Community Wealth Shapes Local Economic Development Programs

Local economic development priorities say a lot about the wealth of a community. Municipalities with strong economies are less interested in jobs than those with a weak economy and are more likely to pursue environmental sustainability and social equity goals. Municipalities with weak economies focus primarily on the basics; jobs and tax revenues. The results, however, are the same; while there are statistically significant correlations between economic development programs and self-reported measures of success, when actual results are substituted, the statistical significance disappears. 

In a previous post I reviewed the accuracy of reporting in local economic development programs. In this article, using the same data set from the International City Manager’s Association (ICMA),  I focus on the alignment of economic conditions (barriers), local economic development priorities, programs and self-reported results.  This is the first exploratory study to test connections across the entire continuum from planning to results. Previous studies have focused only on a portion of this continuum.

As with my previous study on reporting accuracy, municipalities are the focus of this inquiry because of the consistency of their organization, roles, and responsibilities. Counties, special districts, and non-profits can be organized in a number of ways, making it difficult to compare survey results.  The complete ICMA survey instrument included 25 questions. Twenty-two of these questions were close-ended with a predetermined set of multiple choice answers. The number of multiple choice options in these close-ended questions ranged from 2 to 32. The questions involved planning (motivation, barriers, priorities), programs (tools and incentives), and claims of success. The menu of priorities included traditional (creating jobs, increasing the tax base) and Type II programming (quality of life, environmental sustainability, and social equity) . A summary of the responses from municipalities on priorities and claims of success is provided in Table 1. The priorities of municipalities in the survey are fairly consistent, with over 85% indicating that increasing jobs and the local tax base, along with improving quality of life are priorities. The responses are more varied for environmental sustainability (42%), and social equity (25%). As for success in meeting these priorities, just over 89% of municipalities claim some level of success with job growth, tax growth, improvement in the quality of life, and progress towards environmental sustainability. Claims of success on social equity are substantially less, dropping to approximately 76%.

Table 1

Organizing the Data for Analysis
Prior to analysis, the data was organized into four general categories consistent with the structure of the survey; 1) planning (motivation/ barriers), 2) priorities, 3) programs (tools/incentives), and 4) reporting. Measures for planning (motivation/barriers) and programs (tools/incentives) were developed by combining multiple responses through factor analysis. Priorities and reporting were based on individual responses from the survey. The factor analysis started with 79 items relating to motivation (10), barriers (21), and tools and incentives (48). The items associated with motivation, barriers and tools and incentives, all measured on four-point Likert scales, were reduced through factor analysis to 13 measures and tested for internal consistency (α).

The measures developed for the motivation category are “progressive agenda” (α: .725), constructed with four items, and “organizational change” (α: .698), constructed with three items (Table 2). Four measures were created for barriers to success using twelve items (3 for each measure). These measures are “development constraints” (α: .656), “weak economy” (α:.660), “strong economy” (α:.661), and “labor constraints” (α:.575) (Table 3). Finally, seven measures were created for tools and incentives using 24 items. These measures are “direct business support” (α:.792), “sustainability programs” (α:.732), “marketing” (α:.731), “finance” (α:.719), “investment” (α: .681), “contributions” (α: .664), and “assistance” (α:.703) (Table 4). A consolidated description of all the measures is provided in Table 5.

Table 2

Table 3

Table 4

Table 5

Testing Program Alignment
The next step to explore the survey data was to test the relationships between 1) programs (motivation/barriers) and priorities, 2) priorities and programs (tools/incentives),  3) programs (tools/incentives) and 4) reporting. The test between measures are organized along a planning-programming-reporting continuum (Figure 1).

Figure 1

The first set of measures, representing motivation and barriers, was tested for correlation with priorities established by municipalities using binomial logistic regression. All five measures were grouped and tested against the five priorities. Table 6 provides the details of the analysis for all five models. In summary, all five models were found to be, overall, statistically significant. In terms of relationships between specific measures and priorities, a significant positive relationship was found between an economy with labor constraints (antecedent) and prioritizing job growth (OR 3.117), and between a progressive agenda (antecedent)` and prioritizing quality of life (OR 2.061), environmental sustainability (OR 4.143) and social equity (OR 3.698). A significant negative relationship was identified between a strong economy (OR .563) and development constraints (OR .510) in establishing job growth as a priority, and between a weak economy and establishing environmental sustainability (OR.641) or quality of life as a priority (OR .627). The organizational change measure had no significant connection to any of the five priorities.

Table 6

The next step was to test the five priorities with the seven programmatic constructs (tools and incentives). An Independent-sample T-Test was conducted for all possible pairings of priorities and tools and incentives. The results of this analysis are displayed in Table 7. Twenty-two of a possible thirty-five relationships were found to be statistically significant (p <.05). Sixteen of these, using Cohen’s d, had a small effect (>.20), and five had a medium effect (>.50). The strongest relationships were job growth (priority/antecedent) with direct support (d:.84), sustainability (d:.50) and finance (d:.60); environmental sustainability (priority/antecedent) with sustainability (d:.69); and social equity (priority/antecedent) with sustainability (d:.77).

