Small Town Development Approaches

Small Town Development
Approaches
Small Town Development
Approaches
United Nations Human Settlements Programme

Nairobi 2012
i
The Global Urban Economic Dialogue Series
Small Town Development Approaches
First published in Nairobi in 2012 by UN-HABITAT.

Copyright United Nations Human Settlements Programme 2012
All rights reserved

United Nations Human Settlements Programme (UN-HABITAT)
P. O. Box 30030, 00100 Nairobi GPO KENYA
Tel: 254-020-7623120 (Central Office)
www.unhabitat.org
HS/025/12E
ISBN Number (Series): 978-92-1-132027-5
ISBN Number (Volume): 978-92-1-132440-2
Disclaimer
The designations employed and the presentation of the material in this publication do not imply the
expression of any opinion whatsoever on the part of the Secretariat of he United Nations concerning the
legal status of any country, territory, city or area r of its authorities, or concerning the delimitation of its
frontiers of boundaries.
Views expressed in this publication do not necessarily reflect those of the United Nations
Human Settlements Programme, the United Nations, or its Member States.
Excerpts may be reproduced without authorization, on condition that the source is indicated.
Acknowledgements:
Director: Naison Mutizwa-Mangiza
Chief Editor and Manager: Xing Quan Zhang
Principal Author: William H. Lambe
Contributors: Jaana Mioch, Ying He, Ji Yuan Shi
English Editor: Roman Rollnick
Design and Layout: Freddie Maitaria
Assistants: Agnes Ogana, Joy Munene
ii
FOREWORD
Urbanization is one the provision of adequate housing, infrastructure,

of the most powerful, education, health, safety, and basic services.
irreversible forces in the
world. It is estimated The Global Urban Economic Dialogue series
that 93 percent of presented here is a platform for all sectors of the
the future urban society to address urban economic development
population growth and particularly its contribution to addressing
will occur in the cities housing issues. This work carries many new ideas,
of Asia and Africa, and solutions and innovative best practices from
to a lesser extent, Latin some of the worlds leading urban thinkers and
America and the Caribbean. practitioners from international organisations,
national governments, local authorities, the
We live in a new urban era with most of private sector, and civil society.
humanity now living in towns and cities.
This series also gives us an interesting insight and
Global poverty is moving into cities, mostly deeper understanding of the wide range of urban
in developing countries, in a process we call the economic development and human settlements
urbanisation of poverty. development issues. It will serve UN member States
well in their quest for better policies and strategies to
The worlds slums are growing and growing address increasing global challenges in these areas
as are the global urban populations. Indeed,
this is one of the greatest challenges we face in
the new millennium.
The persistent problems of poverty and slums

are in large part due to weak urban economies.
Urban economic development is fundamental to
UN-HABITATs mandate. Cities act as engines Joan Clos
of national economic development. Strong urban Under-Secretary-General of the United
economies are essential for poverty reduction and Nations, Executive Director, UN-Habitat
iii
iv
Contents
FOREWORD iii
INTRODUCTION 1
Case Studies I: Entrepreneurship and small enterprise

incubation-based development 3
Brevard, North Carolina 5
Dillsboro, North Carolina 7
Fairfield, Iowa 9
Nelsonville, Ohio 12
Ord, Nebraska 14
Siler City, North Carolina 17
Case Studies iI: Place-based development 21

Bakersville and Hayesville, North Carolina 23
Big Stone Gap, Virginia 26
Black Mountain, North Carolina 28
Branson, Missouri 30
Colquitt, Georgia 32
Columbia, North Carolina 34
Edenton, North Carolina 36
Elkin, North Carolina 38
Hillsborough, North Carolina 41
Oakland, Maryland 45
Pelican Rapids, Minnesota 47
Star, North Carolina 49
Case Studies iII: Human capital-based development 53

Allendale, South Carolina 55
Houston, Minnesota 57
Morrilton, Arkansas 59
New York Mills, Minnesota 61
Rugby, North Dakota 63
Washington, North Carolina 65
Case Studies IV: Industry, high-tech, or manufacturing-based

development 67
Cape Charles, Virginia 69
Douglas, Georgia 71
v
Etowah, Tennessee 74
Farmville, North Carolina 77
Oxford, North Carolina 80
Reynolds, Indiana 82
Conclusions and Lessons Learned 85
vi
INTRODUCTION
ENTREPRENEURSHIP AND SMALL ENTERPRISE INCUBATION-BASED DEVELOPMENT
INTRODUCTION
From June 2006 to June 2007, researchers from explicit goal of economic development is to
the School of Government at the University of make measurable improvements to the economic
North Carolina at Chapel Hill identified, studied, health of a particular jurisdiction. Equity, or the
and documented fifty case studies of small towns distribution of economic benefits, is only implicit
across the United States that are using a wide in most definitions of economic development.
range of community and economic development CED addresses equity explicitly because it is a
strategies to advance their communities vision process whereby a community realizes positive
for prosperity. The case studies are a response to changes in each aspect of community life
demand, from local public officials, for examples economic, social, civic and environmental.
of real communities facing challenges related to
globalization, geographic isolation, urban sprawl, Second, small towns typically have limited
aging populations and natural disasters. Case resources and capacity, so their economic
studies were published in 2008 in a report entitled development activities tend to include a broad
Small Towns, Big Ideas: Case Studies in Small range of strategies, including those that might
Town Community and Economic Development. otherwise be considered community development
or capacity-building. In small towns, strategies for
This report is a subset of thirty case studies. dealing with housing, transportation or leadership
Its focus is community economic development development tend to be combined with more
(CED), defined as action taken locally by a traditional economic development strategies
community to provide economic opportunities as parts of a communitys comprehensive
and to improve social, civic and environmental development strategy. Success in community
conditions in a sustainable way. That is, CED is development tends to be harder to define and
a process through which communities initiate measure, compared with economic development
their own solutions to local problems. CED outcomes, but is important nonetheless. The
strategies create economic opportunities, but in a social, civic and environmental impacts of a
way that improves social, civic and environmental communitys CED strategy have tremendous
conditions. Finally, CED strategies tend to bearing on the extent to which a community
include some consideration for sustainability, or feels that it is successful. Excluding these impacts
for building long-term community capacity to would sacrifice elements of success that small
deal with future challenges and opportunities. town leaders repeatedly said were important.
There are two reasons for the use of such a Methodology and case selection
broad definition. First, a typical definition of This research was designed to be a broad
economic development tends to narrow the scope qualitative assessment. It is not a study of best
of acceptable activities to those with direct (and practices, which, as the term implies, ought to
measurable) economic outcomes. Jesse White, be subject to rigorous evaluation and replication.
the former federal co-chair of the Appalachian Rather, small towns were selected to provide the
Regional Commission, defines economic reader with exposure to a wide variety of strategies
development as activities that take place at the and tools at work across a range of local conditions.
intersection of public policy and private commerce The selection of cases began with a key informant
to create jobs, businesses, prosperity and wealth. identification process, which resulted in a list of
Under this definition (and most others), the more than 150 small towns that were known,
1
either by word of mouth or in print, for success Case studies in this report are categorized by
or innovation in CED. In addition to screening the primary development approach implemented
cases for geographic and strategic diversity, each by the small town. Towns were characterized as
case features a small town with fewer than 10,000 carrying out:
people in which a CED strategy (or strategies) is
active and where CED activities are controlled Entrepreneurship and small enterprise incubation-
locally. In other words, this report profiles cases based development
in which local civic leaders played a major role in Place-based development
strategic decision-making. Human capital-based development
Industry or manufacturing-based development
Cases were screened for evidence that either the
communitys strategy was successful, in economic, These categories are not, nor were they intended
social, civic and/or environmental terms or that the to be, mutually exclusive. For example, a community
communitys strategy represented CED innovation categorized as deploying an entrepreneurship
(first or early use of a particular practice) or was strategy (Brevard, N.C., for example) might also
distinct (unique among the alternatives for addressing have elements of human capital-based development.
a particular problem) within the local context. For Communities were categorized based on their
most cases, interviews were conducted in-person, primary approach to development and categories
over a one- to four-day visit to the community. For are intended to give the reader a broad sample of
others, interviews were conducted over the telephone examples from which to draw. towns are using
or by e-mail. Data collected during interviews were creative programming to encourage the creation of
supplemented by newspaper articles, scholarly small businesses that, in turn, hire local residents and
articles and other written content. invest in the local community.
2
1
Case Studies I: Entrepreneurship and small
enterprise incubation-based
development
This chapter includes case studies of small towns that are focused
on entrepreneurship or small business incubation strategies.
These towns are using creative programming to encourage the
creation of small businesses that, in turn, hire local residents and
invest in the local community.
Brevard, North Carolina
Brevard capitalizes on the economic value of retirees, and not just as consumers. Local
retirees assemble an award-winning network of consultants, who support entrepreneurs
and existing businesses with expertise from a vast array of business backgrounds.
2000 2010 +/-

Population 6,643 7,609 13%
Per capita income $18,260 $23,702 23%
Per capita income (national, US) $30,319 $39,945 24%
Per capita income (state, North Carolina) $27,906 $34,977 20%
Location Western North Carolina, USA (map)
Distance to metro/micro-politan center 55 km to Asheville, N.C.
Distance to major transportation corridor 48 km
Primary employment sectors Health care and social assistance
(top three as percentage of workforce, 2007) Retail trade
Accommodation and food services
Brevard is tapping into the business expertise in revenue for Transylvania County, and many
within its retiree population as a tool for of these tourists are now retiring in Brevard.
supporting local entrepreneurship. Over the While Brevards tourism industry and population
past 10 years, Brevard has become a hot spot for have been climbing, its economy faced serious
retirees; over 60 percent of newcomers are retired. challenges in 2002 when three large employers
In 2002, this small mountain towns economy closed their doors. An x-ray film manufacturer
hit a wall, though, with numerous plant closures owned by DuPont (600 employees), the Ecusta
and 2,200 job layoffs. At that time, the local paper mill (1,200 employees) and a textile mill
economic development director turned to some (300 employees) all closed in 2002, laying off a
of the retirees on his advisory board for help. Their combined 2,200 workers.
suggestion: create a network of retirees to help new
and existing businesses prosper and expand. The Approach to Development
resulting Retiree Resource Network is a collection Given this challenge, the City worked with
of over 65 retired businesspeople who provide Transylvania County to assemble a network
top quality consulting and advising services to of retirees who provide a range of services to
the entrepreneurs and businesses of Brevard and entrepreneurs and local small business owners.
Transylvania County free of charge. Initially, the network was just a few businessmen
who met informally. After receiving Community
Location and History Development Block Grant funding, the county
NamedforDr.EphraimBrevard,aRevolutionary economic development office was able to hire
War colonel, the city of Brevard is located in the a permanent network coordinator, who set to
mountains of western North Carolina. Brevard is work getting out information about the new
the county seat of Transylvania County, which is program. Tapping his own social networks and
rich in scenic beauty with over 250 waterfalls. In those of others, the coordinator began building a
2005, tourism generated nearly USD 70 million database of retired businesspeople. These personal
CASE STUDIES 1
invitations were critical to the growth of the resources and is equipping new and existing
network, now 68 people strong, and the list of business owners with the skills to flourish in the
consultants reads like a Whos Who. We have 21st century.
people with every kind of business experience you
can imagine, said the coordinator, from human Key Themes and Lessons
resources to engineering to marketing, finance Entrepreneurs need direct, customized assistance.
and accounting. Many have experience with top This story demonstrates that small towns should
corporations and Fortune 500 companies. seek innovative ways to provide individualized
assistance to local entrepreneurs. General business
With the database growing, the coordinator set training for entrepreneurs is a worthy first
up the consultation process for prospective clients. step in a local support strategy. Going beyond
The process begins when a local entrepreneur or general issues into specific challenges facing
existing business owner contacts the coordinator, a range of entrepreneurs is where small town
who then schedules a visit and assesses the business leaders can add maximum value to their efforts.
issue at hand. Afterward, he uses this information Every entrepreneur is different, and their needs
to select the person with the most relevant vary enormously. Direct, customized assistance
experience from his pool of consultants. At this provided by Brevards Retiree Resource Network
point, the business owner and consultant are is one way to move local entrepreneurs toward
introduced to each other and begin working together. being engines for job creation.
Since forming in 2004, Retiree Resource Retirees in small towns can be economic
Network members have met with over 25 local development assets. Brevard provides an excellent
businesses, new start-ups and firms relocating into example of how retirees can be active in community
the county. The president of one company, Solid life and economic development efforts. Often
Surface Arts, was looking to expand his business these retirees bring a professional expertise not
when he contacted the network. We needed common in small towns. In an era of global
someone to help with hiring issues, he said. competition, such expertise is potentially
the coordinator assigned me a former human invaluable to small town entrepreneurs. Small
resources manager from Motorola who rolled town leaders, especially those in towns receiving
his sleeves up and shared his former companys an influx of retirees, can look for ways to
hiring and review techniques. Without his help, I leverage the combined expertise of their new
would have had to pay top dollar for a consultant residents for community benefit. Brevard and
and never could have afforded it. The network Transylvania County have taken their local
is invaluable to every small business in this retiree network to the next level and are using
community. The guidance seems to have worked the network as a differentiating service when
out well. According to the mayor, the Retiree marketing their community to new businesses.
Resource Network is a terrific use of available
5
Dillsboro, North Carolina
Dillsboro turned an environmental pollutant into an economic asset by converting landfill

methane gas into energy to power local artists studios at the Jackson County Green
Energy Park. The results include new businesses and jobs for the community.
2000 2010 +/-

Population 206 232 11%
Distance to metro/micro-politan center 81 km to Asheville, N.C.
Primary employment sectors Educational services, and health care and social
(top three as percentage of workforce, 2007) assistance
Arts, entertainment, and recreation, and
accommodation and food services
Public administration
Located in the rural community of Dillsboro, tourists to town, as people from across the region
the Jackson County Green Energy Park is came to experience the cool summers and Smoky
using methane gas from a nearby landfill to Mountain scenery.
power the studios of local artisans and small
business entrepreneurs. Faced with migrating Over the years, Dillsboro and Jackson County
methane gas from the landfill, town and county have continued to build on their tourism assets by
officials decided to go beyond complying with showcasing the rich cultural heritage of the area. Like
environmental regulations by harnessing the gas most rural counties, Jackson County has a small
to power small businesses. Since opening in 2006, landfill. Located on the outskirts of Dillsboro, the
the park has become home to a biodiesel refinery, Jackson County landfill and trash-transfer site was
three professional blacksmith studios and a series closed in 1996. Within a couple of years, however,
of greenhouse businesses. When completed, county officials were notified that methane gas
the park will create 20 to 25 jobs and provide from the landfill was escaping, or migrating, into
opportunities for artisans and small business the atmosphere and that the site was in violation of
entrepreneurs to hone their skills at minimal cost. federal environmental regulations.
Location and History Approach to Development

Dillsboro is a railroad town situated just on the A model solution was found just a few counties
edge of the Great Smoky Mountain National Park away, where the Energy Xchange Renewable
in western North Carolina. Southern Railway Energy Center in Yancey County used methane
constructed a railroad through town in the 1880s, gas to power the shops of local artisans. Local
which led clusters of general supply businesses to leaders discovered that a similar park could be built
spring up in Dillsboro. The railroad also brought in Dillsboro. Most importantly, it could be done
6
CASE STUDIES 1
for approximately the same cost as exhausting Some of the newly established businesses in the
the gas (which would have been required absent park have had strong initial success. Recently, a
another solution). All told, leaders estimated the biodiesel manufacturer located in the park and is
park would cost around USD 1 million dollars producing fuel for Jackson County government
and, with approval from the commissioners, and Cherokee Tribal vehicles. Once the park is
set out to construct the Jackson County Green completed, leaders estimate that nearly 25 jobs
Energy Park. will have been created. By supporting a creative
strategy to turn a liability into an asset, Dillsboro is
Grant money from the Golden LEAF bolstering its cultural heritage tourism niche and
Foundation, North Carolina Rural Center paving the way for a more sustainable future.
and U.S. Department of Agriculture enabled
the county to begin cleaning up the site and Key Themes or Lessons
designing the park. In 2005, the county hired When facing a challenge, look for a similarly
a project manager. By 2006, construction was situated community to serve as a mentor.
underway and engineers had designed a means Jackson County was not the first county to
for converting methane gas into energy for the face an issue with methane gas migrating from
greenhouse and 10 studios that would make up its landfill. In response, local officials looked
the park. In October of 2006, the first artisan, outside their community for help and guidance.
a master blacksmith from Dillsboro, began In the community next door, they found that
operating out of the park. Yancey County had solved a similar methane
gas problem by turning the methane into an
To fill the remaining spots, the mayor energy source for a business park. This example
assembled a committee to advertise and select sparked the initial idea for Jackson Countys
participants from throughout the region and park and also gave officials insight into the
nation. Each participant is allotted a three-year difficulties Yancey County had to overcome.
residency and receives technical assistance and Jackson County was about to avoid pitfalls and
free energy during his or her tenure. Through build upon, reshape and improve the example
the program, participants delay expensive start- provided by Yancey County.
up costs, a local leader said. Often those
expenses are the biggest barrier for artisans to Use environmental concerns as levers for
overcome. During the first year of the residency, economic development strategies. Typically,
participants work on their business plan with environmental regulations are perceived as
assistance from the local community college. burdens on a town budget. In this case, the
By the second year, artisans are required to post town looked beyond the regulation to see how it
their goods in retail locations throughout the might comply while also creating jobs and raising
region. Finally, in the third year, artisans begin incomes. Further, in creating the Green Energy
looking for new studio space, either in the Park, officials spent about the same amount of
county or elsewhere. Jackson County officials money as they would have to merely comply with
believe that by the third year, participants will environmental regulations. In the process, Jackson
have saved enough money from the previous County and Dillsboro linked their solution to the
two years to make the transition fairly easy. communitys heritage tourism strategy.
7
Fairfield, Iowa
After losing Parsons College, the towns economic anchor, civic leaders in Fairfield take
a risk and sell the campus to an alternative California university. The leads to unique
town-gown relations and ultimately plays a role in Fairfields rich diversity, strong civic
infrastructure and pioneering entrepreneurial networks.
2000 2010 +/-

Population 9,500 9,464 -.4%
Per capita income (state, Iowa) $27,285 $38,084 28%
Location Southeastern Iowa, USA (map)
Distance to metro/micro-politan center 100 km to Iowa City, Iowa
Professional, scientific, and management, and
administrative and waste management services
Retail trade
Over the past decade Fairfield has become entrepreneurship flourished. William Louden,
recognized as one of the nations most one of Fairfields early entrepreneurs, designed
entrepreneurial small towns. In 2003, the and manufactured the first manure spreader,
National Center for Small Communities named the first modern dairy barn and the first ceiling-
Fairfield the top entrepreneurial small city in suspended, single-track rail system. Over the last
America by awarding it the inaugural Grass 100 years, Louden Machine Works built and
Roots Entrepreneurship Award. In response to a occupied 23 facilities across Fairfield (although
question about how to overcome the disadvantage production has since moved away). Around the
of a remote location, the former president of the same time that Louden was experimenting with
Fairfield Entrepreneurs Association responded, manure spreaders, one of his contemporaries --
Easy, you return to your entrepreneurial roots A.K. Harper -- was selling sewing needles door
and you focus on establishing entrepreneurial to door throughout southeastern Iowa. In 2004,
networks and relationships. This, in essence, has Harper Brush, with its headquarters in Fairfield,
been Fairfields strategy. The results include 2,000 generated USD 60 million in revenue.
new jobs, USD 250 million in new investment
and the creation of a civic infrastructure that rivals Given its rural location, first-time visitors are
that of large cities. immediately struck by Fairfields lushness and
vibrancy. This small Midwestern town, where
Location and History community theater and artistic expression
Fairfield is located in an abundant agricultural flourish, is home to 55 restaurants that include
region in southeastern Iowa. Fairfield has always Chinese, Indian, Thai, Mexican, French and
been at a busy crossroads where innovation and American cuisine. The main downtown square,
8
CASE STUDIES 1
fully occupied by thriving local retailers, art Fairfields strategy is supported by two
galleries, coffee shops and restaurants, surrounds organizations with overlapping membership:
an open park with an old-fashioned gazebo in the developers association and entrepreneurs
the center. On any given weekend, the square association. According to the leaders from
may be filled with people inspecting produce at each organization, the two groups work hand
the farmers market, speaking with local artists or in hand in their mutual dedication to helping
enjoying live music. entrepreneurs and local businesses prosper and
expand. The main objective of the entrepreneurs
Approach to Development group is to create networks among entrepreneurs.
Fairfields development strategy is to support This networking activity is supported by programs
entrepreneurship and the expansion of small and resources housed within developers group.
business by facilitating the creation of networks
among entrepreneurs. The goal of Fairfields Even under the best circumstances,
strategy, which was officially initiated in 1989, entrepreneurship can be an isolating activity.
is to link entrepreneurs with a community of In 1989 a group of successful entrepreneurs
colleagues and to provide them with support, launched the Fairfield Entrepreneurs Association
through various public programs, for establishing to provide more support to early-stage companies
and expanding their businesses. The strategy is and increase their survival rate. Every month,
almost entirely volunteer driven and is supported the group sponsors one or two workshops,
by two main organizations: the Fairfield which are broadcast on public access television.
Entrepreneurs Association and the Fairfield The association also matches successful business
Economic Development Association. entrepreneurs with early-stage entrepreneurs and
hosts conferences and boot camps that attract
Fairfield is an example of a small community investors from all over the country. One of the
that has moved well beyond industrial founders and the former president of the group,
recruitment. Its not that we havent tried to described the process as allowing individual
attract big manufacturing plants to Fairfield, entrepreneurs to tap into the collective wisdom
because we have, according to the vice president and experience of a variety of other businesses.
of Iowa State Bank. The bottom line is that Local restaurants and coffee shops sponsor
strategy hasnt worked for us, and weve had to association events with meeting space and in-kind
move on. Now, rather than providing incentives food donations.
to lure major employers, resources are devoted
to building a civic infrastructure that values and The entrepreneurs association is a volunteer
supports small businesses and entrepreneurship. organization that has operated on less than
USD 50,000 since its formation. On average,
Fairfields 10-year strategic plan, completed in it spends approximately USD 3,000 annually
2003, established a series of goals for expanding for promotion and educational programs.
the towns dynamic economy, including In addition to holding networking events,
to enhance business and job opportunities it operates a revitalization loan program,
arising from our economic base and to create an entrepreneur relocation program and an
an economic environment that nourishes entrepreneur-of-the-year award program. The
innovative business development. These loan program is part of a partnership among
goals reflect a choice that civic leaders have the entrepreneurs association, the developers
reaffirmed: to focus on building an economy association, the Chamber of Commerce and
from the towns existing economic assets and several local banks. Local businesses are eligible
its reputation as being entrepreneur-friendly, as for up to USD 100,000 for major capital
opposed to recruiting investment on the basis purchases such as real estate, remodeling,
of low-cost inputs. equipment and expansions. A relatively
new initiative, the relocation program is
9
designed to attract early-stage entrepreneurs Build an economy from a communitys existing

to Fairfield by offering discounts on rents assets. Fairfields priorities are aligned with
and telecommunications, training and access the practical realities of small-town rural
to capital. The association also convenes an America. Fairfield does not compete on
angel investor roundtable, which is made up the basis of having the cheapest labor and
of successful business entrepreneurs looking location. Fairfield took a very broad view of
to reinvest in local companies. Start-up its assets, which include small-town character
entrepreneurs are given the opportunity to and work ethic, an entrepreneurial culture,
present their business ideas and solicit financing civic amenities that rival those in big cities and
from local investors. a reputation for being entrepreneur-friendly.
Fairfield proves that a focus on building from
While the entrepreneurs association provides the communitys existing assets is a valid
entrepreneurs with more soft-touch support, (albeit long-term) strategy.
the Fairfield Economic Developers Association
supports small-business entrepreneurs by Community development propagates economic
facilitating financing for expansions/relocations, development and vice versa. Traditionally,
linking them with vacant manufacturing community development is viewed as the
facilities and providing incubator space. With an creation of infrastructure (largely by the public
annual budget of approximately USD 75,000 sector), and economic development is viewed
and a professional staff of 1.5, the developers as the creation of jobs and investment (largely
association administers state development by the private sector). When the two are viewed
programs, including the states brownfield as having similar ends, synergies can raise a
redevelopment program and an economic communitys standard of living beyond what
development grant and loan program. would have been possible otherwise. By viewing
economic and community development as one
The outcomes of Fairfields strategy include and the same, Fairfield has created a cultural
more than USD 250 million invested in start- infrastructure that helps to retain and energize
up companies since 1990, which is one-third entrepreneurs. Job opportunities increase and
of Iowas overall venture capital investment; the tax base expands in tandem with the creation
2,000 new jobs created since 1990; and USD of recreational, cultural and civic amenities.
8 million invested in new construction per year
since 1990. Small-town location as a competitive advantage.
The perception, whether warranted or not,
Key Themes or Lessons is that businesses located in small-town rural
Bring everyones talent to the table to address locations carry a moral and ethical standard
critical community issues. Embracing cultural above their urban competitors. Businesses in
diversity is a critical step in the process of Fairfield have exploited this perception to their
creating a compelling community vision. competitive advantage. We are geographically
One of Fairfields most prominent assets, the challenged, one local business leader said.
Mahirishi University of Management, attracts There isnt a lot of credibility to having a
a diverse population of talent to Fairfield. The creative advertising agency outside New York,
integration of newcomers into the cultural Chicago, Los Angeles, Minneapolis or Atlanta.
fabric of Fairfield has been a long and difficult However, people perceive Fairfield, with its
process. Pervasive cultural divisions must be Midwestern values, as being morally superior to
dealt with if a community is to move forward. urban areas. Some business leaders have turned
Strong leadership is the critical. this perception into a competitive advantage.
10
CASE STUDIES 1
Nelsonville, Ohio
Civic leaders in this historic coal mining community subsidize downtown storefront rent for
entrepreneurs and artist-retailers. Over a period of five years, artists clean up downtown
storefronts and bring the towns downtown square back into economic productivity.
2000 2010 +/-

