Economic forum: long on views, short on solutions

by Amy Gillentine

Published: May 1,2009

Time posted: 10:09 am

Tags: Economic Development, Limited Government Forum, local economy

Panelists shared many viewpoints but few agreements during a forum Thursday about how to create a vibrant local economy.

The forum was part of the third annual Limited Government Week forum.

Some panelists gave impassioned arguments for increased incentives, while others said government incentives are not cost-effective and seldom work.

One panelist said the key to attracting business was to do away with Colorado Springs’ onerous fees and regulations.

“I am here to talk about reality,” said David White, vice president of marketing for the Colorado Springs Economic Development Corp. “I don’t want to discuss ideology; I’m not here to promote a book or studies. I care about finding jobs for people.”

White said he deals with the reality of competition with other cities and states every day.

“We make the short list, often,” he said. “The top three to five, but then they want to know about incentives, and that’s where we fall short. We don’t have any to offer them.”

Daphne Greenwood, a professor of economics at the University of Colorado at Colorado Springs, said that economic development can only come from an integrated, sustainable economy.

But not just any jobs and not any company will do.

“You can bring jobs and still increase the unemployment rate, or bring jobs and have the average income go down,” Greenwood said. “You read about Colorado’s boom and bust, so you have to base the economy on sustainability.”

She said that the role of government should be limited in economic development – the exact opposite of what White said later.

“Government’s roles should be in parks, schools, roads,” Greenwood said. “But research shows that incentives are not cost-effective in almost every circumstance. I am not that dismayed that IA went down. So what do we do now? Hopefully we can think comprehensively.”

Fred Crowley, associate research professor in the College of Business at UCCS, said that according to studies he has performed, Colorado Springs needs to diversify.

“We explored the economic base, employers, resources and prescribed the effort to attract businesses to El Paso County,” he said. “There was no effort to do that. No one has taken it to heart – maybe because it was free.”

Clear objectives are the way to grow jobs through bringing a wide number of industries, he said.

“It’s a doable objective,” Crowley said. “I just finished a study that shows how to attract business to the state. It will be published soon; maybe then people will take it seriously.”

Tom Arnold, a member of the city’s Sustainable Funding Committee – the birthplace for the failed 1A jobs ballot issue, said perhaps the city should not grow any more because residents were unwilling to pay the price.

“It’s a matter of what you value,” he said. “The direct cost of something is not just in money – it’s what you are willing to give up for what you get.”

Arnold said that the local work force has grown from 195,000 people to 310,000 people during the past two decades, but unemployment has outstripped the growth.

“The bottom line is that growing jobs is not necessarily growing the economy,” he said. “Maybe we should look at what it is costing us for the growth.”

Ron Murphy, who like White, works to attract businesses to Colorado, said it’s difficult to sell Colorado Springs because of the number of regulations and fees imposed on new businesses.

“The taxpayers have voted down new taxes, so we have fees,” he said. “And those fees can really weigh on a small company. The storm water fee, for instance, is a difficult one to pass. When we sit down, with all the information on exactly what it will cost to move here, Colorado Springs loses because of the fees and regulations.”