Table 7
The final step in exploring the connections between measures was to analyze the relationship between program constructs (tools and incentives) and claims of success. For this analysis, a binary dummy variable was created to measure success with a response of “none” being a “0” and responses of “somewhat successful” and “very successful” being a “1”. Binomial logistic regression was then used to test the relationship between the tools and incentives measures (collectively) and the binary success variables for each of the five priorities. The results of the five models are presented in Table 8. All five models were found to be statistically significant. In terms of relationships between specific program measures and success, a statistically significant positive relationship was found between seven measures and claim of success. The investment measure was strongly associated with success with job growth (OR 1.824), tax growth (OR 2.761), quality of life (OR 3.231) and environmental sustainability (OR 2.616). Assistance was strongly associated with quality of life success (OR 2.046), sustainability was associated with success in environmental sustainability (OR 3.893) and social equity (OR 1.899).

Table 8

Figure 2 provides a diagram illustrating the statistically significant relationships for individual components of the binomial logistic models, and moderate effects (Cohen’s d) from the t-tests.

Figure 2

The above analysis of the ICMA data set reveals some internal connectivity between motivation, priorities, and organization (programs) consistent with past research. Municipalities with strong economies are less interested in jobs than those with a weak economy. And municipalities with weak economies are not likely to establish environmental sustainability as a priority. The pattern of data appears logical in this phase of the study – and consistent with past studies (Reese & Fasenfest, 2004, p. 12; Warner & Zheng, 2013). Weak economies focus on the basics, and progressive municipalities pursue environmental sustainability and social equity. The association of public investment (Investment) with results in several categories likely reflects the ability of the municipality to tie direct expenditures with tangible results through operating or capital budget processes.

This exploratory study reveals that local economic development priorities are as unique as the municipality where they are set. Unlike other disciplines in the public sector, finding common ground is difficult. Police departments have crime rates, fire departments have response times, and public works departments have common unit costs that are measurable and repeatable. Local economic development priorities and programs are a reflection of the wealth of a community and the struggle to build or maintain that wealth. Municipalities with strong economies are less interested in jobs than those with a weak economy and are more likely to pursue environmental sustainability and social equity goals. Municipalities with weak economies focus primarily on the basics; jobs and tax revenues. The results, however, are the same; while there are statistically significant correlations between economic development programs and self-reported measures of success, when actual results are substituted, the statistical significance disappears. 


About the author: Bill Farley has 30 years of experience in local economic and community development as a public official, entrepreneur and corporate executive. He is a former instructor of public policy and public finance at the University of Southern California Price School of Public Policy. He is currently advising organizations on local economic policy while completing a PhD in Public Policy and Administration at Virginia Commonwealth University. 

Rethinking Metrics for Local Economic Development

The unemployment rate is too simplistic a measure to use for gauging the condition of a local economy. It masks the number of workers underemployed and those making less than a living wage. The workers suffering under the current economy are those local governments need to perform at high level.

Every chance I get I’m asking politicians about the metrics they use to evaluate their constituent’s local economy. The answers so far are not surprising. The unemployment rate is almost always the first mentioned. Local government officials lean on this statistic as well. While I was in Virginia taking courses for my PhD, I looked at 40 economic metrics tracked by six local governments in the Virginia Beach metropolitan area. While there was not one metric shared by all six, the unemployment rate was one of the few used by five of the six agencies.

The unemployment rate measures the number of residents who are looking for employment but have not yet succeeded in finding work. This is important information and it is readily available. However, it does not tell us how many working age residents have given up looking, whether residents are employed part-time or full-time, or whether they are making a living wage.  Collecting data on these more nuanced dimensions of employment is more difficult. Even more difficult, however, is trying to reconcile the nuanced and simplistic data when they diverge. Attempting to reconcile nuanced misery with simplistic success rarely advances ones administrative or political career.  So then, what could motivate a local official or politician to venture into advanced measures of local economic health, and what should they measure? I suggest the motivator could be protecting or increasing the local tax base, and the measure should be the living wage gap for residents working on the front-lines of high-tax producing businesses – brick and mortar retail and hotels.

The International City Manager’s Association (ICMA) surveys member organizations on a regular basis to determine local economic development priorities and programs. Increasing taxes is the top priority of municipalities, ahead of jobs, quality of life improvements, environmental sustainability and social equity. Cities employ several strategies to boost tax revenues. Promoting tourism can result in more hotel taxes and encouraging retail development can increase sales tax revenues.  Both sectors, however, face stiff external competition. Hotels face national and international competition and retailers battle numerous regional and on-line competitors. Employers understand the need to have quality employees on the front-lines. Employees working in these high-tax businesses are subjected to rigorous screening and performance standards. They must pass a psychological screening during the hiring process and face continuous job enlargement once on the job. Front desk employees at hotels must also work as custodians and wait staff, and retail cashiers must collect a quota of email addresses from customers while providing outstanding service. The effectiveness of these front-line employees determines the success of the business and the tax revenues generated for the local government. Both business and local government have a stake in the economic health of these front-line employees.