Population 5,230 5,392 3%
Per capita income (state, Ohio) $28,695 $36,180 21%
Location Southeastern Ohio, USA (map)
Distance to metro/micro-politan center 19 km to Athens, Ohio
Retail trade
From 2001 to 2006, Nelsonvilles town center student body located on the outskirts of town.
square went from desolate storefronts to a bustling Hocking and Ohio University (12 miles away in
artists community with the help of subsidized Athens) have a significant influence on the civic,
rent for entrepreneurs and artist retailers. The social and economic infrastructure of Nelsonville.
towns historic architecture, anchored by the turn- The towns historic square is framed by buildings
of-the-century Stuarts Opera House, has been with stunning Victorian facades that, ironically, have
rehabilitated and brought back into productive been preserved through decades of neglect (there was
existence. Coffee shops, restaurants and other never enough investment to tear them down or to
social gathering places resonate with community renovate them in more contemporary styles).
activity. This contrasts with several years ago, when
the downtown occupancy rate was 25 percent At the turn of the 20th century, Nelsonville was
and buildings were crumbling. Nelsonville is the hub of the regions coal industry. In 1910, an
reinvigorating itself, one long-time resident said. average of a million dollars worth of coal passed
through Nelsonville every day. The wealth and
Location and History affluence that characterized Nelsonville in the
Nestled in the foothills of southeastern Ohio, early 1900s helped create a picturesque downtown
Nelsonville is a small town with many assets. The square. The downtown anchor was the Stuarts
town is surrounded by thousands of acres of national Opera House. Built with local handmade clay, it
and state forestland that attract millions of visitors housed performances from 1879 to 1925, a period
annually. Nelsonvilles largest employer is Hocking of nearly 50 years. Sadly, the collapse of the regions
College, a two-year college with an international coal industry and the economic depression of the
11
1930s were major contributors to the economic and prominent Nelsonville resident, If you dont like
cultural demise of Nelsonville. But, crucially, the the way things are, then you have to go cut the
physical infrastructure remained. Today Nelsonville grass yourself. This seems an apt metaphor for
has 420 sites on the National Historic Register. how Nelsonvilles strategy evolved.
Approach to Development Since 2000, artists have been quietly moving into
The revitalization of Nelsonvilles downtown square vacant storefronts and a bustling arts community
is partially attributable to a strategy of subsidizing rent has given new life to buildings where oiled floors
for entrepreneurs and artist retailers. In exchange for and tin ceilings and walls are commonplace.
rent support, artists have been required to invest their Following on the heels of the Foothills School,
sweat equity into rehabilitating storefront spaces. Starbrick Clay (gallery and pottery classes)
As the appearance of storefronts has improved and moved downtown and rehabilitated a Victorian
downtown activity has increased, others have taken storefront. Hocking College now offers classes for
note. The artists on the downtown square, with credit in this location.
their energy and creative enterprises, are making
property much more attractive to outside investors, Between 2002 and 2006, the civic entrepreneurs
said one real estate agent. who provided the initial support for artist retailers
went further to identify ways to boost local commerce.
Nelsonvilles strategy was not initiated or driven For example, one group helped raise funds for a
by elected or other public officials, but rather marketing brochure that is distributed to tourism
developed and evolved somewhat organically. agencies throughout the region. The downtown
In fact, the city council was firmly opposed to artist retailers worked with town officials to get better
investing in this kind of development, preferring signage to draw visitors from the highway that passes
instead to focus on industrial recruitment. The through town. The town also developed a logo based
financial resources for Nelsonvilles strategy came on its heritage as a famous brick producing region
from Hocking College, private donations and a in the early 1900s. A concerted effort is now being
small grant from the state arts council. made to highlight the Nelsonville Starbrick motif.
The initial catalyst for Nelsonvilles strategy was Nelsonvilles approach to development has
the Foothills School for American Crafts, which resulted in downtown occupancy rates increasing
moved into a downtown storefront in 2000. from 25 percent to 85 percent in four years. The
Foothills School was an outgrowth of the creativity Nelsonville public square was recently added
emanating from Ohio University and Hocking to the National Register of Historic Places. In
College. The school teaches craft skills to students 2005, local elections led to a major shift in the
of all ages and supplements this instruction with city council. As of today, new public leadership is
lessons in business management and lifestyle establishing itself in Nelsonville. According to the
skills to help artists cope while building an director of the local Rotary Club, volunteerism
artistic enterprise. The Foothills School created and participation in civic life are on the rise.
positive activity downtown, which led a group
of civic leaders to see the value of an economic Key Themes or Lessons
development strategy based on creative enterprise. A community of artists can reinvigorate a
dilapidated downtown. Subsidies for artist
Once they saw and understood the potential retailers catalyzed downtown development. The
value in leveraging local assets and the creative development of the arts community created
economy, a group of civic leaders came together in activity in Nelsonvilles downtown square.
an ad hoc manner to initiate Nelsonvilles strategy This activity has been a means to attract higher
of attracting artists by subsidizing their rent for value development projects. The presence of
downtown spaces. This group included many art studios and creative energy attracted local
owners of downtown real estate. According to one
12
CASE STUDIES 1
and regional investment into a new coffee shop Additionally, the Stuarts Opera House, with
and restaurant. Downtown real estate values its historic character and performance lineup,
are climbing. As the downtown artist-retailers attracts visitors from distant locations. As with
increase their revenues, the initial subsidies that tourism in general, enticing people to visit
the town offered are being repealed. a community is a vital step in revitalization
because visitors have the potential to become
Artist-driven development can help a small new home and business owners.
town attract tourists. Not only have artistic
activities created economic activity and helped Small groups of committed residents can
to maintain historic buildings, but they are jump-start development in small towns.
recreating Nelsonvilles regional reputation. The arts community in Nelsonville was the
The arts community has put together a Final outgrowth of small, informal, grassroots groups
Fridays event to showcase local artists, which is of collaborators who refused to see their town
held every month and has received substantial die. They did not wait for elected officials. They
press coverage as far away as Cincinnati and partnered with property owners and other
Lexington. This level of positive publicity would residents with the means to activate their strategy.
cost thousands of dollars in paid advertising.
Ord, Nebraska
In the face of dramatic population decline and the loss of manufacturing and agricultural
employment opportunities, Ord builds local capacity to pursue its four pillars of community
economic development: youth outreach, leadership development, philanthropy and
entrepreneurship.
2000 2010 +/-

Population 2,300 2,112 -9%
Per capita income (state, Nebraska) $28,590 $39,674 28%
Location North central Nebraska, USA (map)
Distance to metro/micro-politan center 265 km to Lincoln, Nebraska
Retail trade
Other services, except public administration
In 2005 Ord was honored as the governor New York Times and the Kellogg Foundation
of Nebraskas Showcase Community. Ord was annual report. This community has done an
the first community in Nebraska to become amazing job of selling itself and all that it has to
a state-certified community for economic offer, the Governor said. Ords mix of strong
development, and it has been featured in The local leadership, an active business community
13
and an ability to make use of available resources from community and economic development.
to meet development goals has been particularly The city, county and chamber each agreed to
impressive. This is an example of how a contribute USD 15,000 per year for a three-
coherent vision for economic development can year contract to build a cohesive program.
pay dividends in terms of helping to attract new Second, residents passed a 1-cent local option
jobs to a community. sales tax for economic development. Revenue
from this tax could be used for business loans
Location and History and other incentives or leveraged as matching
Ord, the county seat of Valley County, is a small monies for grant funding.
rural town in central Nebraska. It sits along the
Loup River and is the quintessential Midwestern Given these two important tools, Ord
small town, surrounded by hundreds of miles has taken a multifaceted approach to
of rich agricultural land and grain elevators. economic development. In a nutshell,
Ord grew along the rail lines. In 1874, land was Ord has professionalized and diversified
purchased from the Burlington and Missouri economic development. This strategy begins
River Railroad Co. to establish the town of in the schools, where local leaders have been
Ord. At a time when violence between settlers active in creating curricula and programs in
and Native Americans was common, Ord was entrepreneurship and business development.
protected by Fort Hartsuff, 10 miles to the north. Ord links the generations together (ages 18
Given its proximity to the fort and the railroads to 72) through a nine-month local leadership
connecting it to the outside world, Ord prospered development program called Leadership Quest.
as a market for farmers selling their produce and The town is building a community endowment
as a regional hub for commerce. The population by tapping into the wealth transfer from
grew steadily throughout its first 100 years. land-rich farmers, the interest from which is
Recently, a massive ethanol production facility being used to finance economic development
was constructed nearby. projects. Thanks to a growing revenue stream
from the local option sales tax, the town staffed
In 2000, the challenges facing leaders in Ord an economic development office that markets
included a 10 percent population loss for the the area to outsiders, works with existing small
preceding decade. This drop in population was businesses and entrepreneurs, and attracts new
due primarily to the loss of manufacturing and industries into the town.
agricultural employment opportunities. Such a
population loss in a small town creates serious As mentioned above, Ords economic
financial implications. The local school district development strategy rests on four pillars. The
receives state funding based on the number of first of these is outreach to youth, the roots of
students enrolled. Every student in the system any communitys long-term economic vitality.
translates into USD 7,500 per year from the state. The local high school curriculum features
Every student lost is a net drain on the school classes in personal finance, business law and
system. In 2000 Ords most pressing challenge entrepreneurship. The entrepreneurship course
was to stabilize its population. includes a project in which students develop
business plans and conduct analyses of market
Approach to Development conditions in Ord (so they can determine
In early 2001, Ord put in place two tools whether the local market would sustain a
that catalyzed the communitys turn-around. particular business idea). According to one
First, the City of Ord and Valley County, in resident involved in the project, Kids are taken
partnership with the Chamber of Commerce, completely through a business cycle. They are
worked out an interlocal agreement under taught about entrepreneurship, theyre allowed
which the three entities committed to work to select their own project, they write a business
together and to share the costs of and revenues plan, they have a banker counsel with them, they
14
CASE STUDIES 1
develop the project and learn about marketing, efforts. In 2007, the towns collaborative energy
they cut their own spots for the radio, they have a and ample water supply attracted the attention
business fair, and they make money. Training in of a company seeking a location for a USD
entrepreneurship and opportunity analysis provides 75 million dry mill ethanol plant. The town
a solid foundation for Ords future leaders. markets itself to outsiders as well as to natives
who have moved away. The Valley County
Second, Leadership Quest is the leadership Youth Initiative is an effort to stay in close
development component of Ords economic contact with high school alumni as they attend
development strategy. Leadership Quest is a college and keep them informed about job
nine-month class that helps participants to openings, business ownership opportunities
develop interpersonal and conflict management and various community improvements.
skills. Topics covered include policy making,
business and public service. Participants range Several outcomes that can be attributed to Ords
in age from high school students to retirees. approach over a three to five year period include
There is a strong focus on learning how to retail sales increasing 20 percent (compared with
identify individual personality traits and work 16 percent statewide); personal income increased
around differences. by 21 percent in Valley County (compared with
11 percent statewide); per capita income in Valley
The third pillar of Ords economic County increased by 22 percent (compared with
development strategy involves philanthropy. 9 percent statewide); and more than 14 new or
To get as many residents as possible involved expanding businesses.
in philanthropy, Ord established a community
endowment and a founders club. Momentum Key Themes or Lessons
for building the endowment was generated by an Financial resources and organizational
initial USD 1.2 million gift from a pair of local capacity make a difference. Ord is fortunate
residents. Interest earned on the endowment is to have a dedicated revenue stream for
being used to finance community and economic economic development at the local level (the
development projects. The fund is managed by local option sales tax). The community also
the Nebraska Community Foundation, and the benefits from having a professional paid staff
Valley County Economic Development Board to act as organizational capacity for economic
awards grants from the endowment. Among development. These two factors distinguish Ord
other things, earnings from the endowment from many communities of similar size and give
are used to provide relocation assistance as the community a competitive advantage.
an incentive to attract young professionals to
Ord. Ords founders club requires a minimum Measure and monitor the impacts of a
donation of USD 1,000. Ords original goal development strategy. The staff at Ords
was to get 47 local residents into the club, but Chamber of Commerce and its economic
the tally is now up to 65. development office have made it a priority
to measure and continually monitor the
The fourth and final pillar is entrepreneurship. economic, social and civic outcomes from Ords
In addition to the youth entrepreneurship economic development efforts. Documented
component, the Chamber of Commerce put impacts are useful for both external and internal
together a community resource team made up of audiences. Good data can be used to attract
lenders, accountants and attorneys who provide additional investment from outside sources
one hour of free service to small business owners and, by demonstrating a reasonable return on
and entrepreneurs. investment, can be used to build local support.
Ord is also extremely active in marketing, Communication is crucial. Ord provides

small business support and business recruitment regular updates to the community. Economic
15
development staff members spend an ever- not otherwise have existed. The state-level
increasing amount of time publishing newsletters authority working with the ethanol company
and writing articles for the local newspaper. They knew about Ords development efforts (again,
send e-mails to as many residents as possible and thanks to the towns communication strategy)
appear on radio broadcasts regularly. The idea is and contacted the Valley County economic
to replace rumors with accurate information about development director. The timeline for this
what the organization is trying to accomplish. project was extremely tight, and the company
According to one prominent leader, Creating a needed a partner that was ready to go. Within
positive flow of information into the community hours, revenues from the sales tax were used to
is very important. fund an environmental study of the project site.
An infrastructure and incentive package was
A team approach to economic development is put together within days. The lesson here is that
ideal. According to the chair of the Valley County Ord had a team in place and ready to act when
Board of Commissioners, a crucial component opportunity knocked.
of Ords strategy for economic development was
persuading residents that the approach was right Rural philanthropy can be a tool for building
and convincing them to join in the effort. Small a sustainable pool of resources. Research
town economic development must be a team suggests that rural residents in midwestern and
exercise, she said.. Even though it can take more southeastern states have developed a culture of
time and hand-holding, you have to convince as philanthropy that the coasts and Southwest,
many people as possible to join your team and to for all their wealth, do not yet have. The key is
be willing to lend a hand. to create and market a local structure for aging
residents to bequeath assets to local civic causes.
Preparation means opportunity. Ords The intergenerational wealth transfer over the
ability to attract the USD 75 million next 50 years will be enormous, and small towns
ethanol facility demonstrates how the towns can position themselves to benefit from it.
preparation created an opportunity that would
16
CASE STUDIES 1
Siler City, North Carolina
This small town is capitalizing on the economic value of arts-based small businesses and
entrepreneurs. Through a partnership with a regional community college, Siler City is
nurturing the creativity and entrepreneurship of local artists.
2000 2010 +/-

Population 8,079 7,887 -2%
Per capita income $13,950 $12,882 -8%
Location Central North Carolina, USA (map)
Distance to metro/micro-politan center 58 km to Raleigh, North Carolina
Primary employment sectors Manufacturing
(top three as percentage of workforce, 2007) Professional, scientific, and management, and
Retail trade
Siler City is working with the nearby community change, in large part, is attributed to Hispanic
college, Central Carolina Community College workers migrating into the community to work
(CCCC), to create an arts-based small business at the meat processing plants in and around
incubator. Beginning in the late 1990s, the Small Siler City. In addition to the processing
Business Director at CCCC saw an opportunity plants, traditional textile and furniture
to harness the energy of local artisans toward manufacturers have tended to be the largest
the revitalization of downtown Siler City. After employers in Siler City.
securing financing, a portion of which came from
the local government, CCCC renovated three Approach to Development
buildings in downtown Siler City and formed Faced with declining employment in traditional
the North Carolina Arts Incubator. Since 2003, industries, the towns strategy for economic
the incubator has triggered a minor renaissance development was to partner with CCCC to create
in downtown Siler City. The North Carolina Arts the North Carolina Arts Incubator. The idea was
Incubator has turned a loose collection of artisans to purchase adjoining abandoned buildings in
into an economic sparkplug that is helping to downtown Siler City, renovate them and open
revitalize downtown Siler City. an incubator designed to meet the needs of local
artisans. Besides competitive rents (USD 100
Location and History to USD 200 per month), the incubator and
Siler City is located in central North Carolina. CCCCs small business center provide special
Founded in 1887, Siler City is the largest town assistance to artisans in marketing, finance and
in Chatham County and is within a one-hour business planning.
drive to two urban markets in Raleigh and
Greensboro. In recent years, the demographics Siler Citys efforts began in earnest in 2001 when
of town have changed considerably. This a local leader formed a nonprofit organization, the
17
North Carolina Arts Incubator, to raise money Key Themes or Lessons

for purchasing and renovating several downtown Small business incubators, whether focused on
buildings. To secure a bank loan, the leader artists or other entrepreneurs, must provide
recruited six local artisans to demonstrate the training and support, along with affordable
potential cash flow from the incubator. One of space to catalyze economic development. One
the primary tenants of the incubator was to be of the innovative characteristics of the North
CCCCs new professional arts and crafts program, Carolina Arts Incubator is its recognition
the first of its kind in the state. The program was that artists need space, but they also need
to become a crucial training and professional softer support such as the ability to network,
development program for artisans located in mentorship opportunities and small business
the incubator. The program includes training in training. Newer artists in the incubator may
artistic skills in pottery, clay sculpture and metal need continued training in their respective
sculpture, and entrepreneurship instruction to craft. The professional arts and crafts program,
teach artists how to run and manage galleries and the only one of its kind in North Carolina, was
studios. In 2001, the bank approved an initial developed to teach artistic skills and business
loan of USD 125,000, and the North Carolina skills relevant to operating a craft studio and
Arts Incubator purchased buildings along three gallery. By providing affordable space and
full blocks of Main Street in Siler City. training, Siler City, CCCC and the North
Carolina Arts Incubator have brought about
A year later, the incubator project needed a downtown renaissance and facilitated the
additional funding to complete the building creation of new small businesses.
renovation. Having built a strong relationship
with local government officials in Siler City Demonstrating success helps to build
(including the building inspectors and town support for your efforts. Leaders of this
planners), the incubators leadership approached project attracted bank funding for the
the town for local assistance. Siler Citys incubator project by demonstrating the
officials were enthusiastic about the incubator economic potential of six existing artisans,
and agreed to contribute USD 25,000 per essentially making the case to the bankers
year toward operational costs. With the extra for the success of the project. The incubators
boost from the town, building renovation was initial success helped convince local
completed in 2003, and the North Carolina Arts government leaders to invest in the continued
Incubator opened in November of that year. renovation and expansion of the facility.
One of the initial tenants in the incubator was Strong partnerships and visionary leadership
a specialized guitar maker who had previously are necessary ingredients for success. The
worked out of an industrial park outside of successful establishment of the incubator in
another city, but decided to move his shop after Siler City was the product of a partnership
hearing about the incubator. I was able to among the community college, local
get a good workspace at a third the cost of my government, and a variety of NGOs, all
previous space, he said. Plus, it was an incredibly facilitated through the visionary leadership
stimulating environment to be around other of one key leader. Together these groups were
artists making pots and sculptures. The guitar able to see the potential behind focusing
shop now attracts guests from throughout the on artist entrepreneurs who are not usually
world to Siler City. considered targets for incubator development.
18
2
Case Studies iI: Place-based development
This chapter includes case studies of small towns that are

focused on place-based development strategies. These strategies
capitalize on the distinctive and special characteristics of a
particular place. Such characteristics might include a distinctive
town center, the natural environment, cultural heritage,
specialized infrastructure, and arts or historical traditions. These
characteristics of a community are tied to its quality of life, which
matter increasingly in the 21st century economy, particularly for
firms in knowledge-based industries. Quality of life amenities
are central to place-making in small towns as they try to build
vibrant communities by drawing on their localized assets and
sources of competitive advantage.
Bakersville and Hayesville, North Carolina
Two small rural communities in the mountains of North Carolina build civic infrastructure
and partnerships, and boost tourism by elevating heritage and cultural assets and
revitalizing downtown.
2000 2010 +/-

Distance to metro/micro-politan center 97 km to Asheville, North Carolina
Retail trade
Construction
Over the last several decades, parts of the Tenn. Incorporated in 1870, Bakersville has a rich
state of North Carolina have seen explosive and storied history. David Baker, the towns first
growth. Hundreds of new businesses have been resident, is believed to have settled here in 1797.
attracted into urban areas. Universities and Initially an important trading center, Bakersville
colleges throughout the state have incubated endured the boom and bust nature of the mining
entrepreneurial activity, leading to new business industry throughout the 1900s. According to a
spin-offs in biotechnology and high-tech industry. local historian, during the late 1800s and early
Far away from the activity, in the mountains of 1900s, business varied with prices mica would
western North Carolina, a different approach bring; good prices, many jobs, good business; low
to economic development is emerging. It is an prices, the reverse. Fortunes were made and lost.
approach that is rooted in rural heritage and
culture. Bakersville, having recovered from a Hayesville is the only incorporated town in Clay
devastating flood in 1998, demonstrates how a County, located five miles north of the Georgia
small community can turn a natural disaster into state line in far western North Carolina. The town
a catalyst for reinvigorating civic and economic is situated on a knoll overlooking the Hiawassee
activity. Hayesville, using similar heritage-based River and has an expansive view of the southern
approaches to those being used in Bakersville, Appalachian Mountains. The town of Hayesville
enriches the story with tourism and infrastructure was built around the historic two-story Clay County
development. Courthouse in 1888. Today, more than 80 percent
of Clay Countys land area is forested and 46 percent
Location and History is federally owned. History and culture play a
Bakersville, the county seat for Mitchell County, significant role in Hayesvilles social and civic life.
is a quaint mountain community. It is an hours The Clay County Historical Museum, located in the
drive from Asheville, Boone or Johnson City, towns old brick jail house, is the towns centerpiece.
20
CASE STUDIES 2
PLACE-BASED DEVELOPMENT
Approach to Development In Hayesville, CCCRA (in partnership with the

