New monthly EDC publication promotes value of committee’s work

EDC newsletter doing business in Southborough (issue 1)
(click to open pdf)

Southborough’s Economic Development Committee has launched a new publication. As explained in the intro, EDC will be publishing monthly articles to:

educate residents and businesses on the value of what our investment in economic development brings to our town.

It looks like the new monthly publication is the latest way the committee is seeking to secure public support for the work they do.

EDC has had to overcome outspoken critics at Town Meetings in order to get its budgets approved by voters.* And the committee promised that it will get better at measuring success through metrics.

The first in the series, this publication doesn’t provide metrics, but seems to indicate there will be more on that in the future.

This month’s article, written by member Claire Reynolds, focuses on “Defining Economic Development”. It wraps up with:

As with any marketing program, economic development can be difficult to measure. However, defined quantitative metrics can show reveal trends and serve as indicators of success. Metrics may include employment levels, assessed commercial property values, vacancy rates, as well as softer indicators such as the overall health of local businesses, the ease with which business integrates with residents and municipalities, and the diversity of businesses. Click here for more information on measuring the success of economic development.

Stay tuned for next month’s press release which will outline Southborough’s EDC program for economic development for the 2018 fiscal year and our upcoming Downtown Survey.

As the publication reminds us, voters approved the creation of a standing committee in April. But the EDC has been around longer than that. And while selectmen have been strong advocates of their efforts, the committee isn’t without its detractors.

An ad-hoc committee was created by selectmen over four years ago. In 2015, selectmen cemented support by asking the EDC to invest in professional staff to help with their work. Eventually, the Town acknowledged it was time for the committee to come out of ad-hoc status.

The first attempt failed, as the EDC tried to take advantage of a defunct Industrial Development Commission, which some argued wasn’t the right fit. But, in April, voters approved both a standing committee and increased budget for the EDC’s work.

Advisory member Sam Stivers and former member John Butler were among those to publicly question the EDC’s work. Butler has claimed that these kinds of efforts have been found to be a waste of money. Stivers has pushed for better metrics proving the investment is paying off.

The Advisory Committee initially called for the EDC staff budget to be stripped this year. It was a hotly debated item between selectmen and Advisory at a meeting this spring. Advisory was looking to reduce the overall budget and identified EDC as the place where the cut made most sense.

In the end, selectmen secured Advisory’s support for EDC’s budget by agreeing to reduce in other areas (like removing replacement of a sidewalk plow for the DPW and pushing new positions to later into FY18.) But the main requirement for support, was EDC’s promise to work with Advisory on providing better success metrics.*

The link provided in the EDC bulletin leads to a page with the following explanation:

Economic Development Metrics – How We Measure Our Success

Measuring the success of Economic Development policies, programs and activities is just important as implementing them. There are many recognized measures used and bench marked within the economic development industry, and in recent years, this process has become a marriage of an art and science. We strive for efficient work toward our stated goals, while recognizing that some measures of progress are not so easily captured, such as, encouraging vital connections between businesses and residents, or improving customer service for permitting at Town Hall.

Many recognized guiding principles in Economic Development have been corner-stoned by the International Economic Development Council (IEDC). This Internationally recognized Council consisting of more than 5,000 members of Economic Development Professionals (learn more here), has made them the largest organization of its kind. The IEDC has created an Economic Development Reference Guide that can be utilized to assist with how communities create and develop an Economic Development program and policies.

Another great resource in assisting to develop how to measure the success of Economic Development in a community is from the Economic Development Research Partners program, of the IEDC, Metrics for High Performing EDOs. This dynamic Guidebook for Economic Development professionals provides a menu of metrics by which to measure economic development success in a community. Since no two communities are alike, this menu based Guidebook offers an insightful approach on devising a system to benchmark economic development success that plays to each communities uniqueness, and isn’t a one-size-fits-all approach.

Learn more here about the methodology behind this comprehensive Economic Development Guidebook for Metrics and how it was developed.

To open the full bulletin, click here. To visit the Series page on the EDC website, click here.

*The budget for the EDC Coordinator was again debated on the Town Meeting floor, when John Butler moved to remove it. His motion failed but by a narrower margin than EDC would have liked (78 – 95).

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Carl Guyer
6 years ago

It is always an awkward thing when you do something that sounds critical of the work done by people who volunteer there time to the community. At the risk of doing this, I hope these comments will encourage a different and more analytical consideration of our tax policy..

In this article our Economic Development Committee (EDC) is again claiming expansion of our commercial and industrial tax base will lower tax rates while they take a firm stance against modification of our real estate tax policies that could save residents millions of dollars. If you are willing, please consider the following.

1) If you plot real estate tax rates against the concentration (percentage) of commercial and industrial for each community in Massachusetts you see a trend of increasing tax rates with increasing concentration of commercial property. The relationship between tax rates and commercial development is a complicated.
2) The underlying driver for increasing tax rates as the concentration of commercial and industrial property increases is the erosion of the average assessed value of the residential property. An issue not to be ignored in a community with an average residential property of $577,000.
3) Southborough’s single tax rate policy attempts to defy demographics. Residential and commercial tax rates in our state comprise two distinct populations. This is best characterized by the difference in their average values. The average residential tax rate paid on property in Massachusetts is $13.04 per thousand dollars of assessed value. The average for commercial and industrial property owners is $22.64.
4) It is the existence of split tax rates in 103 Massachusetts communities that has created the difference in the average real estate tax rates. These 103 communities have 78% of all the commercial and industrial property in the state. Their average commercial tax rate is $24.83. This distribution belies assertions commercial property owners will not locate in split rate communities. It is closer to the truth that if a company or enterprise were to move, it would move to a split rate community.
5) Our single tax rate makes Southborough’s residential tax rate higher than that on 79% of the residential property in Massachusetts while the same rate makes our commercial and industrial tax rate lower than that paid by 75% of commercial property owners in the state. Again, another example of how our single tax rate defies demographics.
6) Southborough is demographically a split rate community. In 2017 we ranked as the community with the 88th highest concentration of commercial and industrial property in the state. Notably 88 is smaller number than 103 placing our demographics firmly within the communities with split tax rates.
7) We have a demographic twin, Andover, with a split tax rate that provides a working example how we can modify our tax policy. If the Selectmen of Andover had set Southborough’s tax policy in 2017, the result would have been a reduction of $1,506 in the average residential tax bill. (Note: State law does not allow for such a dramatic one-time change.)
8) The long-term resistance to implementation of a split tax rate is now collectively costing the residential properties owners between $3.5 and $7.0 millions dollars in addition real estate tax payments annually.
9) It is unlikely implementation of split tax rates will ever bring Southborough’s residential tax rate near the state average, but is not unfair to ask our commercial and industrial property owners to pay a tax rate closer to the state average. Southborough is a desirable location for residential and commercial property, a fact surely not unnoticed by commercial property owners.

All this is based on data available for the Massachusetts Department of Revenue. For access to this same data you can Google “Mass DOR Data Bank”.

Carl Guyer
6 years ago
Reply to  Beth Melo

I think this is posted under the wrong article

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