Collecting and synthesizing data to assess the economic health of front-line employees takes a few steps, and there is some estimating necessary in smaller counties and towns. But even if the results are more illustrative than precise, for local governments competing to preserve or expand their tax base, it represents a rare and important intersection of social equity and self-preservation. Only by knowing the economic health of these de facto local ambassadors and tax collectors, can a local government begin a dialogue on policies which could buttress this important segment of every local economy.  There are two measures that I’ll cover in this article. The first is measurement of the gap between actual wages and living wages for front-line employees. The second measure is the percentage of front-line workers making above a living wage.

Determining various measures of the living wage gap in a county requires three data-sets; 1) MIT’s Living Wage data base, 2) the Bureau of Labor Statistics’ (BLS) wage survey, and 3) income data from the Census Bureaus’ American Community Survey (ACS). MIT’s data is available for all counties and most cities. For the examples I’ve include in this article, I’m using data from 22 rural counties in southeast Iowa (Figure 1). I’ll detail the specific steps in a separate technical appendix, but for this article, much like your favorite cooking show, I’ll jump right from the ingredients to the finish product.

Figure 1: Southeast Rural Iowa Counties (Outlined in Red)

Figure 1 Map for Metric.jpg

 

MIT’s data base provides living wages for several combinations of adults and children. For this article I’ll present a living wage gaps for a single individual and a two-income family with two children. For actual wage data, I’ve selected six front-line classifications in the retail and hotel industries; cashier, retail sales, cook, waitstaff, food production, front desk, and housekeeper. This equals approximately 11% of a local workforce and may account for upwards of 30% of local tax collections. Table 1 provides a chart of the living wages for each county, Table 2 provides wage percentiles for each of the classifications for all southeast Iowa. The wage gap for each classification is calculated by expanding the wage distribution from a first, to a one hundredth percentile, and then using the living wage to determine the collective wage gap, as well as the percentage of employees making more than a living wage. See Figure 2 for an illustration of this calculation.

Table 1

Table 2

 

Figure 2: Living Wage Gap Example

Figure 1 for Metric Article

 

For these 22 counties in rural southeast Iowa, with a combined population of 520,000 and a workforce of 250,000, the percentage of workers earning a living wage is highest for retail staff, with 45% to 57% earning a living wage, and lowest for wait staff at between 12% and 22%.  Cumulatively, the wage gap for the selected front-line employees in these 22 counties is $61 million using a single person model, and $271 million using a two adult, two child household model. Table 3 provides a chart of the living wage gaps by county, alongside, for context, per capita income and an aggregate income for all residents of each county.

Table 3

 

The data collected and synthesized for these living wage metrics reveal significant stress on the front-line employees collecting sales tax and serving visitors to the community. The living wage data here can be used to start a dialog on the potential value of reducing stress on key front-line employees, the stakes for local government pursuing this goal, and the type of public policies which could achieve this end. For most, this would be an uncomfortable conversation, particularly while the unemployment rate is at historical lows. This is because we have been conditioned to equate unemployment with economic health in our communities, but as this data shows, that is not always the case.

My purpose for this article is to encourage local governments to deemphasize the use of unemployment rates to measure local economic development, present sub-living wages in a new light and to identify a logical coalition of business and government to address the living wage issue for specific sectors. This is clearly a radical notion and the policy options to pursue such a course are largely uncharted. For that reason, I want to conclude with some cautionary advice and then follow with a few ideas on specific and practical program options. My cautionary advice is this, first, I would be careful to develop separate solutions for national corporations and local businesses. The nationalization of our economy has given substantial advantages to national retailers. Also, the profits of national retailers do not stay in the community like local businesses. A two-class solutions needs to be considered – one for national corporations and one for local businesses.  Second, I would set a long horizon to implement changes, allowing programs to be eased in during cycles where there is the least impact. This is how private investors build wealth, and the same tactic can be used by disciplined local governments. Third, I would develop separate programs for retail businesses and hotel operations. Hotels have an equity component that retail owners do not. Put another way, retail buildings are disposable and little value that can contribute to absorbing program interventions, whereas hotels have significant equity to contribute to a desired outcome. The frailty of retail is evident in the epidemic of business closings and building vacancies because of increasing on-line sales. The resilience of hotels is evident in rarity of permanent closings.

The program options I recommend to bolster the economic health of private employees on the front-line of local revenue collections are based on other traditional economic development programs. Local governments offer tax rebates, allocate new tax revenues and contribute public infrastructure improvements in return for achieving specific economic outcomes. All these options could be used in public-private partnership to develop and enhance the economic security of the front-line workforce. A targeted living wage ordinance, coupled with the above tax sharing programs, could also be employed to fairly distribute the burden of economic security for front-line employees.  The public share of the burden can be adjusted based on the class (national or local) and type of business (retail or hotel).  National corporations and hotel properties can shoulder a greater share of the burden.

Local governments have a stake in the economic security of residents, and particularly those on the front-lines of businesses producing tax revenues.  The unemployment rate has little utility for assessing the economic health of these residents. Additional data and analysis are necessary to make a true assessment of wages for these front-line employees, and to create a foundation for exploring program options to address this important aspect of local economic development. Raising tax revenues is the top priority of local economic development programs across the county, and the active engagement of local governments in advancing economic security of key employees through public-private partnerships, using traditional tax sharing schemes, is strategy worth exploring.


