This presentation explores "big picture" demographic and economic trends as context for thinking about how Amherst and the Buffalo region might generate private investment in an era of fiscal scarcity.

1. C it E i D l tCommunity Economic Development
in a Time of Change
Presentation to the Town of Amherst, NY
October 19, 2010
David Rouse
Principal Wallace Roberts & ToddPrincipal, Wallace Roberts & Todd

2. Agendag
• The Context
– “Big picture” (national and global) trends
– Trends in public financing and economic development
• Successful Community Economic Development Programs
– Community examples
– Components
• Implications for Amherst• Implications for Amherst
– How can Amherst and the Buffalo region generate investment
through community economic development?

3. Big Picture TrendsBig Picture Trends

4. Big Picture Trends
Changing DemographicsChanging Demographics
• The U.S population is increasing
– 2008 Census Bureau estimate: 301.3 million
– 2050 projection: 439 million / 46% increase (Census Bureau), 402
million / 32% increase (United Nations)million / 32% increase (United Nations)
2050 100
2008
100
Million+
Increase

5. Amherst & Regional Trends
PopulationPopulation

6. Big Picture Trends
Changing DemographicsChanging Demographics
• The U.S population is becoming increasingly diverse
– 2005 Census Bureau estimate: 45% of children under 5 belonged to
minority groups
2008 Cens s B rea projection The U S ill become a “majorit– 2008 Census Bureau projection: The U.S. will become a majority
minority” country by 2042
– In U.S. cities such as Boston and New York, immigration has
sustained population levels and increased economic vitality
– In Canada, the foreign-born population of Vancouver is 39% and
Toronto 49%%

7. Amherst & Regional Trends
DiversityDiversity

8. Amherst & Regional Trends
ImmigrationImmigration

9. Big Picture Trends
Changing DemographicsChanging Demographics
• The Baby Boomers and the Millennials are the two largest
generations in U.S. history
– Baby Boomers: 76 million born between 1946 and 1964
Mill i l 78 illi b b t 1977 d 1996– Millennials: 78 million born between 1977 and 1996
Baby Boomers Millennials

10. Big Picture Trends
Changing DemographicsChanging Demographics
• What are Baby Boomers and Millennials looking for in
places to live, work, and play?
– Smaller, more compact housing products
W lk bl b l i h i i d hi d id h– Walkable, urban places with amenities and things to do outside the
home
One poll found that 77 percent of Americans born after 1981 want to liveOne poll found that 77 percent of Americans born after 1981 want to live
in an urban core.
Another survey found that 71 percent of boomers placed walking distancey p p g
to transit at the top of their list of housing demands.
Alan Ehrenhalt, “Putting the Urban in Suburban,” Governing, March 9-10, 2009;
quoted in William Lucy Foreclosing the Dream 2010quoted in William Lucy, Foreclosing the Dream, 2010

11. Amherst & Regional Trends
Aging PopulationAging Population
Amherst Buffalo

12. Big Picture Trends
Changing Metropolitan Development PatternsChanging Metropolitan Development Patterns
• Foreclosure rates during the recessiong
have been higher in suburban /exurban
areas than in cities
This foreclosure pattern is…yet one more layer of
evidence…(of) a shift in the momentum of
metropolitan development – a revival of cities and ametropolitan development a revival of cities and a
drawing back from the exurban fervor that drove so
much development during the closing decades of the
last century.y
William Lucy, Foreclosing the Dream, 2010

13. Big Picture Trends
Changing Metropolitan Development Patterns
• Shift in market demand from
Changing Metropolitan Development Patterns
drivable suburban to walkable urban
• Exurban (fringe) development =
th t lthe next slum
• Five types of walkable urban places
T di i l d– Traditional downtowns
– Downtown adjacents
– Suburban town centersSuburban town centers
– Strip commercial redevelopments
– Greenfields (lifestyle centers)
Source: Christopher Leinberger

14. Big Picture Trends
Walkable Urban CentersWalkable Urban Centers
T di i l D B ff l S b b D S f d CTTraditional Downtown: Buffalo Suburban Downtown: Stamford, CT
Strip Redevelopment: Belmar, CO Lifestyle Center

