Assessment of City Economic Development Structure
As Cape Coral grows, it is crucial that economic growth also grows, and the goal should be a reasonable balance of the two metrics. Without economic performance gains, municipal services and budgets will be forced to accommodate significant stress in meeting the needs of a larger and aging population. New revenue from business expansion and investment will provide the financial resources that the City of Cape Coral will need in the future.
As of the present time, this is not being accomplished. In the table below, Cape Coral and its competing cities’ three-year annual rates of growth for the Per Capita Gross Domestic Product (GDP) are compared to Population Growth to produce an Economic Balance Ratio. Data for GDP is based on county-level only, since GDP information is not available on a city level from the Bureau of Economic Analysis (BEA).
As indicated, Cape Coral demonstrates an alarming economic imbalance and trails five of the six competing cities. The State of Florida’s 2.48 ratio should be considered as the benchmrk level, and Cape Coral’s 0.54 figure must serve as a wake-up call that more effort is needed to promote economic development in the City.
The Cape Coral Office of Economic & Business Development (OEBD) is the Economic Development Organization (EDO) for the City. The goal of this task will be an assessment of staffing, funding (including grant applications), community leadership, risk tolerance, and more.
Initial observation of the OEBD is that its role is one of an office or a position rather than as a City department. The OEBD serves below the Assistant to the City Manager along with the Office of Communications and Professional Compliance Officer. Recognition of the importance of Economic Development should be stressed to the City leadership. Elevation of the OEBD to full department status would seem to be a prudent course of action.
As of the FY 2024 report, the OEBD staffing of 4 full-time employees (FTE)s as follows:
Note: The OEBD does not have a full-time grant writing specialist.
The adopted Annual budget for Economic Development in Cape Coral is $1.306 million for FY 2024. Forecasting for 2025 shows a decline to $924,390, but then a steady 2.6% growth through 2028. The OEBD’s operating budget is derived from the collection of business tax receipts, without any funding contribution from the City’s General Fund.
City of Fort Lauderdale
The City of Fort Lauderdale’s Economic Development office has 1 FTE and is a non-regulatory advisory board within of the Public Affairs division of the City Manager’s office . The FY 2024 adopted budget for the Public Affairs $2.121 million, up 27% over FY 2023 figures.
The City of Orlando
The City of Orlando has 9 FTE’s dedicated to economic development and 8 FTE’s for business development. The total staff is 283 persons and the department has an operating budget of $49.077 million. The City of Orlando Economic Development Department supervises the following:
City of Palm Bay
The City of Palm Bay’s Community & Economic Department has 21 FTEs and an annual operating budget of $7.490 million. The Dept. oversees Housing CDBG grants and the Bayfront CRA. FY 2024 objectives include increasing commercial and industrial growth through a series of strategies that leverage assets such as the high-technology sector, economic incentives, crime prevention measures, and underutilized sites.
City of Pompano Beach
The City of Pompano Beach’s Economic Development Office has 1 FTE is organized under the Assistant City Manager’s Office . The office has an operating budget of $225,400. The office provides support to the Pompano Beach Economic Dev. Council, an advisory board with some members being appointed from the City Commission. The City has an innovative plan for its Downtown CRA that is geared toward commercial investment.
City of Port St. Lucie
The City of Port St. Lucie Office of Economic Development has 1 FTE and an annual operating budget of $560,000, up about 24% from the previous year. The Office is organized under the Assistant City Manage and is funded through the General Fund. Economic Development is a member of the City’s Land Development Team which prequalifies companies for expedited site plan review and fast track permitting. The City also offers the opportunity to mitigate any real or perceived disadvantage due to impact fees to certain qualified target industry businesses.
City of West Palm Beach
The City of West Palm Beach Office of Economic Development has 1 FTE and an annual operating budget of $379,000. The office is organized directly under the Mayor’s Office. Innovative incentive programs include the Building Improvement Grant Program, the Merchants/Industry Association Creation Program, and the Ad Valorem Tax Exemption for Job Creation Ordinance.
City of Tampa
For purpose of comparison, the City of Tampa has been selected as the largest city in the region. The City of Tampa Development & Economic Opportunity Department (D&EOD) has a staff of 224 persons and an annual operating budget of $53.35 million. The D&EOD supervises the following:
Given that the larger cities have recognized the importance of economic development, this fact should be stressed to the Cape Coral leadership. Smaller competitive cities have not necessarily expanded the role of their economic development programs, but marked increases in budgets for these areas appear to be indicative of changes that will occur in the future.