Development strategies in Bakersville and local government) began its development work
Hayesville, although not identical in every in a simple and organic way by completing several
respect, are similar. They both involve building community beautification projects, including
infrastructure and capacity for initiating and landscaping at the main entry to town and planting
sustaining locally driven community and trees along Main Street. Further, CCCRA funded
economic development. In addition, each and built a community playground and a downtown
towns strategy includes elements of tourism and park. CCCRA led a local effort to renovate the
downtown revitalization. Bakersvilles strategy is to exterior of the Clay County Courthouse by initiating
improve the towns civic infrastructure in an effort a commemorative brick fundraising campaign.
to attract and retain artist studios and other town
center-based retailers that attract tourist dollars Tourism through events and festivals
into the local economy. Hayesville is working The second part of each towns strategy is to
to beautify the community, forge partnerships to sponsor events and festivals that create community
develop tourism infrastructure and put on events cohesiveness and attract tourist dollars into local
that attract tourists and invigorate local civic energy. businesses. Bakersvilles main event is the annual
Rhododendron Festival, the premier festival
Building infrastructure and capacity in celebration of the worlds largest natural
Given each communitys limited population and rhododendron gardens (situated on Roan
financial resources, Bakersville and Hayesville both Mountain). Beginning in 1994 and held every June
have taken steps to build physical infrastructure since, the festival includes a street fair, antique car
and organizational capacity to facilitate show, childrens events and other cultural attractions.
community and economic development. In each When the creek walk was completed in 2000, vendor
community, a local volunteer-led organization tents were added to pedestrian areas along the creek
evolved in response to dramatic shocks to the local walk. The event attracts thousands of visitors who
economy. BIG (in Bakersville) and CCCRA (in eat in the local restaurants, purchase artwork from
Hayesville) are the primary development entities. local artists and buy produce from local farmers. The
Each partners with its towns local government, success of Bakersvilles Rhododendron Festival spilled
but government is not the primary driver of the over into a number of additional events, including
strategy in either place. Each organization includes an annual Christmas parade, an Easter egg hunt and
both long-time and newer residents, and each seems a Fourth of July fireworks celebration. According
to represent the interests of those residents who are to the Rhododendron Festival website, the festival
active in civic affairs. has been responsible for three-quarters of a million
dollars in grants, which have brought new businesses,
In Bakersville, a major flood in 1998 led to a new jobs, a clean-up campaign and a renewed sense
re-evaluation of the towns floodplain, after which of pride to our town.
the state declared portions of the commercial
district ineligible for redevelopment. Rather than Hayesvilles main event is Car-B-Q, an annual antique
view this redefinition of the floodplain as an car show, barbeque festival and live music concert that
economic threat, BIG went to work to turn it into takes place every July. CCCRA has forged partnerships
an opportunity. The initial move was to focus on a with several local banks and businesses, which provide
walking path along the town creek. A creek walk, financial support to the event. Regional radio stations
they decided, could pull the community together and newspapers provide free publicity. These
and, importantly, would demonstrate activity and partnerships, initiated and managed by CCCRA,
revitalization in the new floodplain. Further, have resulted in an event that brings hundreds of
local leaders believed that additional public space, visitors into downtown Hayesville. CCCRA also
in the form of a creek walk, would support the puts on an event called Lies and Pies, which involves
growing artist-based downtown economy and story-telling and a pie bake-off. According to Rob
attract tourists into the community. Tiger, Lies and Pies is a competition for who can
21
make the best pie and spin the best lie. Events not as much of a second home destination as
celebrating Hayesvilles unique heritage have become Hayesville, is situated in one of the most scenic
a means for attracting tourists and for integrating parts of North Carolina. Both communities are
newcomers into the local civic and social networks. within easy reach of protected state and national
forestland. The location and attractions of these
Key Themes or Lessons communities create a natural draw for tourists,
In small towns, community development artists and vacation/retirement property
is economic development. Both Hayesville developers, and both towns are positioning
and Bakersville demonstrate that community themselves to take advantage of these assets.
development projects, aimed at creating public
infrastructure (both built and abstract), can lead Heritage, culture and history are economic
to economic outcomes. The development of a development assets. Events and celebrations
creek walk in Bakersville has been credited with in Bakersville and Hayesville tend to be
the creation of new businesses on Main Street. centered on an element of heritage. Antique
The mountain bike trail and Pioneer Village cars, local cuisine and story-telling are all
projects in Hayesville are intended to increase aspects of heritage. Each of these communities
tourism traffic and provide entrepreneurial demonstrates a means for taking the local
opportunities for new business development. heritage from a particular region and leveraging
Informal organizations and partnership it for economic gain, in this case tourism dollars.
development in both communities have made
it possible for economic development to occur. Look for opportunity in adversity. In both
towns, volunteer-led organizations developed
Small projects can build momentum and in response to palpable economic hardship.
partnership for facing larger challenges. The BIG (in Bakersville) came together and gained
evolution of CCCRA is a perfect example of momentum after the flood in 1998. The flood
beginning with small, low-hanging fruit projects in 1998 brought the citizens of Bakersville
to demonstrate the capacity for change. CCCRA closer than ever before, Mayor Vines said.
started in 1996, when a local resident decided to CCCRA (in Hayesville) was at least a partial
clean and paint the awnings around the Hayesville response to the dramatic up-tick in retiree and
town square. This effort led to a music event on vacation home development.
the square, which the community parlayed into a
number of other events and celebrations. In small Small groups of committed residents can
towns, small steps can lead to giant strides. jump-start development in small towns.
Both BIG and CCCRA are ad-hoc volunteer
Capitalize on assets -- location and attraction. organizations that, over time, have become the
Hayesville is located 130 miles from Atlanta, primary drivers of economic development in
Georgia, one of the fastest growing cities in their respective communities. Both organizations
the U.S. The rural mountain setting in Clay started with a small group of committed residents
County is a major draw for tourists, retirees willing to volunteer time toward making
and vacation-home owners. Bakersville, while something happen in their community.
22
CASE STUDIES 2
Big Stone Gap, Virginia
This towns choice to embrace ecotourism and to support local entrepreneurs is

transforming the local economy and providing residents with a sense of accomplishment
and independence from the control of industry outsiders.
2000 2010 +/-

Population 4,800 5,614 14%
Per capita income (state, Virginia) $31,634 $44,246 29%
Location Western Virginia, USA (map)
Distance to metro/micro-politan center 100 km to Johnson City, Tennessee
Retail trade
Public administration
Big Stone Gap, located in the Cumberland Bike Route and the new Heart of Appalachia
Mountains of western Virginia, is a town blessed Bike Route and Scenic Drive weave their way
with natural resources and scenic beauty. Over through the region. The town is also a major stop
the last 20 years, however, the declining coal on Virginias Crooked Road heritage music trail,
and textile industries have left hundreds of local which honors this regions role in the creation of
residents without work or income. In response, bluegrass music.
local officials have partnered with several non-
governmental organizations to spearhead an Big Stone Gap was settled in the mid-1800s
ecotourism strategy. By supporting the growth of when rich coal beds attracted miners into the
small business entrepreneurs to serve the ecotourism region. Throughout the first half of the 20th
industry, the town has revitalized its economy and century, the town prospered on proceeds from
created new job opportunities for residents. coal extraction and supplemented its economy
with tobacco and textiles. Beginning in the
Location and History 1980s, however, the mining industry started to
Big Stone Gap is in the heart of Appalachia, falter. By 1992, the countys unemployment rate
a mountainous region along the eastern coast of approached 20 percent and remained in the mid-
the U.S., close to Virginias western border with teens for most of the 1990s.
Tennessee and Kentucky. The rolling hills and
rural landscapes around Big Stone Gap encompass Approach to Development
some of the most promising outdoor tourism Big Stone Gaps development strategy is to
attractions in the country. Jefferson National use ecotourism to attract new investment and to
Forest, the Grand Canyon of the South, and create employment opportunities by supporting
the Natural Tunnel State Park envelop this little local entrepreneurs. As of the late 1990s, tourism
town. The Appalachian Trail, the Trans-America was the fastest-growing industry in southwestern
23
Virginia, with an average annual growth rate of manager. In 2005, the countys unemployment
17 percent. The town partnered with the Heart rate returned to a stable level of 4.6 percent, and
of Appalachia Tourism Authority (HATA) new businesses are beginning to take off. Small
and Virginia Cooperative Extension (both outfitting businesses for kayaking, rafting, biking
NGOs) to develop an infrastructure to support and camping are thriving. The bed and breakfast
entrepreneurship in the ecotourism industry. The industry also is growing and being marketed
towns goal was to allow local residents to harvest throughout the state.
ecotourism, but to do so in a sustainable manner.
Key Themes or Lessons
The first step was to create a local education Supporting entrepreneurs is a long-term
and training infrastructure to provide advice and and transformative economic development
encouragement to budding entrepreneurs. The strategy. Big Stone Gap was riddled with high
Virginia Cooperative Extension offered workshops unemployment and a declining economy. For
in the community to demonstrate how residents decades, the town had relied on outsiders,
could start their own business and take control such as the coal company or textile plant, to
of their economic future. The town also formed provide jobs. When these industries pulled out
alliances with the Mountain Empire Community of town, Big Stone Gap looked at itself and
College and its Small Business Development what it had to offer, and it decided to build a
Center. The center agreed to provide business plan new economic underpinning based on its local
feedback and financial advice to local entrepreneurs. assets and opportunities. In Big Stone Gap, the
Southwest Virginia Community Development ecotourism assets around town were brimming
Finance provided a lending option for ecotourism with opportunity. Over a period of six years,
entrepreneurs in town. The town actively promoted entrepreneurs harvested these opportunities,
these resources to local entrepreneurs and worked to and slowly but surely, new small businesses
connect the right resource to the right entrepreneur started appearing in town.
at the right time.
Entrepreneurs need a flexible and multi-
The town helped build an infrastructure faceted support network. Entrepreneurs have
that entrepreneurs can use to develop their unique needs. A single organization in a small
own jobs and generate income by capitalizing town will never be able to support the broad
on sustainable, value-added, community- range of needs that entrepreneurs face on a daily
based tourism. Big Stone Gap has curbed the basis. Creating a network of services, however
impacts of regional economic stagnation. The informal, is a viable strategy for supporting the
infrastructure and effort weve put in for the past needs of local entrepreneurs. In Big Stone Gap,
10 years is really going to help our town reap the the town linked entrepreneurs to NGOs with
benefits of the increased tourism, said the town relevant services.
24
CASE STUDIES 2
Black Mountain, North Carolina
This small town bridges a thriving local arts scene with economic development to restore
its cultural identity and enlarge the tax base.
2000 2010 +/-

Distance to metro/micro-politan center 18 km to Asheville, North Carolina
Retail trade
The Black Mountain Center for the Arts, made 1933 as an experimental school in interdisciplinary
possible by a local government investment, is education. The college became a hotbed for European
spurring cultural and economic development. In intellectuals forced to flee Nazi persecution. A rich
the early 1970s, the Town of Black Mountain sold community of international musicians, architects and
its town hall to a group of local artists and business writers came together in the mountains of western
people. Thanks to local government funding, North Carolina. Several world-renowned artists
supplemented by private donations, the old town including Buckminster Fuller, Merce Cunningham
hall was renovated and re-opened as the Black and Josef Albers either studied or taught at Black
Mountain Center for the Arts in 2000. Two years Mountain College. After World War II, though,
later, the town council made another strategic many of the Colleges students and faculty moved
decision to retire USD 200,000 of the centers to the West Coast, and in 1956, Black Mountain
remaining renovation debt, ensuring the centers College closed its doors.
long-term viability. Today the center operates
debt free and offers world-class musical, Throughout the 1960s and 1970s, Black
artistic and theater productions that are Mountain struggled. In 1980, the small downtown
rekindling Black Mountains artist community was a boarded up strip of dilapidated buildings.
and attracting tourists from throughout the During the 1980s, an injection of funding from
southeastern United States. the governors Community of Excellence program
allowed the community to charge some energy
Location and History into its downtown corridor. By the 1990s, Black
Black Mountain is situated in the foothills of Mountains downtown was back on track. Next,
the Blue Ridge Mountains. The community has a the arts culture, which had been a prominent
rich and storied history as a center for arts, music part of the community until the 1950s, was due
and drama. Black Mountain College opened in for a renaissance.
25
Approach to Development the center owed for the buildings renovation. The
Black Mountains strategy was to invigorate the Center now operates nearly debt free and can offer
local arts culture to attract tourists and investors more events to the public. Our partnership with
into the community and to catalyze small business Black Mountain is incredibly important, said the
development. Two decisions were key to its centers director. Id estimate the help they have
success: (1) to provide building space for the Black provided in purchasing out our debt and land at
Mountain Center for the Arts and (2) to retire the over USD 70,000 per year. To an arts center, that
centers construction debt. is a lot of money.
The story of Black Mountains strategy begins Black Mountain is reaping the benefits of
in 1990 when the local government was in the investing in its arts community and culture. A
market for new office space. The old town hall recent study estimated the economic impact of
along Main Street was run down and in need of Black Mountain and Ashevilles 3,000 artists to
substantial repair. Rather than construct a new be over USD 200 million annually. This averages
building, town leaders purchased the Union USD 66,000 for each artist artist, of which there
Bank building, cattycorner from the hall, for are hundreds in Black Mountain.
their new offices. At that point, they saw a golden
opportunity to help the local Black Mountain Key Themes or Lessons
arts group. In 1993, Black Mountain sold the Public-private partnerships can be developed
old town hall to a member of an ad-hoc group to support community development interests.
of artists and business people in Black Mountain. The Town of Black Mountain provided capital
They didnt have anywhere to work, said the and building space to an ad-hoc group of local
former town manager. Giving them the old town artists. The investment led to the creation of the
hall was the booster shot to get them going. The Center for the Arts and elevated the role of the
sale prompted the arts group in 1995 to become arts group in the community. It provided the
a formal nonprofit organization called the Black arts community with a place, an identity and a
Mountain Center for the Arts. For the next four focus. The center in benefited each individual
years, the nonprofit campaigned for donations artist and the community as a whole.
to renovate the building. The town government
provided a low-interest loan and an USD 88,000 Investing in the arts community can be a driver
donation. In all, the group raised USD 1.2 million of economic development in a community. The
for renovations, and in the fall of 2000, the new results of Black Mountains investment have
Black Mountain Center for the Arts opened. been increasing tourism, the development of
small arts-based businesses and the attraction of
Since opening, the Center for the Arts has new residents who want to associate with the
attracted cultural enthusiasts from throughout Black Mountain Center for the Arts.
the state and southeastern region. Concerts and
galleries showcase a range of local and international Strategic investments in community organizations
artists, musicians, theater productions and classes. can align private/nonprofit sector interests with
By 2002, the arts culture was thriving in Black broader community interests. Black Mountains
Mountain. In that year, town leaders made strategic investment created the incentives so
another strategic move to ensure the centers that the energy of local artists was aligned with
continued viability. In exchange for the title to the interest of the community.
the centers land, the town paid off USD 200,000
26
CASE STUDIES 2
Branson, Missouri
Branson, with a local economy reliant on theater-based tourism, pursues a large mixed-
use project using creative financing to diversify the regional economy and to increase
year-round employment.
2000 2010 +/-

Population 6,050 10,520 42%
Per capita income (state, Missouri) $27,885 $36,965 26%
Location Southwestern Missouri, USA (map)
Distance to metro/micro-politan center 72 km to Springfield, Missouri
Primary employment sectors Arts, entertainment, and recreation, and
(top three as percentage of workforce, 2007) accommodation and food services
Retail trade
Branson is a small town in the southwest Bransons tourism base expanded throughout
corner of Missouri that attracts 7 million visitors the first half of the 20th century. In 1952
every year. The town has been proclaimed the federal funds were appropriated for a dam
country-music capital of the universe with construction project in Branson, sparking a
more theater seats than Broadway. To diversify flurry of entrepreneurial activity. At about
its tourism industry and create more year-round this time, a group of government officials,
job opportunities, the town has just completed influential local citizens, local businesses and
a USD 420 million retail and convention center the Chamber of Commerce pooled resources to
project that required the largest tax increment create the first performance theater in Branson.
financing (TIF) project in the history of Missouri. The popularity of Bransons first theater led
to the development of several other local
Location and History performance venues. Initially, the theaters were
Branson is located in the southwest corner of family-run and showcased local talent, but over
Missouri near the borders of Oklahoma and the years Bransons venues became popular with
Arkansas. The frontier town of Branson was touring national entertainers, including Wayne
established in 1882, and for much of its early Newton, Andy Williams, Glen Campbell, the
history, tomato canning was the predominant Gatlin Brothers, and many others. Today there
industry. This changed in 1896 when a visiting are more than 50,000 seats in 40 theaters and
minister, Harold Bell Wright, was charmed by the nearly 500 shows by 70 different acts each
areas scenic beauty and wrote a national best seller year. Bransons performing arts cluster attracts
titled The Shepherd of the Hills, set in the region. 7 million visitors annually, a number that is
Wrights book ignited a tourism boom and in expected to reach 8 million in 2007.
1906 tourism became Bransons main industry.
27
In the late 1990s, town leaders in Branson generated by the development, which the city
were wrestling with the impacts of relying on could use to pay off the yearly debt. By generating
an economic development strategy that was a revenue streams from local and state TIF money,
one-legged stool. Tourism created employment Branson also had a foundation on which to issue
opportunities, but many jobs were seasonal. bonds, which generated an additional USD 130
Branson embarked on a strategy to diversify million to pay for new infrastructure. Overall,
its existing tourism strategy and to create more the financing scheme generated over USD 250
consistent year-round employment opportunities. million for the project, and ground was broken
in 2004. In April of 2006, Belks Department
Approach to Development Store opened its doors to the first Branson
In 2001, local leaders unveiled plans for Landing customers.
Branson Landing, a mixed-use project on nearby
Lake Taneycomo that included a 220,000-square- Today, Branson Landing rivals mixed-use projects
foot convention center, a 250-room four-star in major cities. Within eight weeks of opening, the
hotel, a boutique hotel, 140 waterfront luxury development surpassed expectations and attracted
condominiums and nearly 450,000 square feet more than 1 million visitors. City officials estimate
of retail shopping. The project represents an that Branson Landing brings in more than 500,000
attempt to diversify Bransons economy beyond new visitors each year and generates USD 180
musical entertainment and provide stable, year- million in economic activity and another USD 8
round employment. City leaders (are) following million in taxes. The project also has complemented
an economic model of a three-legged stool: the entertainment industry by attracting a younger
tourism providing revenue, service industries crowd to the city.
bringing year-round jobs and homebuilders
filling residential needs, said Bransons director of Key Themes or Lessons
economic development. Small communities can undertake mega-
projects. Branson illustrates that small towns
The scale of Bransons development project can carry out very large development projects
exceeded expectations. Initially, the plan was to utilizing creative finance schemes, typically
develop a regional convention center, but after only deployed in larger cities. The city saw a
seeking ideas from the public, the city added plans need for a convention center and extended that
for retail and residential space. In 1997, local vision into a massive retail and residential space
officials began searching for sites. They also came that has strengthened and diversified the citys
to realize that, given the size and scale of Branson economy.
Landing, TIF was the only realistic option for
financing the project. Everyone wanted the Successful public investments can have
convention center but didnt want to pay for it ripple effects throughout the community.
through increased taxes, Finance Director Deana The Branson Landing project created spin-
Schlegel said. The TIF was the only legitimate off investments throughout the community.
way for us to pursue this development. Branson recently added a USD 12 million
recreation center and approved its first
To finance the Branson Landing project, the industrial park. The industrial park will help
city used a combination of local TIF dollars, state to spur more year-round employment.
TIF dollars and bond financing. First, Branson
declared a stretch of land along Lake Taneycomo Strategies are more likely to be successful
as the target district and then created a TIF board. when they are built on existing assets.
The next step was to seek approval from the Projects such as Branson Landing have to be
Missouri legislature to designate the waterfront constructed on a secure foundation within
area as a state TIF district. This approval allowed the context of a communitys strengths and
the city to capture a portion of the state sales tax assets. Bransons tourism industry has thrived
28
CASE STUDIES 2
and grown for nearly a century, eventually used its strength in entertainment tourism
becoming the citys strongest and largest to pursue other sectors of the economy that
asset. Branson Landing would not have enhance tourism while providing more stable
been a success without Bransons status as employment.
a regional tourism destination. Branson
Colquitt, Georgia
Colquitt uses the arts as a tool for community empowerment and economic
diversification. The success of a community-based performing arts project has resulted
in extensive downtown revitalization and economic development.
2000 2010 +/-

Per capita income (state, Georgia) $28,541 $34,800 18%
Location Southwestern Georgia, USA (map)
Distance to metro/micro-politan center 76 km to Dothan, Alabama
Manufacturing
Retail trade
For four weekends in the fall and spring of and processing), augmented with some textile
each year, tens of thousands of people descend on manufacturing. As the farm economy faltered
Colquitt for Swamp Gravy, a musical play that through the mid-1980s, Colquitts residents were
celebrates life in rural southwestern Georgia. With left with historically low incomes and a downtown
a cast of more than 100 local volunteers, Swamp struggling to support businesses.
Gravy tells the history of Colquitt. The play has
sold more than 120,000 tickets and generated well In 1990 a group of civic leaders in Colquitt
over USD 4 million since it began in 1993. The formed the towns first arts council. The idea
local arts council has reinvested revenues from the for Swamp Gravy was hatched in 1991 when a
production into the revitalization of downtown graduate student from Northwestern University
buildings and the renovation of a local mini-mall, with no direct ties to the community, met with the
where vendors of arts, crafts and antiques have ColquittMiller County Arts Council. The student
access to affordable rental space. was seeking to test a hypothesis that community-
based performing arts and the performing skills
Location and History of individual people could empower individuals
Colquitt is a rural farming community in Miller and bring neighborhoods together. The arts
County. Historically this regions livelihood has council was intrigued by the idea and saw it as an
been fueled by the peanut industry (both farming opportunity to help invigorate the local economy.
29
Approach to Development The arts council has become Colquitts primary

Swamp Gravy is a theatrical production, written responder to local economic development
and produced by local residents, that depicts the life challenges. In 2001, five downtown businesses
and history of Colquitt. The strategy behind Swamp closed due to economic recession. According
Gravy was to let people tell their stories and the story to the director, We saw the impact of Swamp
of their community, strengthening community ties Gravy during the months it played and decided
in the process. Swamp Gravy relies exclusively on we should look to year-round opportunities that
local volunteers to create the script and produce might help stabilize businesses. In an effort
the musical. The script is a collection of local stories to further diversify the local economy beyond
submitted by residents and fashioned together by a seasonal performance art, the arts council now
professional playwright. Each year the theme of the operates a local bed and breakfast, a mini-mall
play changes slightly to incorporate new stories, but for local vendors, a storytelling museum, a mural
the basic weaving of stories remains the same. The use project and the childrens theater.
of local actors and crew members creates devotion
to the common goal of improving the community, Key Themes or Lessons
while the reliance on contributions from community Strategically designed arts programs can catalyze
members to make up the script gives other residents economic development. Colquitt began with a
a sense of involvement in and ownership of the play. vision of a community theater program that
would stimulate economic and civic growth.
The ColquittMiller County Arts Council The community created a specific plan to
deliberately structured Swamp Gravy to involve involve community members, specified
and empower local residents with the goal what kinds of outcomes it expected and
of stimulating civic and economic life in the determined how the program would give back
depressed town. This did not happen overnight; to the community. Stakeholders discussed and
it was difficult for many local residents to accept planned the causal chain of events ahead of time
the idea that cultural tourism was a valid means to -- beginning with the specific design of Swamp
economic development. It was critical early on Gravy and continuing to the community
to have a few local residents and council members capacity and economic growth that they hoped
working hard to help other residents understand the play would foster.
how the arts could give the town a boost, said the
executive director of Swamp Gravy. Small towns can use the arts to build community
and social capital. In small communities, the
In 1992 Swamp Gravy first took the stage in process of designing and executing performance
Cotton Hall, a 60-year-old cotton warehouse. As of art can provide unifying activities that connect
2005, Swamp Gravy had sold more than 120,000 residents and expand social capital. According
tickets (72 percent to out-of-town visitors) and added to the Southern Growth Policies Board:
an estimated USD 4 million to the local economy. Swamp Gravy has won wide acclaim as an
In an average year, 40,000 people come to Colquitt innovative way of bringing people together.
to see the play. Cultural tourism now provides The process, telling ones story and/or working
more jobs and revenue than any other industry in on the production (either onstage or behind the
Colquitt. The arts council has reinvested over USD scenes), has served to form strong bonds among
1 million in downtown renovations and building people, crossing racial, gender and class lines.
projects, including a total renovation of Cotton Hall. Breaking down racial barriers in the community
A childrens theater spin-off from Swamp Gravy was is, in fact, considered part of the programs
developed to give local kids an opportunity to hone mission. In communities where racial tensions
their acting skills. The arts council also has created the stand in the way of economic progress, the
Swamp Gravy Institute, a consulting and training performing arts can provide a neutral space for
organization that works with other communities to breaking down traditional barriers and building
design programming similar to that in Colquitt. new partnerships.
30
CASE STUDIES 2
Columbia, North Carolina
The ecotourism strategy in Columbia is characterized by an innovative approach to

governance and dogged protection of natural resources. By collaborating with surrounding
counties, the town has financed and built a downtown boardwalk, a 4-H environmental
education center and a visitors center -- each of which is attracting new tourist dollars.
2000 2010 +/-

