.

Partnering with the city of Columbia,USC hired an executive director andestablished a business plan and budget.The first incubator outside the university’s campus waslocated in Columbia at 1233 Washington Street inColumbia’s City Center. After just 12 months of opera-tion, the incubator had raised $160,000 in local supportfor operations, occupied 5,000 square feet of officespace, and was home to six new technology focusedcompanies employing 115 individuals in high-tech,entrepreneurial-oriented jobs. As new companies con-tinued to be accepted into the program, the incubatorsoon occupied an additional 10,000 square feet inanother building located at 1334 Sumter Street, less thana block away from its initial off-campus location.

By 2004, the incubator had grown to 23 new compa-nies and had graduated 12 for a total of 35 of new com-panies in the region. These companies created 302 newjobs and $ 18.5 million in new capital was obtained fromventure capital firms, angel investment groups, and indi-vidual investors to support company operations. Theincubator was now completely out of space and neededa larger facility to house more companies. Again, work-ing with the city’s Economic Development Department,the Columbia City Council approved a plan to makeavailable a city building that was being vacated. A lease($1/year) was executed and today the 40,000 squarefoot, 1225 Laurel Street, office building is home to theUSC/Columbia Technology Incubator.

The incubator shares its space with the ColumbiaInternational Business Center where foreign-based com-panies can enter the US market on reasonable terms. Theincubator building is being up-fitted with private contri-

butions ($63,750 to date). The rentpaid by the companies ($10 per squarefoot) along with contributions fromorganizations in the community, bothpublic and private, provide operatingfunds for the incubator.

Companies are selected to be in theincubator program only if they meet theminimum requirements set by theIncubator’s Advisory Council (IAC). Toqualify, a company must: have a writtenbusiness plan, be a technology basedcompany, and need the University ofSouth Carolina or Midlands TechnicalCollege to help it grow its business. Thecompany must be willing, and in factutilize, the resources (students, faculty,staff, and intellectual property) that areavailable at the USC or at MidlandsTech.

Once the company is deemed ready to apply, the IACmeets to review the business plan and interview thecompany’s principals. After an interactive admission ses-sion, the IAC votes for or against admission to the pro-gram. The IAC is composed of nine members from boththe business and academic community.

The USC/Columbia Technology Incubator project is awonderful example of how, both public and private enti-ties, working together can succeed in making a signifi-cant impact on the local economy. To date, 17 companieshave graduated from the incubator program. These com-panies have created 334 new high paying jobs in theColumbia market with average salaries exceeding

Funding Received by the Incubator Since 1998

Jobs Created by Incubator Companies Since 1998

Support received 1998-2006

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After just 12 months of operation, the incubator had raised$160,000 in local support for operations, occupied 5,000 square feet of

office space, and was home to six new technology focused companiesemploying 115 individuals in high-tech, entrepreneurial-oriented jobs.


$60,000. The incubator’s six graduation ceremonies havebeen highly publicized in the local media and also in theWall Street Journal. To date, the incubator program hashelped create 542 jobs, 118 of which are occupied byminorities. These numbers represent the total number ofjobs created by current and post-graduate companies.

At this time, there are 38 companies (10 minoritycompanies) in the program. Statewide, the incubator hasbeen recognized as a cutting-edge business incubatorand has been selected by the South Carolina Departmentof Commerce as a “Best Practices” model to assist otherSouth Carolina communities and organizations in devel-oping their own incubator entities.

IDV: A PERFECT EXAMPLE OFCOMMERCIALIZATION

Businesses from the incubator are at the cutting-edgeof developing new technologies and creating uniqueproducts and services that improve the quality of ourlives, granted, on a relatively small scale today, but on amuch grander scale tomorrow. As a result, these compa-nies are enhancing the economic development success ofSouth Carolina with highly skilled workers, advancedtechnology and research, and adding new products andservices to the market.

Visualization Software is the “name of the game” forone incubator company graduate, Interactive DataVisualization, also known as IDV. If you’ve seen the pop-ular movies “Shrek the Third” or “Spider-Man” thenyou’ve seen the products developed by IDV. Thousandsof scenes call for virtual trees, treesthat move with the wind, trees thatdrop leaves, and trees that diminishin size as the camera zooms out – allcreated by IDV.

Chris King and Michael Sechrestco-founded IDV in late 1999. IDVwas initially formed as a subcon-tracting entity of a Virtual Test Bed(VTB) research effort, focusing onmoving VTB visualization technolo-gy to emerging workstation-classPCs so that a growing body of users,with limited equipment budgets,could benefit from VTB’s robustvisualization technologies. From this project, IDV pur-sued research and software development efforts aimed atdelivering dramatic improvements to the customers’ability to see and understand complex systems. IDV wasaccepted into the Incubator program in June of 2000,and much like Kryotech, is another great example of suc-cessful growth using technology transfer and commer-cialization.

IDV has also done a considerable volume of businessbased on military-related research work, including inter-active visualization for various Electromagnetic AircraftLaunching Systems (EMALS) designs, an orbit irradiance

model for a solar-recharging, satellite and an electricalcabling position system for naval surface vessels.

Apart from its funding from the Office of NationalResearch, IDV has also received Phase I & II SBIR (SmallBusiness Innovative Research) grants from the Navy forthe topic “Enhanced Visualization of Modeling andSimulation Processes.” The work began in summer2002 under the authority of the Naval Surface WarfareCenter (NSWC) in Dahlgren, Virginia, and was complet-ed in February 2005 with the delivery of a fully func-tional version of the Eye-Sys visualization software pack-age. Since the day it was founded, Mr. Sechrest and Mr.King have been directly involved in all aspects of IDV’sbusiness, research and development activities. They havetaken leading roles with the customers both in definingnew project requirements and in supporting products

with new and innovative adaptationof technology driven systems that arealready deployed.

IDV’s success, rapid growth,and the award-winning power of itscommercial products are a directreflection on the vision and manage-rial expertise of their founders andthe assistance they received fromUSC and the incubator staff. Asequal owners of IDV, they are com-mitted to growing the firm andexpanding their visualization offer-ings with products that set the stan-dards for ease of use, efficiency, and

functionality for their customers around the world.Today, the company has 26 employees whose averagecompensation is well above $60K.

THE ECONOMIC FUTURE IN COLUMBIAThere are three basic ways to create jobs and wealth

for a local economy. First, investment and new jobs canbe imported, as in the traditional sense of economicdevelopment. Second, existing companies can be sup-ported and grown via business retention and growthprograms. Finally, new companies can be started andnurtured via programs like the USC/ColumbiaTechnology Incubator.

Interactive Data Visualization, Inc., an incubatorgraduate.

University of South Carolina Campus.


Recruiting new companies can bevery expensive and not always a success-ful (long-term) endeavor. Nurturing andgrowing local companies is an efficientway to accomplish long-range economicgrowth and is usually very cost effective.In addition, business retention andexpansion programs create goodwill inthe business community by supportingexisting companies. Finally, but certainlynot least, new business enterprises canbe highly-successful in creating new jobsand investment. The Incubator programestablished in Columbia is doing justthat as evidenced by the results of thisstill very young program.

The USC/Columbia Technology Incu-bator continues to grow and will even-tually be located in Innovista, theUniversity of South Carolina’s exciting new500-acre Technology Research Campusthat will forever change the landscape ofdowntown Columbia. The impact ofUSC’s research, resulting in marketablenew technologies that are commercial-ized into new companies, will continueto have a significant economic, social,and political impact on Columbia andthe surrounding area.

For their work, in 2007 the Colum-bia Office of Economic Developmentand the USC/Columbia TechnologyIncubator received a State Award for“Innovative Economic Development”from the Municipal Association ofSouth Carolina. They also receivedIEDC’s 2007 award for TechnologyBased Economic Development. As themomentum continues, the push forcommercialization of intellectual prop-erty at the University of South Carolinaalong with the support of the city ofColumbia and the business communitywill insure that the outlook for success-ful new companies, creating new jobs,and investment is bright, and the visionfor economic growth is clear for theMidlands of South Carolina.

John Weidner and Chuck Holland withtheir hydrogen powered Segway fromH2M - Hydrogen Hybrid Mobility, anincubator company.

