Small city “town hall” sheds light on what works in rural development

By Rob Pillow and Eli Dile, IEDC Now

One of the more interactive sessions during IEDC’s Annual Conference is the Town Hall series, which convenes economic developers of similar community sizes in an open forum to discuss challenges and share success stories. The smallest session is for communities with less than 25,000 residents; this event engendered a lively discussion of small city and rural development best practices. Ellen Huber, CEcD, of the City of Mandan, N.D., moderated the discussion.

BRE: For many small communities, business retention and expansion (BRE) is the lifeblood of their economic development efforts. Those in attendance agreed that BRE should avoid the common pitfall of focusing too much on external issues, such as parking availability, visibility, or marketing. This may cause surveyors to miss some of the core, internal issues facing a business, such as poor management, a negative work environment, or communication gaps.

One economic developer from Hamilton County, Ohio, shared that his office brings a business coach on BRE visits to provide advice on modernizing operations. He was careful to point out that coaches never tell a business owner what to do outright, but instead offers suggestions. To supplant outdated, “home-grown” business practices, coaches can offer modern business development strategies including management training, soft skill workshops, accounting, etc.

Ellen Huber noted that one of Mandan’s BRE surveys found a perception among the local business that the EDO was only concerned with recruitment. This revelation helped underscore the importance of business appreciation events, a practice many in attendance conduct, whether it be for a day, week, or month.

Entrepreneurship & small business: The low-hanging fruit of small business growth is to get them to stay open later and on more days. This was an area of shared frustration among economic developers, as many main street businesses choose to stay closed at peak times (especially Sundays).

To finance startups, one new and growing technique is equity investing. This form of crowdfunding allows members of the community to buy a small amount of equity in a potential business to defray initial startup costs. Instead of a bank or the business owner assuming all of the risk, it is spread out among a network of local investors. This not only overcomes barriers to capital access, but it also involves the wider community in the success of the business, creating a sense of local pride.

Succession planning is another key element of small business assistance. Many rural business owners are graying out and may not have a relative interested in taking over. Helping train managers or local entrepreneurs to take over an important local business should be a tool in every rural practitioner’s toolbox, participants agreed.

Marketing & attraction: Huber related that when she began working in Mandan, the city’s marketing budget was $0. However, she was able to raise $17,000 by engaging with the parks department and school district. Social media was one of the most cost-effective ways to communicate their “Made in Mandan” campaign, Huber said.

For many small communities, restaurants (franchises or home-grown) are high-priority targets. Not only do they improve quality of life, but they serve as useful amenities in attracting businesses and residents. (No site selector, CEO, or millennial wants to drive to the next town over to get a decent meal.) Mandan offers a 1 percent local sales tax rebate to new or expanding restaurants for five years. Providing this incentive to existing restaurants was an important consideration to make sure existing businesses didn’t feel slighted.

One big issue on everybody’s mind: broadband Internet. For those present, broadband is quickly going from the wish list to a necessity. An economic developer from Hudson, Ohio, said business leaders told him flat out that they would relocate unless they got high-speed Internet. It’s been a year since Hudson rolled out a broadband network for the city’s businesses parks and select neighborhoods, and the town of 22,000 intends to scale up next year, aiming to connect people’s homes as well (Crains Cleveland).

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