Location Eastern North Carolina, USA (map)
Primary employment sectors Arts, entertainment, and recreation, and
(top three as percentage of workforce, 2007) accommodation and food services
Retail trade
Educational services, and health care and social
assistance
Columbias strategy is to attract investment into the the 1800s and early 1900s, the timber industry
community through ecotourism. Before ecotourism prospered around Columbia from the rich,
was popular, Columbias leaders and residents Scuppernong River-fed groves of cypress and
decided to embrace their natural assetsmany of juniper. The towns economy was also buoyed
which are federally protectedto create new jobs. by corn, rice and cotton plantations. But after
In 1993, the former town manager convinced local reaching a peak population of 1,100 in 1950,
officials in the surrounding counties to join together Columbia began a slow, steady decline in both
in a Partnership for the Sounds, a NGO designed population and economic vitality.
to facilitate regional collaboration around ecotourism
and to prevent the counties and municipalities from In the late 1970s, local officials began to
competing over limited grant funding. Through aggressively recruit new businesses. The town
this innovative partnership, Columbia has received was negotiating with an international aircraft
funding for and built a USD 15 million downtown manufacturer to relocate nearby when the U.S.
boardwalk, a visitors center and an environmental Congress modified an obscure requirement
education center, each of which draws tourism. relating to the interest rate on industrial revenue
Today, Columbia is a destination for travelers seeking bonds. The project fell through, and the towns
a pristine getaway on North Carolinas coast. hopes for luring a manufacturer were dashed.
Location and History After this setback, the town received funding to
The town of Columbia, located in the develop a comprehensive community plan. The
Albemarle-Pamlico region of eastern North plan, which became known as Columbia 2000,
Carolina, was founded in 1793. Throughout relied on a combination of community meetings
31
and household surveys. During the planning of an alternative land ownership agreement. In an
process, participating residents and survey innovative arrangement, the fund purchased the
respondents expressed a strong desire to focus property and allowed NC DOT to use some of the
on a few major projects: downtown renovation, land as a wetland bank. In exchange, NC DOT and
construction of a visitors center and a riverfront the Conservation Fund agreed to contribute toward
boardwalk. Ecotourism, then a new concept, a special endowment set up for the parcel. Revenue
became the centerpiece of Columbias economic from NC DOTs use of the property and from the
development strategy. funds sustainable harvesting of the propertys forest is
used to pay the local property taxes. The ownership
Approach to Development agreement has been a win-win, giving Columbia
Columbias strategy is to join with neighboring additional protected land and tax revenue.
communities in the Albemarle-Pamlico region
to promote a regional ecotourism economy. This Columbias next priority was to develop a visitors
approach began in the early 1990s, when the town center and boardwalk. Working through the
manager met with representatives from various Partnership for the Sounds, Columbia received a
state agencies to explore funding options for local USD 1 million grant from NC DOT to construct
ecotourism projects. During a meeting with a a new visitors center at the main entrance into
representative from the state environmental agency, town. While the center was under construction
the manager learned that other communities around in 1994, Columbia set out to build an adjoining
Columbia were interested in pursuing a similar boardwalk along the Scuppernong River and
economic development approach. into the cypress swamps near downtown. The
Conservation Fund provided the lumber for the
In response, the town manager initiated project by harvesting timber from the nearby
meetings with colleagues from nearby Tyrrell, Palmetto Preserve. With help from the local Youth
Hyde and Beaufort counties. Their idea, which Corps, Columbias mile-long boardwalk and
developed over time, was to work together in visitors center opened in 1995. On average, the
promoting sustainable economic development. visitors center welcomes 400,000 people a year, a
To do so, they created a regional nonprofit significant jump from previous tourism figures. In
organization, the Partnership for the Sounds. 2001, Columbia became home to a new USD 10
Through the partnership, counties and towns million environmental education center, complete
throughout the region would apply collectively with a 250-seat meeting room, four dining areas
for funding, instead of competing with each other and two hotel-style executive lodges.
for scarce grant dollars. The goal was to develop
ecotourism-related facilities that each community Local officials estimate that more than 100
envisioned and then mold these facilities into a jobs have been created in Columbia as a result of
cooperative network. the ecotourism strategy, a handsome figure in a
town of fewer than 800 people. Since 1990, the
The second part of Columbias strategy is to use town has generated over USD 15 million in grant
innovative land-transfer schemes to preserve land funding for ecotourism related projects.
around town. Land and other natural assets around
Columbia form the basis of its ecotourism strategy. Key Themes or Lessons
Preventing land from future development, however, Unique local assets can become economic drivers.
also meant a loss of potential property tax revenues. Columbias leaders and residents recognized
In one case, the states Department of Transportation that their natural beauty was an asset that could
(NC DOT) wanted to purchase the 10,000-acre drive an ecotourism strategy for economic
Palmetto Peartree Preserve near Columbia and turn development. Part of Columbias success with
it into a wetland bank. Since this would pull the ecotourism comes from the clear local mandate
land off the tax rolls, the town partnered with the that residents wanted to see their natural
Conservation Fund (NGO) to explore the possibility surroundings protected.
32
CASE STUDIES 2
Local economic development can be strengthened and counties has more to offer visitors than does
by forming regional partnerships. Through a single municipality.
meetings with the state environmental agency,
Columbia discovered that neighbors from Hyde Innovative local governance can strengthen a
and Beaufort counties were interested in pursuing communitys economic development efforts.
similar ecotourism-related projects. Rather than Columbias ability to design an alternative
see these counties as intra-regional competitors, arrangement for generating tax revenues
Columbia sought regional collaboration. Small on protected lands helped turn a potential
towns thus were able to pool resources and ideas. obstacle to ecotourism into an example of
Moreover, ecotourism should by nature be innovative local governance.
a regional strategy because a collection of towns
Edenton, North Carolina
Elected officials in Edenton partner with a non-governmental organization focused on historic

preservation to turn the dilapidated Edenton Cotton Mill into a new economic asset for the
community. This public-private partnership has resulted in upgraded infrastructure, private
investment in real estate, increased property values and preservation of Edentons historic assets.
2000 2010 +/-

Population 5,394 5,004 -8%
Distance to metro/micro-politan center 115 km to Norfolk, Virginia
Manufacturing
Edentons strategy is to preserve its historic campaign, Preservation North Carolina sold all
assets in order to create conditions for private 48 of the village residences. Edenton has seen
investment in the community. Working together, property values in the village increase nearly 20
the Town of Edenton and Preservation North times and the mill houses have attracted artisans
Carolina (preservation NGO) transformed the and entrepreneurs to town.
old Edenton Cotton Mill Village -- the historic
living quarters for mill workers and their families Location and History
-- from dilapidated shacks to modern village Edenton is often referred to as one of the
residences. By 1999, after improving the villages Souths most attractive small towns. Incorporated
infrastructure and initiating an intense marketing in 1722, it has a well-preserved residential
33
historic district and courthouse. The downtown image of what a mill house could look like with just
also is well preserved and is considered by many a few improvements. The real renovation work, in
to be a poster child of successful downtown keeping with the organizations philosophy, was left
revitalization. Historically, Edentons proximity to the property owner. Preservation North Carolina,
to the Albemarle Sound meant that the shipping however, attached strict protective covenants and
and fishing industries played a major role in the required design review for all of the cotton mill
towns economy. Beginning in the 20th century, homes. This gave buyers the assurance that the
the textile industry came to Edenton. distinctive architectural features that made the
homes so appealing would remain. The organization
The Edenton Cotton Mill, built in 1898, was also stipulated that all homes in the village be owner
the towns economic anchor and largest employer occupied to ensure the residences upkeep.
for nearly 100 years. The Mill provided low-cost
housing for mill workers in an adjacent mill village. Over the next three months, 26 mill homes sold
When the Edenton Mill owner, Unifi, announced for USD 20,000 to USD 30,000 each, 10 times
it was closing the plant in the fall of 1995, the their assessed value just one year earlier. Given
devastating effect was especially concentrated in these clear market indicators, Edentons town
the Edenton Mill Village, where residences were manager applied for Community Development
abandoned and boarded up. Block Grant funding to upgrade the water
and sewer lines into the village. In mid-1997,
Approach to Development Edenton began construction. The communitys
Edentons strategy is to turn a potential liability infrastructure investment spurred further private
into an asset by assisting in the turnabout of the sector investment, and by December 1999, all 48
Edenton Mill Village. As soon as Unifi announced homes in the village had been sold.
closure, the town manager, the local Chamber of
Commerce and president of Preservation North Over the next five years, these new village
Carolina (PNC) contacted the corporation about residents renovated their homes. Through a
donating the mill. In December 1995, just three partnership with Preservation North Carolina,
months after closing, Unifi, PNC and the Town one local bank set up a specialized loan package
of Edenton reached an agreement under which for homeowners that combined construction
the entire mill property (including the mill village) financing and the permanent mortgage into
would be donated to Preservation North Carolina. one simple product. Local officials invested in
The town was instrumental in convincing a boardwalk along the nearby Queen Annes
Unifi to donate the mill instead of selling it to a Creek in 2000, adding value to properties in
developer, said a former Edenton Cotton Mill the mill village. Lastly, in an effort to prevent
worker now working for the nonprofits Edenton gentrification, existing residents -- mostly retired
office. Had it been sold to a developer, we would mill workers -- were given the option to buy their
have lost this incredible historic village. homes at a discounted price or continue renting at
a favorable rate. A number of workers purchased
After the transaction was complete, Preservation their homes, the first they ever owned, and a few
North Carolina faced the challenge of selling old, continue to rent to this date.
deteriorating mill houses in a rural community. It
overcame initial local resistance to subdivide the mill From the towns perspective, the mill renovation
village property to sell the homes individually. It also has been a tremendous boost. For example, the
had to create a market. An aggressive promotional 1996 property tax value of the entire village was
campaign in the winter of 1996 seemed to pay off. USD 610,485. In 2006, renovations to the village
In April 1996, more than 5,000 people attended raised the value to USD 12,110,659, over 19
an open house at the village. Besides a few cosmetic times larger. Average home prices increased from
improvements, the model home was not renovated. approximately USD 3,000 to USD 25,000. And
It was intended to provide interested buyers with an the benefits have reached far beyond increased
34
CASE STUDIES 2
property values. The unique mill homes have rehabilitation creates 41 jobs, whereas an equal
attracted a number of artists and entrepreneurs investment in new construction creates 36 jobs.
to our town, said the town manager. The mill Edentons story also demonstrates that historic
transformation is spreading to surrounding areas properties have the potential to attract creative
as well. In 2006, an abandoned peanut mill across entrepreneurs to the community.
from the Edenton mill opened as a commercial
office building. By creating a market for historic Through public-private partnership, an
mill homes, Preservation North Carolina and economic development liability can be turned
Edenton spurred massive private investment and into an economic development asset. The
preserved an historic asset. Edenton Cotton Mill was a potential liability
for the community. The Town officials and
Key Themes or Lessons the nonprofit Preservation North Carolina
Historic preservation can be an economic partnered to market the village, establish
development strategy. Edenton demonstrates covenants and ownership agreements and
that strategic historic preservation, done with upgrade the village infrastructure, creating a
the goal of stimulating private investment, market for the rural mill village. This partnership
can increase both tourism spending and local allowed them to reduce investment risk and
property values. In addition, local investments create a secure vision of what the mill village
in historic preservation create local jobs. could look like, enticing significant investment
Preservation North Carolina estimates that from outside the region.
every USD 1 million invested in building
Elkin, North Carolina
Elkin builds on the local craft economy by investing in a craft guild and an apprenticeship
program. The apprenticeship program provides crafts training, mentorship and small business
classes to artist entrepreneurs.
2000 2010 +/-

Population 4,109 4,001 -3%
Distance to metro/micro-politan center 70 km to Winston-Salem, North Carolina
Manufacturing
35
Elkin is channeling local artists talents and the tourism traffic from nearby Interstate 77.
energy into new entrepreneurial ventures. A The study urged that Elkin and the surrounding
study from 2003 revealed that Elkin and the area work toward creating a vibrant and growing
surrounding Yadkin Valley region had a rapidly network of small businesses and that they focus on
expanding concentration of artists. As has been crafts and cultural tourism.
demonstrated elsewhere, small businesses in the
arts and crafts sector -- properly marketed and Approach to Development
supported -- can catalyze small business growth Elkins strategy is to support entrepreneurs in the
and attract tourist dollars into the local economy. local heritage craft economy through its Growing
In 2004, leaders from a regional NGO (Piedmont Entrepreneurs program. Growing Entrepreneurs
Council of Governments) worked with three is designed to match experienced craftspeople
artists to form the Yadkin Valley Craft Guild. with new artists and provide them with training
A year later, the guild partnered with the Town and support for starting and growing small
of Elkin on an apprenticeship program through businesses. Growing Entrepreneurs evolved in
which local artists receive education and training conjunction with a regional artists guild called
in their respective craft as well as assistance in the Yadkin Valley Craft Guild. The story of how
starting their own businesses. Local art studios and these two organizations evolved is the story of how
heritage craft-based businesses, combined with Elkin came to initiate an entrepreneurial support
the regions growing wine industry, are attracting strategy for local economic development.
tourist dollars into Elkin.
Within months of the release of the 2003
Location and History regional economic study, a local leader from the
Settlers first came to what is now Elkin in 1740, Northwest Piedmont Council of Governments
attracted by fertile soils and the nearby Yadkin and three local artists hatched an idea to create
River and Big Elkin Creek. By the mid-1800s, two a craft guild for the Yadkin Valley region. Part of
ambitious entrepreneurs established Chatham the vision was to equip artists in the guild with
Manufacturing, a woolen mill, in Elkin. Chatham entrepreneurial skills to start new businesses.
Manufacturing drove the towns growth through According to the North Carolina Arts Council,
the rest of the century and into the 1900s. Along the state ranks in the top three nationally in craft
with Chatham, other textile mills and furniture income. More than 6,100 craft artists in the
plants formed the base of Elkins economy. state generate USD 538 million in revenue. The
theory was that a regional guild could give a voice
In the 1980s and 1990s, however, most of to independent craftspeople and provide them
the textile and furniture plants closed, leading with support to have a positive impact on local
to high unemployment. Elkin has since tried to economic development.
figure out ways to replace the lost jobs. The wine
industry has become an increasingly important Soon after its organization, the Yadkin Valley
player in the Yadkin Valley over the last 20 years. Craft Guild partnered with the Town of Elkin to
Many tobacco farmers have shifted into grape develop an entrepreneurship support program.
production to support the regional wine industry. The Growing Entrepreneurs program would
New vineyards and wineries stretch along the match master craftspeople from the Yadkin
Yadkin Valley Wine Trail, which includes bed and Valley Craft Guild with up-and-coming artists.
breakfasts, antique shops and restaurants. The pairing would allow each apprentice to
receive guidance and education from a mentor
In 2003, an economic development consultant with experience in his or her craft. In addition,
completed a comprehensive study for northwest the guild and the Town of Elkin would provide
North Carolina. The studys findings were a wake- free seminars in entrepreneurship and individual
up-call to local officials in Elkin, who immediately assistance when it came to starting businesses or
recognized the potential for capturing more of studios to showcase work.
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CASE STUDIES 2
Growing Entrepreneurs began implementation are estimated to generate more than USD 530
in April 2007. An initial cohort of eight apprentices million in revenue annually. Leaders in Elkin
was enrolled under the direction of four mentors. recognized this fact and built an economic
Each apprentice was selected based on their development strategy around craft-based
aptitude, commitment and entrepreneurial spirit. businesses to help overcome employment
Apprentices spend 20 hours per week receiving losses in manufacturing and agriculture.
instruction from their mentors and 10 hours A lot of people dont realize the multiplier
practicing their craft. Unique to the Growing effect, said Jeff Sebens, a member of the
Entrepreneurs program is that apprentices are Yadkin Valley Craft Guild. With lodging,
able to keep and sell the items they make during restaurants and other venues, every USD 100
their apprenticeship. Apprentices are able to leave spent on supporting local craftsmen might
the apprenticeship with a number of items ready bring in USD 1,000 to the region.
to put in a gallery or business, said the guild
president. They are building their inventory. It takes a comprehensive support environment
Local officials in Elkin believe that small craft to help a craftsperson, or other entrepreneur,
businesses will complement and enhance the build a new business. Elkin is building a
regions wine industry and result in increased support system for artisans by creating the
tourism traffic. apprenticeship initiative, linking experienced
crafters with new artisans. In addition to
Key Themes or Lessons this mentoring/networking, the support
The craft industry, particularly when tied to environment includes training and the
tourism promotion, is a potential economic opportunity to access micro loans, all necessary
engine. Across North Carolina, working to the development of self-employment and other
craftsmen, most of whom are self-employed, entrepreneurial opportunities.
37
Hillsborough, North Carolina
With an identity proudly rooted in its small town history, and a location ideal for
commercial development, Hillsborough strikes a savvy balance between preservation of its
past and growth for its future.
2000 2010 +/-

Population 5,446 6,087 11%
Distance to metro/micro-politan center 23 km to Durham, North Carolina
In 2007, the U.S. National Trust for Historic Location and History
Preservation named Hillsborough as one of the Hillsborough, the county seat of Orange
nations dozen distinctive destinations. Steeped County, is located at the intersection of Interstates
in history, Hillsborough has taken bold steps to 85 and 40, along the western edge of North
create a vibrant heritage tourism economy, but Carolinas Research Triangle region (Raleigh,
not at the expense of commercial and industrial Durham and Chapel Hill). Three major research
development. The story of this community in universities Duke, North Carolina State
eastern Orange County is about how to hold University and the University of North Carolina
onto the old and embrace the new, all at the at Chapel Hill -- are all within 40 miles of Main
same time. Living in Hillsborough is not about Street in Hillsborough. The town has a reputation
isolating the past in a time capsule, says an as a place where history blends with economic
Alliance for Historic Hillsborough publication. progress in an eclectic Southern community.
It is about managing change; integrating the
old and new in ways that improve the quality For more than 1000 years before its official
of life in our community; and maintaining the founding in 1754, Hillsborough was inhabited
unique qualities that make Hillsborough such by the Occaneechee and other Native American
a great place to live, work and visit. This story Indian tribes. The town was founded on the spot
explores how Hillsborough bridges historic where the Great Indian Trading path crossed the
preservation and managed growth to achieve Eno River. After European settlers drove most of the
impressive economic outcomes. Occaneechee out of Hillsborough in the early 1700s,
the town became a center of political activity during
the Revolutionary period. Hillsborough hosted the
38
CASE STUDIES 2
states Constitutional Convention in 1788, during leaders from each organization agreed to form the
which the convention delegates refused to ratify the Alliance for Historic Hillsborough. The alliance
Constitution until it included a Bill of Rights. By is an umbrella organization through which the
the late 1800s Hillsborough, surrounded by tobacco member organizations coordinate efforts, raise
plantations and textile mills, was a thriving stop on funds together and preserve, enhance, and
the North Carolina Railroad. increase awareness of the historical and cultural
heritage of Hillsborough for residents and visitors.
In 2000, when residents of Hillsborough ushered
in the new century, pressure from development, Throughout the early 1990s, heritage tourism
water resources and historic preservation were was a significant and growing contributor to the
three of the most important issues with bearing on local economy in Hillsborough. Promotional
the communitys economic development future. events initiated by the alliance and highlighting
Each issue brought with it both challenge and the towns history and heritage were attracting
opportunity. The test was how to leverage each, thousands of visitors. In 1994, local leaders
without destroying, or devaluing, the others. proposed a 1 percent sales tax on any food or
beverage prepared within the municipal limits.
Approach to Development Revenue from the prepared food tax was to be
Hillsboroughs strategy is twofoldpromoting used toward promotional events and various
heritage-based tourism and managing growth beautification projects. Local restaurant owners
for economic diversity and quality of life. It were brought into the process early, and several
begins with using its heritage assets to attract restaurant owners helped the town to write the tax
tourists. Through the Alliance for Historic provision. The N.C. General Assembly approved
Hillsborough, the community coordinates and the tax in 1993, and it was first levied in 1994.
focuses its resources toward effective promotion
and preservation. A local tax on prepared Revenue from Hillsboroughs prepared food tax
foods and beverages provides a long-term and is split 60-40 between the Alliance for Historic
sustainable revenue source for promoting historic Hillsborough and the Hillsborough Tourism
Hillsborough. Events such as the Last Friday art Board. The tourism board -- which includes four
and culture series attract thousands of visitors local restaurant owners, one town board appointee,
who spend money on food, entertainment and a Chamber of Commerce representative and
shopping. Second, in response to development an alliance member -- was created as a public
pressure, the town of Hillsborough has planned custodian for the prepared food tax. In 2006,
for and implemented an innovative process of the tax generated USD 170,000 which, divided
managing growth. It uses the l annexation and between the Alliance and the Tourism Board,
permit review processes to facilitate development was used to operate the Orange County Visitors
on the communitys own terms. Center, print and distribute a local restaurant
brochure, conduct a local tourism market analysis,
Heritage tourism and provide grants to local tourism facilities,
By the late 1980s, seven organizations were programs and services.
working independently to preserve heritage assets
and promote tourism in Hillsborough. There was Managing growth
a growing sense that they were competing with The second part of Hillsboroughs strategy is a
each other for financial and volunteer support. response to the increasing pressure on municipal
In 1991, all seven organizations came together services created by residential development within
to discuss a new arrangement. Hillsborough and around Hillsborough. On average, residential
needed an entity to promote everybody, said development is a net loss for the municipal coffers.
a local proponent for historic preservation. According to the executive director of the Orange
There needed to be less territorialism and more County Economic Development Commission,
communication and partnership. In 1991, for every dollar Hillsborough spends to provide
39
municipal services to residential customers, the Access to municipal water is a major point
town recovers 76 cents. The same expenditure of leverage for Hillsborough. A new reservoir
for commercial and industrial customers brings is adequate for existing needs, but it was never
back USD 4.30. Although Hillsboroughs intended as a long-term fix to the towns water-
tax base currently is 40 percent commercial related challenges. We want to grow Hillsborough
property, community leaders know they could in an organic way, said the town planning
not take it for granted. The growing market director. Water pipes are our lever for doing this.
for residential development in Orange County Developers with options on properties outside of
means they must remain aggressive in their Hillsboroughs municipal boundaries must apply
efforts to maintain a diverse tax base and to for annexation to qualify for municipal water and
ensure the towns quality of life. sewer service. Managing growth -- by using the
towns limited water supply and permit processes
A strategic growth plan guides development to make development decisions on the towns
in the town. It was structured as a town-county own terms -- has been the second major element
project, with a steering committee comprised of Hillsboroughs economic development strategy.
of town and county representatives, out of
recognition that planning for growth required a Several outcomes that can be attributed to
multi-jurisdictional approach. It is intended to Hillsboroughs approach over a five year period
clarify the most desirable rate, timing, and location include increased visitor spending from USD
for future growth occurring over the next 20 years 91.2 million to USD 127.2 million, an increase
within and around the Town of Hillsborough. from USD 205 million to USD 232 million
Its goals are to (1) preserve and enhance the in non-residential tax base, and significant
Hillsborough core area, (2) preserve significant increase in citizen involvement on town boards
cultural and natural resources, (3) coordinate and commissions.
growth with water/sewer availability, (4) grow
in a fiscally responsible way, (5) keep existing Key Themes or Lessons
businesses healthy and (6) assure continuity in Use public resources strategically. After
public service provision. The communitys values, going through the process of financing and
including the importance of open space, parks, constructing a new reservoir, local officials were
cultural resources, healthy existing businesses and well aware of the limits of the existing water
fiscal responsibility, underpin the goals. supply. Rather than grant water resources to
any development or to the highest bidder, local
The plan, released in late 2006, concluded officials used their municipal water resources
with several recommendations for using land use to shape development. Development that
planning and the municipal zoning ordinance to was consistent with the communitys vision
encourage the maintenance of a diverse tax base. was granted access. Development that was
It also recommended using interlocal agreements inconsistent with what the community wanted
as mechanisms to assign responsibility within was denied access.
the process of managing development. Some of
the policies have been adopted and others have Know your market. Hillsboroughs annexation
not. An interesting strategy for evaluating and and rezoning review processes have become
approving new development has evolved directly important instruments for shaping development.
from the strategic growth plan. It involves two Rather than entering negotiations with
main components: (1) the use of water as a tool developers from a position of weakness, local
for managing growth and (2) requirements as officials in Hillsborough have leverage because
part of the rezoning and annexation processes -- they understand the value of their market to
that developers include commercial space, parks developers. The basis for negotiating with
and other public facilities in all new residential developers should be rooted in an assumption
developments in Hillsborough. that developers ought to be responsible
40
CASE STUDIES 2
for providing adequate infrastructure for Consider multi-jurisdictional planning for

their development. Communities need to growth. Hillsboroughs Strategic Growth Plan,
understand their local market conditions and drafted in 2006, was a joint effort between
be prepared to take tough stands on issues of the town and Orange County. As explicitly
infrastructure provision. recognized in the growth plan, Hillsborough
and Orange County have a constructive
Use growth management to advance the history of collaborating and cooperating on
communitys vision for economic development. land use management issues in the developing
Hillsborough demonstrates that managing areas surrounding the town. Given the
growth, or being proactive about how tremendous growth pressures throughout
development proceeds in a community, does Orange County, and the overlapping nature
not stifle economic growth. In the last two years, of service provision between the town and
Hillsboroughs non-residential tax base increased county, Hillsborough had to involve county
by almost USD 30 million. This did not happen officials in the planning process. The results
by chance. The community insisted that new of the plan, including the recommendations
residential developments be accompanied by to use interlocal agreements to clarify roles
commercial space. When done thoughtfully, and and responsibilities for managing growth, are
as part of a widely shared community vision, necessary steps for successful development.
managing growth and economic development
can complement each other. Be willing to assume risk. Armed with a coherent
vision for the community and developers eager
Historic assets are economic development assets. to access Hillsboroughs market, local leaders
This case demonstrates that a long-term and have been consistently willing to take bold
proactive effort to preserve a communitys historic action. Risk-taking in Hillsborough began in the
assets can pay major dividends in terms of growing 1970s, with the creation of the historic district
a tourism economy and maintaining a unique and local investments in preservation. Through
quality of life for new and existing residents. the 1990s, the community took a major risk
Local officials in Hillsborough created a historic by implementing a prepared food sales tax and
district and have been vigilant in maintaining insisting that proceeds go toward promoting
the standards associated with that designation. tourism. More recently, local officials are pushing
Tourists are attracted to Hillsboroughs historic the legal envelope with developers to ensure that
and cultural attractions and tourists spend money development is consistent with the communitys
in local businesses, restaurants and hotels. A local vision for growth and economic development.
tax on prepared food captures a portion of this
spending and recycles it into additional promotion
of historic Hillsborough.
41
Oakland, Maryland
Oakland demonstrates that the arrival of a major discount retailer (Wal-Mart) need not
decimate small, local businesses. Oakland works with existing business owners to prepare
for the arrival of Wal-Mart. And, upon its arrival in town, civic leaders forge a unique
partnership with the stores management team.
2000 2010 +/-

