Community Vitality Update

January 2004 Issue No. 3

The purpose of this newsletter is to provide community leaders, economic developers, entrepreneurs, and other Iowans interested in community vitality with features on innovative strategies, updates on CVC projects, and info about opportunities for learning and networking.

Community Foundation and Philanthropy Academy, March 29th

The Community Vitality Center is spearheading a statewide workshop called a Community Foundation and Philanthropy Academy on March 29th at the Gateway Hotel in Ames. The purpose of the Academy is to provide an opportunity for local leaders to learn about and discuss (1) the nature of the wealth transfer occurring in Iowa counties, (2) the new Endow Iowa tax credit incentives and matching grant program being implemented this spring, (3) the best practices for starting and enhancing community foundation performance, and (4) and alternative tools and approaches for working with potential foundation donors. The Academy is designed for community leaders, estate planners, trust managers, and interested citizens from communities that want to form community foundations as well as board members, officers, and other community leaders from existing community foundations that want to improve their performance.

The advance registration fee is $25 per person. Registration at the door is $35. Lunch is included. The registration form can be downloaded here. To register, send the registration form and check made out to ISU-Dept. of Economics-CVC to Becky Johnson, CVC, 478 Heady Hall, ISU Ames IA 50011. If questions regarding registration please contact Becky Johnson or by phone: 515-294-3000. If questions regarding program content, please email: cvc@iastate.edu.

Grassroots Rural Entrepreneruship

“Grassroots Rural Entrepreneurship” is a short national report of the National Center for Small Communities and the Kauffman Foundation featuring the “lessons learned” and “best practices” for supporting entrepreneurs in rural communities. The report features profiles of three rural communities that have been successful in supporting entrepreneurs as engines for economic growth. All three efforts emerged differently. Fairfield, Iowa won the National Center’s 2003 Entrepreneurial Community Award. A community network known as the Fairfield Entrepreneurs Association has evolved since 1989 and works closely with community leaders to accomplish a variety of activities in support of entrepreneurship. The FEA is currently implementing a mentoring program with support from a CVC community seed grant. Entrepreneurship in Broadway, Virginia emerged from a downtown revitalization initiative. Entrepreneurship in Turner County, South Dakota emerged from a Sirolli enterprise facilitation project.

The lessons learned outlined in the report suggest that the entrepreneurial initiatives in all three communities were started because (1) there was a champion who served as a spark plug to get things going, (2) there was collaboration, new partnerships, and seeking out of new alliances, (3) there was a holistic approach to improving the local community and support for entrepreneurs rather than a single strategy, (4) there was no sector focus or targeted industries in recognition that entrepreneurs can be any age, have any income level, or come from any sector of the economy, and (5) the communities remained engaged for the long haul recognizing that support for entrepreneurs must be available when the entrepreneurs need it and successful businesses are not built over night.

Best practice ideas include: (1) recognition such as Entrepreneur Awards, site visits to new firms, and business plan competitions, (2) entrepreneurial education for youth and adults, (3) building entrepreneurial networks for advice, informal education, and mentoring, (4) developing seed capital resources, (5) support in attracting and retaining a workforce for the new firms, (6) developing a support infrastructure that can tap into industry expertise, small business development centers, universities, incubator facilities with secretarial and business services available, and/or enterprise facilitation, (7) reinventing government to make it more entrepreneur friendly.

A link to the 9-page report may be found here.

Improving Economic Vitality in Rural Iowa: A Data-Based Approach
The Committee of 82, which is a new “think tank” being organized with financial support from former gubernatorial candidate Doug Gross, recently distributed a study called “Improving Economic Vitality in Rural Iowa: A Data Based Approach.” The Committee of 82, which aspires to represent the state’s 82 rural counties, commissioned a group of ISU and CARD economists to conduct an analysis of indicators that may help to explain the factors related to counties that grow. While the results, provide an update of descriptive information for Iowa and surrounding states, it appears to generate findings that are similar to earlier works by the USDA Economic Research Service. You can compare the findings of the 82 Committee study along with the USDA study and other related articles here.

• The analysis shows that by far the most significant variable explaining the 1990-2001 income growth for counties in Iowa and surrounding states was the percent of county income coming from farming in 1990. The coefficient was negative meaning that counties with higher proportions of income from farming had slower income growth.
• The initial population level was the second most significant variable. This indicates that less populated counties had slower income growth than larger counties.
• A proxy for South Dakota was the 3rd most significant variable indicating similar counties in South Dakota did better than Iowa. The results also show that the proxies for Minnesota, Wisconsin, and Illinois were also significant. However, the coefficient for Illinois indicates that its counties had slower growth than Iowa counties.
• The good news is that the proxy for entrepreneurship (non-farm proprietors per capita 1990) was the variable with the next highest level of significance. The coefficient indicates that counties with more entrepreneurship had higher rates of income growth.
• The fifth variable of significance was percent of 1990 population over age 65. The coefficient suggests that counties with more seniors have slower income growth.

Other variables in order of significance were counties in metro areas, county tax revenues from own sources, percent of county residents commuting over 30 minutes, percent change in livestock receipts 1990-2001, and a recreational amenity index. While descriptively interesting, results do not necessarily imply cause and effect.

The Community Vitality Center was not involved in conducting this study. However the CVC has been conducting a series of in-depth community studies of four communities that exceeded the state average population growth rates during the 1990s and four that did not. The in-depth studies should help to understand the context of policies and circumstances behind the county data.

National Business Incubation Association Conference, April 25-28 in Atlanta.

Many community leaders in Iowa have expressed interest in developing business incubators. Experts suggest that incubators are more likely to be successful in communities with colleges and entrepreneurial support networks. One source of information on how to start and sustain a successful incubator is the National Business Incubation Association annual conference. "The Power of Supporting Entrepreneurs," is the title of NBIA's 18th International Conference on Business Incubation, scheduled for April 25-28, in Atlanta. It is a great conference for learning and networking with more than 70 sessions and workshops, a tour of host ATDC's incubation facilities, and in the past some sessions have focused on rural community incubators. Topics this year will include funding emerging growth companies, incubating youth-run businesses, encouraging faculty entrepreneurship, starting successful biotech companies and much more.

You can register now here to take advantage of early-bird rates that are in effect until March 5. More than 500 people from more than 30 countries attended NBIA's 2003 conference in Richmond, Va., and an even greater number is anticipated for 2004.For more information about the 18th International Conference on Business Incubation, visit www.nbia.org.