- November 22, 2024
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With the departure of Mark Huey as president of the Economic Development Corporation of Sarasota County, the EDC’s board of directors faces interesting choices. And depending on what choice it makes, it could have profound effects on the economic future of the region.
In simplest terms, the choices can be synthesized to two: Go with the status quo, or innovate.
Put us on the side of innovate, embracing the bromide “Always challenge the status quo.”
Whenever any organization or business loses its top leader, that moment becomes an opportunity for the successors or directors to try to see the organization from the 30,000-foot view, assess its strengths and weaknesses and be visionary.
It’s a moment to try to look into the future in a way that will guide the organization’s direction and what type of leadership is needed. What are the emerging trends influencing the marketplace? What are the organization’s aspirations? Where does it want to be in five years, 10 years? How best to get there? And here’s a question always worth asking: If money were no object, what would you do?
The easy way out is to do what most government institutions do when the top slot opens: Conduct a national search for a black squirrel — that mythical hero who will make the successors and directors look like wise owls.
Of course, the odds of finding that black squirrel are thin. Typically, boards settle for a low-risk bet and close to the status quo.
It all depends on the aspirations.
The whole world of economic development is a conundrum.
It’s an amorphous, nebulous industry, difficult to measure. You often hear EDC officials report on the number of jobs it created or helped bring to a community as a measure of its funders’ return on investment. But it’s often the case that when a business moves here or expands, the business owner already decided to move and expand. The EDC doesn’t create jobs.
More troubling is economic development has become a sophisticated industry of bribing — not in the Adam Schiff sense of dastardly criminality. But throughout the U.S., economic development has turned into contests and bidding wars of using taxpayers’ money as subsidies to woo “white elephant” employers from one location to another.
We saw that played to the max with the senseless bidding for Amazon’s second headquarters.
And when you talk to economic development officials and point out the rip-off of “corporate incentives,” they always say, “Yeah, but unfortunately, the subsidies are a necessary evil if you want to compete.”
They are indeed a rip-off. You can go from one community to the next — including Sarasota County — that has used taxpayer funds to woo a company that promises to create jobs, only to see that company go bust.
We have always taken the side of the late Milton Friedman, who objected to governments taking money from taxpayers to give tax breaks and subsidies to Mercedes Benz, Boeing or Major League Baseball teams just so they’ll build a factory or play spring training games. As Friedman said: What makes a county commissioner smarter than you on how best to invest your money?
Economic development professionals also cite the need for their services to help new or existing local businesses navigate local governments’ labyrinthine regulatory schemes when the businesses want to expand. But common sense says that service would not be necessary if governments didn’t create so many needless regulations to begin with.
At the same time, you also can argue a need for economic development efforts. You know the saying: “Nothing happens until you make a sale.”
Indeed, if you’re an aspirational community that wants economic growth — and who doesn’t? — it would behoove you to have someone or some organization selling the community to prospective employers. Former Florida Gov. Rick Scott rightfully saw his role as the state’s chief salesman. And it paid off. Florida’s economy flourished with new jobs as a result of Scott attracting employers from high-tax states.
But here’s another part of the economic development conundrum: How much money is necessary, and whose money should be used to sell Sarasota County?
Sarasota County collects an annual business tax that ranges from $11.81 to $525 a year, depending on the type of business. In the new county budget, the Economic Development Fund is expected to generate $1.68 million. Another $700,000 comes from private funds.
In the most recent county budget cycle, Sarasota County commissioners seriously questioned the use of that money and the county’s incentive program — an effort that ultimately led to Huey’s departure.
So no one is really sure how much taxpayer money is needed or should be used for economic development.
In some respects, you could argue none is needed. An argument can be made that the best economic development policy to implement is simply creating an attractive framework:
Sarasota County has all but one of those (the exception being regulations) — and so much more … beautiful beaches, beautiful surroundings, a plethora of recreational options and a cultural arts mecca. The county sells itself.
So to heck with having an economic development corporation.
We won’t go that far.
But as the Sarasota EDC board contemplates what to do with its vacant slot for a presidency, we’ll offer an idea that could and likely would lead to smart innovation:
Consolidate the Sarasota and Manatee counties’ economic development organizations into one regional organization.
We hear it constantly from business owners and commercial real estate professionals who work in the corporate relocation and expansion world: Their customers and prospects see Sarasota and Manatee as one market. And they will tell you the two should be marketed as one.
What’s more, it’s constantly frustrating and economically inefficient for business owners and corporate expansion leaders to have to navigate two EDC organizations that are so close in proximity. It’s even worse when the two counties bid against each other for a company’s relocation.
Typically, the obstacle to consolidation is at the political level. You can go throughout Florida and find counties where economic development efforts should be regionalized but are not because of political fiefdoms. County lines become impenetrable barriers to common and economic sense.
But perhaps a good way to show how the business community sees this region as one market is by looking at the makeup of the board of the Bradenton Area Economic Development Corp. Four of its executive committee members are from companies based in Sarasota — the incoming chair, secretary, treasurer and an at-large board member.
All of that takes us back to the Sarasota EDC board facing choices. If it looks to the future, it’s obvious the region will grow into a mid-sized megalopolis. And to be competitive in the corporate relocation and expansion world, a winning strategy is to be a fast, efficient, customer-oriented, one-stop shop.
To be sure, consolidating economic development efforts would present funding and structural challenges. But as one economic development official told us, the region’s businesses and business leaders should drive the issue, not the politicians.
From a business perspective, one economic development corporation makes a lot of sense.
