The Role of Elected Officials in Community and Economic Development

February 23, 2018

Economic Development for Cities

There are 538 cities in Georgia, with 44% having fewer than 1,000 residents, and 83% having fewer than 10,000 residents (based on 2016 U.S. Census population estimates). Although these numbers may be surprising, the reality is city officials frequently do not have the tax base to devote a lot of financial resources to economic development initiatives. That is why it is important to have an economic development strategy that is reasonable and represents the interests of the mayor, council, and citizens. More importantly, the strategy should be coordinated with the economic development strategies of other governmental entities, including chambers of commerce, development authorities and convention and visitors bureaus. And, of course, resources should be allocated for economic development activities that support these combined strategies for the most effective and efficient use of government funds.

The Strategy
The first step in developing an economic development strategy is gathering input from council members, citizens, and other interested individuals and organizations. Ideas and information gathered should then become part of the economic element of your comprehensive plan. After adoption of your government’s comprehensive plan, the economic development element of that plan should become the strategy that the community follows and supports. With limited resources to finance economic development efforts, it is important that municipal officials partner with other governments and organizations to ensure successful implementation of the strategy.

Special Knowledge is Required
Every elected official should have knowledge of 1) the essentials of development, 2) the “players” that can assist and support a community’s strategy, and 3) the tools that are available to assist with economic development projects. Economic Development related raining is available through GMA in partnership with the Georgia Academy for Economic Development. The organization offers a regional program that introduces elected officials to the following concepts, strategies, and resources:
  • The three essentials of development are leadership development, community development, and economic development.
  • The players may include bankers, educators, attorneys, existing business representatives, local, regional and statewide economic development professionals, regional development centers, state agencies, and others.
  • The tools include, but are not limited to, Downtown Development Authorities, Development Authorities, financing programs, quality growth principles, incentives, hotel/motel taxes, Freeport, city business improvement districts, tax increment financing, infrastructure, affordable workforce housing, education and workforce training programs, business retention initiatives, entrepreneurial development programs, and publicly owned available land or buildings.
Development Essentials
How do you, as an elected official, ensure that your city has the three essentials of development?

Leadership is generally considered the key component for successful economic development. You should encourage the implementation of formal leadership development programs, both youth and adult. Not every city needs a program, but there should be an annual program in every county. Elected officials should participate in these programs as a class participant and an alumni presenter. Elected officials should develop programs to recognize citizens that participate in local leadership programs and should look to class graduates when making appointments to boards and leadership positions in the community. In building a strong leadership base in your community, one should encourage inclusiveness, not exclusiveness. The more that you can encourage the recruitment and participation of all sectors of your community, the more successful you will be in implementing your economic development strategy.

Community development is the second essential of economic development. Community development includes social infrastructure, physical infrastructure, and workforce development. Social infrastructure includes the provision of basic human services, effective and efficient governance, and educated, capable, and visionary leadership. As an elected official, you don’t have to have a Ph.D., but you do need to participate in training opportunities provided by your association, colleges, and universities that give you the training and knowledge that you need to be an effective municipal official. Water, sewer, stormwater, gas, electricity, transportation networks, telecommunications, and fiber optics are all essential parts of physical infrastructure. As a municipal official, you must ensure that these amenities are provided in the most efficient manner possible at the lowest cost available. Dependable, efficient and cost-effective infrastructure may be the key ingredient in reaching your economic development goals. Finally, a strong K-12 educational system, opportunities for post-secondary training and degrees as well as workforce training to meet the specific needs of employers are additional ingredients that must be considered when developing your strategy.

The third essential for a successful strategy is the economic development component. Business retention and expansion, entrepreneur development, small business support, financial incentives and new business recruitment are all parts of a complete strategy. In addition, tourism development and downtown development are effective strategies for many cities. As an elected body, the city council must understand the issues that impact your existing business base. Recognition that your existing businesses are the most important element in this mix is vital. There are tools that can help a community determine the impacts of local government policies on local businesses. Your comprehensive plan economic element should identify niches in your community that an entrepreneur can successfully fill. Identification of your community’s assets can help you determine appropriate targets for business recruitment. New business development can include everything from film and movie, heritage and nature-based tourism, recreation and natural resource development, retirement, and alternative agriculture opportunities to downtown development. Without a strong, vibrant downtown many of these alternatives may not even be possible. The importance of investing and maintaining a strong downtown business core is discussed later, as is economic development financing.

It's a Process, Not an Event
There are many resources that local, regional, state and federal organizations can provide to support your economic development efforts. It is incumbent on you to educate yourself about these resources. Remember that economic development is a process, not an event. There must be a long-term commitment of time and resources from a broad cross-section of your community. You must work to ensure that you have the three essentials of development to ensure sustainable economic development success.