15. Amherst & Regional Trends
CommutingCommuting

16. Big Picture Trends
Peak Oil: Declining Supply Rising DemandPeak Oil: Declining Supply, Rising Demand

17. Big Picture Trends
The Restoration EconomyThe Restoration Economy
Restorative development is a mode of economic activity
that returns property, structures, or objects to an earlier
condition, transforms them into a healthier and/or more
functional condition, or replaces an unsalvageable structure
i h i l dwithout consuming more land.
Storm Cunningham, The Restoration Economy

18. Big Picture Trends
The Restoration EconomyThe Restoration Economy
• Trimodal Development Perspective (three
t l lif l )natural lifecycles)
– New development
Maintenance (built environment) /– Maintenance (built environment) /
conservation (natural environment)
– Restorative development
Restorative development (restoration of the built and
natural environments) is the fastest growing of those threenatural environments) is the fastest growing of those three
modes, and it will soon be the largest of the three realms of
development.
Storm Cunningham, The Restoration Economy

19. Big Picture Trends
A Slow Recovery from the Great RecessionA Slow Recovery from the Great Recession
• Indicators favor a U-shaped recovery after a stimulus-fueled
spike up in the last quarter of 2009
– Weak, below-trend growth for a number of years
C ti t f 2011 th i GDP 2 4% (Th E i t– Consensus estimate for 2011 growth in GDP = 2.4% (The Economist,
October 2010)
US GDP GROWTH RATEUS GDP GROWTH RATE
??

20. Big Picture Trends
A Slow Recovery from the Great RecessionA Slow Recovery from the Great Recession
The ULI October Real Estate Barometer is “laced with fluctuations in both
directions but even the most positive gains are still very weak when compared todirections, but even the most positive gains are still very weak when compared to
historic trends.”
COMMERCIAL/MULTIFAMILY INVESTMENT PROPERTY

21. Big Picture Trends
A Slow Recovery from the Great RecessionA Slow Recovery from the Great Recession
HOUSING
Source:The ULI Real Estate Barometer, October 2010

22. Big Picture Trends
A Slow Recovery from the Great Recession
• Employment growth will continue to lag the recovery
A Slow Recovery from the Great Recession
• Sept. 2010: +64,000 private sector jobs, -159,000 public sector jobs
(includes -76,000 Census jobs)
• Local governments face an era of fiscal scarcity
– 88% of city finance officers surveyed in 2009 reported not being able to
meet current year’s financial needsmeet current year s financial needs
– Depressed property values will continue to depress real estate tax
revenues
– As stimulus spending winds down, federal and state deficit cutting will
reduce transfers to local governments
SSources:
Nouriel Roubini and Stephen Mihm, Crisis Economics (2010)
Lincoln Land Use Institute, Municipal Revenues & Land Policies (2010)

23. Trends in Public Sector Financing and
Community Economic Development

24. Trends in Public Sector Financing
Changing Revenue SourcesChanging Revenue Sources
• Property taxesp y
• Intergovernmental transfers
– Federal
– State
• Local sales tax
• Local income / wage tax
– Resident
– Commuter
Source:Source:
Lincoln Land Use Institute, Municipal Revenues & Land Policies (2010)

25. Trends in Public Sector Financing
Changing Revenue SourcesChanging Revenue Sources
• Capital financing of infrastructure• Capital financing of infrastructure
– Bonds (general obligation, revenue)
– Privatization
(design/build/operate/maintain)
• Sub-municipal financing techniques
– Business improvement districts
– Tax increment financing
Community facility districts– Community facility districts
Source:
Lincoln Land Use Institute, Municipal Revenues & Land Policies (2010)

26. Trends in Public Sector Financing
Changing Municipal Revenue Sources
• Decreased reliance on:
Changing Municipal Revenue Sources
– Property taxes (long-term trend)
– Intergovernmental transfers (reduced state aid, avoidance of /
skepticism about federal funding)skepticism about federal funding)
• Increased reliance on:
Other taxes (e g sales income gasoline) depending on anti tax– Other taxes (e.g., sales, income, gasoline) depending on anti-tax
sentiment
– Charges for services / fees
– Public / private partnerships, privatization agreements
– Other financing techniques (e.g., TIF, BIDs)
Source:
Lincoln Land Use Institute, Municipal Revenues & Land Policies (2010)