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2008 EXCELLENCEIN ECONOMIC DEVELOPMENT AWARDS

2008 Awards Timeline:

March 3 Call for Entries opens

April 7 Early Bird submission fee deadline (entry fees increase after this date)

May 19 Final submission deadline

June/July Judging & Notification

Oct. 21 Winners recognized at IEDC’s Annual Conference in Atlanta, Georgia

For complete details, download theIEDC Awards Entry Packet atwww.iedconline.org

This is your time to shine! Send that innovative program,promotion, or project in and get the recognition you andyour organization deserve. The International EconomicDevelopment Council’s 2008 Excellence in EconomicDevelopment Awards will kick off its Call for Entries onMarch 3, 2008. Enter early and save!

Each year, the International Economic DevelopmentCouncil conducts the Excellence in EconomicDevelopment Awards program. With over 20 different categories, IEDC’s highly regarded program recognizesthe “best of the best” in the economic development profession. Award winners will be recognized at IEDC’sAnnual Conference in October 2008 in Atlanta, GA.

More information about the program, including submission requirements and entry fees,will be available online at www.iedconline.org in January 2008.Until then, contact Paul Cutting at (202) 942-9459 or [email protected] for more information.

9 New Categories Added for 2008!

www.iedconline.org


ow does a small suburbanmunicipality that is generatingabsolutely no interest from devel-opers and losing an average of$100,000 per year in tax revenuebecause of an abandoned mall

and declining business district becomehome to one of the largest economicdevelopment incentive deals in Texas, allwithin the span of less than 15 months?The answer is perseverance and cooperation.

These were the daunting circumstances thatWindcrest, Texas, faced in the spring of 2006.During the next year, extraordinary levels of inter-governmental cooperation and new EDC leadershipwould lay the groundwork for an economic trans-formation that previously had been consideredalmost unthinkable in this San Antonio suburb.

At the center of Windcrest’s harsh reality wasWindsor Park Mall, an abandoned shopping com-plex with 1.2 million square feet of space whosesteady loss of tenants and eventual closure had pre-cipitated the community’s economic decline by theend of the 1990s. For more than two decades, themall’s presence had fueled economic activity alongWalzem Road, Windcrest’s main thoroughfare thatformed the northern border of the mall property.

“As the mall goes, so goes Windcrest” was atruthful refrain that at one time could have beenused to celebrate the community’s prosperity. Inmore recent years, these words had become littlemore than a painful reminder for residents andcommunity leaders that their previously insulatednortheast corner of the San Antonio metropolitanarea was feeling the encroachment of urban decay

and a lack of concern from the other municipalitiessurrounding Windcrest.

This is the uphill struggle that faced theWindcrest Economic Development Corporation(WEDC) (www.ci.windcrest.tx.us) in the spring of2006. The other obstacle facing the corporationwas that it had new staff leadership coming in anddid not know if the new executive director wouldbe up to the challenge. The new person had toovercome the fact that Windcrest’s image had beenseverely tarnished. Negative perceptions of the areawere being perpetuated by media reports of vio-lence and gang activity in the vicinity.

from main street to THE GOVERNOR’S OFFICEBy Ray Watson; Contributor: Christopher Shields

AN ALLIANCE FOR ECONOMIC REDEVELOPMENTKnowing that the vitality of the city of Windcrest, a municipality of 5,300 residents located northeast of SanAntonio, was directly linked to the vitality of the neighboring businesses, Windcrest leaders began laying thegroundwork for an initiative to revitalize the adjacent corridor. This corridor was once a thriving area that hadin the last decade seen a dramatic decline in business activity, appraisal values, and sales tax revenues followingthe closing of nearby Windsor Park Mall. Through collaborative efforts including city, county, and state represen-tatives, Windcrest was able to spearhead a complex and innovative economic incentive package that allowedtechnology company Rackspace to relocate to the former mall property.

h

Ray Watson is the executive direc-tor of the Windcrest EconomicDevelopment Corporation ([email protected]) and con-tributing author ChristopherShields of Christopher S. Shields,P.C. ([email protected]), is a leg-islative consultant and tax attorneywho specializes in economic devel-opment incentives.

Out-of-date signs depicting the former mall’s name will soon be replaced with Rackspacebranded signage.

Photo courtesy of Placemakers (Scott D

oyon)

www.ci.windcrest.tx.us

The new leadership also had to surmount a very tan-gible obstacle to new business investment: undervaluedland. The rest of Bexar County was appreciating at anaverage rate of 16 percent, while values in the Windcrestarea were rising only about 4 to 6 percent annually.

Since the mall had long served as the hub of econom-ic activity for Windcrest, the WEDC, City AdministratorRonnie Cain, Mayor Jack Leonhardt, and CountyCommissioner Tommy Adkisson knew that finding aneffective use for the mall property was essential to restor-ing Windcrest’s economic vigor and they had a visionthat just needed to be put into motion. Unfortunately,Windcrest was in no position to bring about any suchproject on its own. The city didn’t own the mall proper-ty. It was split among three separate owners. The mallwasn’t even within the Windcrest city limits. The site wasjust across the line in San Antonio.

Restoring vitality to the mall property would have toinvolve partners in both the public and private sectors.City leaders determined that the only way to begin plot-ting an effective course was to gain control of the mall by

bringing it under single ownership. The city had little tocontribute to a purchase, at least not in traditional ways.Aside from declining revenues, Windcrest had alwaysbeen a fiscally conservative community whose citizenswere extremely adverse to debt. Since conventionalfinancing avenues could not be considered, a privatefunding source would be needed.

PIECES OF A PUZZLEOutreach efforts among various private real estate

investors / developers led to the first piece of a very com-plex puzzle falling into place. A multi-state consortium ofprivate investors (one from the San Antonio area and twofrom Louisiana) who had been looking for an opportuni-ty such as this came together to form a limited liabilitycompany, the Windcrest Economic DevelopmentCompany, L.L.C., and partnered with the WindcrestEconomic Development Corporation (WEDC) to buy themall for $27 million in April 2007 with the intent of offer-ing a lease-to-buy proposal to a future anchor tenant.

The consortium provided all of the capital needed tobuy the mall site from the multiple owners, so that thecity of Windcrest and the WEDC incurred no financialliability and the only recourse was the mall itself. Theirrole was to eliminate procedural obstacles to redevelop-ment and extend incentives to attract investment.

The acquisition of the 68-acre mall property made itpossible for the mall to be listed under the WEDC’s nameon deed records and, therefore, taken off the tax rolls.This strategy was meant to accommodate the consortiumand entice potential tenants, since it would allow themall and all improvements and tangible personal prop-erty to be exempt from city, county, and school districtproperty taxes during the term of a lease agreement. Thevision for the mall structure was that it would ultimate-ly function as a company headquarters in a corporatecampus setting.

Under Texas’ very complexschool finance system, it is difficultto secure exemptions from schoolproperty taxes. These local propertytaxes constitute as much as 60 per-

cent of the local property tax burden and are a key con-sideration for any company planning a major capitalinvestment. WEDC was able to provide the exemptionthrough a unique tax provision that is available only toeconomic development corporations. With minor excep-tions, the school district is not negatively impacted, asthe state holds the local school district “harmless” fromany change in its level of school funding.

Windcrest and the consortium expanded upon thisconcept by outlining a plan whereby the consortiumthrough personal financing would purchase 303 addi-tional acres of property in the immediate vicinity of themall at a cost of more than $40 million. These parcelswere intended to provide room for the developmentopportunities that the reutilization of the mall propertywas expected to prompt. This land was also intended tohelp the investors increase the return on their invest-ment and give Windcrest and other local taxing entitiesgreater gains in the future.

The consortium formulated a plan that would inte-grate the mall property with a mixed-use development onthe adjacent acreage. This additional development wouldinclude retail, commercial and residential facilities, aswell as recreational and lifestyle amenities, that would bedesigned to complement the corporate culture of any ten-ant that would occupy the former mall structure.


Restoring vitality to the mall property would have to involve partners in both the

public and private sectors. City leaders determined that the only way to begin plotting

an effective course was to gain control of the mall by bringing it under single ownership.

The former Mervyn’s building is the first section of the mall to undergo renovations.

