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Council 2010 WorkshopCouncil 2010 Workshop

Economic DevelopmentEconomic DevelopmentBrain Breezing ConceptsBrain Breezing Concepts

Bruce Stahlman, Council Member At LargeBruce Stahlman, Council Member At Large

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AgendaAgenda

• Executive Summary• Background• Other Municipal Approaches / Best Practices• Municipal Marketing Strategy Example• Conclusions / Next Steps

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Executive SummaryExecutive Summary

Assumptions

1. There is a high probability that City revenue could under run costs into the foreseeable future as a result of macro economic disruption.

2. The City will do everything feasible to mitigate costs with as minimal an impact to services as possible.

3. Opportunities to generate incremental revenue that do not include tax rate increases should be investigated.

4. Article 1, Sec. 1 of the Charter refers to Littleton as a “Municipal Corporation”. As a municipal corporation, we have a fiduciary responsibility to “shareholders” (i.e., citizens) to return value for their investment in the community.

5. Creative, out of the box thinking is a valuable commodity.

Assumptions

1. There is a high probability that City revenue could under run costs into the foreseeable future as a result of macro economic disruption.

2. The City will do everything feasible to mitigate costs with as minimal an impact to services as possible.

3. Opportunities to generate incremental revenue that do not include tax rate increases should be investigated.

4. Article 1, Sec. 1 of the Charter refers to Littleton as a “Municipal Corporation”. As a municipal corporation, we have a fiduciary responsibility to “shareholders” (i.e., citizens) to return value for their investment in the community.

5. Creative, out of the box thinking is a valuable commodity.

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BackgroundBackground

Economic Uncertainty – The Impact on Local Government

• Governance is clearly changing, as city officials are continually called upon to develop new policies, set long range plans, and resolve a wide array of local issues. No one can definitively answer the question, ‘When will the economy rebound?’ But, city officials will be strained to balance budgets and forced to make tradeoffs within the cities they govern.

• Times such as these provide opportunities for creative thinking and transformative change. Cities must find solutions for looming cutbacks in essential city services, public works projects, libraries, parks, and recreation programs that are certain to arise.

• City officials across the country are essentially dealing with unscripted challenges, as successful solutions will require fundamental shifts in ways of thinking and operating. Holding on to old assumptions about economic growth, relationships between different levels of government and revenue streams will obstruct our ability to forge new paths toward prosperity.

• The kind of new thinking required to prosper in the ‘new normal’ will emerge as local officials share their knowledge and experience of the economic downturn, their policy and programmatic reactions to it. Understanding and thinking about these issues together will help create the kinds of innovative economic and community development policies and programs that will position our cities to prosper in the future.

Source: National League of Cities,“Leading Through an Economic Storm”

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BackgroundBackground

CML 2009 State of Cities & Towns Survey

• Municipalities have backlogs of unfunded infrastructure projects.

• Top three fiscal challenges for municipalities: (i) Unfunded street needs; (ii) slow growth in tax revenues; and, (iii) unfunded water / wastewater needs.

• Larger municipalities are less optimistic about their financial situation.

• Bigger municipalities are pursuing more options when it comes to alternative energy.

• Municipalities of all sizes are involved in economic development and have economic development projects planned through 2009-2010.

• Small municipalities were actively involved in tourism promotion in 2008.

• Larger municipalities generally had higher tax rates.

• To stabilize or enhance revenues, municipalities favor fee increases over tax increases.

• Expenses related to employees were the expenses that municipalities were most often expecting an increase.

Source: CML “The State of Our Cities& Towns” Survey Report, Feb. 2009

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BackgroundBackgroundKey Financial Metrics

• Macro Sales Tax Trends (Largest component of Littleton’s revenue)

– Sales tax will be less productive, creates more instability;

– We’re getting older;– We live in a service economy but

we tax a durable goods economy;– Inflation of municipal inputs will

rise a third faster than inflation on sales tax eligible goods.

• Littleton General Fund Actual Balances

5 Year Actual General Fund Balance

$2,500,000

$5,000,000

$7,500,000

$10,000,000

$12,500,000

2010Budget

2009 Year-End

Estimate

2008200720062005

5 Year Actual General Fund Balance

$2,500,000

$5,000,000

$7,500,000

$10,000,000

$12,500,000

2010Budget

2009 Year-End

Estimate

2008200720062005

Sales Tax Revenue Profile by Age, 2003 National Data with Boulder Sales Tax Rate Applied

Source: US Bureau of Labor Statistics

$-$50.00

$100.00$150.00$200.00

$250.00$300.00

Under 25Yrs

25-34 Yrs 35-44 Yrs 45-54 Yrs 55-64 Yrs 65-74 Yrs 75 andOlder

Sal

es T

ax R

even

ue/H

H

Sales Tax Revenue Profile by Age, 2003 National Data with Boulder Sales Tax Rate Applied

Source: US Bureau of Labor Statistics

$-$50.00

$100.00$150.00$200.00

$250.00$300.00

Under 25Yrs

25-34 Yrs 35-44 Yrs 45-54 Yrs 55-64 Yrs 65-74 Yrs 75 andOlder

Sal

es T

ax R

even

ue/H

H

Source: 2007 Boulder Blue Ribbon Commission on Revenue Stabilization

Source: Littleton 2010 Budget Book

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Other Municipal Approaches / Best PracticesOther Municipal Approaches / Best Practices

Source: CML “The State of OurCities & Towns” Survey Report,February 2009, 20 of 27 ColoradoLarge Cities Responding.