About the author: Bill Farley has 30 years of experience in local economic and community development as a public official, entrepreneur and corporate executive. He is a former instructor of public policy and public finance at the University of Southern California Price School of Public Policy. He is currently advising organizations on local economic policy while completing a PhD in Public Policy and Administration at Virginia Commonwealth University. 

Reporting Accuracy in Local Economic Development Programs

This exploratory study finds significant inaccuracies in self-reported data in the International City Manager’s 2014 Survey on Local Economic Development. These inaccuracies hinder the use of the data in evaluating program results, and raise issues about previous scholarship that used this data exclusively without validation from secondary sources. This exploratory study was followed by another study looking at predictors of accurate reporting. This latter study is currently under peer-review. 

Defining the limits of local economic development programs has been a vexing problem for scholars and public officials. Every aspect of planning, organizing, operating, and reporting economic development programs is fraught with complications. Complications with planning local economic development programs start with defining and measuring realistic outcomes. Increasing jobs and tax revenues are two traditional goals, but these, as Paul Peterson and others argue, are typically beyond the resources or political strength of their institutions or elected leaders (Peterson, 1981, p. 4; United States Congress, 1975, p. 11). If increasing jobs is a priority, the challenge becomes balancing the needs of business, and the interests of employed and unemployed of the community  (Adua & Lobao, 2015; Lobao & Kraybill, 2014). If tax growth is a priority, overcoming barriers to intergovernmental cooperation  poses significant challenges (Kwon & Feiock, 2010).  Measuring and reporting effectiveness, particularly when it comes to job creation, is another test.  Past research on local economic development program outcomes finds little in the way of employment, income, or fiscal benefits (Feiock, 2002) or worse, spur zero- or negative-sum competition (Reese, 1991; Reese & Rosenfeld, 2004).  Reporting negative or contradictory results is problematic for public administrators tasked with producing successful economic development programs.  The pressure to report positive results, applied more broadly to all public programs, has sparked a separate stream of research, focused on the integrity of the information exchange between public officials and their principals (Bartik, 1994, p. 99; Musgrave & Musgrave, 1989, p. 99).

While past research on local economic development programs has studied the relationship between priorities, barriers to success, and programming (Reese & Fasenfest, 2004, p. 12; Warner & Zheng, 2013), a noticeable gap is an assessment of the accuracy of program results reported by local officials. Despite the wide use self-reported data from national surveys of local economic development programs in academic research, there is no known research testing the validity of claims of success (or failure) by survey respondents. This paper explores this gap with an inductive study of the accuracy of self-reporting successes and failures.

To assess the state of local economic development program reporting practices, responses by municipalities to an economic development survey conducted by ICMA are paired with data collected by the United States Census Bureau on employment and tax revenues from the same time period.  The ICMA surveys its members on a regular basis on government operations, facilities, technology, sustainability and economic development. The results of these survey are provided in summary form to members and the public, and the underlying data is available to purchase for research purposes. The data set used in this study is the most recent ICMA survey on local economic development (2014). The survey was distributed to ICMA’s 5,237 members and 23% responded (N: 1201).  The response rate reflects the deletion of eleven cases that were not identified with a government entity. Additional steps used to clean the ICMA data are detailed in the appendix. Approximately two-thirds of the respondents were municipalities – with the balance being counties, special governments, and non-profits (International City Managers Association, 2014). Municipalities are the focus of this inquiry because of the consistency of their organization, roles, and responsibilities. Counties, special districts, and non-profits can be organized in a number of ways, making it difficult to compare survey results (Peterson, 1981, p. 10).  Table 1 provides basic demographic comparisons between the municipal survey respondents (n=827) and all places within the United States. The ICMA participants are generally among the larger places/municipalities, but have relatively equal income per capita, and slightly higher income deficits per capita. Property taxes are generally higher, and sales taxes are lower (Table 1). The stratification of the participants by population, compared to all other places/municipalities, is approximate for populations above ten thousand (Table 2).

Table 1

 

Table2

The ICMA survey instrument included 25 questions. Twenty-two of these questions were close-ended with a predetermined set of multiple-choice answers.  The number of multiple-choice options in these close-ended questions ranged from 2 to 32. The questions involved planning (motivation, barriers, priorities), programs (tools and incentives), and claims of success.  The menu of priorities included traditional and Type II programing; creating jobs, increasing the tax base, quality of life, environmental sustainability, and social equity. A summary of the responses from municipalities on priorities and claims of success is provided in Table 3. The priorities of municipalities in the survey are generally consistent, with over 85% indicating that increasing jobs and the local tax base, along with improving quality of life are priorities. The responses are more varied for establishing environmental sustainability (42%), and social equity (25%) as priorities. As for success in meeting these priorities, just over 89% claim some level of success with job growth, tax growth, improvement in the quality of life, and progress towards environmental sustainability. Claims of success on social equity are substantially less, dropping to approximately 76%.