Photo courtesy of Placemakers (Scott Doyon)


Despite securing private funding and having a con-cept for the project, the intricate nature of Windcrest’sultimate objectives required that several political hurdleswould have to be cleared before the project could gainmomentum. In particular, Windcrest eventually hopedto gain additional tax revenue by bringing the mall andthe adjacent properties inside its city limits.

Purchasing the mall site had not been a problembecause current state economic development statutesallowed a municipality to purchase land that was outsideof its city limits, as long as the land was to be part of aproject that involved adjacent land within its city limits.Gaining future tax revenue from the mall site and near-by properties, though, was not a possibility forWindcrest because the land was outside its jurisdiction.Furthermore, even if a mechanism for effecting a bound-ary change was put into place, San Antonio would haveto be persuaded to go along with the proposal.

CONSENSUS BUILDINGWindcrest representatives engaged in an exhaustive

series of meetings from the fall of 2006 through thespring of 2007 to help state and local officials under-stand the merits of their project and gain support.Windcrest’s core message was that reinvigoratingthe mall area and the Walzem Road corridor wasnot just a Windcrest issue. Windcrest leaders con-tended that their objective was good for the entirenortheastern section of the metro area and BexarCounty, since the ancillary growth that wouldresult would spread into these nearby areas.

Persistence paid off. During the 2007 session ofthe Texas Legislature, State Representative JoeStraus authored a bill, co-sponsored by StateSenator Jeff Wentworth, that would allow cities ofsimilar size and demographics to the cities ofWindcrest and San Antonio with a similar situa-tion as Windsor Park Mall to negotiate a revisionof their boundary lines that separate them. Thelegislation called for San Antonio to relinquish themall property and the adjacent tracts of land andfor the Windcrest city limits to be extended toinclude them. The bill, which the legislature even-tually passed, combined with Judge Nelson Wolff’s(county judge, Bexar County Commissioners Court)influence helped spur talks between the two cities.

San Antonio representatives initially were not con-vinced of the need to transfer property to Windcrest, inorder to help redevelopment move forward. Windcrestofficials explained that their collaboration with the invest-ment consortium and the use of the property tax exemp-tion/lease back provision available only to economicdevelopment corporations made it imperative thatWindcrest acquire the property. The proposed tax abate-ment structure was worth several tens of millions of dol-lars to the right tenant. Without this transfer, the projectcould not progress and the metro area would squander achance for extraordinary economic expansion.

FILLING A VOIDAs the political considerations were being sorted out,

Windcrest was simultaneously intensifying its efforts tosecure a tenant for the mall site. Initial discussionsinvolved Nationwide Insurance, but a homegrown, SanAntonio-based technology company soon entered thepicture. Rackspace Managed Hosting, the fastest-grow-ing managed hosting specialist in the world, expressedinterest in the location because of its potential to accom-modate the company’s rapidly expanding workforce.Rackspace, which also has facilities in Dallas,Washington, D.C., and London, projected that its 1,800employees would more than triple in the next four tofive years. When discussions between Windcrest andRackspace began in the summer of 2006, Rackspace wasalready exploring options for relocating its headquartersto other cities and states.

Windcrest crafted a package of incentives forRackspace that necessitated another enormous diplo-matic effort for Windcrest to spearhead. The packagewas largely a mixture of tax abatements and bond moneytied to a 30-year lease offer. The lease included a 14-yearproperty tax exemption that had been approved by theaffected city and county taxing entities.

Windcrest and Rackspace representatives wanted toensure that the Northeast Independent School Districtdid not lose any school funding as a result of the mallproject, and could even come out ahead. As a result, theagreement called for the tenant to make “payments inlieu of taxes” (PILOT) during the abatement period equalto the amount of interest and sinking fund monies thatthe company would have paid under normal circum-stances. In Texas, these dollars are used to provideschool facilities and are separate from the “maintenanceand operations” taxes that constitute the majority ofschool property taxes. Along with PILOT payments, thetenant would be required to pay full sales taxes on localsales made throughout the lease period.

With a focus on green building techniques, Rackspace plans to utilize the facility’s 18-foot-high ceilings by positioning offices on raised floors that will house sub-level heating and cooling systems.

Photo courtesy of Rackspace and Sixth Seal

The initial incentive package also called for Windcrestto issue approximately $100 million in taxable lease rev-enue bonds to finance the initial renovation of the mallto suit the tenant’s needs, as well as pay back the con-sortium for the purchase of the mall property itself.Additional bond issues for as much as $200 millionwould be made available for further renovation andexpansion projects in the area. The bonds would bepayable solely with the lease payments. No general fund,property taxes or sales taxes were to be used and thebonds would solely be based on the company’s credit.Additionally, Windcrest was to serve as general contrac-tor for the tenant during the remodeling of the mall tosave the 8.25 percent sales tax on the materials used incompleting improvements to the mall. At the end of thelease term, the mall property would be conveyed to thetenant for $1 under an agreement between the city andRackspace.

Finalizing the framework of incentives for Rackspacerepresented only part of the battle for Windcrest repre-sentatives. They also had to address a number of periph-eral concerns that involved the city of San Antonio andthe state of Texas.

In return for San Antonio’s agree-ment to relinquish the mall site andthe adjacent acreage, Windcrest nego-tiated a revenue-sharing agreementwith its neighbor. Windcrest wouldpay San Antonio the current level ofproperty taxes that it was alreadyreceiving from the properties plus 50percent of all property and sales taxesthat would be generated during thecourse of the 30-year lease period. SanAntonio would be guaranteed at least$4.1 million, but could collect asmuch as $34.5 million.

An opinion by the Texas attorneygeneral, meanwhile, created the needfor Windcrest to provide further reas-surances to Rackspace of the funda-mental soundness of the project. The opinion suggestedthat combining the tax abatements offered to Rackspacewithin the framework of the lease-back agreement couldbe deemed unconstitutional in a court challenge. Forexample if a taxing district decided that it did notapprove of an incentive package that the city or othergovernmental agency offered to a company, that districtcould file a suit against the constitutionality of the pack-age, thus forcing the attorney general’s office to make aruling one way or another.

To allay any possible fears on the part of Rackspace,Windcrest entered into an agreement under Section 380of the Texas Local Government Code, which contains a“make whole” provision. It would obligate Windcrest tocompensate Rackspace for any tax liability that it mightincur, if the laws that allowed Rackspace’s tax exemptionwere to change in the future. Bexar County (spearhead-ed by Commissioner Adkisson and David Marquez

of the Bexar County EconomicDevelopment Department) also gave aSection 381 agreement – a similar gov-ernment code designed specifically forcounties – to guarantee its portion.

Even as Windcrest eliminated obsta-cles and enhanced the existing proposalfor Rackspace, city representativessought to exhaust all enticement possi-bilities. They approached the Texas gov-ernor’s office with the plan for theirproject and the proposal for Rackspace,in hopes of garnering a grant from theTexas Enterprise Fund (TEF). This fundwas a key factor in 2005, 2006, and2007 when Texas won Site Selectionmagazine’s Governor’s Cup award,

which is presented to the state that secures the mostprojects in a given year to build or expand corporatefacilities.

The case for receiving grant funding was compelling,given Rackspace’s projected growth, the prospect that itsrelocation would spawn related economic activity, andthe need for revitalization in the Windcrest area. Despitethis compelling case, there were several hurdles to crossto secure funding.

As with most state programs, there is some sense ofthe need for geographical distribution, and there was ageneral perception that San Antonio had gotten its fairshare from the TEF during the past two years. In addi-tion to that, the legislature helped provide incentives forthe Toyota facility, although the TEF had not yet beencreated; that package included training dollars, infra-structure improvement, land purchase, site preparationwork dollars, as well as a facility in which to train Toyota


Remodeling of the former Mervyn’s building began in fall 2007 with anexpected completion of this section in spring 2008 when the first Rackersmove into their new offices.


Approval of the grantfrom the Texas

Enterprise Fund and thecommitment for jobtraining dollars from

the Skills DevelopmentFund amounted to thefinal pieces of a rede-

velopment puzzle thattook more than a year

to complete.


employees. Every other region of the state had certainlytaken notice of the San Antonio region’s recent successin attracting major new investments.