Per capita income (state, Maryland) $34,678 $49,070 29%
Location Western Maryland, USA (map)
Distance to metro/micro-politan center 154 km to Morgantown, West Virginia
Finance and insurance, and real estate and rental
and leasing
Oakland, a small town in western Maryland, Oaklands turnaround began in 1988 with the
prepared its downtown retail community for election of a new mayor, who orchestrated the
inevitable competition from a big-box retailer, financing and construction of a treatment plant.
leading to a unique partnership between small, In 1998, Oakland was designated as a Main Street
town center vendors/retailers and the local Community. As part of the Main Street application
Wal-Mart. As a result, Oakland has a thriving process, Oakland was required to generate broad
downtown with near-zero vacancy and the local interest and support for downtown revitalization.
Wal-Mart is one of the companys highest-grossing The town organized four committees to help with
locations in the country. the Main Street Project and filled the committees
with citizen volunteers. The committees grew
Location and History as volunteers encouraged friends and family to
Oakland is located in Garrett County among the join. Oakland began making improvements in
rolling hills of rural western Maryland. Oaklands downtown buildings and restored the towns
economy is rooted in traditional agriculture. historic train station. The downtown -- made up of
From 1970 until the late 1990s, the town was in a hardware, antique and jewelry stores, pharmacies,
near-constant struggle with high unemployment, restaurants, and beauty shops -- was steadily
which reached its highest unemployment level improving. A weekly summer concert series called
(16.5 percent) in 1995, when one of the countys Wonderful Wednesday started attracting folks
largest employers, a Bausch and Lomb plant, into downtown Oakland from all over the county
closed and moved out of state. and region. Downtown vitality seemed to be on
the upswing. Then, one year after the Main Street
42
CASE STUDIES 2
program kicked off, Oakland was informed that There have been minimal downtown vacancies
a big-box retailer was scoping out a location in since Wal-Marts arrival. Two retailers were
Garrett County. unable to sustain operations, but their space was
quickly absorbed by new businesses. Since 2000,
Approach to Development unemployment in Garrett County has remained
Often, the arrival of a large discount retailer at or below 5 percent and the local Wal-Mart has
(such as Wal-Mart) in small-town America is become one of the highest grossing stores in the
perceived as a fatal blow to local small businesses, company, ranking 11th in 2005. In addition, an
especially retailers. Not so for Oakland. Oakland indirect consequence of Oaklands strategy has
worked to prepare downtown retailers for been the evolution of a unique partnership among
inevitable competition from Wal-Mart. The town eight surrounding towns, all with fewer than 500
then formed a partnership with the mega-retailer people. The initial preparation for Wal-Mart
that has brought benefits to both Wal-Mart and brought in representatives from surrounding
to downtown merchants. towns. A result of this process was an agreement to
pool small-town resources across Garrett County
When leaders in Oakland learned that Wal-Mart in an effort to provide efficient public services and
was moving in, they retained several consultants share staff. Each month, mayors from these towns
to help the town think strategically about ways gather to discuss issues such as garbage collection,
to maintain their steadily improving downtown. negotiate purchases together and apply jointly for
Over the next year or so, in preparation for Wal- various funding streams.
Marts arrival, Oaklands Main Street retailers
restructured their product lines to create new Key Themes or Lessons
niches that were unique to these local stores. For Big-box retail does not necessarily destroy
example, a 100-year-old hardware store developed town center merchants. As big-box retailers
an upscale electrical product line to capture saturate urban markets, more and more small
market space not occupied by Wal-Mart. A local towns are facing the prospect of competition
bookstore added a line of antique products that from big-box retail. The perception is that
complimented the store and created a unique Wal-Mart (and others) will inevitably cripple
environment. In addition, most downtown town center businesses, especially retail. This
retailers started focusing on customer service outcome is not inevitable, however. Oakland
and improved their ability to order specialty created capacity within the community that
products for customers. could be used to gain Wal-Marts support for
revitalization efforts downtown.
In 2001, Wal-Mart officially announced its
intention to build a store in Garrett County. Look for opportunity in adversity. Oakland
Almost immediately, Oaklands Main Street could have pursued an expensive legal strategy
director approached the store manager and asked of confrontation with Wal-Mart. This approach
for the companys support of Oaklands downtown might make sense for some small towns.
development. As a result of this conversation, an By viewing the arrival of Wal-Mart as an
innovative partnership in which Wal-Mart helps opportunity to move local retailers up the value
to promote downtown events was created. For chain, however, Oakland created a more viable
example, in a promotional agreement for the Main Street for the long term. In addition, by
towns Wonderful Wednesday concert series, Wal- viewing the retailer as an ally in promoting
Mart inserts double-sided advertisement cards in downtown activities, Oakland was able to
its customers bags. On one side is a promotion bring Wal-Mart on board with its agenda. Such
for Wal-Mart; on the other is an advertisement for a strategy can create a better environment for
the concert series downtown. future collaboration.
43
Pelican Rapids, Minnesota
Pelican Rapids is a diverse rural community where 18 different languages are spoken in the
elementary school. By developing cross-cultural learning opportunities and a youth soccer
league, this community capitalizes on the entrepreneurial talents of local immigrants.
2000 2010 +/-

Per capita income (state, Minnesota) $32,599 $42,847 24%
Location Western Minnesota, USA (map)
Distance to metro/micro-politan center 80 km to Fargo, North Dakota
(top three as percentage of workforce, 2007) Retail trade
assistance
Located in west-central Minnesota, Pelican activity has expanded to the processing of

Rapids is considered one of the most culturally farm products, especially turkeys. In addition,
diverse communities in the state. Hispanic, tourism has been growing with the recent
Vietnamese, Bosnian, and Somali refugees opening of Maplewood State Park nearby and
have migrated to this historically white, rural the giant pelican statue in town.
community in search of work at the countys
largest employer, West Central Turkeys. The Pelican Rapids was settled by Norwegians in
injection of new culture and language into this 1868 and the community was long dominated
tiny town has brought a variety of challenges and by northern European culture. This began to
opportunities to civic leaders in Pelican. We try change about 30 years ago when Mexican migrant
to do everything we can to make a safe and stable workers started coming to the area for agricultural
place for people to live, Pelican Rapids Mayor work. Through the 1980s and 1990s, Southeast
said. We work across city groups to facilitate Asian immigrants found their way into Pelican,
the transition of people to our community. attracted by work at the turkey processing plant,
Rather than holding immigrants at a distance, the countys largest employer at just over 700
Pelican Rapids has designed an innovative, locally employees. Like many meat processing operations
controlled system to integrate them into civic, across rural America, immigrant workers are
social and economic life, and is using the growth a major factor in its success. In 1995 a Bosnian
to fuel the economy. human resource director at West Central Turkeys
embarked on a company initiative to sponsor
Location and History refugee workers from Eastern Europe. A year later
Pelican Rapids is in the lakes region of Otter 100 Bosnian refugees arrived in Pelican. Our
Tail County in rural west-central Minnesota. school system, with 1,400 students, had at least
A traditionally agricultural region, economic 12 languages and dialects being spoken, recalled
44
CASE STUDIES 2
the owner of a small local business. There was a concerns. Using the information gleaned from
tremendous need for translation services and for these discussions, the library began running a
teaching people how to live in this country. We series of articles in the local paper, highlighting
were facing a social emergency. each culture and interviewing a specific Pelican
Rapids resident from the ethnic group being
Approach to Development profiled. The articles served as an opportunity
Pelicans strategy for building local capacity and to put a face with a culture and improve
nurturing entrepreneurship has been to create and understanding across cultures. The committee
coordinate a web of services for both immigrant also emphasized similarities that new immigrants
and native residents. Leaders in Pelican Rapids had with existing residents and pointed out that
recognized the importance of immigrant labor to all of the immigrants were coming to work and
the local poultry processing industry. In addition earn a living. The committee noticed that peoples
to providing labor for West Central Turkeys, thinking began to shift as residents learned more
research suggests that immigrants tend to have about the newcomers, their challenges and their
strong entrepreneurial tendencies. These factors cultures. People, including the students, now
combined to make immigrant integration in say that Were great precisely because were so
Pelican Rapids a crucial economic development diverse, a library administrator said.
issue. The strategy has been a coordinated effort
by several organizations, including Lutheran The culmination of this shift occurred in
Social Services, the Pelican Rapids Library and 2000 when a teacher noticed the passion and
the local schools. It began at a meeting in the late excitement that some of her students had for
1980s when a group of volunteers at the library soccer. She scheduled a meeting for students with
started to think strategically about how the library an interest in soccer and 200 showed up. That
might facilitate understanding between new and summer, Pelican Rapids formed its first under-
long-term residents. The result of this meeting was age-16 soccer team, made up of Bosnian, Somali,
the formation of a multicultural committee that Hispanic and European American students. After
would work to help people understand each other. winning all of its regular season games, the team
was invited to play in the state championship. The
The committee partnered with the school team left town with a celebratory police escort and
system to initiate a new program designed to went on to place second in the state of Minnesota.
educate students about different cultures. This Everyone here respects sports, said Joan Ellison,
included a series of visits from immigrants living a member of Friends of the Library. This
in Pelican Rapids, who shared stories about their community began to see that these immigrants
native countries. The committee also established should be given respect. The soccer team gave us
a buddy system that paired new immigrants with something to be proud of. Pelicans soccer team
American students who helped them through continues to be a source of community pride as it
the school system. The library began offering four has traveled to the state tournament four times in
English-as-a-second-language classes each week, a the past six years.
bilingual story time, a literacy drive and miscellaneous
presentations about immigration. At the same Key Themes or Lessons
time, the school system and library worked hard to Look for entrepreneurs within immigrant
enhance programming and learning resources for the communities. Small business entrepreneurship
traditional residents of Scandinavian background so is a substantial contributor to economic
as to be as inclusive as possible. development in small towns. As a result of their
integration strategy, Pelican Rapids appears to be
In response to the public unease about the on the front-end of an economic reawakening
changing complexion of Pelican Rapids, the based on the entrepreneurial tendencies of new
multicultural committee hosted a series of public immigrant residents. The town is starting to see
conversations in which residents could voice their new immigrant-owned retail shops and grocery
45
stores downtown. These immigrant-owned It is important to build a web of service

businesses pay local taxes, hire local workers organizations to facilitate integration. In
and contribute toward building a viable civic terms of small town development, the most
infrastructure in Pelican Rapids. immediate challenge associated with the arrival of
immigrants is that civic and social infrastructure
Social events, such as soccer, can be a can be quickly overwhelmed. Leaders in Pelican
great source of community identity and Rapids recognized that a number of social service
integration. Travelers to foreign countries groups could work collaboratively to help aid
have long recognized that sports (especially immigrant transition. These groups included
soccer) can be a universal language to the library, schools and Lutheran Social Services,
promote understanding and cooperation as well as volunteers in the community. Rather
among different individuals and cultures. In than leaving these groups to work independently
the case of Pelican Rapids, soccer brought of each other, Pelican Rapids formed the
kids and families together from different multicultural committee, which coordinated a
racial groups and ultimately became a source web of social services and provided a lead agency
of community pride. for the communitys integration efforts.
Star, North Carolina
In the wake of declining textile industry employment, Star joined with a regional
nonprofit partner to develop a business incubator, located in a former mill building, which
provides space and training to local artisans and small business entrepreneurs.
2000 2010 +/-

Population 800 876 %
Per capita income $ $13,631 %
Distance to metro/micro-politan center 78 km to Greensboro, North Carolina
(top three as percentage of workforce, 2007) Educational services, and health care and social
assistance
In Star, small business entrepreneurs are Yadkin Pee Dee Lakes Project (a regional NGO)
driving job creation. Until the mid-1990s, to work toward economic diversification in
Star was a one-industry rural community. the small, rural communities of Montgomery
The hosiery mills provided solid and steady County. The centerpiece of the strategy is the
job opportunities. As the mills closed and STARworks Center for Creative Enterprises
unemployment worsened, Star joined the in downtown Star. It is a business incubator,
46
CASE STUDIES 2
located in a former mill building, which to recruit big manufacturing operations,

provides space and training to local artisans and according to the project director. We thought
businesses and then facilitates their transition why not recruit smaller entrepreneurs who
into Star and other surrounding communities. could grow their business and then spin them
off into the surrounding small towns. The
Location and History strategy became known as Small Town Area
Star is located in the Yadkin Pee Dee River Revitalization or STAR.
basin, approximately halfway between Charlotte
and Raleigh, the two largest cities in North The Pee Dee Lakes Project and the Town of Star
Carolina. Star grew as a railroad stop on the teamed-up to test the idea. The project received
Norfolk Southern Railroad, which passed from a grant from a regional foundation and the U.S.
Charlotte through Raleigh on its way to Norfolk. Department of Agriculture to fund renovation
Railroads, cheap non-unionized labor and low tax of the Renfro Mill. By 2005, renovation was
rates brought hosiery mills into the region, and complete and the STARworks Center for Creative
mill jobs formed the basis of Stars economy for Enterprises opened with its first tenant, a high-end
almost 50 years. ceramics artisan. Currently, STARworks is home
to a variety of businesses including a geothermal
By the 1980s, Star was home to two large hosiery business, a ceramics supply business and a glass
mills, each employing more than 1,000 workers. and metal studio.
The mills were the lifeblood and economic engine
for the community until both mills closed in the While rehabilitating the Renfro Mill, the town
1990s. To combat the job losses, towns from also set about a process to improve their downtown
the seven-county basin came together to create business district (town center) so that small
a strategic plan for economic revitalization and businesses had a place to go after incubating in
balanced growth. the STARworks Center. With help from the Pee
Dee Lakes Project, the town created a citizen-
Approach to Development led group to initiate downtown revitalization.
Beginning when the mills closed in the early Star Central is a citizen led organization in
1990s, Stars development strategy is to work charge of preparing the community to receive
with the Pee Dee Lakes Project to develop the businesses from the incubator. Star Central
STARworks Center for Creative Enterprises. was divided into six different teams, ranging
Local leaders believe that small business from economic restructuring to promotion
entrepreneurs who nurture their young businesses and marketing, that are currently working to
in the STARworks Center will move out into revitalize Stars downtown.
Star and surrounding communities and become
new engines for the regions economic growth. Since opening, the STARworks Center
Importantly, Stars strategy is twofold: to create an has produced results. Star Kilns, a ceramics
incubator for new small businesses and to create a business, is moving from incubator space to
pathway and support network for businesses that downtown Star. The mayor estimates that Star
graduate from the incubator and move out into Kilns will create seven jobs for local residents.
the local market. Additionally, Star Kilns is in discussion with
one of its suppliers to open a facility in Star.
Development of the STARworks Center Nearby Ellerbe and Baden are working to
started in 2004 when a prominent local replicate the Star Central citizen group model
businessman donated the Renfro Mill building under the direction of the Pee Dee Lakes
in downtown Star to the Pee Dee Lakes Project. Project. Through the STARworks Center, Star
The imminent availability of a significant and neighboring communities are showing
building space got the town thinking. At the how rural mill villages can find new economic
time, counties in this region were still trying engines in the 21st century.
47
Key Themes or Lessons Surviving the economic transition requires a

Find creative re-uses for vacant buildings. shift in local expectations regarding job creation.
Textile mills offer unique features not Most of Stars economic legacy has been shaped by
commonly found in business incubators: one business -- first the railroad, then the hosiery
abundant space. Large, historic mill buildings industry. The transition from a one-industry
can be both assets and liabilities to small town to a community supported by a number of
communities. In some cases, environmental small businesses requires more than reshaping an
factors are a roadblock to building reuse. In economic development strategy; it requires shifting
others, moderate revitalization investments mindsets and community expectations. Through
can jumpstart a facilitys productivity. The citizen groups such as Star Central, the mindset
STARworks Center illustrates how one small is shifting. Residents are beginning to understand
town used its mill to create new jobs. The that these smaller businesses, which individually
Renfro Mill is 187,000 square feet giving create far fewer jobs than a large branch plant, will
the project freedom to offer businesses and form the economic backbone of their community.
artisans substantial loft-type space. The Realistic expectations among local residents help
availability of low-cost space ended up being to make a businesss transition from the incubator
a big draw for many of the businesses now to town more fluid. Perhaps even more important
located in the STARworks Center. is that this shift in community mindset is creating
the kind of community buy-in necessary for
projects such as STARworks to succeed.
48
3
Case Studies iII: Human capital-based
development
This chapter includes case studies of small towns that are

focused on human capital strategies, including partnerships with
post-secondary educational facilities (colleges or universities).
These are towns that have come up with ways to leverage their
educational institution for the communitys economic benefit.
They are focused on building the workforce and leadership to
carry a community forward.
Allendale, South Carolina
A small rural community in South Carolina creates a leadership institute to cultivate local
leadership, generate grant funding and confront the racial divide.
2000 2010 +/-

Population 3,900 3,482 -12%
Per capita income (state, South Carolina) $25,076 $32,460 23%
Location Central South Carolina, USA (map)
Distance to metro/micro-politan center 92 km to Augusta, Georgia
Primary employment sectors Retail trade
(top three as percentage of workforce, 2007) Manufacturing
assistance
After decades of high unemployment and the main north-south highway along the eastern
crippling poverty, Allendale created a regional seaboard. Allendale was conveniently located
leadership institute to equip emerging leaders at the midpoint between New York and south
with the skills to reverse the communitys Florida, and travelers found Allendale to be the
fortunes. Allendales post-war economy -- built perfect stopping point on their trips to the beach.
on pass-through tourism -- was crushed in the Throughout the post-war years, Allendales streets
1960s when Interstate 95 was built 35 miles east bustled with restaurants, hotels and grocery stores.
of town. In 1997, the Chamber of Commerce,
concerned with the deteriorating conditions in The towns character was changed forever
town, partnered with South Carolinas Downtown in 1960 when Interstate 95 was planned for
Development Association and state officials for a construction approximately 35 miles east of
strategic planning exercise. A lack of leadership Allendale. Soon, travelers were using the new
was identified as one of the regions most Interstate to commute south and Allendales
prominent issues. In response, public and private tourism industry collapsed. Poverty levels and
actors came together to create the Salkehatchie unemployment rose, and the region became
Leadership Institute in 1998. The institute has known as one of the poorest and least educated
since trained nearly 2,000 leaders who have gone in the state.
on to become elected officials or leaders in the
field of community and economic development. Approach to Development
Given these challenges, Allendales development
Location and History strategy was to play a primary role in creating a
Allendale, in rural southwestern South regional leadership development program. After
Carolina, is an agricultural community focused on identifying a lack of leaders in Allendale and the
soybean and cotton. The big boom for Allendale surrounding rural counties, local leaders from
came in the 1940s and 50s when U.S. 301 was Allendale identified the local branch campus of
50
CASE STUDIES 3
HUMAN CAPITAL-BASED DEVELOPMENT
the University of South Carolina as a possible influential in initiating local community and
partner in creating a leadership program. The town economic development efforts. In fact, the
approached administrators at USC-Salkehatchie, institute estimates that more than USD 9
located in Allendale, about hosting a leadership million in grant funding has been awarded to
course on campus. From this conversation, the projects in Allendale because of the initiative
Salkehatchie Leadership Institute was born. of new local leaders. One former student alone
raised more than USD 1 million to fund a
The next step was to identify a long-term new county health services building in nearby
funding source for the institute. The first director Barnwell County. In many rural communities
of the Institute lobbied state legislators about the where leaders are few and far between, a
possibility of state support for the center and, capacity building strategy such as leadership
in 1998, the Institute was appropriated USD development can be a viable strategy for long-
100,000 in the states recurring budget. term economic development.
The institute provides a series of leadership Leadership development can be a tool for
development programs for youth and adults. bridging social divides. Developing new leaders
Through these programs, it prepares citizens in small towns is one way to begin dealing with
to take the lead in economic and community difficult issues that may be standing in the way
development. All institute attendees start by of development. The Salkehatchie Leadership
learning about social and economic issues in their Institute was an incubator for a diverse community
community. Once they have a deeper awareness development organization called Allendale
of these issues, the institute helps attendees decide County ALIVE. ALIVE initiated a local process
on a problem area to tackle in their community. to openly address race and seek community-
Attendees are then connected to relevant boards wide solutions to issues. Allendale is one of
and committees to begin seeking solutions. the few communities Ive seen that hasnt been
afraid to address racial issues and move forward
Since developing these programs, the together, said the associate program director of
Salkehatchie Institute has trained more than 1,100 Clemson Universitys Institute for Economic and
adults and 800 youths, who have become more Community Development.
engaged and educated citizens. Some of the adults,
for instance, have gone on to hold elective office Local colleges are assets for small town
or have generated grant money for redevelopment community and economic development.
in their home counties. The Institute has helped The Salkehatchie Leadership Institute was
to generate an estimated USD 9 million in grant created through a partnership of Allendale,
funding for the area. Through the institute, neighboring towns, the state and the University
Allendale is creating leaders to sustain economic of South Carolina. Housing the institute on
development over the long term. a local campus was helpful, both in terms of
securing funding for the program and access to
Key Themes or Lessons professional expertise in the field of leadership
Leadership development can lead to economic development. Local leaders can look to local
development. Allendales strategy -- to cultivate or regional higher education institutions to
local leadership -- resulted in a cadre of new and support their towns efforts to develop local
well-connected leaders, many of whom became leaders or create new businesses.
51
Houston, Minnesota
The Houston public school system capitalizes on an opportunity to partner with a private
sector entity to develop an online learning curriculum. In the process, the local school
district leads an initiative to equip and connect rural residents to the Internet, the school,
their neighborhoods and the larger community.
2000 2010 +/-