27. Trends in Public Sector Financing
Federal Funding Programs
• American Recovery and Reinvestment Act of 2009
Federal Funding Programs
y
– Included $90 billion for investments in clean energy
– Transportation Investment Generating Economic Recovery
(TIGER): $2 1 billion made a ailable so far for m ltimodal(TIGER): $2.1 billion made available so far for multimodal
transportation projects
HUD/DOT/EPA S t i bl C iti P t hi• HUD/DOT/EPA Sustainable Communities Partnership
– June 2009 agreement to coordinate federal housing,
transportation, and environmental investments
• These two programs reflect likely future direction of
federal fundingg
– Surface Transportation Act Reauthorization is pending

28. Trends in Public Sector Financing
Sustainable Communities Planning Grants
• $150 million made available in HUD FY 2010 Budget
Sustainable Communities Planning Grants
• $150 million made available in HUD FY 2010 Budget
• Two Types of Grants
Sustainable Communities Regional Planning Grants: $98– Sustainable Communities Regional Planning Grants: $98
million awards to 45 regions on October 14, 2010
– Community Challenge Planning Grants: up to $75 million in grant
awards to communities currently pending
• Future funding rounds anticipated

29. Trends in Community Economic Development
Evolving Approaches
from:
Evolving Approaches
• … a wholesale approach (offsetting capital costs by
providing land and infrastructure), to…p g )
• …a retail approach (reducing the cost of doing business via
tax abatements), to…
• …a systems approach (addressing quality of life issues to
increase appeal to business owners, workers, and
entrepreneurs)
Adapted from Elaine Carmichael, Principal, Economic Stewardship, Inc.

30. Trends in Community Economic Development
Evolving ApproachesEvolving Approaches
Innovation economics is an economic doctrine that reformulates the traditional
model of economic growth so that knowledge, technology, entrepreneurship, and
innovation are positioned at the center of the model…
Source: Wikipedia

31. Trends in Community Economic Development
Evolving ApproachesEvolving Approaches
• Community revitalization rules (Stormy (
Cunningham)
– Rewealth: base our economy on renewing
what we have (restorative development)
– Integrate restoration of natural, built, and
i i tsocioeconomic assets
– Engage all stakeholders in the revitalized future
of their communityof their community

32. Trends in Community Economic Development
Evolving ApproachesEvolving Approaches
• Community revitalization processes (Stormy p (
Cunningham)
– Establish a shared vision of the community’s
future based on renewal
– Embed renewal in the community’s culture
th h li i l ti tthrough policies, regulations, support programs,
incentives, etc.
– Partner to build the critical mass of resources– Partner to build the critical mass of resources
and knowledge to accomplish the vision

33. Trends in Community Economic Development
Evolving ApproachesEvolving Approaches
• Renewal engine: a nonprofit organizationg p g
to promote community revitalization on an
ongoing basis
– Forms the renewal vision and strategy
– Fosters a renewal culture that attracts
ireinvestment
– Establishes bonds of trust and shared values
needed for public and private entities to workneeded for public and private entities to work
together

34. Successful Community Economic Development
Programs

35. Community Example
Chattanooga TNChattanooga, TN
• The legacy of an industrial city
– The nation’s dirtiest air in 1969 per the
federal government
– Socioeconomic divisions / challengesSocioeconomic divisions / challenges
• Response
– Citizen task force appointed to oversee
cleanup (Air Pollution Control Board)
– 1984 community visioning process (Vision
2000)
– Public/private partnership formedp p p
(Chattanooga Venture)

36. Community Example
Chattanooga TNChattanooga, TN
Results
• Dramatically improved air quality
• $120 million riverfront / downtown revitalization
• 3 national awards for outstanding livability in 10 years

37. Community Examples
Branding StrategiesBranding Strategies
• Austin, TX: Live Music Capital of the, p
World
• Indianapolis, IN: Amateur Sports
Capital of the World
• Chautauqua County, NY: World’s
Learning Center