After a great presentation by the company and somekey support from local legislative leadership, the stateresponded by approving $22 million for the project.This is one of the largest grants awarded from the TEFand represented a significant percentage of the dollarsthat were available for the balance of the fiscal year.

Representatives of the governor’s office projected thatthe state would receive a return that is far greater in newsales tax revenues alone than the amount of the grantaward. They also estimated that keeping Rackspace frommoving would generate more than $400 million in cap-ital investment in Texas. There were no stipulationsassigned to the money, so Rackspace could use it for anypurpose that the company saw fit.

The state was able to provide one additional incentiveto urge Rackspace to grow in Texas as it became clearthat at least two other states were willing to provide sub-stantial incentives to Rackspace. That additional incen-tive was in the form of $4 million of job training fundsthrough the state’s Skills Development Fund. Workingthrough the region’s community college district, thesefunds will help ensure the quality and availability of theworkforce that is critical to Rackspace’s success.

Approval of the grant from the Texas Enterprise Fundand the commitment for job training dollars from theSkills Development Fund amounted to the final pieces ofa redevelopment puzzle that took more than a year tocomplete. On August 3, 2007, Windcrest publiclyannounced that Rackspace had signed an agreement tooccupy the former Windsor Park Mall site and take it onas the company’s corporate headquarters, with visions ofa Google, Apple, and Adobe world headquarters.

LOOKING AHEADThe outlook for Windcrest and its Walzem Road cor-

ridor changed almost overnight with Rackspace’s com-mitment. In all, as many as 6,000 Rackspace employeesare expected to be working in the remodeled mall struc-ture within the next five years. Their average salary of$51,000 will result in a payroll in excess of $300 mil-lion. Along with Rackspace’s relocation, the investmentconsortium has obtained 111 acres south of the mall sitethat will be developed into a $225 million mixed-useproject that feeds into Rackspace’s needs and was part ofthe consortium’s original vision for the area.

These figures are just the hard numbers. The comple-tion of this deal is bringing renewed recognition andinterest to Windcrest, which bodes well for future prop-erty values and tax revenue. Just since the Augustannouncement, at least nine developers have contactedWindcrest about opportunities associated with theRackspace agreement, some of whom were not interest-ed in the area prior to Rackspace.

Additionally, in December 2007, the WindcrestEconomic Development Company hosted a weeklong,public design planning process, known as a charrette

(www.whatsnextforwindsorpark.com), with renownedarchitect and city planner Andrés Duany of DuanyPlater-Zyberk & Company (DPZ). The DPZ team hassince finalized a master-plan for a true, mixed-use devel-opment south of the mall that will feed into the youth-ful culture that Rackspace is bringing to the area.Currently, the development company is working with anumber of other investors and developers to evaluatetheir potential fit into this development.

The Windcrest experience is not easily modeled.Public-private partnerships tend to involve two, ormaybe, three partners, not the five-member coalitionthat has launched this redevelopment initiative. Whatother municipalities and economic development corpo-rations can glean from this case is a lesson in persever-ance and a key to forging and maintaining alliances:focusing on the common good. The fundamentals of thisproject were sound. Moving forward became a matter ofeducating different audiences about the collective bene-fits that could be achieved for the area as a whole, if eachgroup could understand and accept its role, and retain-ing legal counsel that could steer through the complexi-ties of the project.

In this particular case, Windcrest benefited fromlawyers who were also economic development special-

• October 2005 – First public meeting held in Windcrest to discuss revitalization needs.

• January 2006 – The Walzem Road Area Revitalization organization was formed by citizens concerned about area decline.

• June 2006 – Ray Watson hired as executive director of the Windcrest Economic Development Corporation.

• July 2006 – Windcrest Economic Development Corporation and city of Windcrest meet with Rackspace to discuss options for the company relocating to the area.

• September 2006 – Private real estate developers / investors partner to form the Windcrest Economic Development Company, LLC.

• April 2007 – Windcrest announces ownership of former Windsor Park Mall property.

• May 2007 – City councils from San Antonio and Windcrest vote to approve a boundary redistribution to place the mall under the jurisdiction of the city of Windcrest.

• August 2007 –

– City councils from San Antonio and Windcrest vote to approve the entire economic incentive package being offered to Rackspace;

– Rackspace signs a lease to relocate its company headquarters to the former Windsor Park Mall.

• November 2007 – Redesign of the mall property begins.

• December 2007 – Area developers host public planning meetings to initiate master design plans for the area surrounding the mall.

• Projected in April 2008 – Rackspace expects to move several hundredemployees to its new headquarters in Windcrest.

Project Timeline

www.whatsnextforwindsorpark.com


ists. In fact, Chris Shields, the attorney who originallyhelped outline the structure of the incentive package forRackspace, actually helped draft the legislation morethan a decade ago that authorized the property tax abate-ments that made this deal possible. Shields recommend-ed Jim Plummer, a tax partner at the law firm ofFulbright & Jaworski, to handle the implementation anddocumentation for the transaction. Together, Shields andPlummer guided all of the multiple parties involvedthrough a very complex transaction.

Economic development is different today than it wasin the relatively recent past. Globalization and outsourc-ing have brought new competitive pressures to bear onthe process. Public sector entities typically are not sub-ject to market forces, but the current environmentdemands that they adopt a more aggressive stance whenit comes to attracting new investment and nurturingongoing economic activity. Existing jobs, and entirecompanies, can quickly be relocated, given the manyincentives that exist for them to do so. Remaining eco-nomically viable may involve exploring nontraditionalfunding sources. It also could require collaboration, notonly with the private sector, but with other governmen-tal bodies as well.

Forming strategic alliances to generate economies ofscale was once a practice reserved almost exclusively forthe private sector. Today, employing such tactics shouldbe a common approach for the public sector as well.Before starting a project like this, participants especiallywill need creative legal counsel that understands howeconomic development works.

Special thanks to:

The state of Texas

Rackspace

Bexar County

City of Windcrest

City of San Antonio

Christopher S. Shields, P.C.

Jim Plummer, Fulbright & Jaworski

Walzem Road Area Revitalization Group


Demolition of the second floor of the former Mervyn’s building began in fall 2007 in preparation for the first several hundred Rackspaceemployees moving into their new offices in spring 2008.

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INTRODUCTIONntil recently, historic preservationhas most often been thought ofin terms of architectural design,both by its proponents and bythose seeking to replace historic

structures with more modern ones. Thefocus is always the aspects of form, style, andunique attributes of structures which aredescriptive of the particular eras in which thesestructures were constructed. While the architec-tural attributes of historic structures tend to beaesthetically pleasing to those who live in andnear them, they also evoke a sense of culturalconnection. They are symbols of bygone eras, atangible link to the past history of an area, oftencherished for their ability to convey the intangi-ble aspects of social attitudes, cultural influ-ences, and community history and character tothe people that have contact with them.

Traditionally, conflict has arisen between thosewho have favored preservation purely for culturaland aesthetic means and those who have sought todemolish historic structures for the purposes ofeconomic development. It had long been assumedthat preservation was a hindrance to economicdevelopment – costing money to preserve historicstructures as opposed to new developments whichcan generate money through the businesses, com-mercial structures, and homes that are built uponthem. Although preservationists made many validpoints in favor of preservation, most often they had

great difficulty in fighting this perception.Primarily, this is because proponents of develop-ment are speaking in terms of realized economicgain – a dollar figure that can be quantified withconsistency. Conversely, the primary arguments infavor of historic preservation tend to be far more‘intangible’ from a cost-benefit analysis perspective.

A number of studies in recent years, particular-ly those done by Donovan Rypkema, have shownthat preservation in fact does not hinder economicdevelopment efforts, but instead can be a powerfuleconomic development tool. Industries such astourism, entertainment, environmental manage-ment, and housing can all be significantlyenhanced by historic preservation, providing

historic preservation and CLUSTER BASED ECONOMIC DEVELOPMENTBy John Laurie

BUILDING THE FUTURE ON THE FOUNDATION OF THE PASTHistoric preservation has most often been thought of in terms of architecture and aesthetic appeal as opposed to a vehicle for economic development. Recently, it has been shown that a range of industries can be economicallyfortified by historic preservation. However, historic preservation has the capacity to do far more than just bringabout positive economic outcomes in various industries. Using the cluster based economic development theory,this article will describe how a cohesive economic development effort, centered on historic preservation, can be an important part of a city’s economic development strategy. The article provides an overview of the tourism,environmental management, housing, and film making sectors in conjunction with a cluster based approach. This focus demonstrates how this approach can help cities increase inward investment and move away from imitation and toward innovation.

u

John Laurie is a research assistantat the University of New OrleansCenter for Economic Development.His email address is [email protected]

Historic New Orleans.

