Bringing Economic Growth to Rural Tennessee
The Tennessee Toolkit provides a fresh approach to enhancing rural communities.
By Jennifer LeClaire
In the past four years, Tennessee has created more than 108,000 new jobs, attracted $13.4 billion in new capital investment, and landed 30 new corporate headquarters. That's reason enough for any state to brag, but Tennessee isn't quite content.
That's because only a handful of counties have benefited from the economic prosperity. Tennessee's government officials and economic developers are working to share the economic wealth and shine a light on the regions that need economic development assistance the most: rural areas.
Gov. Phil Bredesen has outlined a multi-faceted approach to address Tennessee’s rural communities and to combat the challenges of generating economic growth in these areas. The plan includes the Rural Opportunity Initiative, or ROI, the Rural Opportunity Fund and “Orange Carpet” Tours. These new economic development initiatives are detailed in the recently published 15-page Tennessee Tool Kit.
"Each company is unique, with a distinctive competitive environment and business needs which may not apply to everyone. That’s why we’ve established a multitiered approach to jobs tax credits and we’re giving our commissioner of economic and community development broad latitude to partner with communities in creating jobs," Bredesen says. "Our goal is to ensure all Tennesseans share in the amazing economic success our state has enjoyed."
The first leg of the multifaceted rural economic development stool is the ROI program. The program focuses on removing barriers to job creation in rural Tennessee. As part of the program, companies can tap into an enhanced job tax credit if they locate or expand in rural regions.
"The credit amount and the time period during which it can be used vary based on the county’s level of economic need, the company’s capital investment and the number of jobs created. In this win-win scenario business owners’ future tax liability is offset, while Tennessee does not have to use current taxpayer dollars to incentivize job creation," says Matthew Kisber, commissioner of the Tennessee Department of Economic and Community Development (EDC).
The second leg of the strategy is a partnership known as the Rural Opportunity Fund. This program has created a $12 million venture capital pool of private and public dollars aimed specifically at small and independent businesses in rural areas. The fund, representing new economic development dollars, assists businesses that already have gotten off the ground, but need help in growing and expanding.
"The Rural Opportunity Fund is a private fund that serves as a new source of low interest capital for rural communities. This pool of money will help companies in rural regions of the state to invest in and grow their businesses," explains Andrea Arnold, a spokeswoman for the EDC.
Hosted by the EDC, Orange Carpet Tours are the third leg of the stool. The tour is a play off the orange worn by the University of Tennessee, and the creativity doesn't stop there. On the tours, site selectors go through the A-to-Z process of allowing communities to give their best pitch to attract business. The site selectors physically visit the sites and sit down with the local economic developers to discuss the good, the bad and the ugly, Arnold explains.
"This is a no holds barred meeting; it's not a feel-good piece," Arnold assures. "The site selectors will tell us exactly what our strengths and weaknesses are, areas we may be undermarketing, and areas that really need some help."
The feedback will leave Tennessee communities with objective assessments that serve as a launching point for making improvements for the short- and long-term. Kisber calls the exercise an "invaluable tool that will assist communities by ensuring they have a realistic plan in place for growth."
Beyond the three-pronged approach, Tennessee economic development officials are holding a series of roundtable discussions throughout the state to discuss the next steps to this private industry approach to state government. Bredesen will meet with each county's key leaders to let them know what is being done and what more could be done. "There is definitely a spotlight on rural economic development in Tennessee," Arnold concludes, "and we have high expectations for return on investment here."