Monday, March 19, 2007

Coordinated Economic Development Is Music To Our Ears

At first blush, the news items seem unrelated: the Memphis and Shelby County Music Commission is breaking its ties to the Music Foundation, and Memphis and Shelby County Port Commission policy sends projects to nearby counties.

And yet, they are symptomatic of a long-standing problem: the lack of an overriding philosophy of economic development that brings coherence to the dozen public agencies charged with creating economic growth.

First, the city/county commissions in question.

While it’s our predisposition to resist anything that resembles fragmentation, it’s hard to argue with the Music Commission’s decision to divorce the Music Foundation. From appearances, the Commission has gone to great lengths to be a good soldier and work as a full partner with the Foundation, but it could never shake the feeling that it was clearly more of a junior partner and that promises made when the working agreement was being reached never materialized.

Sensitivity To Light

Back then, the Commission was the vehicle used to hire staff, but in time, staff appeared to chafe under expectations that a public agency complies with state laws about public records and public meetings. The head of the commission moved over to a nonprofit, private corporation – the Music Foundation – where the glare of the public spotlight could be avoided.

At the time, the deal between the Commission and the Foundation called for the staff to serve both organizations, but it became clear that the real allegiance was to the private nonprofit organization. Increasingly, Commission members felt ignored and neglected, feelings that crystallized when their request was ignored for the staff to appear with them to answer questions of the Memphis City Council. In the end, Music Commission officers appeared alone but didn’t have enough information to answer some key questions.

At that point, the seeds of discontent were planted, and with little done to allay them, the Commission voted to go its own way despite the Foundation’s recent hire of a new president, hinting at how deep the bad feelings run.

It’s The Musicians, Stupid

As we wrote last week in the posts about Memphis music, it’s time for success needs to be defined by whether more money is being put into the pockets of local musicians. That seems to be the prevailing sentiment of the Commission members, many of whom feel that the Foundation has chased too many big, and ultimately futile, projects.

Speaking of philosophy, over at the Port Commission, its board members continue to see themselves as land barons, and as a result of its hidebound focus on the needs of its own bureaucracy, Memphis loses out in jobs and growth. It’s a debate that’s gone on within local government for a decade, as mayors, staff of the Memphis and Shelby County Office of Economic Development and prominent business leaders have failed to convince the Port Commission to act more entrepreneurially.

The crux of the issue is that the Port Commission is so focused on generating money for itself that its decisions on policy are clouded by its own financial self-interest. As The Commercial Appeal reported Sunday, the prime example of the consequences of this myopic policy is that Hillwood, the second largest industrial developer in the world, was forced over the county line where it now owns 1,200 acres housing four million square feet of distribution and assembly facilities valued at $150 million.

Holding Firm

Meanwhile, though, the Port Commission seems to be proud that it held firm, refusing to budge from its position that it only leases land in its Pidgeon Park and never sells it. The comments by the head of the staff at the Port Commission are telling, “If we sell…to developers, then we’re out of business.” Like too many agencies, the commission seems unable to grasp the fact that its ultimate success might be when it no longer needs to exist.

Back when Hillwood indicated its interest in land owned by the Port Commission, not even the county mayor could persuade a change in commission policy, and he left one key meeting shaking his head and muttering about “out of control” public boards.

At the time, it seemed to those in county government that the Port Commission policy was short-sighted and illogical, because while it refuses to sell the land for fear of reducing its revenues, the 3,000 acres remain vacant. As a result, they produce no revenue for anyone, and that’s the way it’s been for more than 10 years.

The Thread

But, what is the thread that unites these two commissions? The lack of an overall philosophy for the public agencies engaged in economic development – agencies like the Office of Economic Development, the Center City Commission, the Port Commission, the Music Commission, the Film Commission, Airport Authority, Sports Authority, Depot Redevelopment Commission, Agricenter, Memphis Cook Convention Center and the Health, Educational and Housing Boards.

These boards own and control substantial land, waive taxes, receive revenues from special taxes, grant low-interest loans and invest in infrastructure. A few show a disdain for answering to the public, but most labor in obscurity day in and day out.

Some of the organizations cooperate and some sit on each other’s boards, but by and large, they operate without any communications, must less a shared plan or strategy. To compound things, local government has no dependable, systematic way of measuring whether they accomplish their missions.

Creating The Model

While it’s probably impossible to create a model organization like the Portland Development Commission, it’s a worthy goal, because it would integrate for the first time economic development policies into an overall plan of action.

In the meantime, it would be a start if organizations here began to meet on a regular basis to map out strategies, to evaluate options and to target opportunities. A logical place for these kinds of conversations would seem to be the Office of Economic Development housed in the Memphis and Shelby County Department of Planning and Development.

Unlike the other agencies, the head of the Office of Economic Development is not hired by members of a board, but appointed by the Memphis and Shelby County mayors. It’s this direct line to the top that gives it the best opportunity – not to mention the clout – to communicate and coordinate an agenda for local governments.

Key Queries

Perhaps, with a little luck, this kind of coordinating committee could actually lead to considerations of the most important questions of all:

• What is the most effective way to structure economic development in Shelby County?

• How can this structure create a culture of creativity and innovation, a talent strategy for the future and a brand that positions Memphis competitively for the future?

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