Photo: Chris G

ranger

ample economic development opportunities for commu-nities, cities, and even regions. While it is impressive thathistoric preservation can have positive economic out-comes for such a diverse set of industries, it is possibleto link together these seemingly unrelated componentsthrough commonalities, multiplying their economicimpact many times over. How? The key is to identifyindustries and sectors that can be improved through his-toric preservation, find the commonalities, and linkthem so they function as an integrated unit. Applyingthis cluster based economic development approach to his-toric preservation, a city or region can profoundlyimprove its economic viability.

This article will identify particular industries and sec-tors which can be positively enhanced by historic preser-vation, and it will also show the specific economic ben-efits of preservation regarding these areas, and demon-strate how these industries and sectors can function asan integrated system using a cluster based approach.

CLUSTER BASED APPROACHCluster based approaches to eco-

nomic development are microeconomi-cally based, emphasizing national, state,and local competitiveness in a globaleconomy. According to Michael Porterof the Harvard Business School, clustersare “geographic concentrations of inter-connected companies, specialized sup-pliers, service providers, firms in relatedindustries, and associated institutions(e.g. universities, standards agencies,trade associations) in a particular fieldthat compete but also cooperate.” Thisdefinition provides the framework fordeveloping a cohesive economic development planbased on historic preservation. But, what exactly does acluster based approach mean to historic preservationand economic development? Aside from being the basisof an organized economic development plan, thisapproach provides tangible and powerful benefits tothose involved in the cluster as well as the region as awhole. Specific benefits include access to specializedknowledge, skills, and resources; lower transactioncosts; specialized infrastructure; and enhanced produc-tivity and output. These benefits come from improvingcompetitiveness among firms within the cluster, from anincrease in inward investment, as local rivalries moveaway from imitation and toward innovation.

HISTORIC PRESERVATION AS AN ECONOMICDEVELOPMENT STRATEGY

Historic preservation has in fact shown that it canhave a positive economic impact on a number of indus-tries, even some which on the surface appear to be unre-lated to one another. This is in direct contrast to previ-ous, standard misconception that historic preservation isa costly luxury that must give way to new physical devel-opment in order for economic development to move for-ward in an area. Historic preservation can be an econom-

ically beneficial venture even down to the neighborhoodor block level.

Although seemingly an unorthodox player in the eco-nomic development game, historic preservation is reallyan economic tool like any other. Because of this, a neigh-borhood, city or region can benefit from shaping itthrough a cohesive approach, allowing it to function effi-ciently, and capturing revenue which otherwise wouldbe lost. However, in order to have a significant impact, acohesive strategy should be developed at least at the city-wide level, and quite possibly, even at the regional level– assuming a region has enough historic property tomake this viable.

Because preservation is able to affect a diverse range ofindustries, it appears that revenue generation is ineffi-cient, with unrealized monetary gains. Simply put, with adiverse range of industries affected by preservation, it isunlikely that many of the industries are aware that theothers benefit economically from historic preservation. Itis not only possible but probable that a number of sectorswithin each affected industry are unaware that they are

connected via historic preservation. This leads to the inef-ficiencies that cause lost revenue within the industries,businesses, the city, and the region. Finding the rightapproach or economic development strategy is crucial.

CLUSTER IDENTIFICATION AND BOUNDARIESEssential to this strategy is identification of cluster

boundaries, industries, and sectors within industries.Additionally, it is then necessary to link the interrelation-ships among sectors in each industry, even the intra-rela-tionships among sectors and industries, and identify the“spillover” created by overlapping industry sectors.Finally, determining what these relationships mean afterthey are identified is crucial. In its simplest form this isdone by identifying each industry and drawing the con-nections and linkages among them.

One of the downfalls of cluster based economic devel-opment approaches is the ease in which non-meaningfulrelationships can be drawn. Clusters are too broadlydefined if they are aggregates such as manufacturingservices, consumer goods, or “high tech.”1 In thisinstance, the groupings are so general that nearly everysector could conceivably be linked. Conversely, it is alsoeasy to identify a cluster with a single industry, missingcrucial interconnections with other industries and insti-


But, what exactly does a cluster based approach mean to historicpreservation and economic development? Aside from being the basisof an organized economic development plan, this approach provides

tangible and powerful benefits to those involved in the cluster aswell as the region as a whole. Specific benefits include access to

specialized knowledge, skills, and resources; lower transaction costs;specialized infrastructure; and enhanced productivity and output.

tutions – which is precisely the point of identifying theindustries and sectors within clusters.2 Either of thesemistakes can doom an economic development plan.

In using the cluster based approach with historicpreservation, the identification of industries related tohistoric preservation is the first, vital step. While a neces-sity when dealing with any cluster, proper industry iden-tification in the preservation cluster is absolutely criticalbecause historic preservation is, to this point, such anunorthodox approach to forming an economic develop-ment strategy.

The basic assumption previously had been that preser-vation costs money and hinders economic development.While proven to be untrue, there has been little if anythought on the industry components of preservationbecause of it. In order to identify these industries, it is nec-essary to refer back to the four areas which provided pos-itive evidence that historic preservation is indeed viable asan economic development approach. These four cate-gories – tourism, housing, the film industry, and environ-mental management – are the industry components uponwhich the historic preservation cluster is based.

TOURISMThe tourism sector is perhaps the most important and

powerful ally of historic preservation in terms of eco-nomic benefit. In the United States alone, $545.5 billionwere generated from travel related activities in 2003.3

This figure includes both domestic and internationaltravelers to the U.S. and encompasses not only travelrelated expenses but the cost of passenger fares.However, demonstrating an accurate breakdown of whatsectors actually generate tourism dollars has been histor-ically difficult as well as contentious. This is due in largepart to overlap in spending done by tourists regardingtheir interests and needs during travel. Fortunately, agreater emphasis on qualitative research has been donein recent years. This has led to greater detail and under-standing the reasons tourists spend their dollars amongsectors and more specifically, intra-sector spending.

A study done by the University of Florida’s Center forGovernmental Responsibility indicated that historicpreservation generates $4.2 billion tourist dollars annual-ly to the state of Florida – and this is considered a conservative estimate.4 This is an impressive figure consid-ering the wealth of tourism opportunities Florida has tooffer – beach and ocean related activities, theme parks,restaurants and nightclubs, and sports. Because of this, itis necessary to delineate between tourism directly relatedto historic preservation and all other tourist activities.

Researchers used a breakdown of several key areaswhich they considered relative to historic preservation –property values, assistance programs, housing rehabilita-tion, and heritage tourism. Using accepted industry for-mulas, the study found that $3.7 billion tourist dollars aredirectly related to heritage tourism.5 Tourists specificallyvisited and spent money at locations which offered theintangible attributes that historic preservation has to offer.This makes a clear connection between the intangible cul-

tural, architectural, and historic elements of preservationand the tangible, quantifiable element of money.

It can be argued that a state such as Florida, with itsmany natural attributes, is a tourism magnet and thiswould seem to skew upward tourism dollars generatedfrom historic preservation. With tens of millions of peo-ple visiting Florida every year, at least a portion would bewilling to visit locations with a heavy emphasis on his-toric preservation. However, studies conducted byDonovan Rypkema show that the most frequently visit-ed states by heritage and cultural visitors are New York,California, and Pennsylvania.6

The most frequently visited states have economieswhich are not nearly as tourist driven as Florida, focus-ing far more on finance, industrial, real estate, and bank-ing sectors. This is a clear indication that people are will-ing to travel to locales not necessarily dependent ontourism in general, in order to experience (spendmoney) areas with high levels of historic and culturalvalue. Rypkema’s studies have also shown that heritagevisitors – those who travel for the historic and culturalattributes of a locale – contribute more dollars to thetourism industry nationwide than any other type of vis-itor (See figure 1).