Population 1,200 979 -4%
Location Southeastern Minnesota, USA (map)
Distance to metro/micro-politan center 100 km to Rochester, Minnesota
Manufacturing
Retail trade
In Houston, Minnesota, almost every household and Rochester (Minnesota), have blossomed as
-- even in the most remote rural parts of the county regional hubs, and in recent years Houston has
-- has a computer with a high-speed Internet become a bedroom community for these larger cities.
connection. I live at the end of a 1.5-mile long Today, roughly 50 percent of Houston residents
driveway in rural Minnesota and I have a high-speed commute out of town for work.
Internet connection to communicate with folks in
town, said former Houston County commissioner. In addition to its proximity to these cities,
Widespread use of broadband technology in Houston has a well-regarded public school system.
Houston came about somewhat indirectly, through The district receives excellent ratings relative to
an effort to address declining enrollments in local both southeastern Minnesota and the state as
public schools. By 2004 Houston had launched one a whole. Over the past few decades, however,
of the largest online learning curricula in the state Houston has been struggling financially. Even
and, in the process, had brought computers and though the town has become a modest bedroom
the Internet to homes throughout the community. community, declining population and school
The result of Houstons strategy is a fully-wired enrollments have meant less state money, making
community and a technologically proficient it increasingly difficult for the local school district
workforce, which are prominent assets for this small to offer a broad curriculum. In the late 1990s, the
towns economic development prospects. Superintendent of Schools began to take steps to
address the challenge.
Location and History
Houston is located in the southeastern part of Approach to Development
Minnesota, where farms dominate the landscape. Houstons strategy, which is led by the local
Houstons closest neighbors, La Crosse (Wisconsin) school district superintendent and his staff, was to
52
CASE STUDIES 3
create an online learning program to reach rural to enhance its course offerings. The Minnesota
students (and to boost enrollment locally) and Department of Education estimates the Houston
in the process bring computers and broadband Public Schools soon will be the largest district in
Internet to residents of its rural community. the county in terms of enrollment, with over 50
Students who register for the online learning percent of its students residing outside the district.
program offered by the local public school district
are counted as students of the district, regardless of Finally, because this rural community is one of
their physical location. the most wired in the country, it is well-situated
for potential economic development projects.
One of the first initiatives was a program to use Every household has a computer and is online,
the Internet to keep parents informed about their said an economic development expert who has
childrens progress at school. Because fewer than 75 worked in Houston. They are connected to the
percent of local residents had computers connected school and are connected to one another. They are
to the Internet, the School Superintendent rebuilding the whole community around this.
convinced the nearby Mayo Clinic to donate used Houston has the infrastructure in place and a
computer equipment to families in Houston. The budding workforce of technologically proficient
school district negotiated with a local telephone students, giving it an entrepreneurial advantage
cooperative for discounted broadband Internet and making it an attractive prospect for new and
service for residents with children who qualified for expanding businesses.
free and reduced priced lunch. The program boosted
the use of technology in and around the community. Key Themes or Lessons
Look for creative ways to glean public goods from
With the success of this implementation, the public-private partnerships. The opportunity for
district began to consider additional ways to Houston to become a wired community came
leverage technology and boost enrollment for indirectly -- from the needs of public school
the district. The practice of online learning was students and the initiative and innovation of the
becoming increasingly widespread, and home- districts superintendent. The initiative to link
schooled students in the rural areas surrounding rural residents to the school system also motivated
Houston were an untapped market for online other partners (the Mayo Clinic and the local
learning services from the district. The School telephone cooperative) to bring their resources
Superintendent partnered with K12, an online to benefit the public good. Civic leaders should
curriculum provider, to offer a home-based look for creative opportunities to leverage private
education curriculum that would leverage market investments for public benefit.
parental involvement and technology while at the
same time, boost enrollment in the district. Visionary leadership is critical to a towns
success. Houstons School Superintendent is a
In 2003, Houstons online curriculum was made visionary local leader. The question we were
available to all Minnesota public school students in asking as a school is how can we move into the
kindergarten through second grade. Within a few future and be relevant in education? Looking
years, the Minnesota Virtual Academy (MNVA) forward and seeing the potential growth in online
was being offered to students through 12th learning, Houston was willing to risk charting a
grade. Today, as a state-approved online school new course in education. As a result the city school
program, MNVA is the largest provider of online district has enhanced the quality of the education it
public education and one of the fastest growing offers and increased the funds the town can spend
public schools in Minnesota. Two-thirds of the on its students. Town leaders should not hesitate
students enrolled in the curriculum live outside to explore technological advances and determine
the school district, generating a significant source ways their towns could use technological progress
of revenue. MNVA has helped Houston to reverse for the publics benefit.
declining enrollments and has allowed the district
53
Morrilton, Arkansas
In Morrilton, two of the towns largest employers closed in the same week. A coalition
of community leaders responds quickly to form partnerships and implement job training
programs for the dislocated workers.
2000 2010 +/-

Per capita income (state, Arkansas) $22,574 $32,678 31%
Location Central Arkansas, USA (map)
Distance to metro/micro-politan center 85 km to Little Rock Arkansas
Manufacturing
Other services, except public administration
Over the last 20 years, Morriltons high first major shock came in 1985 when a textile
concentration of textile and manufacturing plant, Crompton Mills, closed and laid off 1,100
plants has been eroding. The biggest loss came in people. Unemployment rose to 18 percent and
1999 when two of its largest employers closed in 600 people left town. Unemployment leveled off
the same week. More than 1,000 workers were to around 6 percent by 1990, and locals believed
laid off, resulting in 40 percent unemployment. the worst was behind them. In 1999, within the
The mayor and economic development staff span of one week, Morrilton lost its two largest
quickly assembled an industrial fair in which employers and more 1,000 jobs. Nearly 40
more than 50 area businesses hired many of the percent of the towns workforce had been thrown
former plant workers. In addition, Morrilton out of work.
obtained help to establish a computer training
center where former textile workers learned Approach to Development
computer and technology skills. Through Prior to the plant closures, leaders in
these efforts, Morrilton has attracted three Morrilton anticipated the potential for plant
new industries and replaced nearly all of the closings and prepared to help displaced workers
lost jobs. and to prevent further dislocations. Beginning
in 1998, the town mayor began to develop a
Location and History strategy for helping laid off workers. Staff in
Morrilton is located in central Arkansas. Since its the local economic development office made
founding in the late 1800s, farming and industry contact with local businesses to assess their
have been the mainstays of the local economy in plans for future hiring. Having generated a list
Morrilton. Through most of the 20th century, of potential job opportunities, officials were
textile and other labor-intensive manufacturing ready when the plants closed. Within a few
operations were the towns largest employers. The days of the closure announcement, Morriltons
54
CASE STUDIES 3
officials pulled together a job fair with over 50 Key Themes or Lessons
area businesses in attendance. The job fair was Workforce development is economic
funded with donations from local businesses, development. Morrilton demonstrates that
and many of the laid off employees left the assisting workers through the transition to
event with new jobs. new jobs can be an effective tool for economic
development. The communitys initial push was
In addition to delivering a job fair, the to engage with existing businesses to secure jobs
town established a training program to for dislocated workers. Skill deficiencies pushed
teach former textile workers basic computer the town to go further and to create a computer
software and technology skills. By training training program, which has become a draw for
textile workers in new technology, economic more modern industries. Communities moving
development officials believed Morrilton away from labor-intensive manufacturing can
would be able to attract more modern develop workforce strategies that help local
industry. The town worked with state and workers compete for new economy jobs.
federal agencies to fund a training center
with computer equipment. A local shopping Anticipating the worst enables a community
mall owner donated land and power for the to respond faster to plant closures. Rather
training center. Within six months, the goal than relying on federal and state authorities to
of landing a modern employer was realized help dislocated workers, Morrilton took a leading
with the recruitment of a banking call center. role in finding workers new jobs. By utilizing
Many of the former textile workers who had contacts with area business owners, something
completed the computer program went on to state officials could not do, Morriltons economic
work for the call center. development group pulled off a highly successful
job fair that helped many find work. Morrilton
To prevent future dislocation, Morrilton also was aggressive in seeking support from its state
has been working to diversify its economic senator to secure a facility and resources for the
base. The town has implemented programs computer skills class. Morrilton demonstrates that
to recruit large and small century businesses. a concrete response during times of crises can have
In recruiting smaller companies, Morrilton is a large impact on a community.
spreading its employment over a broader range
of employers and economic sectors to minimize Seek nontraditional partners in responding to
impacts should a business close. In addition, economic disasters. After the plant closures of
Morrilton has partnered with the nearby Fort 1999, elected officials set out to inform laid-off
Smith branch of the University of Arkansas to workers of job openings through the industrial
develop a basic management training program. fair and provide workforce training programs. But
Employees of area businesses can attend the officials did not stop there. The mayor brought
intensive program and learn management skills area churches together to discuss how the faith
and quality control techniques. This training community might help in this time of need.
curriculum meets the demand from business The churches agreed to host prayer meetings and
owners and increases the skill sets of the local provide counseling to workers and their families.
workforce. By investing in its workforce and The churches also opened food banks to ensure
playing a proactive role in the wake of plant that no family went without a meal. This brought
closures, Morrilton has been able to overcome a more members of the community into the
devastating situation and reinforce its economy problem solving process.
against future disasters.
55
New York Mills, Minnesota
This town invests in the creative energy of rural artists. Through a regional cultural center,
New York Mills attracts outside talent and energy, bringing fresh perspective on the
communitys challenges and opportunities.
2000 2010 +/-

Location Central Minnesota, USA (map)
Distance to metro/micro-politan center 126 km to Fargo, North Dakota
Manufacturing
Nearly 80 miles from any significant city, the small have been important to the local economy. The
town of New York Mills demonstrates the potential largest employer in town is Lund Boats, a boat
for turning rural arts and culture into economic manufacturer, employing 575 people.
development. Through bold and forward-thinking
investment by local leaders, the community created The arts-based approach to economic
the New York Mills Regional Cultural Center development in New York Mills began in 1987
in 1992. The center hosts an artist-in-residency when an art school graduate moved to town and
program, art exhibits, theater productions and started out painting homes and barns in town
musical performances, including international and realized that these were highly educated
caliber events, all of which make the arts accessible residents, he said, and I got the sense that they
to rural residents. Further, the center set off a wave wanted more culture, more arts. There wasnt an
of new business creation. In the first six years that the art teacher at school. Art was the piece that was
cultural center was open, 17 new businesses opened missing in town.
in town, creating 350 jobs.
Approach to Development
Location and History The strategy in New York Mills was to use art
New York Mills owes its legacy to a hardy group as an economic development tool by creating the
of Finnish immigrants who came to northwest New York Mills Regional Cultural Center. The
Minnesota in the 1880s. In 1885, New York Mills center, it was believed, would attract tourists and
was incorporated and named for the large number catalyze the development of new small businesses.
of timber mills in town. After clearing every tree in In 1990, a new resident of the community and
sight, the towns residents turned to farming in the emerging local leader organized a nonprofit
early 1900s. Since then, corn and dairy farming group with the mission of bringing the arts
56
CASE STUDIES 3
to New York Mills. The first initiative was an In June of 1992, the New York Mills Regional
artist-in-residency program that integrated a Cultural Center opened to a community
visiting artist into the community through parade. The center, in total, has put on more
art exhibits, classes and various public service than 80 exhibits and hosted 50 visiting artists
responsibilities. In exchange for housing and since opening. Remarkably, New York Mills has
gallery space, artists were required to assist the seen tremendous investment in its downtown.
community in a variety of ways, based on their Between the centers opening in 1992 and
individual interests and skill sets. By including 1998, 17 new businesses opened in New York
this public service element in the artist-in- Mills, increasing employment by 40 percent.
residency program, the town ensured that new Many of these businesses are bed and breakfasts
ideas and creative energy were injected into and restaurants serving new tourists visiting
public life in New York Mills. the cultural center. The center also has attracted
media attention from the Today Show, The New
During the trial run of the artist-in- York Times and National Public Radio, giving
residence program, the town decided to build it a presence far beyond the state of Minnesota.
on momentum by developing a downtown New York Mills is a national example of how the
cultural center to place the residency program arts can be embraced in a rural community and
and art exhibits in the center of town. Around reinvigorate a local economy.
this time, a local businessman was looking to
donate his dilapidated 1885 general store. After Key Themes or Lessons
months of negotiating, the town acquired the Communities that embrace the ideas and
property in 1990. It also secured seed money to energy of new residents have much to gain
begin a multi-use arts and cultural facility. For the in the long run. In New York Mills, a new
rest of that year, local leaders visited all regional resident and civic entrepreneur brought new
NGOs and civic groups to request contributions. ideas about the importance of arts and culture
to community life that were embraced by
The local government agreed to donate community leaders. The community was willing
USD 35,000 to the project. Several local to support and work with him, demonstrating
officials questioned the figure, but a number how volunteerism, investment in the arts
of key civic leaders, including the council and public-private partnerships can all come
members, recognized the potential in this type together to the benefit of the community.
of investment. It was a risk, according to the
mayor, but towns our size are struggling to Figure out ways to reduce risks on out-of-the-
keep businesses downtown and our population ordinary projects. Investing public resources
growing. We saw it not only as an opportunity in the New York Mills Regional Cultural
to fill a void in the culture of our community, Center represented a significant risk for the
but as a way to help our community and community. By structuring this investment so
businesses keep growing. To reduce the towns that the town had ownership of the cultural
risk, the agreement was structured to give the building and by designing exhibits that were
town ownership rights to the building for five attractive to both residents and tourists, leaders
years. Thus, in the event that the cultural created a situation where the town would gain
center flopped, the village would gain a whether the project worked or not. New York
newly renovated commercial space for its Mills demonstrates one way to reduce financial
USD 35,000 investment. risk to the local government.
57
Rugby, North Dakota
Recognizing the lack of computer skills among its workforce, Rugby partners with a
statewide training program to enhance the job skills of its citizenry. Its investment in
workforce development is attracting new businesses to Rugby.
2000 2010 +/-

Population 2,939 2,876 -2%
Per capita income (state, North Dakota) $27,906 $42,764 40%
Location Central North Dakota, USA (map)
Distance to metro/micro-politan center 245 km to Grand Forks, North Dakota
Retail trade
Rugby is a small town that has survived The towns early promoters thought the name
multiple economic recessions by investing in would entice English settlers to move to North
its workforce. Historically, Rugbys economy Dakota. The plan never worked out; almost all
was based on agriculture and retail trade. Until of the population is of Scandinavian and North
the last five years, the local labor force lacked Germanic ancestry.
basic computer skills. The local economic
development director came to recognize that Like most rural outposts on the northern
this skill deficiency was limiting the ability of plains, Rugby has a traditional agricultural
existing businesses to compete. It also became a economy. Throughout the 1980s and 90s,
barrier for recruiting new competitive industries Rugbys economy struggled to grow. Local
into Rugby. In response, the town created a leaders recognized that many residents were
partnership with the Center for Technology and unable to compete for modern job opportunities
Business in Bismarck to develop a technology because they had limited experience with
training program for the local labor force. As computers. This created several problems. First,
a result, one-third of Rugbys labor force has technology-driven businesses, which had the
received training and new, technology-driven potential to be important for Rugbys growth,
businesses have located in town. shied away from town. Second, Rugbys
existing businesses that relied on computers
Location and History were unable to fully utilize them to become
Rugby is one of North Dakotas larger towns. more competitive.
Incorporated in 1886, it was initially called Rugby
Junction because of its location at a junction of Approach to Development
the Great Northern Railway. The name Rugby Rugbys strategy is to enhance the computer
came from a city of that name in England. skills of its workforce. In 1999, the town partnered
58
CASE STUDIES 3
with the Center for Technology and Business cue manufacturer that was seeking a technology-
(CTB), a statewide NGO and technical assistance proficient workforce settled in Rugby, as has a pole
provider, to administer a low-cost computer training barn manufacturer from Canada. A local auto
program. The program includes practical instruction body shop was at the point of closing its doors
in running a computer, using Microsoft Office because of major issues with its computer system
applications and navigating the Internet. Moreover, when the Center for Technology and Business
instead of sending teachers throughout the state to sent a consultant to see if the problem could be
run the training programs, CTB selects and provides fixed. After a week of work on the system and
training to a few local residents, who then teach some training for the workers, the body shop was
the courses in their hometown. Once a town has back and running and quickly became profitable.
trainers, they are free to administer and manage Not long after, that same company decided to
the program themselves. Costs to participants create a new business that designs signs for trucks
range from USD 30 to USD 60 per course, and cars using a sophisticated computer graphics
though students unable to pay are subsidized. system. Three Rugby residents were hired to run
Course revenues cover textbooks and teacher pay. the computers and apply the graphics.
In Rugby, courses are held in donated meeting
space at the local hospital. In the past six years Key Themes or Lessons
more than 400 residents, about one-third of Workforce investment can be a catalyst for
Rugbys labor force, have completed the program. improving a towns economic prospects. The
recent attraction of new employers to Rugby
A computer-literate labor force has positioned can in large part be attributed to the successful
Rugby as an attractive site for new businesses. workforce training program it implemented.
The first of these was Verety, a Chicago-based By improving the technical skills of workers,
business that uses a broadband network to take Rugby has increased their value and pursued
fast-food restaurant orders from remote locations. a strategy that can attract and retain better-
Given Rugbys established computer training paying businesses. The success of the training
course, Verety decided to locate in town. Verety program became a sort of marketing device
saw that Rugby was a place where people had a as businesses heard about this small town and
good understanding of technology, according its trained labor force. Town leaders should
to one local leader. Verety hires stay-at-home see workforce training as a starting point for a
workers (including underemployed mothers) number of development strategies, including
to take and send orders. The company provides entrepreneurship and business recruiting.
free computers and broadband access to each
employee. These stay-at-home mothers can put Resources are available to create training
their kids on the bus in the morning, work from programs. Rugby partnered with the NGOs
10 a.m. to 4 p.m. and still have dinner on the including the Center for Technology and
table by 5, one local official said. That additional Business as well as a number of state and
income and not having to travel to and from work federal agencies to devise and implement their
has been a benefit to so many families in Rugby. training program. One of the Federal agencies
Veretys business model, combined with Rugbys Rugby partnered with was the U.S. Department
workforce development initiative, has allowed the of Agriculture, which provides funding to many
unemployed and underemployed labor force in rural communities for technology education. The
this rural outpost to link into the local economy. message here is for economic developers in small
towns to know that funding is available from a
In addition, since the workforce training wide variety of agencies and that forming alliances
program was implemented, Rugby has caught the with them can be key to a programs success.
attention of several relocating businesses. A pool
59
Washington, North Carolina
Located at the center of a regional cluster of marine and boat-building businesses,

Washington partners with the community college to create a workforce development and
entrepreneurship program to capitalize on the booming industry.
2000 2010 +/-

Population 9,841 9,583 -3%
Construction
Washington is taking advantage of the existing called Washington in the United States and was
marine trades cluster in eastern North Carolina by incorporated in 1782.
upgrading the skills of its workforce and fostering
entrepreneurial development in the marine By virtue of its location on the northern bank
trades industry. After a number of plant closures of the Pamlico River, Washington became a
throughout the 1990s, Washington officials regional shipping center and was recognized by
partnered with county economic development the North Carolina General Assembly as a port in
officials and the local community college in 2004 1784. Over the next two centuries, Washingtons
to develop the Skills Center, a business incubator economy was spurred by textile and lumber mills
that provides worker training and entrepreneurial locating on the banks of the river. Increased global
development for new marine trade firms. Since competition forced the closure of many of the
opening in 2004, the Skills Center has generated mills in the mid 1990s, leaving Washingtonians
two new boat manufacturers in Washington, without work and with a decaying town center.
creating more than 100 jobs.
Approach to Development
Location and History Washingtons strategy was to develop a skilled
Washingtons history dates back to the early labor force and encourage entrepreneurship in
1700s as a shipping port, a legacy that has since the marine trades industry. The State of North
shaped the communitys economy. It was not Carolina provides funds to community colleges
until 1775 that Washington was formally named to train the workforce of new and expanding
by resident Colonel James Bonner in honor of his industries. Washington capitalized on the state
commander-in-chief, Gen. George Washington. funding by partnering with Beaufort County
The newly named community was the first to be Community College (BCCC) to develop training
60
CASE STUDIES 3
courses in welding, manufacturing and electronics similar path through the Skills Center and created
related to the marine trades. Through this flexible 56 new jobs in Washington. All told, Washington
curriculum, Washington created the institutional currently has three boat manufacturers, employing
capacity to train the workforce of nearly any boat- several hundred workers, as well as a number of
building manufacturer. component manufacturers and machinists.
With a training program in place, community Key Themes or Lessons

leaders turned to developing the entrepreneurs who Workforce development is economic development.
could eventually make good use of their communitys This is a case about using workforce development
skilled marine trade workforce. Washington and as a driver of entrepreneurship development
Beaufort County partnered in 2004 to build the strategies, a way to give local entrepreneurs a
Skills Center, a business incubator with space for competitive advantage. Washington demonstrates
new business owners to temporarily establish their that, especially in small rural communities,
headquarters and take training courses offered by workforce development programs can catalyze
BCCC. The Skills Center also allows entrepreneurs economic development in ways beyond just
the time to build partnerships and establish contracts training workers.
with surrounding component manufacturers and
thus become embedded in the boat building cluster. Recognize and tap into regional economic
opportunities. In times of economic transition,
By 2005, Washingtons strategy was starting to Washington chose to build on its unique
pay dividends. One local resident and graduate of waterfront location and its shipping heritage to
the training course opened Brooks Boats. During become part of a broader economic engine, the
the year his manufacturing plant was being built, marine trades cluster in eastern North Carolina.
Brooks set up his offices in the Skills Center and Doing so allowed Washington to become a
began training his workforce. Besides building workforce development hub for this growing
boats, Brooks also manufactures parts for other economic sector. The town was strategic in
boat builders in eastern North Carolina, further terms of evaluating what it could offer to the
strengthening this cluster. In 2006, Brooks moved growing marine trades cluster and recognizing
to his new 14,000-square-foot space. His company opportunities to set the town apart from other
employs 50 workers. Egret Boats has followed a towns in the region.
61
4
Case Studies IV: Industry, high-tech, or
manufacturing-based
development
This chapter includes case studies of small towns that are focused
on industrial, higher technology, or manufacturing development.
These towns have developed innovative industrial development
strategies that incorporate business clustering and regional
collaboration; emphasize green development; and make use
of creative incentive tools.
Cape Charles, Virginia
With a local economy crippled by plant closures and environmental problems, Cape Charles
bridges these challenges with the nations first eco-industrial park.
2000 2010 +/-

