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The Economic Development Connection

The Economic Development Connection. Steven E. Daniels Utah State University Extension 435-797-1255 steve.daniels@usu.edu Presented at Utah State Council of Workforce Services Conference 12 October 2006. Today’s objectives. Provide some information Start a relationship

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The Economic Development Connection

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  1. The Economic Development Connection Steven E. Daniels Utah State University Extension 435-797-1255 steve.daniels@usu.edu Presented at Utah State Council of Workforce Services Conference 12 October 2006

  2. Today’s objectives • Provide some information • Start a relationship • Begin a conversation

  3. The Plan: Three “FYI” items to spur further conversation • Research bulletin on rural small business success • Latest legislative recommendations from the Governor’s Rural Partnership Board • Policy report linking IDAs and WIA/ITAs

  4. FYI #1: Factors affecting rural small business success National study prepared by a consulting firm under contract to the Small Business Administration Studied factors correlated with rural business births and deaths; used appropriate statistical methods Had access to firm-level data not generally available Looked at two different economic periods: Expansion (1997-99) Downturn (2000-02) Also looked at six state-level case studies, with Utah being one of them

  5. So what matters, nationally? • Educational attainment matters: # high school graduates increases the number of businesses • Amenities/attractiveness matters • Rural areas constrained by educated labor force and necessary infrastructure • Policy and assistance have an impact • The focus is on entrepreneurship

  6. How does Utah compare to the Nation? • Growing rural income gap (more closely resemble nation) • Rural wages flat over the past 15 years • Rate of business replacement substantially above national averages • Unclear why the rate is so high; it might be policy or might be personal preference • Educational attainment and quality are both predictive of business formation at county level

  7. Questions regarding this FYI?

  8. FYI #2: GRPB Governor’s Rural Partnership Board established 2004 Mission is to make legislative recommendations regarding rural issues, and co-ordination among rural programs

  9. GRPB 2006-07 Legislative Recommendations • Include broadband internet in telephone universal services fund • Modify Industrial Assistance Funding authority to require a minimum rural exposure • Push for a rural education initiative

  10. Questions regarding this FYI?

  11. FYI #3: Linking IDA and WIA/ITA Caveat: I am probably the least knowledgeable in the room Intrigued by a policy brief from Center for Social Development (inventors of the IDA concept)

  12. Overview of Individual Development Accounts • Have some broad similarity to IRA; assets that a person holds for specific purposes • Targets low income/wealth families • Family contributions are matched • Funds may be spent on first home, education/training, or starting a small business

  13. WIA/Individual Training Accounts • Training assistance is the highest “tier” WIA-related service • Voucher based funding of training for qualified participants at approved training providers

  14. Potential Benefits of Linking IDA and ITA • Leverage multiple sources of funding to provide higher level of education than might otherwise be available (both IDA and ITA typically have caps) • WIA-related counseling services assist efficient expenditure of IDA assets • WIA funds provide the match to IDA contributions

  15. Policy Recommendations • DOL clarify IDA status as a personal asset • DOL clarify ability to use WIA funds to match IDA contributions • Modify WIA performance measures to remove disincentive to serving low income employed individuals

  16. Policy Recommendations, cont. • Allow WIA funds to provide support services to an individual with IDA-funded education IF an employment plan in place • Include financial education as an intensive service funded by WIA (Senate WIA-reauth. S1021) • Increase WIA appropriations

  17. Questions regarding this FYI? http://gwbweb.wustl.edu/csd/Publications/2006/RP06-09.pdf

  18. Were today’s objectives met? • Provide some information • Start a relationship • Begin a conversation

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