Table3.JPG

Testing Accuracy of Claims of Success or Failure

The first part of the exploratory study compares secondary data on actual job growth (2010 to 2014) and actual tax base growth (2012-2014) with the claims of success or failures from the ICMA survey responses. No definitive secondary data sources were identified to verify claims of success, or failure, improving quality of life, or advancing environmental sustainability or social equity.  For job growth, unemployment and employment status was collected for each municipality from the American Community Survey (Table S2301) for 2010 through 2014  (U.S. Census Bureau, 2010, 2011, 2012b, 2013b, 2014b). Both measures of employment were used because it is not known how each jurisdiction measures job creation. Also, since it is unclear what time-frame respondents to the ICMA survey used for gauging success, rates of change were calculated for the periods, 2010 to 2014, 2011 to 2014, 2012 to 2014 and 2013 to 2014. Eight binary dummy variables were created, representing each of the four time-frames and the two measurements (employment rate and unemployment rate) with “0” representing no growth in employment or decrease in unemployment, and “1” representing growth in employment and a decrease in unemployment.  For tax growth, property and sales tax data was collected from the Census Bureau’s State and Local Government Finances survey for 2012 through 2014 (codes T01 and T09)(U.S. Census Bureau, 2012c, 2013b, 2014c).  The Bureau notes that this data set may include high sampling errors (U.S. Census Bureau, 2012a, 2013a, 2014a). Again, since it is not clear what time frame respondents were contemplating when making claims of success or failure, rates of change were calculated for the periods 2012 to 2014 and 2013 to 2014. Only two periods were used for tax revenues, because typically municipalities measure and report tax revenues on an annual or bi-annual basis. Two binary dummy variables were created, representing each of the two time-frames and the single measurements (change in tax collections) with “0” representing no growth in tax revenue and “1” representing growth in tax revenue.

After the ten dummy variables were created for both actual jobs and tax growth, they were cross-tabulated with binary dummy variables representing survey claims of success or failure. Municipalities are deemed to be accurate if claims matched actual results. For example, if a city claims no success growing jobs, and the job growth rate was negative, the city is deemed to be accurate. If a city claims some job growth success, but yet experienced negative employment growth, that city’s claim in the survey is designated as inaccurate. The results of this cross-tabulation are present ed in Table 4.  The accuracy of claims of success, or failure, by respondents increased with shorter time frames. For example, the accuracy of job claims using the unemployment rate, increased from 28% using a four-year period (2010 to 2014) to 75% using a one-year period (2013-2014). Similar improvement occurred using the employment rate, with 24% accuracy using a four-year period and 66% accuracy using a one-year period. The accuracy of tax revenue claims improved slightly, 71% to 74%, contrasting two- and one-year periods.

Table4.JPG

Evaluating Programs using Self-reported and Actual Data

The next step to explore the accuracy of survey data was to compare the effectiveness of local economic development programs using self-reported and actual data. For this analysis, a binary dummy variable was created with the ICMA data to measure success with a response of “none” being a “0” and responses of “somewhat successful” and “very successful” being a “1”. Measures for programs (tools/incentives) were developed by combining multiple responses from the ICMA survey through factor analysis. The factor analysis started with 48 items from the ICMA survey relating to programs. The items associated programs, measured on four-point Likert scales, were reduced through factor analysis to seven measures and tested for internal consistency (α). The measures created for programs used 24 of the 48 select items. These measures are “direct business support” (α:.792), “sustainability programs” (α:.732), “marketing” (α:.731), “finance” (α:.719), “investment” (α: .681), “contributions” (α: .664), and “assistance” (α:.703) (Table 5). A consolidated description of all the program measures is provided in Table 6.

Table5

Table6

Binomial logistic regression was then used to test and compare the relationship between the programs (collectively) and the binary success variables using self-reported and actual data. The results of these models are presented in Tables 7 and 8.   In Table 7 a statistically significant relationship is found between the seven measures (collectively) and self-reported claims of success for both jobs and tax revenues. The investment measure was strongly associated with success with job growth (OR 1.824) and tax growth (OR 2.761).  With actual data (Table 8), no statistically significant relationship was found between the seven program measures (collectively) and actual success increasing jobs, decreasing unemployment or increasing tax revenues. This analysis used the period from 2013 to 2014 for the success measures. In summary, with self-reported data the relationship between programs and claims of success were statistically significant in some instances, but using actual data, the relationship between programs and results were not statistically significant.

Table7

Table8

Conclusions

The use of self-reported data in ICMA economic development surveys is problematic for public officials, community members and researchers. Alternative data, or validation methods must be employed to ensure the voracity of the self-reported data. Finding reliable alternatives to assess program results is important for public officials and community members as the information exchange between staff and the public is a critical part of the democratic process.

For researchers, the use of self-reported data in ICMA surveys is compounded by past research that used this data exclusively to address research questions. ICMA, or equivalent survey data,  has been used to quantify the balance between pro-business policies social services (Adua & Lobao, 2015), determine the interaction of privatization, business attraction and social services (Lobao & Kraybill, 2014) assess the ability of poor cities to pursue local economic development (Lobao & Kraybill, 2009) and determine the economic climate where business incentives are deployed (Warner & Zheng, 2013; Zheng & Warner, 2010).  Researchers should be careful in citing these studies without checking to see how the ICMA data was used, and if it was validated by other sources.

