by James A. Bacon
You most likely missed it because it has gotten next to zero publicity, but the Commonwealth does have an economic development strategy for rural Virginia.
In 2017, a group of rural development stakeholders come together to form a “Rural Think Tank” to identify policies the state should pursue to position smaller metros and rural areas for economic growth. After deliberating, the twelve think tank members came up with five strategic priorities, as described in the latest edition of the Virginia Economic Review, a publication of the Virginia Economic Development Partnership (VEDP). This second edition of the quarterly publication is devoted to “America’s Rural Growth Challenge.”
The priorities include:
Ubiquitous broadband access. Topping the list is ubiquitous broadband access, a priority embraced by the Northam administration that receives broad bipartisan support. The ability to plug into the Internet is a necessity not only for business growth but is essential to education, healthcare, social connectivity, and the quality of life. As the Virginia Economic Review quotes Didi Caldwell, past chair of the Site Selection Guild, put it, “Broadband is to the 21st century was electrification was to the 20th. Rural communities need it to thrive and survive.”
Marketing rural Virginia. Rural economic development is a tough challenge. Across the U.S. 80% of rural localities fail to secure a single greenfield economic development project each year. One reason (among many) is that small localities lack the resources to market themselves. Says the Virginia Economic Review: “State leaders have now embraced a goal to brand and expand national awareness of rural Virginia as the highly compelling business investment destination that it already is — one of the most attractive, competitive location in the U.S. for manufacturing and other sectors interested in rural locations.”
Expanded prepared sites inventory. In recent years the lack of a prepared site was one of the most common reasons that rural Virginia lost out on high-impact manufacturing and distribution projects. State leaders are now identifying development sites in Virginia of 25 acres or larger and, through the GO Virginia initiative and the Business Ready Sites Program, making them readily available for occupation.
World-class custom workforce solutions. A big obstacle to attracting investment to rural areas is the concern about the ability to attract a qualified workforce. Virginia is now building a fast-reaction, turnkey workforce recruitment and training capability to address that issue..
Transformational economic development projects. Virginia is building the capability to support recruitment of “transformational” investments such as Merck’s $1 billion investment in the expansion of its Rockingham County plant that will create 100 high-quality jobs, and the $400 million expansion of the Volvo Group truck manufacturing plant in Pulaski County, which will create 777 jobs. According to the Virginia Economic Review, VEDP is expanding beyond manufacturing, collaborating with state, regional and local partners “to launch a rural and small metro technology centers initiative” to attract tech companies interested in locating software-development and tech-services operations in lower-cost markets outside of big cities.
Overall, I think these priorities are fine. I do question the cost-effectiveness of marketing rural Virginia as a “highly compelling business investment destination” — that strikes me as a hard sell for a rural area anywhere in the country — but, yes, rural Virginians do need broadband, and it undoubtedly would be helpful to have shell buildings and a turnkey workforce solution. As for “transformational” projects, the Commonwealth should be as willing to commit state dollars to big projects that show a positive, risk-adjusted return on investment in rural areas as well as in urban areas.
But let’s be clear, this is largely a top-down approach that demands little of rural Virginians themselves, and it is heavily geared to luring outside corporate investment — primarily light manufacturing. Any comprehensive economic development strategy must dig deeper. Here are a few thoughts on other ways for rural, small-town communities can think about transforming themselves.
Solar/wind. The rise of the renewable energy industry creates an opportunity to exploit one thing — abundant land — in which rural areas enjoy a competitive advantage over urban and suburban areas. Some rural areas in Virginia have been receptive to solar and wind farms, others have resisted. But the generation of electric energy could become a new cash crop for landowners, providing a steady stream of leasing income.
Outdoor recreation, natural vistas. Rural areas have another competitive advantage — open space, rivers, streams, bays, mountains, and natural beauty. People in a knowledge economy that rewards deep labor markets in large metropolitan areas may not want to build their careers in rural areas, but they do enjoy visiting rural areas, which can provide the underpinning of a recreational industry built around sailing, golfing, hiking, kayaking, mountain biking, etc. Look at Wintergreen, a weekend-getaway destination for Washingtonians and Richmonders, for inspiration. Look at St. Michaels, a Chesapeake Bay sailing Mecca in Maryland, for inspiration.
Retirement communities. While the agglomeration effect favors large metros for people participating in the workforce, the agglomeration effect does not come into play for retired people. Access to outdoor recreation and natural vistas is a significant amenity for retirees, who comprise an ever-increasing share of the population. Other states, particularly North Carolina, have been far more successful than Virginia in attracting this demographic. Look at Blowing Rock, N.C., for inspiration.
Place-making. Smaller communities have another competitive advantage over urban and suburban areas: “small town feel.” People love “quaint.” Some people prefer the anonymity of big cities, but many people want to feel part of a connected people where everyone knows everyone else. Rural/small-town communities can build on this by paying attention to place making, the design of public space and amenities. But this will require a major shift in attitude. Instead of subsidizing “rural sprawl” — random, low-density development along rural roads — they need to steer local investment into creating the kinds of places people like visiting and living in. Place-making is critical both for attracting retirees and building a tourism trade.
Restructuring health care. Many rural counties are losing their community hospitals. As health care is a critical component of quality of life, it is necessary to restructure rural health care systems so they can serve less-affluent, low-density populations: more clinics, more urgent care centers, more outpatient surgery centers, more tele-medicine, and the like.
This is hardly a comprehensive list. Rural Virginia could do more with niche agriculture, artisan guilds, and wood products. It could do more to promote small businesses and entrepreneurship. Pockets of rural prosperity can be found around the country. Rural Virginians could benefit from studying them. Perhaps Virginia’s “Rural Think Tank” can turn its attention to creating bottom-up approaches to improving livability and reinventing local economies.