Heritage tourism visitors spend more money than the average traveler.

Photo: Sydney Harbour Foreshore A

uthority

Figure 1. Attributes of Heritage Visitors

• Heritage visitors spend, on average, $615 per trip, compared to $425 for all U.S. travelers.

• Travelers at historic and cultural sites stay an average of 4.7 nights as compared to 3.3 nights for all U.S. travelers.

• Travelers to historic and cultural sites are more likely to shop as part of their trip.

• Heritage visitors are more likely to stay in a hotel, motel, or bed and breakfast.

• Travelers to historic and cultural sites are more than twice as likely to take a group tour than the average traveler.

(Rypkema and Wiehagen, 1998)


HOUSINGTraditionally, maintaining and rehabilitating homes

has been little more than an afterthought. This has beenespecially true since World War II when the newer, big-ger better attitude of American consumerism took hold.The standard development pattern since this time hasbeen to continually develop the less expensive, less reg-ulated, fringe areas away from the more populated urbancores. However, recently the U.S. has witnessed anincrease in the number of housing rehabilitations occur-ring in cities, and an increasing percentage of those havebeen historic rehabilitations. Historic rehabilitationshave been most prevalent in older cities, particularlythose which have significant numbers of historic homes.

Historic preservation is able to spur economic devel-opment through housing rehabilitation tied to theHistoric Rehabilitation Tax Credit (HRTC). Created in1976 and amended in 1986, it allows for a 20 percenttax investment credit for the rehabilitation of income pro-ducing properties7. The investment tax credit (ITC)allows investors to deduct dollar for dollar against theirfederal income taxes. In order to qualify, structures beingrehabilitated must be a Certified Historic Structure.According to HRTC guidelines, the rehabilitation mustbe ‘substantial’ – more than $5,000 or the adjusted basisof the renovated property, whichever is greater.8

For the last 25 years, both developers and non-profitorganizations alike have used this tool, allowing for therehabilitation of homes in areas with historic structures.

From 1990 to 1994, rehabilitation represented almost80 percent of the total value of central city constructionin St. Louis and 50 to 60 percent in Baltimore,Cleveland, Detroit, Philadelphia, San Francisco, andWashington D.C.9 While not all rehabilitation of housingstock has been to historic structures, preservation playsan important role in the rehabilitation process. It is esti-mated that 5 to 10 percent of all rehabilitation construc-tion is historic and this percentage tends to be higher inmore densely constructed urban areas and older sub-urbs, at about 7 to 10 percent.10

A peripheral benefit to the use of federal tax incen-tives for historic building rehabilitation has been theincrease in affordable housing stock in the urban core.While on its face, affordable housing may seem to beonly a nice social benefit, it provides opportunities forrevenue generation through taxes and commerce. It alsohelps to encourage further historic preservation efforts ascities begin to recognize people have once again begunto desire to live in close proximity to the amenities of theurban core.

Richard Moe, president of the National Trust forHistoric Preservation, has noted that over the next tenyears, approximately 20 million new jobs will be createdand about 7 million of those will produce incomes of less

than $20,000 per year.11 The people who holdthose jobs will require affordable housing,preferably within moderate driving or possiblyeven walking distance from where they work.

It would seem unlikely that historic preser-vation efforts could be a contributor to afford-able housing stock – it has often been criti-cized as having an ‘elitist’ effect on neighbor-hoods. The argument has been that while his-toric preservation increases home valueswhich increases revenue through propertytaxes, it also increases rent and the cost of liv-ing (often through these same revenue gener-ating taxes) for those low-to moderate-incomeresidents, often displacing them. This is large-ly a myth.

According to the National Park Service,$4.76 billion has been invested in projects ithas reviewed and approved, including 27,851

low-to moderate-income housing units. This constitutes44 percent of all housing units completed through thehistoric preservation tax credit program in the same fiveyears.12 The Colorado Housing and Finance Authority(CHFA) has found that while historic home rehabilita-tion brings newcomers to an area, only a small portionof them have incomes that are significantly higher thanexisting residents. In historic districts studied by theCHFA, more than half the residents had householdincomes of $30,000 per year or less. This serves as aclear indication that wealth is not a prerequisite for his-toric home rehabilitation, and lower income residentscan benefit from and play a role in historic preservationefforts.

FILM INDUSTRYTraditionally, the film industry has been most closely

associated with Hollywood. Many of the films producedhave used historical settings as part of their backdrop.While technology has continually improved over theyears, especially the last 20 years, there is still a need fora physical representation of the historical built environ-ment. While this can be done by physically constructingbackdrops or even entire towns, it is often preferable tofilm at a location with buildings that have authentic his-toric value. Aside from contributing to authenticity, it is

Cornell University Students Participate in Historic Rehabilitation in Post-Katrina New Orleans.

Phot

o: S

amue

l Bel

l


also more cost effective for production companies totravel to a given location than it is to build entire cityreproductions.

Because of this need for historical authenticity, citiesnot normally associated with the film industry havebecome prominent locations. These include Philadelphia;Montreal; New Orleans; Chicago; and Asheville, NorthCarolina. These places have become movie industry hubsbecause of their ability to convey a particular time andplace. In fact, they do not always represent only their actu-al location or region in films. Often, these cities are usedto represent other cities in movies because of the wholesaledemolition of historic structures and/or neighborhoods inmany parts of the country.

The movie “Beloved” for example, was set inCincinnati in the 1880’s. Unfortunately, too many of thebuildings from that time period in the city had beendemolished to realistically portray the historical contextof the movie. Instead, the movie was shot in

Philadelphia, where entire blocks of buildings from theappropriate time period remain. This movie alone had a$15 million direct economic impact on the city.13 Eightother movies have been filmed in the past decade usingthe historic elements which are unique to Philadelphia.All have had similar direct economic benefits throughcast and crew patronage, taxes, the hiring of local work-ers/laborers, and tourism related activities.

The film industry has had an important economicimpact in other cities as well. Asheville, North Carolina,with a population of only 90,000, now has the thirdlargest film industry in the country. Since 1980, the tiny

city has seen direct expenditures of over $4.6 billion.14

This is directly related to the city’s significant historicalstock, variety of housing styles, and its location (nestledin the Blue Ridge Mountains) making it a versatile film-ing location.

Along with the recognition produced by mass movieaudiences and increasing tourism to the state, there is alsothe benefit of taxes on production, equipment, salaries,and accommodations. Additionally, there is a boost to thelocal economy in terms of money generated by specializedand non-specialized workers needed as part of the entireproduction process.

As many urban areas throughout the country havelost much of their historic fabric in the last 50 years,cities which continue to have high quantities and quali-ty of historic buildings will continue to reap the benefitsof the movie industry. In fact, it is likely that they willbecome even more prominent players in Hollywood, asmany urban areas are so devoid of their once plentifulhistory that they are no longer accurately able to repre-sent themselves as a particular time period.

ENVIRONMENTAL MANAGEMENTWhile historic preservation would seem to be capable

of having a positive economic effect on tourism, hous-ing, and the film industry, environmental management

would seem to be an unlikely component.However, historic preservation and environmen-tal management efforts are working towards thesame ends, while following a parallel track. Themost tangible link between the two is brownfieldredevelopment. Again, this may seem like a bare-ly plausible connection, but both preservationand brownfield redevelopment address the issuesof growth management, community develop-ment, quality of life, and neighborhood revitaliza-tion.15 More specifically, both preservation and

brownfield redevelopment seek to achieve the same endgoals: a cleaner environment, the infill of urban centers,economic development/revitalization, and creative, pro-ductive communities.

Through its nature, historic preservation is an envi-ronmentally friendly practice. Not only does it save orrehabilitate old buildings, but it also reduces the need fornew structures. Historic preservation is environmentallysound because by bringing a building back into com-merce through adaptive reuse, communities can contin-ue to draw on existing infrastructure, such as sewers,roads, and electrical wiring.16

Most new construction is not cost effective, as it istypically low-density in nature, and consumes more landper person than the traditional urban core. Building newstructures on undeveloped land requires new infrastruc-ture, causing negative environmental impacts, such asnon-permeable surfaces, disrupted habitat areas,increased non-point source pollution, and demand formore ground water.

