Last month we shared some tips on talking about incentives to people outside the economic development field. In that post, we advised making clear the connection between individual incentive deals and a community’s broader economic development strategy. This post expands on that theme with a few more pointers.
- Summarize in a few sentences why the incentivized investment is good for the community. Have your elevator pitch ready. Avoid economic jargon or references to modeling output.
- Report on basic project characteristics – jobs, investment, and job quality. The number of jobs and total investment in a project are still the attributes that interest most people, and reporting on expected job creation and investment value remains a fundamental part of the mission of most economic development organizations. At the same time, job quality – as determined by wages & salaries, benefits, educational or skill requirements and industry sector – is becoming a more important indicator of successful economic development.
- Define the location where the project will take place and where the benefits will accrue. This will become more important as economic developers are increasingly focused on expanding economic opportunities in distressed areas.
- Be clear on project timing. Too often, projects are presented as if all benefits will begin immediately upon approval. It is helpful to be up front on when the project is expected to begin, when the investment and hiring are anticipated to occur, and the lifespan of the project.
- Don’t ignore inherent project risk. No investment is risk-free, and there is no point hiding that fact. Acknowledging that the decision to provide an incentive considered factors that affect project risk, such as an investor’s track record, the presence of other partners or financial backers, and whether the investment involves a new or unproven technology (for example), demonstrates responsible stewardship of funds.
- Prioritize projects that are a good fit with your community’s goals and values. These goals may be designed to develop specific economic sectors or support individual target industries. They may focus on supporting small businesses or companies meeting certain demographic criteria. Other goals and values may address sustainability and triple bottom line economic development.
Good economic development organizations know their communities well and should be able to assess whether a proposed investment aligns with community values on these factors, singly or in combination, and to determine the overall value of the project along with a rough sense of timing and project risk. The objective is not to be “right” every time, but to be able to explain the decision to provide incentives based on the basic pros and cons of a given opportunity from a community perspective.