B2BMonday, October 1, 2007 9:28 PM CDT

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ECONOMIC DEVELOPMENT: The federal role in economic development

By Marty Vanags

The United States is currently experiencing one of the great economic challenges in American history – the rising global competition facing our communities.

The advancement of information technology, world trade and preferential government policies in competing nations has created a more competitive environment, forcing Americans to be more creative and to develop policies and ideas that better address the forces of the changing global landscape.

In order to continue to prosper and move forward here in McLean County we must empower ourselves with tools that help make us more competitive and create new opportunities for our existing business and entrepreneurs to more successful. There are many ingredients that go into this soup and federal policies and programs are just one of them.

In March of this year I attended and participated in the International Economic Development Council’s Federal Economic Development Forum in Arlington, Virginia. This forum brought together federal officials and economic developers to examine innovation and American competitiveness and the role economic developers should play in this very important issue.

American competitiveness should rely heavily on the efforts of economic developers, but as a profession we have spent too much time “smoke-stack chasing.” The new agenda we created during the forum defines economic developer’s viewpoint on how to enhance the federal policies that support America’s global competitiveness.

We developed policy recommendations for both economic developers and federal policy makers that aim to ensure America remains globally competitive. Here are some of the ideas we came up with.

Driving innovation and expanding entrepreneurship

Federal research and development (R&D) funding strengthens most innovation and is essential to maintaining America’s competitiveness.

Federal funding supports critical research in universities and federal laboratories and through special programs aimed at small businesses, manufacturers, and critical industries. In recent years, federal R&D has stagnated, yet it is vital to the competitiveness of McLean County and the nation that federal support for R&D remains strong.

In addition to enhancing federal funds, America’s colleges and universities are key assets that must be tapped in order to advance our nation’s innovation strategy. Illinois State and Illinois Wesleyan are essential institutions in educating our future workforce, conducting research, and producing innovations.

Community colleges like Heartland Community College also play a vital role in educating our future workforce and re-training our current workforce. Comprehensive education and workforce strategies involving closer linkages between universities and community colleges must be encouraged.

The role universities play in research and technology transfer is essential in driving innovation and expanding entrepreneurship. University leaders can further promote innovation by creating entrepreneurial initiatives and working with community leaders to develop an entrepreneurial environment. In Bloomington-Normal this collaboration includes our partnership with ISU to develop a business incubator and their current commitment to the Small Business Development Center.

Linking economic development, workforce training and education

Driving innovation and maintaining America’s competitive position involves strengthening and coordinating R&D, entrepreneurial development, education and workforce development.

Attention to K-12 education and increasing exposure of technology, math and science to students in early education is essential in this effort, along with encouraging more students to enter science and education related fields.

Undergraduate education is an equally vital component. Innovation and entrepreneurship will not flourish without bold investments in education, science and technology. In order to effectively promote innovation and entrepreneurship, communities cannot act alone and instead must act together through regional efforts with their economic developers, going beyond city and county boundaries. By working regionally and recognizing economic competitiveness on a global scale, economic developers and their surrounding communities will recognize the results of better communication, coordination and cohesiveness of their innovation related efforts.

In the future, I will describe the policies and programs that are important to the McLean County economy and how the federal government can play a role. These programs and policies include the role of federal research labs, smart grants, the Manufacturing Extension Program (MEP), the National Institutes of Health (NIH) and the National Science Foundation (NSF) grant programs, the R&D tax credit, Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs, Education in Science, Technology, Engineering, and Mathematics (STEM) and The Workforce Investment Act (WIA) reauthorization.

McLean County will continue to grow with jobs and capital investment as we work together with federal, state and local governments and our partnership with the public sector.

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