Back on March 19^th I outlined the general theory behind neighborhood and community based economic development strategies.  Now, after a few short diversions, I’d like to return to the topic of neighborhood and community development by outlining some specific strategies.

The first specific neighborhood and community based economic development strategy is better known as “Community Building”.  According to the International Economic Development Council (IEDC), “Community building strategies focus on harnessing existing networks of social capital to encourage community empowerment and capacity building; this approach channels community assets such as the skills of local residents, the power of neighborhood associations, and the resources of public and private organizations, to solve problems”.

Since the end of the “federal urban renewal” era in the mid 1970’s, local governments across the United States almost universally turned to property-based approaches to local urban revitalization and economic development.  The lasting legacy of federal urban renewal was a tendency to overlook the non-property based approaches to economic development vital in building vibrant and dynamic communities.  A new hotel does not a community make.  A new condominium tower does not a community make.  A new convention center, a new office tower, or even a new shopping center by themselves does not a community make.

Yet, time and time again, local governments, now primarily responsible for local urban revitalization and economic development efforts, tend to invest all their economic development efforts in attracting new retailers or new hotel operators.  It’s time to reintegrate the non-property based approaches – approaches that attempt to build and channel existing community assets including the skills of local residents and even the power of neighborhood associations – into our ongoing economic development efforts.

“Place-Oriented Strategies” are the second set of neighborhood and community based economic development strategies.  Place-oriented strategies, according to the IEDC, “…focus on the community’s physical resources.  Inner-city communities targeted for economic redevelopment typically suffer from inadequate infrastructure, and dilapidated residential and commercial buildings.  Place-oriented efforts seek to improve buildings, roads, utility and telecommunications service, as well as transform brownfields into usable sites”.

Notice how neighborhood and community based economic development strategies – via community building and place-oriented strategies – attempt to merge both property-based and non-property based strategies into a single strategy.  Whereas community building focuses on the non-property based side of economic development (by empowering neighborhood associations and groups and by enhancing the skill sets of individual neighborhood residents), place-oriented strategies focus on the property-based side of economic development by improving the “basic infrastructure” that economically viable communities need to be economically competitive.  In simple terms, community building focus on eliminating or at least mitigating SOCIAL blight and place-oriented strategies focus on eliminating and mitigating PHYSICAL blight.

Place-oriented strategies, according to the IEDC, should focus on resolving the following “common and prominent” problems that tend to retard the economic viability of neighborhoods and communities:

• Limited availability of appropriate development sites.
• Failing infrastructure.
• Inadequate public services.
• Environmental contamination of structures and land.
• Inadequate housing stock.
• Dilapidated commercial areas.
• No or limited sense of neighborhood identity and/or character.

“Business-Oriented Strategies”, focused on providing financial and technical support to neighborhood businesses, are the third set of neighborhood and community based economic development strategies.  Business-oriented strategies, according to the IEDC, by providing financial and technical support to neighborhood businesses, “…helps businesses in distressed communities face the challenges caused by lack of financial and technical support.  Examples of business-oriented efforts are micro-business support, groups, business skills training courses, and revolving loan funds offering loans considered too small or high risk for conventional banks”.

“Healthy” neighborhood commercial areas typically create jobs, increase the local area tax base, keep money in the neighborhood by encouraging area residents to stroll, socialize, and shop in the neighborhood, improve the image and quality of life of the neighborhood, and even attract shoppers from outside the community.  Local governments have a strong incentive to offer financial and technical support to emerging local area businesses.  In order to do so, local governments must employ a broader set of business-oriented strategies that encourage new business formation and the growth and expansion of existing local businesses.  In short, business-oriented strategies are designed to target, eliminate, or at least mitigate ECONOMIC blight.

Notice that business-oriented strategies focus primarily on how to create new businesses while also growing existing businesses – i.e. the use of micro-business support programs and groups, business skills training course, and even the use of revolving loan funds geared toward the needs of small to mid-size local area businesses.  Place-oriented strategies focus primarily on how to improve the physical appearance and quality of local area communities and individual neighborhoods – i.e. infrastructure improvement programs, improvement in existing telecommunication and utility services, and even the removal or rehabilitation of physically dilapidated structures.  Community building strategies focus primarily on empowering area residents and neighborhood groups in order to build the workforce that new and existing businesses need to survive and grow.

This is the comprehensive nature of a proper neighborhood and community based economic development strategy.  Simultaneously, a comprehensive neighborhood and community economic development strategy incorporates property-based and non-property based strategies designed to build businesses, build individual workforce skills, and improve the general physical appearance of local neighborhoods and communities.  Economically vibrant communities depend on a local government’s ability to effectively combine each of these three specific sets of strategies into single neighborhood and community based economic development strategy.  Without proper consideration of each individual specific set, much of the effort to stimulate local levels of economic activity will likely fail.

This entry was posted on Saturday, April 3rd, 2010 at 12:49 am and is filed under Economic Development. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a comment, or trackback from your own site.