The Virginia Economic Developers Association (VEDA) has prepared
this overview of economic development fundamentals in an effort
to assist and support community leaders, citizens and elected
officials on the integral and important role economic development
plays in creating a better future for Virginia.
What is Economic Development?
The goal of economic development is to increase the tax base
and provide better jobs, thus enhancing the well-being and
prosperity of the citizens of Virginia. These are the activities
measured and are ultimately how success is measured. In order
to do these things, it is necessary to create and maintain
the most competitive product (sites, buildings, business climate)
to attract new businesses and to promote expansion of existing
businesses.
The Role of Public Policy
Underlying any successful economic development program is
public policy. The decisions made by government to invest in
education, transportation, natural resources, health care and
social programs all impact a jurisdiction's ability to attract
companies, which leads to new jobs and investment.
Governments serve a fundamental role
in facilitating job creation and investment by supporting
economic development activities through both marketing and
site development. Public policy choices made by government
entities drive the business climate that determines the attractiveness
of a particular locality to business prospects. A pro-business
climate, fostered by all levels of government, is essential
to continued success in promoting economic prosperity, broadening
the tax base and enhancing the Commonwealth’s economic
stability and quality of life. Furthermore, economic development
can lead to enhanced tax revenues for state and local governments,
thus providing the funds to support essential government
services.
Economic development is an investment in our economic prosperity.
The time and resources allocated to economic development programs
typically fall under two areas: creating a competitive product
and attracting new and expanding business.
Creating a Competitive Product - Business
prospects cannot locate in a community unless the necessary
infrastructure is in place. In its most basic form, this
includes land with adequate access to transportation, water
and sewer connections, as well as modern telecommunication
infrastructure and service. This is the "product." As in any marketing environment, you have
to have a desirable product that will entice and meet your
customers’ needs. A good product is sold via a comprehensive,
holistic approach that addresses community, regional and/or
statewide issues such as transportation, education, business
climate, environment, taxation, quality of life, community
infrastructure, skilled and competitive work force, etc. It
is necessary to ensure that sites are ready and available to
show to prospects when they have a need to relocate or expand
their businesses.
Attracting New and Expanding Business - The primary role of
economic development professionals is to aggressively market
this competitive product, identify potential business prospects,
develop relationships, package proposals and close deals that
lead to job creation and investment. An important secondary
role is to provide appropriate assistance in creating a competitive
product. This role increases as the competitiveness of the
product decreases.
The Role of VEDA
The Virginia Economic Developers Association supports the
maintenance and expansion of efforts by state, regional and
local governments and other interested organizations to foster
the growth of basic employment sectors that will expand job
opportunities for Virginians.
At the state level, there are a variety
of programs and initiatives that specifically focus on developing
the economic infrastructure, as well as broadening the awareness
of Virginia’s superior
business climate. These programs include grants to local governments,
funds for advertising and outreach, incentives and tax credits,
and support for education and training programs. They are concentrated
within three agencies under the Secretary of Commerce and Trade
- the Virginia Economic Development Partnership, the Department
of Business Assistance and the Department of Housing and Community
Development. Yet, the state is not the sole source of support
for economic development. Local and regional entities, including
local governments, local and regional authorities, chambers
of commerce and regional economic development marketing entities,
play a valuable role in attracting new jobs and investment.
Cumulatively, these investments total in the millions, but
the return on that investment is far greater.
The Virginia Economic Developers Association
(VEDA) is a professional association of economic development
professionals and ally organizations representing all corners
of the Commonwealth. As the leading voice for economic development
professionals, the association works to ensure Virginia’s
continued prosperity by supporting key economic development
programs that assist in creating news jobs, investment and
maintain a pro-business climate.
