This was not how you envisioned the board meeting going. By this time, you expected to be getting kudos from the board and feeling on top of the world after presenting this really big economic development opportunity. You expected to feign humility while you packed up your things and told the last few attendees, “it’s a result of all of our hard work”. Instead, things took a turn somewhere along the way. The board meeting devolved into cross talk between board members on about a hundred different topics, none of which were your big project or your hard work. Where did this all go so wrong?
You presented the project just as you planned – millions in capital investment, hundreds of jobs in high-paying occupations, and a well-respected local firm behind it all. But then one of the board members, a local contractor, asked how many new homes he’d get to build. “With all these new jobs, we’re going to have a lot of people looking for housing.” As you reiterated the new job count and average pay, the school district superintendent and ED board member jumped in. Worried about educating all of these new students, he declared “Our elementary school is busting at the seams; this whole deal is going to cost more that we’ll get back in taxes – by the way how much does the school district get in taxes from this?” A city official offered something about zoning or parks or whatever he’s always talking about. The accountant on the board wanted to discuss the discount rate you were using and understand how you arrived at 5%. Suddenly, you felt like a school teacher at that understaffed, too small, elementary school trying to restore order to the class.
I hope that our readers can find some humor in this, but unfortunately, it’s not an uncommon story that we hear from our clients. As an economic developer, you need to invest in your relationships with board members more than just the third Wednesday of every month. One of the unspoken best practices of economic developers that we observe is the willingness to address issues head on, in advance. Economic developers know their board members. They know who is going to ask what type of question. They know what page of the board packet each member turns to first before you even start presenting the project.
In addition to the advice we offered to economic developers in Prepare Yourself, Prepare the Board, we think there is a lot to gain from having a clear and consistent approach. While clarity and consistency can be applied in several ways to board relations, in our world, this most often relates to information that gets presented with each project or deal – the impact analysis. To put it simply, an impact analysis shows what the community can expect from the new project. A detailed impact analysis will summarize the jobs to be created, both directly by the new business as well as indirectly throughout other businesses in the community. The impact analysis will also estimate how the capital investment will affect things like property tax revenues or even permits and fees. The impact analysis can even give you a framework to answer the question of how many new homes may need to be built and how many new school students you can expect. These aren’t black box calculations. Based on our 20+ years of experience and with your input and even the input from your board, we can develop a set of a parameters that can be applied with clarity and consistency to all projects. So not only will you have answers for the general contractor, the school superintendent, or even the tire shop owner, everyone will understand how those answers were derived because they were a part of the process. Based on our experience, economic developers that are willing to go down this rabbit hole with their board one time – to develop and agree upon a consistent framework that will be used to score every project, will benefit by avoiding board member rabbit holes at every meeting.
Banner Photo Credit: FreeImages.com/Andrzej Pobiedzinski