Population 1,130 1,009 -12%
Per capita income (state, Virginia) $31,634 $44,246 29%
Location Eastern Virginia, USA (map)
Distance to metro/micro-politan center 69 km to Norfolk, Virginia
In the mid-1990s, Cape Charles planned of the 1900s, the towns port and ferries connected
and developed an environmentally friendly Northampton County with Norfolk across the
eco-industrial park. This development was bay. In 1965, a two-lane bridge and tunnel were
part of the towns strategy to blend job creation built to connect Cape Charles with Norfolk,
with environmental protection. Located in reducing the ports traffic.
Northampton County on the Chesapeake Bay,
the towns economy is based in fishing, farming Cape Charless economy has always centered
and food processing. Over the last couple of on agriculture and fishing. The rich soils and
decades, however, local food processing plants freshwater bays have provided a living to
have moved away, and overfishing has decimated generations of family farms and fishermen.
the fishing industry. In the wake of significant job Beginning in the early 1900s, processing plants
losses and increasing water pollution, local officials located in town to package and sell produce and
committed to charting a new, more sustainable seafood from the area. Over the next half century,
economic development path. Cape Charles is Cape Charles blossomed yet retained its character
now the location of the nations first eco-industrial as a quaint coastal town.
park, which has created new jobs for residents
while limiting its environmental footprint. In the mid-1980s, food processors became an
obvious and easy target for federal environmental
Location and History regulators. In addition, improvements in
Sandwiched between the Chesapeake Bay to technology and transportation networks meant
the west and the Atlantic Ocean to the east, Cape that the proximity between processors and
Charles has a long history as a trading post and growers was becoming less important. In the late
fishing center. It was founded in 1886. For much 1980s, three food processing plants in or near
64
CASE STUDIES 4
INDUSTRY, HIGH-TECH, OR MANUFACTURING-BASED DEVELOPMENT
Cape Charles closed, and 1,500 workers lost their fixtures and native landscaping. Local water
jobs. At the same time, the fishing industry began resources were protected through an innovative
to flounder because of overfishing and increasing water recycling system. The system collects used
pollution from run-off. On top of all of this, the water from each company, recycles it and then
only source of drinking water in the region started redistributes the water back to businesses.
showing signs of saltwater intrusion.
In the first few years after opening, STIP
Approach to Development leveraged another USD 8 million from private
Cape Charless strategy was to link companies locating there and created more
environmental protection with economic than 65 new jobs. Unfortunately, some of the
development. One element of this strategy was to businesses have since closed, and the county has
develop an eco-friendly industrial park. In 1992, struggled to replace them. According to local
the Northampton County Board of Supervisors officials, federal and state officials developed a
received a grant from the National Oceanic and rigorous list of sustainability criteria for how
Atmospheric Administration (NOAA) to research businesses in the park could operate. Apparently,
innovative ways to balance economic growth with these criteria are so stringent that the already small
coastal resource protection. In 1993, town and pool of potential green businesses able to locate in
county officials partnered with NOAA and the the park became even smaller. In addition, county
Virginia Department of Environmental Quality to officials attribute miscommunication between
hire the nations first local sustainable development state and local leaders over who would lead in
planner. The planner created a volunteer citizens recruiting businesses to the park as being a major
task force to identify measurable, achievable tasks factor in its downturn. County officials and the
that build the economy and preserve the assets on Chamber of Commerce are now talking with a
which they depend. nearby community college about locating in the
unused space. Even though the eco-industrial park
Through a series of public meetings spread over did not turn out to be an outright success story,
18 months, the task force came to an agreement the forces that led to its creation and the reasons
on six economic sectors they felt Cape Charles for its continuing struggle bring out lessons for
could pursue for job growth. One was to recruit similar strategic initiatives.
new low-emission industries that would have
a limited impact on the environment and local Key Themes or Lessons
waterways. The task force recommended that Environmental adversity can lead to economic
Cape Charles create a new type of industrial park opportunity. Cape Charles and county officials
designed to reduce water and resource use while were in a predicament after food processing
allowing businesses to take advantage of all the plants closed in the late 1980s. On the one
traditional benefits of a park. hand, residents were desperate for jobs; on the
other, the once pristine environment was being
The recommendation was timely as degraded. Cape Charles also faced threats to its
Northampton residents had already approved a water supply. The town had to come up with a
USD 4.6 million bond to build a new industrial strategy that would balance economic growth
park. County officials thus committed to use this and environmental protection. In this case, public
bond money to create an innovative eco-industrial leaders decided to put a new spin on an old tool
park. In January of 2000, the first phase of the the industrial park. As the county supervisor, said,
Cape Charles Sustainable Technologies Industrial We saw nature-based development as an asset
Park (STIP) opened to much fanfare. It was the and key differentiator in doing business. This
first industrial park of its kind in the United innovative approach to economic development set
States. A 31,000-square-foot manufacturing/ Cape Charles apart from its neighbors, provided
office building was complete with solar panels, uniqueness to the community and gave industries
protected wetlands, low-energy light and water a reason to explore the town.
65
The process of building capacity and creating exclusive access to Nature Conservancy-owned
partnerships is as important as the outcome. barrier islands and can offer a more expensive
The inclusive nature of the planning process for and exclusive experience to their customers. The
the eco-industrial park generated community course has been extremely successful for both the
capacity to do other things. In 2006, when the town government and local business owners. This
park was struggling to maintain occupancy, the partnership was a direct result of the process that
local Chamber of Commerce partnered with Cape Charles went through to explore sustainable
the area community college and the Nature economic development strategies (of which the
Conservancy to develop a certification course park was only one option).
in ecotourism. Graduates of the course receive
Douglas, Georgia
Douglas cultivates economic development from three angles -- by intensifying

entrepreneurship and small business efforts, diversifying industrial recruitment and
employers, and preparing a cadre of new leaders to move the communitys vision forward.
2000 2010 +/-

Population 10,650 11,589 8%
Per capita income (state, Georgia) $28,541 $34,800 18%
Location Southern Georgia, USA (map)
Distance to metro/micro-politan center 185 km to Jacksonville, Florida
Retail trade
Manufacturing
In 2005, Douglas was the first rural expansions and start-ups. Several major employers
community in Georgia to meet the states also have been recruited into town.
rigorous standards as an Entrepreneur Friendly
Community. Through a balanced economic Location and History
development strategy -- which includes Douglas is a small community in Georgia,
supporting entrepreneurs and small businesses, located between the Okefenokee Swamp to the
industrial development and leadership training south and open farm plains to the north. As the
-- Douglas enjoys a 20 percent growth rate county seat of Coffee County, Douglas is about
and has become a regional hub for jobs, retail, a three-hour drive from Atlanta and two hours
entertainment and medical services. In the last from Jacksonville, Fla. With its bustling town
10 years, at least 800 jobs have been created and center, thriving economy and strong industrial
more than 345,000 square feet of previously presence, activity in Douglas is comparable to that
vacant space has been occupied by small business in a city 10 times its size. Small business and retail
66
CASE STUDIES 4
outlets attract shoppers and clients from across wanted to get it (the guide) into as many hands
the region. As a regional employment hub, about as possible, said the chambers small business
20 percent of the workforce in Coffee County program director. Our goal was to demonstrate
commutes into the county. to the community that we were serious about
stimulating entrepreneurship and small business.
Coffee County, once occupied by Creek
Indians, was named after General John Coffee, a The next step was to connect small business
hero in the War of 1812. The Town of Douglas owners and entrepreneurs to resources and to
was chartered in 1899. It took its name from recognize them for their contributions to the
Stephen A. Douglas, a presidential candidate towns vitality. The chamber developed a program
running against Abraham Lincoln. It was born to connect new small business owners and
as a railroad stop among the rich agricultural entrepreneurs with experienced business owners.
fields of south Georgia. Agriculture and crop- The town maintains a network of mentors who
related commerce ruled the day for much of the commit time and resources to helping new
towns early history; then the boll weevil arrived, businesses survive. In addition, each year the
destroying much of the cotton industry, followed Chamber presents awards for Small Business of
by further mechanization of agriculture. the Year and Entrepreneur of the Year. Awards are
handed out and celebrated at a formal banquet.
As early as 50 years ago, the challenges in
agriculture made economic diversification a town To support local retail development and
priority. While Douglas has been relatively successful diversification, Douglas developed a retail
at building an industrial manufacturing base, incubator where entrepreneurs can lease space,
between 2001 and 2003, it lost more than 1,000 on a month-to-month basis, to market test their
manufacturing jobs. A major challenge has been re- ideas. If they find their concept has a market,
orienting the approach to economic development the town helps the entrepreneur move into a
so that it includes new economic drivers, including permanent space in town. The chamber also
small businesses and entrepreneurs. partnered with South Georgia College to create
a small business incubator on campus, where
Approach to Development student entrepreneurs are provided with space
The Douglas-Coffee County Chamber of and clerical support.
Commerce (the Chamber) and the Economic
Development Authority (EDA) lead economic Douglas offers tax abatement packages
development efforts. The town pursues a three- to small business entrepreneurs similar to
pronged strategy for economic development -- those given traditional industry prospects. To
support and nurture small business entrepreneurs; further stimulate local business activity, the
recruit a diverse range of industrial employers, town encourages any company that receives
and develop a new generation of leaders who are local incentives to use local contractors for
versed in economic development. construction projects. In one of Douglass
boldest moves, the EDA re-engineered and
Small business and entrepreneurship redesigned one of the towns industrial parks,
Douglas support for small businesses ranges Park West, into a small business and technology
from simple thank-you visits from chamber and center. Recognizing the growing importance
EDA representatives to intensive financial and of small business entrepreneurs to the local
infrastructure supports. In 2002, the chamber economy, EDA subdivided the site into dozens
hired a full-time staff person to manage the of smaller parcels and invested in state-of-the-
organizations small business and entrepreneurship art technology infrastructure and underground
program. The first task was to publish How to Start utilities. The Park West business and technology
and Grow a Business, a guide to local resources center opened in 2007.
for anybody interested in starting a business. We
67
Industrial development include more than 500 jobs have been created
While Douglas focuses at least one-third of through small business start-ups, more than
its energy and resources on supporting small 345,000 square feet of previously vacant space
business entrepreneurs, it has not forsaken has been occupied by small business expansions
more traditional industrial development assets. and entrepreneurial start-ups, several companies
The industrial development strategy begins completed major expansions: Diamond Builders
with the connections and networks that local (50 jobs), Elixir Industries (50 jobs) and Spectrum
leaders have been building for decades. Personal Distribution (20 jobs) and in 2006, Douglas
connections between leaders in Douglas and recruited American Insulated Wire (250 jobs
economic developers in Atlanta are a bridge to and USD 26 million investment) and Premium
high-level business prospects. The chamber and Waters (80 jobs and USD 30 million investment).
EDA, along with the town administration, tap
into these networks to bring business prospects Key Themes or Lessons
into Douglas. Celebrate success. Success comes from
talking about it, one leader said. If you dont
When it comes to recruiting specific tell your community what you are doing, then
industries, the towns goal is to attract they wont know what you are doing. When an
a diverse range of companies that pay article comes out that mentions your town, you
reasonable living wages. We dont go out give that to everyone. Douglas works hard to
of our way to recruit minimum wage jobs, keep local newspapers informed about various
said the EDA president. The town offers local economic development projects and publicizes
incentives, with a heavy emphasis on non- even the most modest success, including
cash incentives. During a typical negotiation stories of local entrepreneurial successes. If
with a business prospect, the local technical we announced a new industry was coming
schools are at the table to outline training to town creating 240 new jobs, it would be
opportunities, local business leaders make very exciting, said another leader. Our small
themselves available to sell the supportive entrepreneurial businesses in Douglas-Coffee
business culture in Douglas. Georgia also created that number of jobs in one
year, and they are more often than not locally
Leadership development owned and less likely to relocate. So we need to
The third pillar of Douglass strategy is to grow celebrate those successes, too.
new leaders with a comprehensive understanding
of economic development in the 21st century. Respond quickly to local industry. Douglas
Leadership development is all about building is quick to respond when local businesses ask for
bench strength, said the assistant city manager. assistance. Several years ago, the EDA started
Just like good sports teams have to have bench hearing complaints from local industry regarding
strength to win games, communities need bench the lack of trained commercial truck drivers. In
strength to stay ahead in the 21st century. In the response, EDA partnered with the local technical
mid-1990s, the chamber and EDA developed college to develop a commercial drivers license
the New Century Leadership Program, which driving range and education facility to train
gives participants hands-on learning experience new truck drivers. Students, instructors and
in government, education and the practice of 18-wheelers hit the pavement in 2006 and we
economic development at the local, regional and couldnt be more excited, the EDA director said.
state levels. The program has grown in popularity. This sector of workforce development responds
Graduates of the program become key leaders on to specific needs from local employers, and it fits
local boards and commissions. well in terms of Douglas growing importance in
distribution and warehousing and proximity to
Several outcomes that can be attributed to regional seaports.
Douglas approach over a three to five year period
68
CASE STUDIES 4
Grow young leaders with a passion for Cultivate relationships with state-level
economic development. One of Douglass developers, bankers and power companies.
biggest challenges relates to the generational Last year, the Town of Douglas hosted 17
void of young leaders to take over key state-level economic development partners.
public positions as the baby boomers retire. Getting these leaders from Atlanta to visit our
In response, the town created the New community allows for a better understanding
Century Leadership program and is working of our regional assets and amenities, the EDA
to implement a new program -- the Young director said. One local real estate developer
Professionals Network -- to bring a greater and local philanthropist, likewise insisted that
number of young people into the fold. cultivating these relationships is the most
Douglas working to fill the leadership void important thing that small communities can do
before it becomes a major problem. to lure new industries to their towns.
Etowah, Tennessee
Etowahs persistence and high standards yields one of the most scenic rail trips in
the nation, an attraction that is spurring downtown retail, restaurant and hospitality
development and innovative approaches to industrial recruitment.
2000 2010 +/-

Population 3,660 3,490 -5%
Per capita income (state, Tennessee) $26,689 $34,955 24%
Location Eastern Tennessee, USA (map)
Distance to metro/micro-politan center 80 km to Chattanooga, Tennessee
(top three as percentage of workforce, 2007) Educational services, and health care and social
assistance
Retail trade
Etowah is a unique community in the foothills and built a new, long-term and sustainable
of eastern Tennessee. Century-old railroad strategy for development. Today, Etowah has a
infrastructure provides the town with a valuable thriving economy based on three pillars: heritage
heritage asset while a modern and thriving tourism, downtown development and industrial
industrial park provides well-paid employment recruitment and expansion.
opportunities to its residents. Historic downtown
architecture and modern amenities stand side- Location and History
by-side. Ten years ago, Etowah faced a severe Etowah is a small town in the eastern Tennessee
economic challenge, with declining employment foothills. It is the second largest town in McMinn
and dilapidated infrastructure. Town leaders County and about a quarter of the size of
focused on their communities existing assets Athens, the county seat. The drive into town
69
from the north is striking, both in terms of the community raised USD 1.6 million to purchase
level of activity in town, and the immediacy of the line. The City of Etowah partnered with the
Etowahs development assets. These include Starr Tennessee Valley Authority (TVA) to rehabilitate
Mountain, the colossal natural treasure that serves the rail line, which provided TVA with access to
as the western-most edge of Cherokee National the Appalachia Powerhouse (a power generator on
Park and skirts Etowahs eastern city limit; the the Hiawassee River) and provided Etowah with a
L&N Train Depot, a turn of the century train prominent tourism asset. The Tennessee Overhill
station at the center of an historic main street; and Heritage Association, in partnership with the
most recently, the massive industrial park at the town, applied for and received a grant from the
northern edge of town. National Trust for Historic Preservation to initiate
its rail excursions.
Etowah was the first planned community in the
United States. Built by the Louisville & Nashville Rail excursions have become the anchor for
(L&N) Railroad Company in 1906, Etowah was Etowahs tourism industry. Trips begin in town and
to be a crucial location in the companys efforts take riders into the Cherokee National Park. The
to piece together a direct route from Chicago trip is considered one of the most scenic rail trips
to Atlanta. In terms of natural and built assets, in the United States, said the Executive Director
Etowah is a regional gateway into the Cherokee of TOHA. It carries passengers up the Hiawassee
National Park. Starr Mountain, on the towns River Gorge, around an historic loop with vestiges
undeveloped eastern horizon, is a constant of the mining industry, and back down into town.
reminder that Etowah rests on the very edge of the There are no roads in this river gorge, and the
Appalachian high-country. Hundreds of hiking only access is by rail. The city and heritage group
trails and four major rivers skirt the town. The manage the train excursions, which have become
Ocoee River, was the whitewater kayaking venue a profit engine for the town. According to the
for the 1996 Olympic Games. chamber of commerce president, train excursions
bring folks into town and downtown merchants
Approach to Development keep them there.
Etowahs strategy for economic development is
to build from its existing assetsto use its heritage Downtown development
assets to attract tourists; to create a dynamic and It follows that the second pillar of Etowahs
thriving downtown corridor with retail and service economic development strategy is to build a
amenities that attract visitors as well as locals; and downtown corridor with services and amenities
to leverage the towns quality of life factors and its that attract tourists and locals alike. In the
existing industries to further expand its industrial vacuum created by economic shocks of the late
base. The roots of Etowahs strategic approach can 1990s, a second-hand-item market developed
be traced back to a community planning exercise in Etowahs downtown retail corridor. Shops
that took place in 1998, during which a coalition selling antiques and sundries took root in
of government, business and NGO leaders came previously unoccupied storefronts. According
together to develop a shared vision for Etowah to a prominent town official, Etowahs second-
and a long-range agenda for development. hand stores attract shoppers from as far away as
two hours. Their main challenge, which was
Tourism articulated during Etowahs strategic planning
First, the towns strategic planning exercise in efforts of 1998, was their lack of capacity for
1998 revealed that the old abandoned rail line, marketing and advertising.
which stretched up into a nearby national park,
was an asset that the town could use to create a In response, the chamber worked with
draw for tourists. At the time, the rail built in downtown merchants to help them take
1890 was owned by a private holding company. advantage of traffic from the railroad excursions.
In 2001, opportunity presented itself and the Simple changes to the merchants business
70
CASE STUDIES 4
routines and schedules have made a tremendous Key Themes or Lessons

difference. Restaurants and retailers coordinate Development strategy should be based on a
their hours of operation and staffing levels with broad definition of small town assets. In Etowah,
anticipated tourist traffic. The chamber published the train depot, historic downtown architecture
a shopping and dining guide to market downtown and rail infrastructure were obvious development
merchants. The cost was covered by a USD 200 assets. Some of the less obvious but equally
fee for merchants to be included in the guide. important assets included the adaptability and
When the trains are running, volunteers ensure grittiness of local residents, the towns interesting
that a guide gets placed on every seat. history, local NGOs, and the nearby protected
parkland. The process of identifying a small towns
Industrial development assets ought to take a broad view of what a town
The final pillar in Etowahs economic has to offer and employ creative ways to leverage
development strategy is industrial development. those assets toward economic, civic, social and
The town manager coordinates recruitment environmental gains.
and expansion activities. When Etowah was
working on its community strategic plan, it Proactive industrial development as part of
became apparent that being proactive in the area a broad-based strategy can spur investment.
of industrial development could complement Etowah demonstrates that proactive industrial
Etowahs tourism and downtown development development can be part of a broad-based and
activities. Town leaders recognized that the asset-driven economic development strategy.
railroad infrastructure in Etowah was a valuable According to Etowahs strategic plan, recruiting
asset, not only for tourism, but for industrial technology-based industries that provide a clean
distribution. The town made a strategic decision industrial environment will avoid the brain-drain,
to purchase and develop an industrial park on the create higher paying opportunities, which will
northern edge of town, the goal of which was to give our children a reason to remain in Etowah
create sustainable, living-wage jobs for Etowah. and recruit others to relocate in Etowah. Etowah
The town extended infrastructure for water, sewer initiated industrial development on its own terms,
and utilities to the North Etowah Industrial Park. and only after embarking on a community-wide
exercise to determine its assets and strengths for
Once the site preparations were complete, development. The results are impressive, including
companies started calling. Etowah was never in hundreds of living-wage jobs in expanding industries.
the position of being able to offer cash incentives,
but site development at the industrial park and Scrappiness pays. In this day and age, when
the existing rail infrastructure, combined with federal and state resources are funneled through
the countys payment in lieu of taxes program multiple levels of organization before they reach
were sufficient to attract tenant interest. Today, individual communities, small towns have to be
Etowah is home to major industrial tenants, loud, aggressive, and scrappy, according to one
including Waupaca Foundry, Johns Manville and local leader. We have to fight for our share.
Consolidated Metco. Average wages in Etowahs Leaders in Etowah confront these challenges with
industrial park range from USD 16 to 20 per grit and confidence, and are willing to work hard
hour plus benefits. to earn their share.
71
Farmville, North Carolina
A historically tobacco-dependent community, Farmville ensures its long-term vitality

through diversification. Today, furniture, health care, construction, warehousing and
service industries can all be found thriving in this small North Carolina town. Farmville
invests in local businesses and schools, and markets itself to new industries and residents.
2000 2010 +/-