0% 20% 40% 60% 80% 100%

Other

Tourism Promotion

IT Infrastructure

Other Infrastructure Improvements

Streetscape / Aesthetic Improvements

Transportation / Parking Infrastructure

Outreach or Marketing to Outside Businesses

Retail Development

Technical or Business Assistance to Local …

Creation of an Economic Development Plan

Creation of Special Development Authorities / …

Redevelopment Projects

Tax Incentives to Businesses

Services to Small Businesses

Promoting Entrepreneurship

Percentage of Large Municipalities (> 18,000 pop.) Engaged in Each Economic Development Activity

0% 20% 40% 60% 80% 100%

Other

Tourism Promotion

IT Infrastructure

Other Infrastructure Improvements

Streetscape / Aesthetic Improvements

Transportation / Parking Infrastructure

Outreach or Marketing to Outside Businesses

Retail Development

Technical or Business Assistance to Local …

Creation of an Economic Development Plan

Creation of Special Development Authorities / …

Redevelopment Projects

Tax Incentives to Businesses

Services to Small Businesses

Promoting Entrepreneurship

Percentage of Large Municipalities (> 18,000 pop.) Engaged in Each Economic Development Activity

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Other Municipal Approaches / Best PracticesOther Municipal Approaches / Best Practices

• Overland Park, KN, branding program.

• Ft. Collins / Northern Colo. Clean Energy Cluster smart grid technologies, renewable energy and energy efficiency3

• Lakewood Villa Italia urban renewal, +5,000 jobs.

• Brighton, Pueblo and Windsor host new energy manufacturing plants.

• Longmont Area Economic Council and Entrepreneurial Network public / private partnering.

• Centennial Planning & Development Survey of Local Realtors– Client motivations to buy in Centennial vs. elsewhere.– Neighborhood and foreclosure perceptions.– What is needed to improve neighborhoods and quality of life?– What can Centennial do to best improve neighborhood values?

Sources: CML, City of Longmont, South Metro Denver Realtor Association.

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Municipal Marketing Strategy ExampleMunicipal Marketing Strategy Example

• Concept / Objectives

• Target Audiences

• Program Elements

• Reach / Frequency / Breadth

• Example Content

• Economics

• Risk Factors

Source: Avocet Communications

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Municipal Marketing Strategy ExampleMunicipal Marketing Strategy Example

Renton,

Washington

Renton,

Washington

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In 1997, The City of Renton, in conjunction with the Greater Renton Chamber of Commerce, Renton Technical College, Valley Medical Center, Renton School District and the Renton Visitor’s Connection launched a community marketing campaign. The mission was to collectively market the Renton community to recruit quality companies and diversify Renton's employment base.

Like any successful company, Renton needs to continue to be on the cutting edge to market its products and services. When companies or residents look at locating in Renton, they look at the community as a whole: Schools, parks, housing, amenities, higher education, public safety, health, and medical care. Our goal is to collectively market our product, Renton, to help us maintain a healthy community.

Stakeholders developed a brand, “Renton. Ahead of the Curve”, to promote a consistent identity that builds on the appeal of the community's residential, educational and business opportunities and positions the community for future success. This theme captures our community and the innovation and creativity of all key stakeholders. By leveraging marketing dollars, the stakeholders collectively promote Renton as an outstanding place to work, live, learn, shop, visit and play.

The Renton Community Marketing Campaign has been an overwhelming success. New investments are being made, the employment base is diversifying and people are not only talking about Renton, they are making the conscious choice to locate their businesses and families in the community. The campaign has received national recognition, not only for its effectiveness, but also for the unique collaboration and partnership among community stakeholders.

- City of Renton Web Site

In 1997, The City of Renton, in conjunction with the Greater Renton Chamber of Commerce, Renton Technical College, Valley Medical Center, Renton School District and the Renton Visitor’s Connection launched a community marketing campaign. The mission was to collectively market the Renton community to recruit quality companies and diversify Renton's employment base.

Like any successful company, Renton needs to continue to be on the cutting edge to market its products and services. When companies or residents look at locating in Renton, they look at the community as a whole: Schools, parks, housing, amenities, higher education, public safety, health, and medical care. Our goal is to collectively market our product, Renton, to help us maintain a healthy community.

Stakeholders developed a brand, “Renton. Ahead of the Curve”, to promote a consistent identity that builds on the appeal of the community's residential, educational and business opportunities and positions the community for future success. This theme captures our community and the innovation and creativity of all key stakeholders. By leveraging marketing dollars, the stakeholders collectively promote Renton as an outstanding place to work, live, learn, shop, visit and play.

