Downtown Revitalization is
Economic Development

Tom Yantis, AICP

Vice President – Community Planning

BWR Corporation

The direct impact of downtown revitalization on local and state economies is well documented. Investment in revitalization creates jobs, increases property values and attracts tourists. All of which are economic benefits to the cities making those investments. So we know that downtown revitalization has a direct positive benefit on our local economies, but what about the bigger role of a vibrant downtown as the cornerstone of a local economic development program? Could it be that a revitalized downtown is the most important economic development tool for a community? I believe it just may be and here’s why.

What makes a community stand out among the crowd of cities seeking to lure new businesses and jobs? What are the attributes of success that keep certain cities always at the top of the lists of where people want to live and work? One word comes to mind: character. Think about all the places you’ve ever been and then think about the places that stick out most in your mind as memorable. What was it about those places that make you want to go back? I bet it wasn’t the new retail strip or the shiny new industrial park. It was likely a special experience you had or something unique that you saw while you were there.

And you aren’t alone. As Richard Florida describes in The Rise of the Creative Class, one of the key indicators of a community’s economic success in today’s economy is the ability to attract and retain what Florida calls the creative class, “a fast-growing, highly educated, and well-paid segment of the workforce on whose efforts corporate profits and economic growth increasingly depend.” Florida argues that the creative class values places that are authentic and unique and states that “authenticity comes from several aspects of a community – historic buildings, established neighborhoods, a unique music scene, or specific cultural attributes.” All of which a revitalized downtown can offer.

Corporate CEOs, whose success depend upon the talents of the creative class (i.e. high-tech, bio-sciences, law, engineering, etc.), understand that they are more likely to increase their pool of talented recruits if their company is located in a place that offers an authentic and unique sense of place. So, more and more, they are instructing their site selectors to seek out locations for business expansion or relocation that meet those criteria. That is why investing in downtown revitalization is an important strategy in every community’s economic development program.

These concepts are not new to most economic developers. When you ask them what businesses are looking for when they inquire about a community, they will tell you that they want a talented labor pool, good schools, cultural and recreational amenities — an authentic and unique place. Yet, many of our community economic development programs have not aligned their resources with these priorities. Many economic development programs continue to operate in an outdated system where their time and resources are focused on developing industrial parks and offering cash payments to try to lure companies. The reality is that those things are only of secondary importance. A community may not even get the chance to show off the new industrial park or offer a cash incentive if it does not first make the cut by scoring high in quality of life amenities essential to which is a healthy, vibrant downtown.

In order to truly maximize the benefits of downtown revitalization a community must understand its revitalization program in the context of its overall economic development program. In short, downtown revitalization is economic development. For many communities this is a paradigm shift. I have worked with a number of communities assessing their downtown revitalization programs and more often than not, the downtown revitalization function is completely separate from the community’s economic development program. The separation is typically at multiple levels: staffing, funding, physical location, and, more importantly, level of organizational priority.

This phenomenon is certainly understandable. Most economic development professionals are not downtown revitalization experts and vice versa. Most economic development financing tools are geared toward conventional industrial development; and most elected officials do not have the expertise to create policies that prioritize downtown revitalization as a part of their economic development program.

So how can you work to make downtown revitalization a core component of your community’s economic development program? Here are a few questions to assess where your program stands today:

Does your community’s comprehensive plan or master plan identify downtown revitalization as an economic development strategy?
Is downtown revitalization a stated (documented) goal of your community’s economic development organization?
Is your downtown revitalization program under the same umbrella as your economic development program?
Does your community allocate a significant percentage of its economic development revenues to downtown revitalization (i.e. Type A & B sales tax)?
Does your community offer the same or better incentives for downtown revitalization projects as it does for conventional industrial/commercial projects (i.e. tax abatements, tax increment financing, sales tax sharing, development fee waivers, etc.)?
Is your downtown revitalization program highlighted on the economic development web site?
If you answered yes to most of these questions then your community is well on its way to making downtown revitalization a core component of its economic development strategy. If you answered no to most of these questions, it’s time for your community to have a conversation about the important role a revitalized downtown can play in developing the local economy.

As a downtown revitalization professional, your plate is likely full with the day-to-day challenges of managing your program. However, it is important for you to raise awareness within your community to the advantages of integrating downtown revitalization with economic development. In order to successfully do that, you have to be able to speak the language of economic development and understand economic development tools, how they are used and how they can be used for downtown revitalization. Your professional network is a great place to start. There are many communities that have made great progress in synchronizing their downtown revitalization and economic development programs. There are also many good examples of how communities are utilizing economic development financing and incentive mechanisms within their downtown revitalization programs. You may even want to invite one of your peers who has been successful in this area to come speak with your community leaders (better yet, take your community leaders on a field trip to see first-hand).

Most citizens and community leaders want a vibrant downtown and a thriving local economy. Helping them understand the link between the two is one of the most important roles of a downtown manager.

tyantis@bwrcorp.com