Distance to metro/micro-politan center 24 km to Greenville, North Carolina
Manufacturing
Retail trade
In 2004, Farmville was a finalist in the National formally incorporated until 1872. The first quarter
Civic Leagues All American City competition. of the 20th century was a period of incredible
Residents of this small rural community boast growth, as the town became a commercial center
about their towns big-city amenities, which for the regions booming tobacco industry. At
include an active cultural scene with live the time, two railroads linked Farmville to the
performing arts, a bustling Main Street, and an major tobacco markets in Wilson and Durham,
innovative four-campus public school. Farmvilles and a number of large tobacco processing and
recent success has not come without hard work warehousing operations set up in town.
and innovative thinking. Facing declines in
traditional industry, this small town -- once at Farmville has managed to maintain its
the center of the national tobacco industry -- individuality and small town feel in the face
diversified and expanded its economy to an extent of growth from these more sizable neighbors.
that makes it the envy of much larger urban In 1998, Farmville put in place an innovative
neighbors. Through an intensive branding and structure to facilitate economic development.
marketing campaign, coupled with aggressive A group of public and private sector leaders
support for existing businesses, Farmville has recognized the need for a single point of contact
become a beacon of hope in the golden leaf for economic development to avoid duplication
tobacco country of eastern North Carolina. of effort. They created the Farmville Development
Partnership to be an umbrella organization
Location and History for three existing organizations: the Economic
Farmville is a small town in eastern North Development Council (established in 1956), the
Carolina. The area surrounding Farmville was first Chamber of Commerce (formed in 1936) and
settled in the mid-1760s, but the town was not the Downtown Partnership (created in 1994).
72
CASE STUDIES 4
According to a local leader, the concept was to develop a satellite campus in Farmville to boost
create a single economic development office local workforce development.
that would efficiently use office space, staff,
management expertise and funding. A small business incubator is available to
entrepreneurial companies. In addition to
The Farmville Development Partnerships providing businesses space, FDP organizes
governing board is made up of three members training opportunities (through Pitt Community
each from the Town of Farmville, the Economic College) for companies that locate in the
Development Council, the chamber, and the incubator. EMI, a heating and cooling contractor,
Downtown Partnership. The town provides started in Farmvilles incubator before moving
USD 200,000 annually (in addition to in- into a larger facility across town. It had grown
kind office space), which is supplemented by from one employee to eight in just eight months.
chamber and council dues, donations and state/ The small business incubator is a fantastic thing
federal grants. All three organizations share an for a small business owner and for a community,
office and a staff of three full-time employees. EMIs founder said. It shows Farmvilles dedication
In conjunction with the town managers office, to growing and expanding, providing jobs, and
the FDP through its subordinate institutions contributing to the quality of life in the community.
coordinates all of Farmvilles economic
development efforts and provides the town To ensure the towns long-term livability,
with a substantial amount of local capacity. Farmville provides incentives for a mix of affordable
and high-end residential development. Under
Approach to Development this program, the town reimburses developers
Given this capacity, Farmvilles strategy is to for 40 percent of the total cost of streets, water,
support existing businesses through a coordinated sewer, curbs, gutters and storm drainage after a
visitation program, small business incubation and subdivision is completed. If a new development
an incentive program for residential development; has 10 lots, after the first house was built and
to recruit large and small businesses in a range of occupied, we would pay two-tenths of our 40
sectors with creative incentive programs; and to percent share to the developer, explained the
enhance its support for economic growth with an town manager. After 51 percent of the total lots
intensive marketing and branding campaign. are built and occupied, we would have reimbursed
the developer for our 40 percent. The idea is to
Supporting existing business create residential infrastructure for local workers
Farmville recognizes that, in the words of the to live in Farmville and to attract higher-income
town manager, more than 80 percent of the residents from Greenville.
new jobs and investment in our community
comes from businesses that are already here. The Marketing and incentives to recruit new business
town works hard with existing businesses, large The most intense element of Farmvilles
and small, to ensure their long-term viability in strategy is to create a brand identity for the
Farmville. Working with economic developers town and to market the livability of Farmville
from Pitt County, the partnership coordinates a -- all in an effort to entice new residents and
comprehensive business visitation program which businesses. In 1999, the partnership led a group
ensures that every business in Farmville -- large, of citizens through a visioning exercise and chose
small, manufacturing, service or retail -- gets a visit Farmvilles gazebo, a popular landmark, as the
from FDP. The town hosts an annual industry image for a new logo. The logo is incorporated
appreciation banquet and golf tournament. into all of Farmvilles marketing materials,
FDP hosts regular Business After Hours banners on Main Street, a community-owned
events to provide networking opportunities for billboard on a nearby highway and a variety
existing business leaders. In addition, the town of print advertisements. Farmvilles tagline,
is negotiating with Pitt Community College to Experience our community, also is printed
73
on its marketing materials. In addition, the living in Farmville. Proceeds from events support a
town invested in a modern and well-designed fund for downtown building faade renovations.
website. We believed that because a great
deal of preliminary research by business site Several outcomes that can be attributed to
consultants is now being done online, it was Farmvilles approach over a five year period
important that we create a portal to Farmville include 64 new businesses to town (380 new
that was convenient, catchy and easy to use, jobs), including small shops and large industries,
according to one local leader. six new businesses (with 20 jobs) to the town
center, population increase of 4 percent, and
The town has worked hard to build strategic average wage increased by 7 percent.
partnerships to distribute its message. Because
the Pitt County Economic Development Key Themes or Lessons
Commission is the primary point of contact for Respond quickly to local business and
state-level business recruitment leads, Farmville industry. Leaders in Farmville, including the
makes sure the towns marketing materials are mayor, town manager and the executive director
adequately represented when the commission of FDP, respond promptly when industries ask for
works with statewide business prospects. assistance. In 2006, Alliance One was struggling
to hire a sufficient workforce. Managers from the
Farmville actively recruits industries in two main company called the town manager and asked if
categories (1) traditional industries that pay wages he could help. By the next afternoon, the town
above those in the service industry and (2) medical had assembled a team of local, regional and state-
services and retail. The town tailors incentives level workforce resources to assist the company. A
packages for the situation. To lure Alliance One, the few days later, a regional job fair allowed Alliance
town offered USD 5,000 for each new job created, a One to fill its vacancies. The towns response --
moderate amount of relocation assistance to certain and particularly the fact that busy people set aside
levels of staff, USD 2,500 toward the purchase of whatever they were doing to help -- demonstrated
new homes for executives and some travel expenses to us that the town cared about our business and
for visiting managers. In another case, Farmville could help, an Alliance One manager said.
provided a moderate amount of rental assistance
to a new small business that moved into a vacant Small towns can maintain their character
property in town. The town also has a package of in the face of growth pressures. According to
retail incentives for businesses on Main Street and the mayor, the question that Farmville asks
a faade grant program for downtown buildings. is: How can we use the urban growth from
The incentives serve several ends, from the creation Greenville to our advantage, rather than let it
of jobs and tax base to property revitalization and consume us? Through aggressive marketing,
residential development. events promotion and determination to develop
on its own terms, Farmville has maintained its
Internal marketing -- or keeping residents of identity. The town has no interest in becoming
the community up-to-date about economic a bedroom community. Rather than passively
development activities is yet another element react to the growth from Greenville, Farmville
of Farmvilles success. The town and FDP reach supports and promotes local business growth
out to residents through local and regional media, while also working with residential developers
the distribution of Farmvilles annual report, and to meet the growing demand for homes and
sponsorship of local events and celebrations. The neighborhoods.
town and FDP sponsor an annual Christmas parade,
the Dogwood Festival and Hometown Halloween. Embrace change and evolve. Ever since the
Events and celebrations give residents a way to 1950s, Farmville has put itself on the front
celebrate their community, but also draw tourists end of shifting economic circumstances. For
and, implicitly at least, promote the advantages of example, local tobacco barons were willing
74
CASE STUDIES 4
to adapt and diversify at a time when such Use multiple tools to achieve multiple
behavior was unheard of in other parts of outcomes. Farmville employs a variety of
eastern North Carolina. Over time, Farmvilles incentive configurations that are customized
willingness and ability to change and evolve, to a particular project. The town will provide
rather than to get comfortable and stagnate, incentives for not only job creation, but retail
has allowed new and innovative approaches locations on Main Street, faade/property
to local development to take root. upgrades and residential development. A diverse
and customized incentive toolbox is ideal.
Never wait for help when you can help
yourself. Farmville is not a town that waits Integration of new residents into the towns
around for help to come from the outside. civic and social infrastructure. In Farmville,
For example, when Hurricane Floyd flooded few barriers limit newcomers from integrating
a residential section of Farmville in 1999, into the towns social and civic infrastructure.
the town purchased 16 residential properties The mayor and town manager welcome
and turned the area into a public park with newcomers with a new residents picnic each
trails, recreational amenities and exercise spring. All of Farmvilles elected officials and
equipment. Farmville was the first community public leaders attend. This encourages new
to take a proactive and long-term approach to residents to apply their fresh energy and
responding to the disaster. vitality to civic life.
Oxford, North Carolina
Located 30 miles north of the booming Research Triangle Park, Oxford is partnering with
Granville County and its neighbors to implement a mini-hub approach to economic
development. The strategy is to prepare relatively low-cost industrial sites that are
attractive to companies that need to be near the Research Triangle, but not in it.
2000 2010 +/-

Population 8,530 8,461 -1%
Distance to metro/micro-politan center 48 km to Durham, North Carolina
Manufacturing
Retail trade
Oxford, the seat of Granville County, has involves four counties sharing the costs and
tethered its local economy to the development of revenues from regional economic development.
the Kerr-Tar Mini-Hub. The mini-hub project Between 2000 and 2003, the Kerr-Tar region
75
of north-central North Carolina lost 5,600 jobs test the mini-hub concept. The regions county
from plant closures and another USD 655 million managers and economic developers agreed.
in revenues from reductions in tobacco quotas. With a nearly unanimous voice, leaders from
The mini-hub is a regional response to these across the Kerr-Tar region decided to move
setbacks. It consists of four technology parks, one forward with a mini-hub strategy.
in each of the participating counties. The Town
of Oxfords role is to supply water and sewer Approach to Development
infrastructure to the mini-hub site in Granville Oxfords development strategy is to supply
County. After signing an interlocal agreement and targeted infrastructure to the mini-hub site
raising more than USD 5 million, county and in Granville County. By providing water and
municipal leaders are forging ahead with the mini- sewer infrastructure, Oxford is contributing to
hub. Oxford is set to install infrastructure in the the regional cooperative arrangement and thus
Granville County site by the fall of 2007. pursuing new mid-technology jobs for residents
at any or all of the participating counties sites.
Location and History In 2004, regional officials selected four sites, one
Oxford is located in the Kerr-Tar region of each in Franklin, Granville, Vance and Warren
north-central North Carolina, which includes counties. In total, 2,111 acres were dedicated to
Franklin, Granville, Person, Vance and Warren the mini-hub, with each site targeting a specific
counties. The region is proximate to the Research industry sector, from bio-manufacturing to
Triangle Park (RTP) to the south and the Virginia informatics. After selecting sites, hub leaders
border to the north. Tobacco farming brought then created the Kerr-Tar Regional Economic
early prosperity to Oxford and the region in the Development Commission (EDC), a non-
1700s and the crop remained an important local governmental organization, to manage and
commodity until 2000. Between 2000 and 2003 oversee the mini-hub. The commission is led
federal tobacco quotas for growers in the Kerr-Tar by four officersone county commissioner
region were slashed by 70 percent, resulting in a from each of the participating counties. Since
loss of USD 655 million in local tobacco-related forming in late 2004, the Kerr-Tar EDC has
revenues. In addition, the five counties lost an received more than USD 5 million in funding
estimated 5,600 jobs to plant closures over the for the mini-hub.
same three year period.
In November of 2005, participating county
In 2003, a report from the Center for officials made an impressive commitment to
Competitive Economies at the University of regionalism by signing an inter-local agreement.
North Carolina at Chapel Hill recommended The agreement required each county to contribute
the development of mini-hubs in the regions USD 40,000 each year to the Kerr-Tar EDC and,
surrounding RTP, a center of high-tech research in exchange, to share the tax revenues generated
and manufacturing. Mini-hubs, or enhanced from the hub. The executive director of the Kerr-
technology parks geared towards mid-tech Tar CoG, explained the agreements importance.
businesses, would benefit counties surrounding Companies dont care about jurisdictions, he
RTP by attracting businesses that needed to be said. Whats attractive to them -- and unique
near the park but not in it. The mini-hub was about us -- is that we have four counties working
envisioned as a network of sites, offering a together in ways rarely seen. Were getting
variety of enhancements to businesses. It was international attention.
likely to require a more substantial investment
than any single community could provide. With the interlocal agreement signed,
The former executive director of the Kerr- preparation of the various sites began in 2006.
Tar COG, was convinced that his regions At this point, Oxford provided key leadership
relatively inexpensive land and proximity to in developing the Granville County site. While
RTP would make Kerr-Tar a perfect location to the Granville site is located outside of Oxfords
76
CASE STUDIES 4
jurisdiction (meaning no property tax revenue), projects. Counties and municipalities

the town contributed to the regional effort by that cooperate on economic development
providing critical water and sewer infrastructure. infrastructure projects can, according to a recent
Thanks to an upgraded sewer plant, Oxford had report, enjoy economies of scale and cost
more than enough capacity to meet the needs savings and pursue projects that otherwise might
of the new technology park site. Using a USD not be feasible. In exchange for its investment
900,000 grant from the N.C. Department of in water/sewer infrastructure, Oxford, as a
Commerce, Granville County contracted with municipality in the Kerr-Tar region, expects to
Oxford in 2006 to extend infrastructure to the share in the economic spillovers that result from
site. Overcoming the infrastructure hurdle is increasing regional investments.
allowing the Granville site to open earlier than the
other sites in the hub. Consider regional resources that support
economic development. The mini-hub concept
Key Themes or Lessons being employed in the Kerr-Tar region benefits
Inter-local cooperation on economic development from the resources and opportunities being
projects is an emerging and promising strategy. created in RTP. The communities in this region,
Small towns, especially rural communities including Oxford, have been willing to look
with limited resources, face major challenges outside the immediate area to tap into assets
in developing industrial parks or other that may drive the decisions of firms to locate in
infrastructure for industrial development their mini-hub parks.
Reynolds, Indiana
A town with 550 people and 150,000 hogs turns an agricultural waste product into
an economic asset. By converting waste from hog farming into a local energy supply,
Reynolds is working to become the first energy self-sufficient community in America.
2000 2010 +/-

Population 550 533 -3%
Per capita income (state, Indiana) $27,459 $34,042 19%
Location Western Indiana, USA (map)
Distance to metro/micro-politan center 40 km to Lafayette, Indiana
Manufacturing
Transportation and warehousing, and utilities
Reynolds has branded itself BioTown, U.S.A., bold approach to develop local renewable energy
and it pursuing a strategy of becoming energy production, create a cleaner environment, find new
self-sufficient. The BioTown project represents a solutions to municipal and animal waste issues and
77
develop new markets, all at the same time. The The project is divided into three phases. Phase
objective of the BioTown project is the conversion of I, which concluded in September 2006, focused
Reynolds from a reliance on fossil fuels to biomass- on promotion, education and increasing the local
based fuels. Local and state organizers hope to use of ethanol and biodiesel in automobiles. The
establish a model that promotes energy security, rural state helped to facilitate a unique partnership
development, profitable agriculture and a green, between General Motors and BioTown in which
thriving natural resource environment. GM offered various discount packages for local
residents to purchase or lease flex-fuel vehicles.
Location and History Flex-fuel vehicles are designed to run on gasoline
Reynolds is a small, one-stoplight town with or any mix of gasoline with ethanol up to 85
550 people and 150,000 pigs. For decades, the percent ethanol, called E-85. As of early 2007,
economy in this small town has revolved around local residents and businesses have purchased
corn, soybean and hog farming. Reynolds lies more than 160 flex-fuel vehicles.
close to an interstate highway and has two active
rail lines. Purdue University, a major research The second major milestone for BioTown was
institution, is 23 miles away in West Lafayette. the completion of a USD 400,000 renovation
Over the last few years, retail stores, merchants project to add a pump for E-85 fuel at the local
and services have closed or moved away. BP gas station. This investment, which was
required to upgrade the tanks and pump island at
In response to Reynolds circumstances, officials the towns only filling station, was made by Good
from the governors office and the Indiana State Oil, a regional petroleum dealer that wanted to be
Department of Agriculture came to Reynolds on the front end of the environmentally friendly
with a proposal. The governor wanted to make movement in Reynolds. These alternative fuels
Reynolds the nations first community to use really needed to be showcased, so we decided to
renewable resources to meet the energy needs of put in two islands and remodel the building, said
all homes and businesses in town. the investor and owner of Good Oil.
Approach to Development Phase II of the project includes the research,

Reynolds is now BioTown, U.S.A. With the development and implementation of plans to
support of state officials, researchers and corporate transform agricultural and municipal waste into
partners, Reynolds has embarked on a strategy to energy. In late 2008, Rose Energy Discovery,
become a showcase community whose complete Inc., a private alternative energy company, broke
energy needs are met by renewable resources. ground on a USD 10 million facility. The state
State and federal resources are playing a role in offered USD 3 million in tax credits and other
BioTown, but not to the extent one might expect. incentives to Rose Energy Discovery to develop
In fact, one prominent goal for the development the technology for the project in Reynolds. The
of BioTown is that 80 percent to 90 percent of technology will be capable of converting animal
the investment comes from the private sector. The waste, municipal waste, corn stover and other
goal is to create a sustainable and replicable model types of biomass into electricity, thermal energy,
for small town energy self-sufficiency. biodiesel and crop inputs such as fertilizer.
Phase III calls for upgrading the technology to
The decision-making authority for the BioTown produce natural gas. The technology is still being
initiative rests with the BioTown Economic developed.
Development Authority, which consists of a local
economic development executive, the president Key Themes or Lessons
of the county council, the township trustee and Green innovation is an economic development
one representative each from Purdue Cooperative strategy.In Reynolds, taking the opportunity to be
Extension, the state agriculture department and on the front-end of an innovative green strategy
the state energy department. has jump-started economic development.
78
CASE STUDIES 4
Investments by Good Oil (to upgrade the local products has the potential to drive innovation
service station) and Rose Energy Discovery in rural agricultural regions.
(to develop bioenergy conversion technology)
will eventually lead to more direct economic Biomass fuel production can reduce the load
development benefits such as new jobs and on municipal wastewater infrastructure.
new businesses. These initial investments also Reynolds has discovered that its effort to
demonstrate the tremendous economic impact convert various biomass waste products into
that green innovation can have in small town energy products will greatly reduce its need for
America. higher load wastewater infrastructure. In fact,
three neighboring municipalities are planning
Biomass waste has a huge potential to create to send their municipal waste to the bioenergy
energy. Residents of Reynolds were shocked to plant as an alternative to upgrading their own
learn that their towns municipal waste had the municipal wastewater infrastructure. The
potential to produce 74 times the power to fuel potential for lowering sewer bills was a major
their little town. More widespread recognition selling point in terms of invigorating local
of the latent energy in traditional biomass waste interest in the BioTown project.
79
CASE STUDIES 4
Conclusions and
Lessons Learned
In small towns, community development is Successful community economic development

economic development strategies are guided by a broadly held local vision.
If community development--compared with Small towns profiled in this report demonstrate
economic development--is generally considered the importance of establishing and maintaining
to include a broader set of activities aimed at a broadly held vision, including goals for all
building the capacity of a community, then these manner of CED activities. A separate but related
case studies demonstrate that capacity-building point is that in small towns, residents are always
and other strategies typically associated with the most important resource and communities
community development are analogous with with limited resources cannot afford to exclude
actions designed to produce economic outcomes. anyone from planning or development efforts.
This is especially true, it seems, when these efforts Case after case has demonstrated that people (as
are included as parts of a comprehensive package of opposed to money or other resources) are the
CED strategies designed to address a communitys one absolutely necessary ingredient to successful
core challenges and opportunities. Further, CED. A committed group of local residents who
communities that take a comprehensive approach are willing to work hard for their communitys
to CED -- one that includes economic and interests can change the fate of an otherwise
broader, longer-term, community development hopeless community. Importantly, it seems,
goals -- stand to gain more than small towns special attention needs to be paid to integrating
that take a piecemeal approach. Finally, because newcomers into the community. Newcomers,
CED includes short-range and long-range including young leaders, bring a fresh perspective
strategies, it is by definition a long-term and and new energy to local challenges.
transformative process (a fact that is recognized
more in community development circles than in Defining assets and opportunities broadly can
economic development). Successful small towns yield innovative strategies that capitalize on a
tend to balance short-term economic gains with communitys competitive advantage.
longer-term community development goals. In almost any settingurban or rural, small
or largeshell buildings, low tax rates, limited
Small towns with the most dramatic outcomes regulation and access to trained workers,
tend to be proactive and future-oriented; they highways, railroads or professional services might
embrace change and assume risk. all be considered economic development assets
These general characteristics of small towns and justifiably so. Small towns, however, cannot
(specifically, of leadership in small towns) perhaps afford to stop there. Given limited sources of
relate to the fact that most communities featured competitive advantage, they must redefine
here hit the bottom, and their stories evolved economic development assets in a much broader
from circumstances in which local leaders were framework. Further, the mere fact that a particular
willing to try new things and take new risks. Being town is small can become an asset. In some cases,
proactive (as opposed to reactive) can be measured locating a business in a small town can provide
by a small towns willingness and ability to act on a a competitive advantage for the business. A final
particular challenge before it becomes a problem. emerging trend in this category is the increasing
Finally, most of the communities profiled in this use of small town assets as either fuel or triggers
collection demonstrate a willingness to embrace for innovation in the area of environment-friendly
change and assume risk. development or clean energy.
81
Innovative local governance, partnerships and the case for any intervention is to demonstrate
organizations significantly enhance the capacity success. Second, many communities profiled
for community economic development. here make an explicit effort to measure and
Most towns featured in this collection include monitor the impacts of local CED efforts. It
an innovative element of either organization seems obvious, but measuring progress and
or governance. It is clear that innovative local evaluating programs tend to get pushed to the
governance, in a variety of forms, can strengthen end of priority lists. Not so in successful small
a communitys CED strategy. The key is to towns. Finally, small towns profiled here tend
think creatively about organizational structure, to communicate and celebrate success, another
but always to keep the communitys overall net simple concept related to making the case for
benefit in mind. Regionalism, or identifying CED activities.
opportunities and partnerships beyond municipal
boundaries, is another emerging theme in Viable community economic development
successful CED. Cross-jurisdictional partnerships involves the use of a comprehensive package
can help small towns to pool resources toward of strategies and tools, rather than a
shared CED objectives. In addition to regional piecemeal approach.
partnerships and opportunities, successful small The capstone lesson is, perhaps, a reaffirmation
towns tend to have local leaders who connect with of a point that we have heard over and over again:
higher level policy makers and business leaders. there is no silver bullet. No single strategy saved
Finally, public-private (including not-for-profit) any community in this study. Successful CED
partnerships are emerging as the prominent in small towns is always multi-faceted. Small
organizational model for small town CED. Given towns that are working to develop CED strategies
the wide range of concerns that cut across CED, should take nothing off the table in selecting
small towns are taking creative approaches to strategies to pursue. Successful communities tend
public-private partnerships. to have evolved to the point where they have a
comprehensive package of CED strategies and
Effective communities identify, measure tools that are specifically aligned with the core
and celebrate short-term successes to sustain assets, challenges and opportunities within their
support for long-term community economic regional context.
development.
Given the long-term nature of CED, and the Furthermore, given the basic strengths,
fact that measurable results from a particular weaknesses, opportunities and threats affecting
project may be decades in the making, leaders each community and the virtually limitless
in small towns must repeatedly make the case menu of possible strategies, no single package of
for the importance of their efforts. Making strategies necessarily fits with a particular type
the case is important to maintain momentum, of community. That is, there is no universally
invigorate volunteers and donors, convince applicable formula for determining the right way
skeptics and, most importantly, to keep the to do CED. Decisions about what to do and why
focus of CED activities on the vision or the goals to do it have to be based on local conditions,
established in a communitys strategic plan. context and capacity. The lessons from these small
Many of the communities profiled in this study towns, however, provide insights and inspiration
recognize that making the case is an ongoing and for other community leaders as they begin the
continuous effort and that there are a number important process of building locally driven
of strategies for doing it. First, in small town strategies that create economic opportunities
CED, short-term success can build long-term and improve the social, civic and environmental
momentum. Obviously, the best way to make conditions that face their hometowns.
82
The Global Urban Economic Dialogue Series
This publication is a collection of case studies which demonstrate

successful approaches to small town development. The cases
were screened for evidence that either the development strategy
was successful, in economic, social, civic and/or environmental
terms or that the strategy represented community economic
development innovation (first or early use of a particular
practice) or was distinct (unique among the alternatives for
addressing a particular problem) within the local context.
Case studies in this report are categorized by the primary
development approach implemented by the small town. Towns
were characterized as carrying out:
Entrepreneurship and small enterprise incubation-based
development
Place-based development
Human capital-based development
Industry or manufacturing-based development
HS/025/12E
ISBN Number (Series): 978-92-1-132027-5
ISBN Number (Volume): 978-92-1-132440-2
UNITED NATIONS HUMAN SETTLEMENTS PROGRAMME

P.O.Box 30030,Nairobi 00100,Kenya;
Tel: +254-20-7623120;
Fax: +254-20-76234266/7 (Central office)
infohabitat@unhabitat.org
www.unhabitat.org/publications

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Small Town Development Approaches

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Small Town Development

United Nations Human Settlements Programme

Small Town Development Approaches

First published in Nairobi in 2012 by UN-HABITAT.

All rights reserved

Director: Naison Mutizwa-Mangiza

Chief Editor and Manager: Xing Quan Zhang

Principal Author: William H. Lambe

Contributors: Jaana Mioch, Ying He, Ji Yuan Shi

English Editor: Roman Rollnick

Design and Layout: Freddie Maitaria

Assistants: Agnes Ogana, Joy Munene

Urbanization is one the provision of adequate housing, infrastructure,

The persistent problems of poverty and slums

Case Studies I: Entrepreneurship and small enterprise

Case Studies iI: Place-based development 21

Case Studies iII: Human capital-based development 53

Case Studies IV: Industry, high-tech, or manufacturing-based

Conclusions and Lessons Learned 85

2000 2010 +/-

Dillsboro, North Carolina

Dillsboro turned an environmental pollutant into an economic asset by converting landfill

2000 2010 +/-

Location and History Approach to Development

2000 2010 +/-

designed to attract early-stage entrepreneurs Build an economy from a communitys existing

2000 2010 +/-

2000 2010 +/-

Ord is also extremely active in marketing, Communication is crucial. Ord provides

Siler City, North Carolina

2000 2010 +/-

North Carolina Arts Incubator, to raise money Key Themes or Lessons

This chapter includes case studies of small towns that are

Bakersville and Hayesville, North Carolina

2000 2010 +/-

Approach to Development In Hayesville, CCCRA (in partnership with the

Big Stone Gap, Virginia

This towns choice to embrace ecotourism and to support local entrepreneurs is

2000 2010 +/-

Black Mountain, North Carolina

2000 2010 +/-

2000 2010 +/-

2000 2010 +/-

Approach to Development The arts council has become Colquitts primary

Columbia, North Carolina

The ecotourism strategy in Columbia is characterized by an innovative approach to

2000 2010 +/-

Edenton, North Carolina

Elected officials in Edenton partner with a non-governmental organization focused on historic

2000 2010 +/-

Elkin, North Carolina

2000 2010 +/-

Hillsborough, North Carolina

2000 2010 +/-

for providing adequate infrastructure for Consider multi-jurisdictional planning for

2000 2010 +/-

Pelican Rapids, Minnesota

2000 2010 +/-

Located in west-central Minnesota, Pelican activity has expanded to the processing of

stores downtown. These immigrant-owned It is important to build a web of service

Star, North Carolina

2000 2010 +/-

located in a former mill building, which to recruit big manufacturing operations,

Key Themes or Lessons Surviving the economic transition requires a