It is estimated that for every dollar gained in taxes andfees for new developments, that it costs a community

As many urban areas throughout thecountry have lost much of their historic

fabric in the last 50 years, cities which con-tinue to have high quantities and quality ofhistoric buildingswill continue to

reap the benefitsof the movie

industry.

Brownfield Redevelopment Site in Florida.

Photo: State of Florida

Director Steven Zaillian on the set of “All the Kings Men”in New Orleans.

Photo: Kerry Hayes

Although each industry in and of itself functionsautonomously from the others, they are linked as each

contributes to the preservation cluster.

two dollars in infrastructure requirements. These nega-tive effects are enhanced more rapidly when brownfieldsites are involved. Communities with brownfields cansuffer from increased health risks, a decline in livability,decreased tax revenues, and job losses. These blightedsights actually induce sprawl more rapidly as residentsseek to move away from these contaminated areas,underscoring the need for historic preservation efforts atthese sites.

Most often thought of as contaminated industrialsites, many of the estimated 130,000 to 450,000 brown-field sites are actually very conducive to preservationefforts. Many of these sites have buildings dating fromthe late 1800’s to the early 1930’s, which were used formanufacturing. In terms of serving their intended pur-pose, these buildings have become functionally obsolete.However, the same elements which made them obsoleteas technology and innovation improved make them idealfor adaptive reuse through historic rehabilitation. Theytend to have a boxy, utilitarian shape which can easily bereconfigured into highly customized spaces, especiallyfor condominiums or apartments.

Many buildings have distinctive elements such assturdy brick construction, old brick walls, high ceilings,wood columns or beams, intricate metalwork, hardwoodfloors, and cannot be easily or inexpensively replicatedby new construction. These features coupled with thetendency for many brownfield sites to be located next to

rivers in urban areas have led to remediation and preser-vation efforts in cities across the United States over thelast decade.

LINKAGES AND PRODUCTIVITYThe historic preservation cluster model will vary with

each city, depending on the quality and quantity of his-toric structures, the emphasis placed on tourism, and theemphasis placed on environmental quality and regula-tion. Therefore it is necessary to use a generic model, onewhich can demonstrate in general terms, the use of acluster based approach to historic preservation.Illustrated in Figure 2, the historic preservation clustercan be defined as a horizontal cluster, one in which thecomponent industries have common resource bases, butfew logical buyer-supplier linkages.17

Although each industry in and of itself functionsautonomously from the others, they are linked as eachcontributes to the preservation cluster. Using the gener-ic model, each of the four industries is broken down intosectors. Each sector in an industry is linked to oneanother as it contributes to that industry by providingservices or commodities – acting as suppliers.

Another way in which linkages can be observed is ina number of supplier overlaps among the industries –which links industry to industry in the cluster. Overlapsoccur in the security, landscaping, sanitation, construc-tion, real estate, university/research, hotel, retail, public


Figure 2. Historic Preservation Cluster

Tourism Film Housing Environmental Management

Hotels Hotels Architects Bioremediation

Restaurants Restaurants Interior Design Construction

Bars Artists Construction Planning

Museums Retail Landscaping Real Estate

Tour Groups Public Relations Real Estate University/Research

Retail Security Security Sanitation

Transportation University/Research Sanitation Landscaping

Public Relations Planning Planning Regulatory Agencies

University/Research Construction Regulatory Agencies

Security Real Estate University/Research

Sanitation

Planning

Overlap SuppliersConstruction

Hotels

Landscaping

Planning

Public Relations

Real Estate

Regulatory Agencies

Restaurants

Retail

Sanitation

Security

University/Research

relations, finance, and planning sectors. The key is toenable these overlapping sectors to share these resourcesthrough intra-cluster recognition and identification, andmaking an effort to use as many local suppliers as possi-ble, further strengthening the local economy.

This spillover effect actually helps to increase compe-tition among sectors and industries. A cluster can affectthis competition in three ways: by increasing the pro-ductivity of constituent firms or industries, increasingthe capacity for innovation, and stimulating new busi-ness formation that supports innovation – expandingthe cluster.18 This cooperation/competition cyclespawned by the cluster leads to increased productivity.According to Porter (2000), productivity is increased inthe following ways (examples of each using the historicpreservation cluster provided by the author):

Access to Specialized Inputs and Employees – Relying onfirms within the cluster for commodities and labor, ineffect insourcing instead of outsourcing. For example,construction and construction related firms play a largerole in historic preservation. These firms are used by themajority of industries within the preservation cluster(housing, film, environmental management), with highlyspecialized skills directly applicable to preservation. Thelocal pool of talent, familiar with the needs and require-ments of preservation, can be drawn on for its expertise.

Incentives and Performance Measurement – This is theessence of internal cluster competition. Because of thequick spread of reputation and performance within thelocal cluster, the likeliness of poor service or faulty prod-ucts is drastically reduced. For example, security is a linkamong the tourism, film, and housing industries in thehistoric preservation cluster. If a company provided secu-rity services that were lackluster, this information wouldmove quickly within the cluster, resulting in significantlydecreased employment opportunities for the offendingsecurity firm. In order to maintain a solid reputation, eachsecurity company must continually provide high or high-er levels of service.

Access to Institutions and Public Goods – Clusters allow forinvestment and return through public institutions, such asschools or universities, much more cheaply. Many univer-sities will offer programs which draw on the strengths ofthe local economy. Graduates with specialized skills comemore readily trained and are more cost effective than train-ing new employees without such knowledge. Firm invest-ment in university research, program design, and graduateassistantships and internships provides a cost effective wayfor industries in the historic preservation cluster to bemore productive and competitive.

Complementarities – Coordination among firms in sec-tors related to a specific industry or industries results inhigher customer satisfaction and therefore higherreturns. In the tourism industry, the tourist’s experienceis affected not only by the quality of the activity itself,but also by the related sectors, such as hotels, taxis,restaurants, and tour guides. Coordination among thesegroups results in higher customer satisfaction, and even-tually, greater numbers of tourists and dollars spent.

POLICY RECOMMENDATIONS How does a city or region begin to develop a cluster

based economic development approach to historicpreservation? The best way is not necessarily to developa comprehensive and complex plan. Using the availableresources is an excellent starting point. Why? Because itis probable that any area with a strong preservation

movement already has the necessary resources availableto develop a comprehensive approach. These resourcesmay include historic district boundaries, individualbuilding ratings, zoning and codes, building types, andknowledge of future projects within or adjacent to his-torically sensitive areas.

The ‘players’ however, are likely unaware that they arepart of a historic preservation cluster, and are linked toother sectors and industries within the cluster. Takingthis into consideration, the basis of an economic devel-opment policy can be formed by using the followingsuggestions:

Identify each industry’s components on a city by citybasis. Each city will have a slightly different historicpreservation cluster model based on quantity, quality,and emphasis on regulation for historic preservation as awhole, and within each identified industry.

Focus Groups should be used to bring together the sec-tors in each industry. This is necessary because many ofthese sectors will either be unaware of one another orpossibly only vaguely aware that they share some of thesame suppliers. They certainly would be unaware thatthey are part of a cluster.

Determine policy and program needs using focusgroups. Focus groups should be viewed as a valuablepolicy shaping tool. The groups, which are comprised ofsectors in each industry, are in the best position to deter-mine their needs and to help develop a comprehensiveeconomic development policy.

Consolidate supplier resources within overlap groups.A number of sectors between industries use some of thesame services and suppliers. It is important to determine


Because of the quick spread of reputation and performance within the local cluster, the likeliness of

poor service or faulty products is drastically reduced. Forexample, security is a link among the tourism, film, and

housing industries in the historic preservation cluster. If acompany provided security services that were lackluster,this information would move quickly within the cluster,resulting in significantly decreased employment oppor-

tunities for the offending security firm. In order to main-tain a solid reputation, each security company mustcontinually provide high or higher levels of service.


what these are and to make an effort to use local sup-plies, suppliers, and services, further strengthening theeconomic ties within the cluster.

