"CITY OF SACRAMENTO ECONOMIC DEVELOPMENT STRATEGY"
CITY OF SACRAMENTO ECONOMIC DEVELOPMENT STRATEGY Local Agencies/Associations Focus Group Tuesday, August 9, 2005 10:00 a.m. to 12:00 p.m. Sacramento Convention Center, Room 305 Meeting Summary – DRAFT On the morning of August 9, 2005, the City of Sacramento’s Economic Development Department hosted an Economic Development Strategy Focus Group at the Sacramento Convention Center. The participants included representatives from business improvement districts; local business associations and chambers of commerce; the Sacramento Housing & Redevelopment Agency; and the City’s Economic Development, Finance, and Planning departments. A total of 36 attendees and project team members participated, including: Connie Miottel, Capitol Station District Danielle de l’Etoile, Deputy Director, Downtown Sacramento Partnership Brian Holloway, President, East Sacramento Chamber of Commerce Joe Chasko, President, Folsom Boulevard Business and Property Association Heinz Ludke, Executive Director, Natomas Chamber of Commerce Rebecca Garrison, Executive Director, Point West TMA Becky Heieck, Executive Director, Power Inn Business & Transportation Association Lisa Schmidt, East Sacramento Chamber of Commerce Marta Basset, East Sacramento Chamber of Commerce Ted Walker, Greater Broadway Partnership Charline Speck, Director of Business Development, SACTO Lisa Bates, Director, Community Development, SHRA Leslie Fritzsche, SHRA Jim Hare, Program manager, Community Development, SHRA Chris Pahule, Planner/Project Manager, SHRA Redevelopment Cynthia Shallit, Program Manager, Community Development, SHRA Tom Friery, Treasurer, City of Sacramento Lydia Abreu, Office of the Treasurer, City of Sacramento Gus Vina, Director, Finance Department, City of Sacramento Steve Peterson, Principal Planner, Long Range Planning, City of Sacramento Wendy Saunders, Economic Development, City of Sacramento Denise Malvetti, Economic Development, City of Sacramento Traci Michel, Economic Development, City of Sacramento Michelle Nelson, Economic Development, City of Sacramento Ali Pezeshkpour, Economic Development, City of Sacramento Katherine Robbins, Economic Development, City of Sacramento Micah Runner, Economic Development, City of Sacramento Laura Sainz, Economic Development, City of Sacramento Melissa Valle, Economic Development, City of Sacramento Tom Zeidner, Economic Development, City of Sacramento H The Hoyt Company Page 1 Economic Development Strategy - Local Agencies/Associations Focus Group August 12, 2005 The consulting team included: Jim Gollub, ICF Consulting Egon Terplan, ICF Consulting David Zehnder, Economic and Planning Systems Isabel Domeyko, Economic and Planning Systems Tim Youmans, Economic and Planning Systems Peter Castles, The Hoyt Company Wendy Saunders, Director of Economic Development, welcomed the participants, facilitated introductions, explained the goals of the project, and outlined the Strategy update process. Tim Youmans of Economic and Planning Systems then gave some background about the existing Strategy and explained in further detail the goals of the Strategy update process. He emphasized that the strategy update is primarily to provide the City’s economic development department with a clear work plan for the next few years. Jim Gollub of ICF Consulting then gave a presentation where he described ICF’s approach to economic development and identified several principles which are essential to apply in developing a competitive economy. After the presentation, Mr. Gollub then led an extensive interactive exercise to help participants identify and prioritize their principal economic development challenges. Each participant was provided with a set of three index cards, on which they were to record their challenges in order of priority. Then each participant was given an opportunity to present and discuss their primary challenges with the group. Mr. Gollub directed the discussion while his colleague Egon Terplan and EPS’ Isabel Domeyko clarified the comments and recorded the challenges onto a series of flip charts organized by topic/issue area. To culminate the exercise, participants were given five dot stickers each to place next to those challenges they considered most important or critical to economic development. After reviewing the “votes” the ICF team described the top challenges which emerged from the prioritization process. They are: Need Stronger Leadership and Political Will for Implementation of Plans and Strategies How to Establish a Common Understanding of and Clear Priorities in Economic Development How to Better Engage the Private Sector Need to Identify Self-financing Economic Development Projects Need to Improve Perception of City and Region While the focus group did not discuss actions to resolve these priority challenges, it became clear that Sacramento has a history of successful planning or strategy development, but falters when it comes to effective implementation. These priority challenges with implementation revealed the participants’ primary concern with issues of leadership, organization, and participation. Fortunately, these are areas mostly controlled by factors within the city or region. The full set of identified challenges are below. These are organized into economic foundation categories: H The Hoyt Company Page 2 Economic Development Strategy - Local Agencies/Associations Focus Group August 12, 2005 MARKETING AND STRATEGY Need Stronger Leadership and Political Will for Implementation of Plans and Strategies: How to ensure political will and leadership to follow-through on plans and commitments. How to move from effective conceptual planning to successful implementation. Too often, short-term or limited perspectives overwhelm the long-term (and often previously agreed-to) vision. Need to be able to establish and implement a long-term plan. Plans are changing constantly, sometimes due to market changes – sometimes due to political whims. There is often a lack of commitment and willingness to take risk and spend resources on identified projects. The lack of leadership limits the support for difficult decisions and elected officials too often look for compromises that degrade the outcome. Need for more “offensive” economic development (instead of “defensive” economic development). This also requires finding a common economic development vision and story that community residents understand and support (see next challenge). Further, it is often difficult to identify all the stakeholders (City, private, County, State) involved in economic development projects which affects the lines of communication necessary to make projects successful. Participants noted the Blueprint, General Plan, and City Strategic Plan as examples of “plans” which have not been effectively implemented. How to Establish a Common Understanding of and Clear Priorities in Economic Development: How to establish a clear focus for economic development activities. There is a difficulty in prioritizing and deciding where to focus among the many options. Participants asked “Whom do we help?”