Further study

The disparities between findings in the exploratory study using self-reported versus actual data generates the research question for further study; what are the predictors of accurate performance reporting in local economic development? There are two important reasons to address the accuracy of reporting from local economic development programs. First, access to accurate information about public programs is a critical safeguard of our democratic system. Murray Edelman summed it up this way, “Citizens who are informed about political development can more effectively protect and promote their own interests and the public interests”(Edelman, 1989, p. 382). For Paul Peterson, access to quality information is critical to a reasoned discourse on urban policy, “neither city residents nor city leaders are fools. On the contrary, they can be expected to think about their situations and take reasoned positions on the problems they face – within the limits of the information available to them (Peterson, 1981, p. xii).

I have completed a study with the subject research question. My methods and findings are currently under review by a peer-reviewed journal. I will post my results once I have passed the peer-review process. 


About the author: Bill Farley has 30 years of experience in local economic and community development as a public official, entrepreneur and corporate executive. He is a former instructor of public policy and public finance at the University of Southern California Price School of Public Policy. He is currently advising organizations on local economic policy while completing a PhD in Public Policy and Administration at Virginia Commonwealth University. 

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Zheng, L., & Warner, M. (2010). Business Incentive Use Among U.S. Local Governments: A Story of Accountability and Policy Learning. Economic Development Quarterly, 24(4), 325–336. https://doi.org/10.1177/0891242410376237

Murray’s Monterey

Footprint and Postcard

Murray’s mansion and the property he held across the street (labeled a private park in property records).

Last month I travelled to Monterey, California to tie up loose ends on research for my biography of James A. Murray. I knew several things about Murray’s life in Monterey prior to my trip. He moved there in 1904, at age 64, eight years into his second marriage. He purchased the Tevis Estate from David Jacks, and was likely the home’s first permanent occupant. The home remained in the Murray family until it was demolished in the 1940’s to make way for the expansion of Cannery Row. Murray died in the home in 1921 and the battle for his estate played out in the Monterey Superior Court. Today, a portion of the residence (the horse stables and corral) is the site of the Monterey Bay Plaza & Spa. Five other buildings occupy the site as well. The Monterey Bay Inn sits on the location of his main residence. During the seventeen-year period that Murray called Monterey his home, he commissioned a monument to mark the location of Junipero Serra’s first mass, purchased a Leon Trousset painting of the same event, found work for a dear friend at the Monterey Cypress newspaper, buried that friend at the San Carlos cemetery, commissioned a monument to mark his friend’s grave, and loaned money to several Monterey residents, including artist Charles Rollo Peters. Murray’s wife remained in Monterey after his death, as did her son by another marriage, Stuart Haldorn, and his wife Enid Gregg.

Serra Trousett

Murray’s Trousset painting now hangs in the Carmel Mission.

My primary research objective on this trip was to define the relationship between Murray and Charles Rollo Peters. My secondary objective was very broad. I wanted to find any other information that would further define Murray’s role in Monterey’s early history. My advance work for the trip was aided by James Perry at the Monterey County Historical Society and Dennis Copeland at the City Library. Perry pulled the case numbers I needed to look up court records involving Murray – two of which involved Peters. Copeland pulled a glass negative of the Trousset painting that I could examine to determine if Murray’s version was the same one that now hangs in the Carmel Mission. My plan was to review the cases at the Superior Court, see if the negative matched the Trousset painting at the Carmel Mission and then spend time looking though reels of local newspapers at the City Library. My time flipping through the newspapers was just a hunt for random stories.

My time at the court went very quickly. The lawsuits between Murray and Peters were very revealing. Murray lent Peters a total of $15,000 in two loans between 1906 and 1907. This was a significant amount of money in that time period. It would take a blue collar worker 30 years to earn that amount, and a white collar worker ten. Both loans were secured against his estate (Peters’ Gate). This was at a time of lavish spending for Peters. He took in artists after the 1906 earthquake and opened a gallery at the Del Monte hotel. Both notes were due within one year, but as with many of his charitable loans, Murray did not make any effort to collect. When Murray died, he held over 50 uncollected private loans to individuals totaling over $1.25 million. Many were worthless and of a similar age to Peters’ notes. It seems he only moved to collect on these private loans if he felt slighted.

It appears Murray’s lawsuits were prompted because Peters sold his estate (Murray’s collateral) between 1909 and 1910, and did not use the any of the proceeds to repay Murray. This likely irritated Murray, so he foreclosed on the new property owner to assert his right to title. It appears he won his effort to gain title to the property, as new owner entered into a mortgage with Murray. Whether any money exchanged hands for the clouded title is unclear. Murray probably did not receive much, but the foreclosure process allowed him to go after Peters for some compensation. The court records indicate Peters was forced to sell two paintings hanging at the St. Francis hotel in San Francisco to make at least a symbolic payment to Murray. Paintings by established California artists at that time sold for $50 to $500.