An excellent example of the importance of following acluster based approach is within the film sector of his-toric preservation, a recently burgeoning industry with-in the preservation heavy city of New Orleans. While therecent explosion of the film industry in Louisiana, andparticularly New Orleans, can be attributed to the taxincentives program aimed at luring movie production,the backbone of film making is the vast amount of his-toric structures which can be portrayed as a variety oftime periods, cities, and regions.

While Hurricane Katrina caused a temporary slow-down in movie production – many of the movies alreadyin production were shifted to unaffected areas of thestate in the year following the storm – Hollywood hasreturned to New Orleans and more movies are beingmade there than ever before. Even though many of thesemovies do not fit the mold of the $100 millionHollywood blockbuster, their proliferation is strainingthe already thin ranks of skilled workers needed in themovie industry, as the city continues to repopulate.

The type and skills of workers needed cover a broadspectrum – electricians, carpenters, painters, makeupartists, office workers, and various assistants. This pres-ents speculation that New Orleans may not be able tosustain the momentum in film production.

While a work force shortage may not necessarilycause movie makers to move to locations that have amore ample supply of the workers needed, it could havethe effect of causing the growth in the movie industry tostagnate. But it is not as if New Orleans does not have thenecessary amount of talented and skilled workers to fillthe positions. It is likely that if the policy recommenda-tions for the formation of a historic preservation clusterwere followed, that the workers needed and the movieindustry both would be aware of corresponding needsand skills. While not all films in New Orleans require ahistoric preservation component, the skilled labor need-ed could be identified as part of the ‘overlap suppliers’ inthe overall historic preservation cluster. This awarenessof various industries and individuals within a cluster is akey component to developing a successful cluster.

History has shown that most people within clustersare not at all aware that they are connected in variousways to people in seemingly different industries but whoare nonetheless part of a network of suppliers whichoverlap. As part of an overall historic preservation clus-ter in the New Orleans metro region, it is likely that thesame workers and suppliers needed for the movie indus-try are also functioning within other sectors of the clus-ter; they simply have not been identified and consolidat-ed in a meaningful way.

CONCLUSIONMany urban cores across the country have been built

and built upon by generations of people, each investing apart of themselves into the fabric of the area. The result is

a rich inventory of history and heritage through the builtenvironment, which serves as a viable, powerful econom-ic engine in the form of historic preservation today. Theintrinsic cultural and architectural value of these buildingsand neighborhoods alone is worth the effort to preservethem for the educational, historical, and aesthetic valuethat they provide. Unfortunately, developers frequentlyoverlook the covert values of historic preservation, insteadchoosing to focus on the easily defined economic values ofnew development, which can easily be demonstrated toshareholders and lending officers.

Historic structures are often thought to be cost pro-hibitive because they often lack amenities such as com-munication infrastructure, modern floor plans, adequateoff street parking, and require more upkeep than con-temporary structures. From a development standpoint, itis just more simple and convenient to remove historicstructures and to build modern structures with specificamenities in their place.

In order to stave off destruction of historic structures,neighborhoods, and communities via development, his-toric preservation must be able to prove its worth in termsof realized, tangible economic benefits rather than intan-gible, cultural benefits. Preservation must have cumulativeeconomic benefits that put it on par with other economicdevelopment efforts which are more convenient to enactbut are highly destructive to preservation efforts.

Fortunately, preservation is not only compatible withcontemporary economic development efforts, but the fourindustries of tourism, housing, environmental manage-ment, and the film industry are viable, profitable keys tothe use of historic preservation as an economic develop-ment strategy. These industries can actually have their eco-nomic output amplified if developed as an integrated eco-nomic development effort. Using a cluster based approachto historic preservation can alter the economic develop-ment of a city and region by linking the sectors and ulti-mately the industries themselves. This allows for the con-solidation of resources, increased industry competitive-ness, and an investment that benefits existing sectors, andattracts new firms. By taking this approach, historicpreservation will be viewed less as an expensive luxuryand more as a driving economic force within a metropol-itan region as part of a cohesive economic developmentstrategy.

ENDNOTES1 Porter 2000, 172 Porter 2000, 173 Travel Industry Association

of America 20044 McClendon 2003, 25 McClendon 2003, 26 Rypkema and Wiehagen 19987 Stipe 2003, 658 Stipe 2003, 659 Listokin and Listokin 2001

10 Listokin and Listokin 200111 Maharaj 200212 Listokin and Listokin 200113 Rypkema and

Wiehagen 199814 Rypkema 199715 Paulus 2001, 116 Singer and Ploetz 2002, 717 Held 1996, 25018 Porter 2000, 21


SELECTED BIBLIOGRAPHY

Bingham, Richard and Robert Mier, eds. (1997) Dilemmas of UrbanEconomic Development. London, England: Sage Publications.

Ceraso, Karen. (1999) Eyesore to Community Asset: HistoricPreservation Creates Affordable Housing and Livable Neighbor-hoods. National Housing Institute – Shelterforce 106(4) Retrieved December 5, 2005 from http://www.nhi.org/online/issues/106/ceraso.html.

Colorado Status of Housing 2000. The Affordability Challenge,Colorado Housing and Finance Authority, 2000.

Economic Research: Economic Impacts of Tourism and Travel.Retrieved March 15, 2005 from http://www.tia.org/Travel/eco-nomicimpact.asp.

Held, James R. (1996) “Clusters as an Economic DevelopmentTool: Beyond the Pitfalls.” Economic Development Quarterly 10(3),pgs. 249-261.

Incentives (n.d.) Retrieved December 10, 2005 fromhttp://www.filminpa/filminpa/index.jsp.

Listokin, David and Barbara Listokin. (2004) Historic Preservationand Affordable Housing: Leveraging Old Resources for NewOpportunities. Fannie Mae Foundation Housing Facts and Findings3(2). Retrieved December 12, 2005 from http://www.fanniemae-foundation.org/programs/hff/v3i2-histpres.shtml.

Maharaj, Nicole. (2002) Historic Preservation Helps Spur AffordableHousing. U.S. Mayors Newspaper, Retrieved March 12, 2005 fromhttp://www.usmayors.org/usmc/us_mayor_newspaper/docu-ments/07_01_02/hist_preserve.asp.

Malizia, Emil E. and Edward J. Feser. (1999) Understanding LocalEconomic Development. Rutgers, New Jersey: Rutgers Press.

McClendon, Timothy and JoAnn Klein. (2003) “HistoricPreservation: Value Added.” Explore Magazine 8(1), pgs. 1-5.

Morris, Marya. (1992) Innovative Tools for Historic Preservation.Chicago, Illinois: American Planning Association, 1992.

Nickless, Pamela. (1997) Economic Development and HistoricPreservation. Retrieved December 6, 2005 fromhttp://www.psabc.org/news/econ.htm.

Porter, Michael. (2000) “Location, Competition and EconomicDevelopment: Local Clusters in a Global Economy,” EconomicDevelopment Quarterly 14(1), pgs. 7-34.

Paulus, Emily L. (2001) The Role of Historic Preservation in theRedevelopment of Urban Brownfields, University of Delaware.

Rypkema, Donovan D. (1997) Profiting From the Past: The Impact ofHistoric Preservation in North Carolina, Preservation NorthCarolina. Retrieved March 10, 2005 fromhttp://www.presnc.org/learnmore/newsletters/winter1998b.html.

Rypkema, Donovan D. and Katherine Wichagen. (1998) The Economic Benefits of Preserving Philadelphia’s Past, Preservation Alliance for Greater Philadelphia, RetrievedDecember 10, 2005 from http://www.preservationalliance.com/resources_EconBene.php#intro.

Singer, Molly and Adam Ploetz. (2002) Old Tools and NewMeasurements: Local Government Coordination of BrownfieldsRedevelopment for Historic and Cultural Reuses, InternationalCity/County Management Association.

Stipe, Robert E., ed. (2003) A Richer Heritage: Historic PreservationIn the Twenty-First Century. North Carolina: University of NorthCarolina Press.

Walker, Dave. (2004, August 18). It takes a thief: Andre Braugher’sFX series pilot could become the biggest N.O. production yet. The Times-Picayune, pgs. E1, E2.

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