. There also needs to be more targeted and strategic investment in order to maximize limited dollars. Decision makers can become more strategic by understanding what is achievable. People too often are looking for a “golden bullet” to solve economic woes. This challenge was different from the first challenge because it was about identifying focus for economic development, not about the leadership required to implement the focus. How to Better Engage the Private Sector: Need to understand private-sector needs and engage them more in economic development. Often, representatives from business are not at the table. This includes both large and small companies. There was some discussion about ensuring that businesses are able to work with the public sector and are not skeptical or fearful of government. Participants noted that business leaders in Sacramento may not be as active as in other regions due to the lack of corporate headquarters. How to Develop Stronger Regional Collaboration and Reduce City/Suburb Conflicts: Need for greater regional collaboration and a reduction of “turfism”. There is limited regional leadership and too much competition for limited funds and opportunities. Often there is a district mentality at governing levels (where people fail to see the big picture). Too many fights are subsumed by the growth vs. no growth struggle. Additionally, political entities outside of the City have their own agendas which often hurt the City. Surrounding cities do not always see the value of financing a major project if it is located in the City of Sacramento (even if their residents would benefit). Need to figure out how to ensure that the City of Sacramento does not continue to lose economic opportunities to outer jurisdictions. This will require learning how to market older neighborhoods relative to outlying green fields as well as working more collaboratively across the region. Influencers of the above challenges include • SHRA, Other City departments • City Council (Sacramento and surrounding cities) H The Hoyt Company Page 3 Economic Development Strategy - Local Agencies/Associations Focus Group August 12, 2005 • Private companies • SACTO • City Manager • Private developers • Media perceptions PHYSICAL INFRASTRUCTURE How to Reconcile Competing Transportation Uses: In several neighborhoods in Sacramento, there is conflict between the regional transportation needs and specific concerns of community residents. Often, the regional transportation need calls for development of a transit line and new transit stations with the expectation that there will be significant development in close proximity to the new transit station (‘transit oriented development”). Some residents have opposed these efforts and have gotten the Council to change their support for the transit station. This also reflects the lack of political will to follow-through with a plan. In these cases, the City Council has gotten swayed by active few at the expense of the broader community which needs the transit. The big challenge is going from the “page” to the “ground”— planning to implementation and overcoming NIMBYism and political waffling. How to Balance Transportation Demands (Goods/People) Through Natomas, Power Inn: Need to ensure transportation/movement of commercial goods through key areas with significant congestion (Highways 5 and 80; Truxel Road, Del Paso Road and West El Camino). How to Overcome Perception Negative Perception of Neighborhood Investments: Many noted that greenfields are perceived as superior to existing neighborhood redevelopment which hurts investment in Sacramento. They noted that there is a need to educate people on the benefits of urban investment. The challenge below is related. How to Face Aging Infrastructure: There is a lack of adequate basic public infrastructure and available land to attract reinvestment in older areas and commercial corridors. Specifically, there are key infrastructure gaps in sewer, transit which need to be addressed. How to Support Growth of Commercial Corridors: How to make the long-term case for the benefit of developing commercial corridor districts, particularly with property owners who focus on the potential for short-term benefits and fail to see the need for longer-term investments. How to Identify Appropriate Land for Specific New Industries: For example, Sacramento lacks large developable parcels conducive to a “campus” setting. This was noted by one participant but not discussed by the group to determine if others believe that the campus setting is necessary to attract large knowledge-based tenants. Need to Shift to New Uses: How to shift older manufacturing areas to new uses, given NIMBYism. There is a need to diversify PBIDs. Need to Support Alternative Transportation: How to ensure proper funding and support for public and alternative transportation from Light Rail to Bike paths to Pedestrian improvements. Influencers of the above challenges: • City of Sacramento, Economic Development • Developers H The Hoyt Company Page 4 Economic Development Strategy - Local Agencies/Associations Focus Group August 12, 2005 • Brokers • Banks • EDA/Redevelopment for infrastructure • Neighborhood associations • Folsom Boulevard Business and Property Association • Power Inn Business and Transportation Association • Retirement community HUMAN RESOURCES How to Use City’s Diversity as an Asset: How to overcome business community fears given the cultural diversity within the business community. Need to use this diversity as an asset. Some noted that there is a need to educate diverse