"High-end" Economic Development
The city's economic development efforts have had limited success. The presence of a major science research university should have spawned a host of high-tech companies in the community. This has not occurred. The current economic development efforts should be redirected. Most of the top ten employers in College Station are governmental organizations. The private business sector is minimally represented on this list.
It is imperative that economic development is differentiated from corporate welfare. College Station has relatively full employment. If companies offering $15 an hour ($30,000 per year) jobs are given incentives to locate in College Station, it is likely that low income housing will be developed to accompany them which would likely result in existing taxpayers subsidizing growth. Too much of what is currently done under the heading of economic development, in fact encourages uneconomic development.
Progress Report (June 2007 – Present)
1) Initiated council workshop on re-evaluating city economic development policies. Voted against the present guidelines, which in my view are anachronistic. They reflect an approach to economic development which is 20 years out-of-date, and do not relate well to the contemporary context of College Station . They encourage corporate welfare. Council agreed to revisit this issue when a consultant's report is presented in Summer 2008 as part of the Comprehensive Plan. They also agreed to move away from cash incentives for new businesses and towards viewing incentives in terms of staff consulting and expediting permit processes.
2) Initiated additional “high-end” target to focus more effort on recruitment of affluent retirees who are “positive” taxpayers (i.e. they generate more on taxes than they cost to service).
Proposed Future Agenda (2008 – 2011)
1) A more selective economic development policy that focuses on:
- Attracting companies involved in such activities as high tech, research and development, company headquarters, start-up incubations, and high-end services. TAMU is a powerful anchor attraction for such companies. Their major asset is professionals and “knowledge workers.” Such workers favor attractive communities. Thus, effective economic development requires investment in such areas as parks, greenways, hike and bike trails, landscaping, tree planting, horticulture and beautification. If College Station is inferior to competitive cities in this respect, then the city, and any companies which locate here, will have to pay “disamenity compensation”, that is, a salary/benefit premium to offset the lower quality of life.
- High quality, market appropriate, retail development. Since sales taxes are critical to the city's financial viability, recruitment of new retail opportunities should be on-going.
- Attracting GRAMPIES --- The Growing number of Retired Active Monied People in Excellent Shape. Their retirement incomes equate to new business payrolls moving into the community. The city should refocus its economic development investments to target this market.
- The following major projects:
- Hotel/convention center
- Enhancement of the city's position as a regional medical center
- Enhancement and development of Northgate
- Campus Pointe (joint development with TAMU)
2) Substantially reduce monetary incentives provided for economic development, because often the resultant economic development is transitory. When the incentives expire, companies too frequently move on elsewhere and there is no net economic gain to the city. The widespread use of tax abatements is especially problematic since they provide new businesses with a competitive advantage over existing businesses in the community which is unfair
3) Nurture locally owned businesses, since much more of their revenue recycles and remains in the community than the revenue of businesses whose headquarters are elsewhere.