Without a plan that has the buy-in of your citizens, players, and partners, you cannot sustain development. Your goal is to create wealth for all your citizens and to guide growth and development with a plan that creates and retains wealth while encouraging reinvestment in your community.

To learn more about special economic development training opportunities and leadership skill development, visit Georgia Academy for Economic Development or contact Corinne Thornton at (706) 340-6461.

Downtown Development in Georgia

Downtown development has proven to be an essential part of a community’s overall economic development strategy. It can be argued that a healthy and vibrant city or town center is one of the most important elements of an effective economic development program. Even if people do not live in the city proper, polls have shown that people identify with their nearest city or town and view it as their hometown. These same polls have shown overwhelmingly that people value a safe, vibrant, and healthy downtown. The downtown area of a city is often the largest employer in a city—it is almost always in the top three. The collection of retail, office, governmental, and service workers located in downtown can be from the low hundreds in a small town to over a thousand in a larger city. And these jobs are by their very nature diversified, so that most downtowns remain a strong and flexible employment center.

Downtown is also critical in the development of classic and cultural tourism. Studies have shown that small towns and historic places are second only to beaches in terms of the most desirable places to visit, and a city’s downtown and surrounding neighborhoods are the embodiment of the history and culture of a community.

Downtown is also a ready-made business incubator, particularly for small service-based businesses that need limited space at an affordable rate. And since 80% of all workers are employed in small businesses across America, downtowns continue to provide reasonable space for the emerging small businesses that form the backbone of the American economy.

Across Georgia, downtowns are experiencing a housing boom, with everything from small-scale upper floor rehabilitations for apartments to the construction of major new developments in and around downtown. In the smallest to the largest of cities, investors are discovering the benefits of investing in our downtowns, and people are discovering the joys and benefits of living downtown.

Finally, investing in downtown development has returned some significant dividends statewide. The Georgia Main Street Program began in Georgia in 1980 as one of the original pilot state coordinating programs of the National Main Street Initiative launched by the National Trust for Historic Preservation. The Georgia Main Street program began with five local communities, and it presently has 111 participating communities throughout the state. In FY 2015-16 alone, 3,652 net new jobs were created, 1,019 new businesses were opened, and 661 building rehabilitation projects were completed in Georgia’s Main Street communities, with total public and private sector investment exceeding $588 million. That is reason enough for city leaders to continue to nurture downtowns as the heart and soul of their cities.

Technical Assistance for Downtown Development
The Department of Community Affairs’ Office of Downtown Development coordinates the Main Street program. This program assists Georgia cities and neighborhoods in the development of their core commercial areas. Assistance provided by the Office of Downtown Development emphasizes community-based, self-help efforts grounded in the principles of professional, comprehensive management of core commercial districts. Communities are expected to work within the context of historic preservation and the National Main Street Center’s Four-Point Approach to Downtown Revitalization™.

The Office of Downtown Development offers a tiered-level approach to the Georgia Main Street Program, with the following tiers: Downtown Start-Up Program; Classic Main Street Program; Georgia Exceptional Main Streets; and Downtown Affiliate Network. Classic Main Street communities make up the vast majority of the network of communities and are designated as nationally accredited Main Street America cities.

Elected Officials Role in Downtown Development
Elected officials can and must play an active role in encouraging downtown development. The following is a list of steps local officials can take to help foster and sustain meaningful downtown development activity:
  1. Encourage Public Discussion on the Need for Downtown Revitalization. If no downtown revitalization effort exists, begin a series of public meetings to discuss the need for revitalization. Invite speakers from nearby successful Georgia Main Street cities to share their stories, and invite speakers from GMA, DCA, UGA, or other partner organizations to discuss resources available to assist your community in starting up a revitalization effort.
  2. Build a Public/Private Partnership to Support Downtown Development. Bring together key members of the community, representing both the public and the private sectors, to discuss downtown revitalization. Build an initial public/private leadership group to explore the various ways a revitalization effort can be started and sustained over time. This always needs to be done with the active involvement of property owners and merchants in your downtown.
  3. Authorize a Downtown Development Authority. By state statute, every city in Georgia has the authorization to create a Downtown Development Authority (DDA) through city council action. All that is required is a resolution from council to declare the need for the authority, appoint authority members, and establish reasonable downtown development boundaries to activate the authority. Start by sending representatives of the public and private sectors to the next GMA-sponsored DDA training program. For more information on Downtown Development Authorities, please visit this GMA website
Provide Consistent Support for Downtown Revitalization
Just like the economic development process, understand that downtown revitalization is a process, not a project, product, or event. By working incrementally overtime, success will be achieved and—most importantly—sustained.