The lawsuit with Hugh Porter revealed that Murray started the Monterey Cypress newspaper in 1907 and lent Porter, the paper’s editor,  half of the start-up money to be a partner in the business. Murray did this with a lot of people to avoid paying them a salary – instead, his partners worked for free and had to make sufficient profit to pay off Murray’s loan. In this case, Porter also had to make sure he could pay John Maguire’s salary as associate editor. Murray also owned newspapers in Pocatello, Idaho and Livingston, Montana where he had business interests. He also invested heavily in the radical Butte Bulletin.

Carmel Mission Basilica

When I visited the City Library I discovered that in the week prior, the library has just transitioned all of their microfilm roles to an on-line platform. I searched the database very quickly and found a great article on (new-to-me) renovations at the Carmel Mission funded by Murray in 1908. This work was completed shortly before the installation of his Serra Monument. I then spent some time in the California Room browsing through file cabinets and shelves. I found some good articles on Charles Rollo Peters to provide context for Murray’s loans and the disposition of Peters’ Gate. The image of Murray’s Trousset was out for scanning, so Dennis arranged to send me a copy via email later in the week.

Steps to Little Pulpit

Steps to small pulpit in Carmel Mission. Repaired by Murray.

I accomplished all of the goals I set for the trip, so I shortened my stay in Monterey and booked a room near U.C. Berkeley. I wanted to check out the Douglas Tilden papers to see if there were any mention of the base reliefs he prepared for the Serra Monument Murray commissioned at the Lower Presidio Historic Park. As I left town the next day for Berkeley, I stopped by the Carmel Mission to see if any of the work Murray commissioned still existed. The curator, Jewel Gentry, was kind enough to give me a tour of the mission. It appeared to me that only the work Murray did with the stairways remained. My last stops before leaving the area were the Monterey County Historical Society and the County Recorder. At the society office I had a chance to brief Perry on what I had found, and at the Recorder’s Office I found several new-to-me property documents that enlarged the footprint of Murray’s ocean front mansion.

IMG_0745My trip to Berkeley the next day only provided a couple bits of new information, but reading Tilden’s papers was a very moving experience. With a few extra hours I had, I made another unplanned trip to Mission Delores to see a bronze casting of the Tilden base relief that was part of Murray’s Serra monument.

HuntersHotSprings Tri-fold Post Card (2)

Murray’s Hunter’s Hot Springs Resort with Mission Style Architecture (Montana).

With my new research I have a fuller picture of Murray’s role in Monterey’s historic preservation, the lengths he went for his good friend John Maguire, and the secret role he played in funding the area’s artist colony. It also came clear to me just how much influence the mission architecture influenced his other projects. Two resorts that he developed in Montana reflected this influence. Monterey was fortunate that they were able to experience the best of Murray’s personality. Most places where he did business were not so fortunate.

Now back to writing the biography of my complicated relative……

Letters of heartbreak and hardship worth the visit

After two days researching documents in Monterey, I moved north and spent a day at the Bancroft Library on the U.C. Berkeley campus. There I reviewed the papers of famed sculptor Douglas Tilden. My subject, James A. Murray, commissioned two base reliefs from

Base Relief

Created by Tilden for Serra’s Cross

Tilden in 1904. Both adorn the monument Murray placed at the spot of Father Serra’s first mass in Monterey, California. One is a profile of Serra and the other a likeness of Mission Carmel. I quickly realized that I would not find anything of significance relating to Murray’s monument, but left with several hours of spare time on my hands, I started reading through random letters in the collection. I’m glad I did.

After reviewing several folders, I was struck by the heartbreak and hardship in Tilden’s life. Before Tilden garnered great success in his late thirties, his collection of papers includes terse correspondence from bill collectors, associates in desperate straits pleading for payment from Tilden, and even Alexander Graham Bell’s handwritten note expressing regret he could not afford to buy any of Tilden’s wares. I approximate that half of Tilden’s professional arc was a flat line of despair and agony. Adding to his hardship was a hearing impairment that rendered his world silent.

I wondered why Tilden held on to these reminders of suffering, and then it occurred to meDouglas-Tilden-WPA-by-Peter-Van-Valkenburgh I had seen this before. I’ve reviewed the papers of two other individuals at University archives and both of them, despite having a public perception of great success, also left a trail of papers documenting the darkest days of their careers. In the biographies that treat their lives you might read that they experienced early hardships, but in their papers – in their own hand and those of others – you feel excruciating pain. Willis Polk, who went on to become a noted architect, wrote Tilden a note on a small piece paper in the late 1890’s pleading for a payment of a few dollars. Family members had taken ill and he desperately needed payment to take care of their medical needs.  Tilden saved none of his responses, but three additional notes from Polk over six months, each escalating in desperation, indicate that Tilden could not make ends meet.  In the other papers I reviewed, those of Ed Fletcher and Frank Brown, I also read desperate pleas from men, all whom showed a strong public face, needing money to take care of their wives, children and parents.

So despite coming away empty in new facts, I did gain additional perspective on the wreckage caused by subject’s like mine, when they leverage desperation to meet their business goals. Perhaps this is the reason, in part or in whole, that my three left their papers for others to see.

