Tuesday, February 4, 2014

Chattanooga Proves the Power of Economic Development Planning

Author Larisa Ortiz is Principal at Larisa Ortiz Associates. 

Great article today in the New York Times ("Fast Internet is Chattanooga's New Locomotive") on the power of “The Gig”, a city-owned high-speed fiber optic connection that is helping to transform downtown Chattanooga into a destination for high-tech firms. More than anything, it speaks to the power of economic development planning. When stimulus money was available in 2009, the City already had a plan in place with elements that needed funding. The impact of the investment on downtown was felt fairly quickly. “Since the fiber-optic network switched on four years ago, the signs of growth in Chattanooga are unmistakable. Former factory buildings on Main Street and Warehouse Row on Market Street have been converted to loft apartments, open-space offices, restaurants and shops. The city has welcomed a new population of computer programmers, entrepreneurs and investors. Lengthy sideburns and scruffy hipster beards — not the norm in eastern Tennessee — are de rigueur for the under-30 set.”

The River City Company, Chattanooga's economic development agency,
has also commissioned marketing material to help attract retailers downtown.
This piece was developed by Stevaker, a Chattanooga based graphic design firm. 

This is Why Economic Development Planning Matters
The high tech development plan was part of an economic development initiative that really took off when the city received a $111 million federal grant in 2009. While the stimulus money – and leveraged private investment was critical – without a ready to go plan in place it’s likely that those funds would have gone elsewhere.

Additional Economic Development Tactics Also Played a Role
If economic development is about creating a positive business environment. the City of Chattanooga seems to be ahead of the curve. But the high speed internet connection is not the only tool in the Chattanooga’s Economic Development toolbox. According to the Times the city has “cleaned its air, rebuilt its waterfront, added an aquarium and become a hub for arts in in eastern Tennessee.”

Another important component is that the network is municipally owned – a powerful commentary on the need for public investment in large infrastructure. (Although the article does state that Google is building similar networks in Kansas City - both MO and KC - and Austin, Texas)

The City has also leveraged partners in its efforts to spearhead the tech sector. One successful tactic is an entrepreneurial contest that came with a $100,000 prize by The Company Lab, a non-profit that conducts programs and events to support start ups and entrepreneurs in Chattanooga. The contest helps to raise the profile of Chattanooga among start ups – and the winner of the contest was Baynan, a firm that relocated to the City in 2013.

The economic renaissance that seems to be taking hold in Chattanooga is a powerful testament to the needs for thoughtful public investment - what I call "outside the store" investment - by the public sectors. It is also about being prepared so that when opportunities and investment opportunities arise, your community is prepared and ready to take advantage of them.

Additional Useful Links
The River City Company, Downtown Chattanooga's economic development agency has links to a number of studies they have commissioned. This site is geared toward the investor and real estate community.

Downtown Chattanooga's  website is a great place to go to find out about events and going's on. This site is geared toward the casual visitor who wants to know about events downtown, as well as folks who might be considering moving to Chattanooga. 

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