The Renton Community Marketing Campaign has been an overwhelming success. New investments are being made, the employment base is diversifying and people are not only talking about Renton, they are making the conscious choice to locate their businesses and families in the community. The campaign has received national recognition, not only for its effectiveness, but also for the unique collaboration and partnership among community stakeholders.

- City of Renton Web Site

Municipal Marketing Strategy ExampleMunicipal Marketing Strategy Example

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Municipal Marketing Campaign Summary

• City population 83,000.

• Alex Pietsch, Director Department of Community & Economic Development, includes Economic Development, Development Services, Planning, Neighborhood Program.

– $7.0 million department budget ($1.0 million Economic Development), 60 staff.

• Catalyst - Early 1990’s, Boeing moved 5,000 jobs to Everett, WA. Office vacancy rate = 40%. Crisis convinced City leadership that aerospace was to cyclical to rely upon.

• Partnership between City, School District, Community College, Medical Center, Chamber. Broad support among partners a key selling point a la “scrappy underdog”.

− Each contribute $15,000 + 1% lodging tax to fund campaign.

• Print, TV, radio, Web, events, direct mail, hotel vouchers as catalogue inserts.

• Regional CEO brand awareness survey: 43% associated “Ahead of the Curve” brand with Renton. 80% had a positive impression.

• Big wins include IKEA, Fry’s Electronics, Federal Reserve Bank, new shopping center

Municipal Marketing Campaign Summary

• City population 83,000.

• Alex Pietsch, Director Department of Community & Economic Development, includes Economic Development, Development Services, Planning, Neighborhood Program.

– $7.0 million department budget ($1.0 million Economic Development), 60 staff.

• Catalyst - Early 1990’s, Boeing moved 5,000 jobs to Everett, WA. Office vacancy rate = 40%. Crisis convinced City leadership that aerospace was to cyclical to rely upon.

• Partnership between City, School District, Community College, Medical Center, Chamber. Broad support among partners a key selling point a la “scrappy underdog”.

− Each contribute $15,000 + 1% lodging tax to fund campaign.

• Print, TV, radio, Web, events, direct mail, hotel vouchers as catalogue inserts.

• Regional CEO brand awareness survey: 43% associated “Ahead of the Curve” brand with Renton. 80% had a positive impression.

• Big wins include IKEA, Fry’s Electronics, Federal Reserve Bank, new shopping center

Municipal Marketing Strategy ExampleMunicipal Marketing Strategy Example

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Municipal Marketing Strategy ExampleMunicipal Marketing Strategy Example• Concept / Objectives

− Tell the Littleton story.

− Raise enthusiasm and awareness of the city to low impact businesses.

− Promote business development that complements Littleton’s assets.

− Create a sustainable revenue growth to maintain the quality of City services and fund infrastructure improvements.

• Target Audiences

− Local entrepreneurs.

− Innovative Littleton businesses that have growth opportunities.

− Businesses with 100 or less employees within Colorado, regionally and nationally.

Source: Avocet Communications

• Program Elements− Job 1: Get their attention, then sell.

− Create a marketing plan, brand strategy and market position that enhances “Economic Gardening” with initial saturation then a three year maintenance campaign.

− Develop a market position that is intriguing to businesses while differentiating Littleton from other municipalities.

− Focus media mix on prestigious business journals such as Business Week, Wall St. Journal, Newsweek, etc., buying specific markets plus Web, maybe KOA, probably social marketing (e.g., Facebook)

− Expect 40 – 50 leads per year in a normal economy with a strong program.

− Enhance a sense of public/private partnership and cooperation through relationships.

− Responsiveness to the needs of the business community fosters business retention.

− Maximize the potential of the City’s commercial property assets.

− Identify and track economic trends relevant to Littleton and be prepared to maximize the opportunities such trends present.

− Promote a strong local economy that in turn helps maintain municipal services, the community’s quality of life, residential property values and schools.

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Municipal Marketing Strategy ExampleMunicipal Marketing Strategy Example

Municipal Marketing Strategy ExampleMunicipal Marketing Strategy Example

Motivation vs. InformationMotivation vs. Information

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Municipal Marketing Strategy ExampleMunicipal Marketing Strategy Example

Multi-Level Vertical Support for BusinessMulti-Level Vertical Support for Business

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Municipal Marketing Strategy ExampleMunicipal Marketing Strategy Example

“Rememorable” Play on Words“Rememorable” Play on Words

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Municipal Marketing Strategy ExampleMunicipal Marketing Strategy Example

The Littleton that CouldThe Littleton that Could

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Conclusions / Next StepsConclusions / Next Steps

Call to Action

• “An economic crisis is a terrible thing to waste.” - CML

• Preferences / Priorities

• Gather Additional Information

• Time Line

• Deliverables / Responsibilities

• “To do nothing is to still decide.” - Anonymous