If you have a historical figure of interest I strongly encourage you to see if they, or their partners, donated papers to archives. If they did, they left a trail for you to follow to gain additional perspective on their lives, and their interactions with others. Seeing for yourself, the steadiness of their hand, their choice of stationary, and most importantly their own words, will give you valuable insights that even the best biographer is want to capture.  It will be worth the trip.

Picture in banner: Tilden’s Mechanic sculpture amidst the ruins of the 1906 San Francisco earthquake.

Tieing up the last loose end…

I’m travelling to Monterey this week to look through court records from the early 1900’s involving James A. Murray’s lawsuits against famed artist Charles Rollo Peters. It appears Murray held a substantial mortgage against Peter’s Gate, the artist’s popular retreat. Hopefully the court records and local newspaper accounts of the trial will review the nature of thier partnership. I’m hoping there is more to the story than Murray’s typical loan sharking practices. This is the last loose end in my research on Murray’s activities in Monterey.Murray v. Rollo.jpg

My Unorthodox Query Letter is Rejected. But I Wouldn’t Have Changed it.

My brother’s query on a unique travel destination between Las Vegas and Lake Tahoe. Tonapah was a roaring mining camp back in late 1800’s and through the turn of the century. There is a nice hotel in town that has been restored recently. It makes a great pit stop.

thomas farley's blog

My query letter to National Geographic’s Traveler was just rejected. But I think I did the best I could. Here are the details. Perhaps you will be inspired to put your own off-the-wall query letter into the mail.

I proposed a travelogue to central Nevada, participatory tourism to discover turquoise at the Royal Royston claim outside of Tonopah. That was what my Rock&Gem (internal link) article was all about and I thought I might interest Nat Geo in a piece tailored toward their audience.

Since my article and query letter revolved around turquoise, I decided to confort the query letter editor with the real thing: real turquoise. I bundled up two samples, one rough, one finished, and sent them off. I included my magazine article and a photo of Kate Blanchett at the Academy Awards wearing a turquoise necklace. Just to show turquoise is in style. (See the image below.)

Alas, my…

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Our presidential contenders could all benefit from free college tuition when they were 18

Daily ClogLilia Vega of the Daily Clog takes baby boomers on a walk down memory lane with her piece that details the history of tuition and fees in the University of California system since 1868.

The UC system, one of two in California, and home to UC Berkeley and UCLA, started in 1868 with a goal of free tuition for all students. The system met that goal for over one hundred years. Here are the undergraduate tuition and fees that our presidential candidates would have paid if they entered the UC system when they were 18:

The above charges were fees for non-classroom expenses. Tuition was free. Adjusting these fees to today’s dollars, results in annual college costs for our candidates of $1,123, $1,348, $1,510, and $2,146.

And the cost for our next generation of leaders?

In 2015-16 our next generation is paying $5,006 per quarter ($15,000 per year) for the UC system. Of this amount, $3,740 per quarter is for tuition ($11,220 per year) and $1,266 is for fees ($3,800 per year). The new college catalogs address this with an entire section devoted to student loan programs, a feature missing in catalogs from the baby boom years.

Book Review: When Mandates Work: Raising Labor Standards at the Local Level

when_mandates_workWhen Mandates Work [1] is a good resource guide for use in cities and airports located in primary urban markets. Most of the research centers on San Francisco, which likely applies to cities like Seattle, Portland and San Diego and their airports. The content of the book is drawn from individual journal articles written by several different authors, so the content varies dramatically from chapter to chapter.

Part one of the book looks at living wage ordinances in cities and airports. Significant benefits are found in terms of reduced turnover rates and improved employee morale. For restaurants in one study, price increases  of 2.8 percent occurred, which is remarkably similar to estimates on anticipated cost increases derived using MIT’s living wage models.[2] As an aside, I am confounded that there is not bi-partisan support for living wages at fast food restaurants across the country. Why any fiscal conservative would not want the fast food industry to stand on its own, and stop using federal subsidies to bolster worker’s living standards, is incomprehensible.[3] Every fiscal hawk should be wagging their finger at Ronald McDonald to get off the public dole!

Part 2 covers health care benefits and Part 3 provides execution strategies – including the use of Community Benefit Agreements (CBAs).

Anyone looking at CBA’s for their city should take a close look at the CBA negotiated with Twitter in San Francisco. The hearings on this document are readily available on-line in City archives. Twitter clobbered the City in negotiations. Adding insult to injury, the primary beneficiary of Twitter’s move to the City’s central business district (building owners) did not participate at all in the CBA.

If you are on a budget, review the table of contents and search for the individual journal articles that comprise this book which are relevant to your situation, and download those individually (most libraries provide patrons with access to JSTOR – the primary database for academic journal articles).


[1] Michael Reich, Ken Jacobs, and Miranda Dietz, eds., When Mandates Work: Raising Labor Standards at the Local Level (University of California Press, 2014).

[2] http://livingwage.mit.edu/

[3] McDonald’s has in the past directed employees to federal assistance programs through their employee hotline.