To learn more about DCA's services, please contact Jessica Reynolds, Director, Office of Downtown Development, at (404) 679-4859.

The Georgia Cities Foundation
The Georgia Cities Foundation (GCF) is a non-profit organization originally established by the Georgia Municipal Association. The goal of the Foundation is to promote economically sustainable projects and build partnerships to help ensure the long-term health and economic vitality of Georgia’s downtown areas. This is being accomplished through the infusion of capital via a revolving loan fund program. Through its revolving loan fund program, GCF desires to assist in the rehabilitation and adaptive reuse of historic and dilapidated downtown buildings throughout Georgia, thus allowing these structures to thrive again as retail shops, offices, restaurants, theatres, and residences.

The Georgia Cities Foundation works in partnership with DCA to obtain the maximum level of state financial support for GCF projects. Most of the GCF loans that have been made to cities have been matched dollar-for-dollar with loan commitments from DCA through their state-funded Downtown Development Revolving Loan Fund program.

The Foundation also works closely with local banks in most of its loan projects. The Foundation’s revolving loan fund program is not designed to compete with local banks; rather, the Foundation seeks to work with conventional lenders, private developers/investors, DCA, and others to develop a successful financing structure for each potential downtown project. The infusion of a low-interest GCF loan, when combined with conventional bank financing, results in a “blended” interest rate that is below market rates. The result is reduced debt service costs, which allows many project developers/investors to proceed with their good, but difficult, downtown projects that might be impossible to complete otherwise. Another result is access to capital, which has become extremely important since the Great Recession, as most banks are no longer willing to provide 80-90% financing for downtown projects.

The GCF Revolving Loan Fund program welcomes applications from cities in Georgia in conjunction with their Downtown Development Authority, which are requesting financial assistance in their efforts to revitalize and enhance their downtown areas.

Georgia Downtown Renaissance Partnership Programs
Downtowns in Georgia are the heart of our communities and are integral to the economic prosperity of our cities and state. The Georgia Downtown Renaissance Partnership was created to foster vibrant downtowns. The Partnership provides access to technical assistance for clear and concise strategic downtown visions and plans for local government leaders, downtown development authorities, chambers of commerce, downtown merchants, property owners, lending institutions, and citizens. The Partnership seeks to ensure all downtowns and cities in Georgia have the tools needed to realize their vision and potential.

In 2013, the Georgia Downtown Renaissance Partnership developed the following programs to assist cities with downtown strategic visioning, planning, design and technical services:
  • Renaissance Strategic Visioning & Planning (RSVP) Program: This program assists cities in creating an initial vision and short-term work program for their downtown areas.
  • Downtown Renaissance Fellows Program: Through this program, an undergraduate landscape architecture student at UGA is assigned to work with a participating city during the summer months, providing technical and design services.
  • Downtown Renaissance Planning & Design Studio: During an academic semester, students within UGA’s College of Environment & Design are provided an opportunity to focus their skills and knowledge on a downtown project.   
For additional information about the Georgia Cities Foundation, please contact Perry Hiott, GCF Managing Director, at (678) 686-6207.

Georgia Downtown Association
The Georgia Downtown Association (GDA) is a non-profit association that promotes the economic redevelopment of Georgia’s downtowns. Through advocacy, education and marketing, GDA works to focus the public’s attention on the value of downtown. GDA has several programs that are designed to increase the opportunities for and multiply the talents of its members. Membership in the Georgia Downtown Association includes cities, Downtown Development Authorities, businesses, professionals, and other individuals interested in downtown development.

In partnership with DCA and other sponsors, GDA helps coordinate the Annual Georgia Downtown Conference. The conference provides up-to-date information on downtown development techniques and strategies and includes nationally known keynote speakers, hands-on work sessions, topical roundtables and panels, as well as plenty of networking opportunities. The conference is open to the public. For more information on GDA, please contact Janice Eidson at (678) 686-6256.

Economic Development Financing in Georgia

With limited resources to finance economic development efforts locally, it is important that city officials partner with other governments and organizations to ensure successful implementation of a city’s economic development strategy. There are many resources that local, regional, state, and federal organizations can provide to support your economic development efforts to foster business retention and expansion, entrepreneur development, small business support, and new business development.

Economic development financing in Georgia is largely a collaborative partnership of several state-wide partners, including DCA, the Georgia Department of Economic Development, the OneGeorgia Authority, the Georgia Environmental Finance Authority, the U.S. Department of Agriculture - Rural Development, and the Department of Revenue. In addition, the Board of Regents, the Advanced Technology Development Center, and the Georgia Research Alliance often partner to provide support during the application-review process, including scientific vetting and Georgia Tech’s market analysis, equity valuation, and review of business plans.