38. Community Example
Cumberland MDCumberland, MD

39. Community Example
Cumberland MD
• Key road, railroad, and canal junction during the 1800s; was
the second largest MD city after Baltimore
Cumberland, MD
the second largest MD city after Baltimore
• The “Queen City” developed as a manufacturing powerhouse
during the 19th and 20th centuries but declined after WWII dueg
to industrial plant closures
• In 1987 the Kelly Springfield Tire Plant was the last major
manufacturing plant to close (relocated to Akron, Ohio)
• The City’s population has declined from 39,483 residents in
1940 t 20 495 ( ti t ) i 20081940 census to 20,495 (estimate) in 2008

40. Community Example
Cumberland MDCumberland, MD
Kelly Springfield Tire Plant to
Riverside Industrial Park

41. Community Example
Cumberland MD
• In 1993 Canal Place (historic terminus of the C&O Canal) was
designated Maryland’s first state heritage area
Cumberland, MD
designated Maryland s first state heritage area
• In 1996 the City adopted a new Comprehensive Plan with a
vision statement to guide revitalization effortsvision statement to guide revitalization efforts

42. Community Example
Cumberland MD
• 2005 Sustainable Economic Development Strategic Plan
defines target niches related to C mberland’s assets
Cumberland, MD
defines target niches related to Cumberland’s assets
• Priority business / industry sectors
– Tourism
– Restoration / rehabilitation (built, natural environments)
• Priority social / occupational groups
– Technological entrepreneurs
A ti t– Artists

43. Community Example
Hamilton ONT
• 504,559 residents in 2006
Hamilton, ONT
– 20% foreign born; half of recent immigrants from Asia and Middle East
• Traditional economy based on heavy manufacturing (known
as the Steel Capital of Canada)as the Steel Capital of Canada)
– Economy has shifted towards services, especially health sciences, over the
last decade
• Rated as 6th best place to invest in Canada (2nd in Ontario) by
Real Estate Investment Network (REIN Canada)

44. Community Example
Hamilton ONT
• Comprehensive development strategy builds on strengths
Hamilton, ONT
– Four-tiered transportation hub
– Manufacturing excellence
– Reputation for educational qualityp q y
• Four fundamental principles: innovation, diversification,
entrepreneurship, and triple bottom line
• Quality of life is a key focus area to attract business as well
as the “best and brightest” employees and citizens

45. Community Example
Hamilton ONT
• McMaster University
Hamilton, ONT
– Health science, automotive technology, and materials and manufacturing
research and development
– McMaster Innovation Park
• City Planning and Economic Development Department
– “One-Stop Shop” for three key business services: Small Business Enterprise
Centre, Business Facilitation (municipal planning process guidance), Licensing
and Zoning
– Downtown and Community Renewal Division Programs

46. Components of Successful Economic Development
ProgramsPrograms
• Vision
– Define an economic position / niche based on assets
• Strategygy
– Develop a game plan to realize the vision
• CapacityCapacity
– Leverage resources through partnerships across sectors (public,
private, institutional / nonprofit)
• Program
– Implement the vision and strategy through coordinated use of
economic development toolseconomic development tools

47. Examples of Economic Development Toolsp p
• Data
– Inventories of available properties
• Development ordinances / codes
• Marketing
– Branding and outreach to targeted groups
• Infrastructure
– Investments in roads, utility, telecommunications, etc.
• Financing
– TIF, BID, NYS Main Street Program, etc.
• Incentives

48. The Role of Incentives
• A useful tool but only part of the total package that attractsy p p g
businesses (typically not the deciding factor)
• Be aware of downsides
f f f– Costs of subsidies provided can exceed benefits in terms of jobs, tax
revenues generated
– Subsidies can put existing businesses at a competitive disadvantagep g p g
– Jobs created often go to outsiders rather than current residents
– Businesses can leave when subsidies expire

49. Implications for AmherstImplications for Amherst

50. Implications for Amherst: Changes Over Time
• Amherst Community Development Plan (1975)
“A i b b it i i t f t lit
p g
– “A growing suburban community, recipient of metropolitan
expansion…”
• Bicentennial Comprehensive Plan (2003)• Bicentennial Comprehensive Plan (2003)
– “Become a model for effective reinvestment and revitalization of
older neighborhoods and commercial areas…”

51. Implications for Amherst: Discussion
How can Amherst and the Buffalo region generate
investment through community economic development?g y p
David Rouse, Wallace Roberts & Todd
drouse@ph.wrtdesign.com
215-772-1465 Wallace Roberts & Todd, LLC