Citizens expect their governments to promote job creation and stabilize the economy. Jurisdictions that are fiscally stable use development tools to enhance the tax base, while those that are fiscally stressed rely on economic development initiatives to improve the business climate and thereby increase tax revenue.
"What You Should Know 2.0: Elected Leaders and Economic Development," a report from the National League of Cities and the International Economic Development Council, breaks down the process of local government economic development in easily understood chunks, which provides a good basic primer for finance officers, as well.
The report reminds governments to start out with a strategic plan. "This means designing where and how economic development efforts will be focused and implemented," based on community values, needs, strengths, and weaknesses.
The next step: Creating context for development. No local government is the same as any other, but there a few aspects of economic development that apply to everyone. Understanding the context is crucial--the city's economic strengths and weaknesses, its role in the regional economy, the difference between a weak and strong real estate market, and the local regulatory environment
Stakeholders and partners are another issue the government must address. The players in any economic development deal have diverse and sometimes conflicting priorities and interests. Agencies, business groups, and community partners a government should consider and consult include the jurisdiction's economic development agencies and staff; public-private and non-profit economic development organizations; the local and regional business community; the real estate development community; residents and community groups; and workforce development partners.
Of course, economic development requires funding. The report explains four common strategies: dedicated...