Many of the state’s economic development financing programs are housed in the Department of Community Affairs’ Office of Economic Development (OED). OED’s goal is to be responsive to local government needs, especially in the area of accessing the department’s economic development finance programs. DCA’s economic development programs deliver millions of dollars in grants and loans annually to Georgia communities. These include two dozen financing programs, some of which DCA manages directly as well as other financing programs, such as the Georgia Cities Foundation’s downtown program and the OneGeorgia Authority, with which DCA has contractual relationships.

Most of OED’s economic development finance programs have a rolling application cycle, meaning an application can be made at any time as long as there are funds available. Since an application is generally only required to meet a minimum threshold level for funding, OED has taken a very proactive stance in efforts to inform local governments about the department’s programs and at the same time provide technical assistance early on in project development through the Office of Field Services (OFS) within the Community Development and Finance Division. Within the OFS are economic development field services representatives that are experts in these programs. It is important to note that often there is more than one pathway to funding a project, and bringing in the experts early on in project development can be key to developing a successful financing strategy.

Some of the advantages that OED brings to the overall financing picture are the strategic processes that DCA has developed. These stretch across relationships with statewide partners and include:
  • helping local governments identify their community and economic development needs
  • once the needs are identified, help to find which financing program best fits their overall needs
  • early on in project development, assessing how competitive a project may be and to the extent possible, help mitigate any shortcomings prior to the submittal of an application
  • during application review, OED’s credit unit analyzes and underwrites projects as a critical part of the department’s due diligence
  • on-going monitoring and technical assistance during project implementation
  • and identifying best practices to share with other communities.  
Examples of projects that DCA’s economic development programs can fund include:
  • Grants
    • Infrastructure for businesses creating or retaining jobs
    • Brownfield redevelopment (publicly-owned land)
    • Site acquisition and site prep for rural communities (publicly-owned land)
    • Project funding for 37 North Georgia Appalachian communities
  • Loans
    • Buildings, equipment or other fixed assets for businesses creating or retaining jobs
    • Speculative buildings in rural communities
    • Downtown development
    • Brownfield redevelopment (privately-held land)
The OED developed a very useful resource, the Economic Development Finance Packet, which is a comprehensive listing of state, federal and local programs that are designed to promote economic development and business enhancement. For further information, please contact Joanie Perry, Director, Community Finance Division, at (404) 679-3173.

Other Partners in Community and Economic Development in Georgia

In addition to the resources mentioned, there are many other public and private organizations that support community and economic development throughout the state. A few of these organizations are listed below:

Georgia Department of Community Affairs – Community Services
DCA has staff assigned to assist communities in all regions of the state. Regional Representatives serve as DCA’s first point of local government/community contact for brokering, supporting, and implementing departmental programs and services. Throughout the state, cities can find a DCA staff member available to help with their community and economic development interests.

Georgia Department of Economic Development
The Georgia Department of Economic Development is the state’s sales and marketing arm and lead agency for attracting new business investment, encouraging the expansion of existing industry and small businesses, developing new domestic and international markets, attracting tourists to Georgia, and promoting the state as a location for film, video, music and digital entertainment projects, as well as planning and mobilizing state resources for economic development.

Georgia Department of Natural Resources - Historic Preservation Division
A division of the Georgia Department of Natural Resources, the Historic Preservation Division assists Georgia communities and its citizens in historic preservation education and programs and the Historic Preservation Tax Credits. In addition, it works with other partners to develop and sponsor training programs on building preservation issues, provides technical assistance, and administers a preservation grant program for the state.

Georgia Economic Developers Association
The mission of the Georgia Economic Developers Association is to provide and promote networking and professional development opportunities and to shape economic development public policy.

Georgia Power, Georgia Electric Membership Corporation, MEAG Power
Though many Georgia utility companies assist at the state and local level with community and economic development, Georgia Power, Georgia Electric Membership Corporation, MEAG Power, and Electric Cities of Georgia have provided significant sponsorships and direct assistance to community and economic development throughout the state. They also have staff available to assist when needed.

OneGeorgia Authority
Utilizing one-third of Georgia’s share of the Tobacco Master Settlement Agreement, the goal of the OneGeorgia Authority is to offer financial partnerships with rural communities to create strong economies in all business sectors, allowing new and existing industries, both large and small, to flourish.

U.S. Department of Agriculture
USDA - Rural Development provides funding to eligible cities around the state for important local and regional economic development projects and programs.

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