business owners about how to work with government. Some owners are often skeptical of the public sector. How to Preserve and Keep Skilled Graduates Within the City: How to build a skilled labor force comparable to the Bay Area and San Diego. There is significant leakage of college graduates and other higher education students. Influencers of the above include: • Educational institutions • Local businesses and associations • Local government FINANCE Need to Identify Self-financing Projects: How to identify economic development projects which are self-financing and do not require significant government subsidies to be successful. There was concern that economic development was not expected to be a moneymaker which affected the quality of “projects” being encouraged. Over the years the City has assisted in a number of projects without trying to recapture investment on return. City tends to treat one project at a time and not report benefit or recapture any part of it to reinvest. How to Encourage Lenders to Finance Neighborhood-Serving Retail: Often there is no information on buying power (capital available if buying power shown) which limits the availability of capital. Influencers of the above include: • Lenders / banks • Economic development departments • City Council • Local businesses H The Hoyt Company Page 5 Economic Development Strategy - Local Agencies/Associations Focus Group August 12, 2005 BUSINESS CLIMATE How to Reduce Perception of Onerous Permitting Process: Need to facilitate the movement of projects/contracts through the administrative rules/policies and processes in a timely manner so that it will not impede the project. Need better understanding of the flow in projects How to Develop Greater Confidence in the City: How to create confidence that the City can provide services/support to businesses or that it is a good location for one’s business. How to Get City to Understand Needs of Business: There is a need for local government to better understand business needs. How to Maximize Economic Development Dollars Within Limited Resources/Budget: This issue was raised and discussed several times and referred to the existence of a joint City/County redevelopment agency which does not have to focus its dollars in Sacramento. How to Recruit New Businesses When City Lacks Financial Incentives: Potential companies and or their site selector frequently ask this question first. How to Coordinate and Reconcile Different Plans: How to better implement plans among City agencies which might have differing strategies or approaches. Influencers of the above include: • Local government • Economic development department • Planning department • Businesses QUALITY OF LIFE How to Overcome Misconceptions People Have of Sacramento: Many think of Sacramento as a “hot Central Valley city” that lacks the amenities of a major city in a metropolitan area and does not have a thriving business community or urban center. Other perception challenges include the assumption that Sacramento is “not a destination”, is a “political town”, has “major traffic problems”, and does not have significant innovation assets. How to Reestablish a Vital Urban Core: How to create downtown neighborhoods with urban retail amenities. How to attract businesses and residents to the central city but still provide, manage, and mitigate social services/low-income housing to the disadvantaged. Related topic: crime, blight and nuisance activities. Need political will to do the tough work as well as support from the media. How to Overcome the Negative Perception of Commercial Corridors: The public, business, and investors have negative perceptions of older commercial corridors which results in insufficient investments in these areas and unreasonable subsidy requests. Multiple groups overlook these older areas: City Council does not have a strategy for business; Real estate brokers are often not interested; Land use planners/Public Works department have archaic ways of looking them and Landowners often speculate and let sites deteriorate. There is a need to work to beautify the commercial corridors and older areas. H The Hoyt Company Page 6 Economic Development Strategy - Local Agencies/Associations Focus Group August 12, 2005 How to Attract Neighborhood-Serving Retail: Sometimes there is capital available but not sufficient buying power to attract businesses. It might require accurate market information. How to Successfully Revitalize the Waterfront: There are many challenges affecting this such as the lack of a “marina culture” and the presence of multiple agencies with few funding sources (i.e. no lead agency). How to Maintain an Affordable Housing Advantage: How does the City and region continue to provide affordable housing to attract and retain companies with good paying jobs? There is a need for affordable housing to support business growth since the affordability advantage of the region is eroding. How to Maintain Public Safety: How to manage public safety despite increase in crime (particularly in Natomas). Influencers: • Elected officials, Political operatives/professional political staff • Social service providers, Non-profit agencies • Community activists • Media • Neighbors, residents, businesses, property owners • City, County staff • Public safety personnel • Developers/BIA • Chamber of Commerce • Housing advocates • Lenders • Providers of transportation networks INNOVATION/TECHNOLOGY How to Change Image About Region’s Innovation Assets: Need to eliminate/reduce self- doubt about region’s innovation that affects companies. How to Secure Risk Capital: In particular, it is difficult for local firms to obtain venture capital from the region. It is not clear if obtaining VC money from outside the region is a challenge. How to Highlight Need for a “Research-Based Knowledge Economy”: How to focus more on the importance innovation and research as a key input to regional economic development. Influencers of the above include: • City and County Government • Education • Investors (VC firms) and Financial institutions (CalPERS) • Area leadership (namely Economic Development) At the end of the focus group, each participant submitted their index cards containing their critical economic development priorities. The comments in thse index cards have been added to the above summary. H The Hoyt Company Page 7