In this regard, we recommend the elevation of the OEBD to full department status, with some use of the General Fund to be allocated for the development of incentive packages, enhanced marketing programs, speculative development of catalyst projects, and increased staff. In the immediate future, the creation of a grant writing position is vital so that additional funding streams for OEBD operational budget can be achieved. Our initial recommendation is the increase in funding by at least 50% of the current allocation.
Additionally, it might be better to move the CRA under OEBD in the new department. The CRA is a stand-alone department now in Cape Coral, but for the development of incentives and other economic development strategies, having a common level of interest with a single point of leadership could ensure more integration of resources and outcomes. In many of the competing cities evaluated above, CRAs are administered by the EDO.
Upon visiting the Office of Economic & Business Development webpage on the capecoral.gov site, two clickable choices are available to the user: Economic Incentives; and Site Selection. The Economic Development button redirects to a general list of incentive offerings which may or may not be relevant to the user. The Site Selection button redirects to Loopnet.com, a commercial property listing service. At the time of this writing, the Loopnet redirect is not functioning. Sidebar selections provide navigation to eight redirects:
The information on many of these topics are helpful but not particularly detailed and are generally out of date. On the other hand, the quarterly Economic Development Activity reports provided by OEBD are very thorough. The Target Industries section, however, is very weak and only features some prominent local employers. Missing from the website are some important features:
In general, the website is not aesthetically pleasing or very current in graphic layout. Rather than serve as a simple repository of reports and also follow the graphic format of other departments, a new stand-alone Economic Development website should be created. Some examples of superior website design in economic development include:
We recommend that the City of Cape Coral retain a recognized graphic designer to create a more visually pleasing and useful website including a mobile app that utilizes the information generated in our study to present the City to prospective employers. Additionally, as the City has no tourism department and relies on Lee County or the State of Florida for this support, the economic development site will likely also need to provide a dual resource for new webpage visitors as the introduction of Cape Coral as a tourism destination. For this reason, the website will require a level of graphic quality that is missing in the current design.
The Government Finance Officers Association (GFOA) recommends that local governments recognize the value of public infrastructure as an Economic Development Strategy. GFOA recommends that economic development strategies and capital improvement planning should be coordinated and integrated within and among governments. Specifically, governments should do the following:
As Cape Coral expands northward to accommodate new population growth, utility and roadway capital expenses continue to escalate. Presently, housing expansion supplies the revenue for water and sewer services through special assessment. But for speculative development of new commercial, industrial, or institutional properties, the City may become responsible for the full cost burden. To offset these costs, the City can employ the use impact fees. While this use is available to the City, in all likelihood, the abatement of such fees as incentives for private investment may result in enhanced commercial development activity.
The role of the OEBD should be one of mediator for capital expense outlays, helping to demonstrate the viability of anticipated spending in view of strategic directions the City is planning to navigate in the future. Judicious use of Economic Impact Analysis (EIAs) can be quite beneficial in helping to chart that course. EIAs are the means that job creation, direct/indirect/induced benefits, and tax revenue can be evaluated simultaneously to arrive at positive or negative recommendations.
During our engagement with the City of Cape Coral, we will have employed EIAs on many subjects. Our recommendation is that a representative of the OEBD be educated on the use of IMPLAN software and that an annual subscription be purchased for use by the City for ongoing EIA analyses. DCG Corplan personnel can be available to help with training for the new users in the economic impact analysis software program.
One of the most easily achievable paths toward effective economic development is to demonstrate organizational excellence. The International Council of Economic Developers (IEDC) is the premier US membership group of Economic Development Organizations (EDOs). The City of Cape Coral Economic Office of Economic & Business Development (OEBD) is already member in good standing with IEDC but we recommend elevation of the office to an Accredited Economic Development Organization (AEDO).
The AEDO program recognizes the professional excellence of economic development organizations (EDOS). The AEDO Program provides EDOs with independent feedback on their operations, structure, and procedures. With the AEDO recognition, the City’s Economic Development Office will become part of an elite network of EDOS who have gone through the accreditation process. The AEDO status indicates leading authority status of economic-related issues.
Of the 75 North American agencies with AEDO accreditation, only six are in the State of Florida:
We recommend that the requirements for AEDO be reviewed and that a self-examination by the Office be undertaken to determine what milestones might be needed to be reached to achieve AEDO confirmation. The IEDC publishes the “Guide to Becoming an Accredited Economic Development Organization” which explains the process. Once certified, the OEBD will be invited to take part in IEDC’s annual meeting of AEDO's. In addition, as an accredited organization, the OEBD will receive exclusive use of the AEDO logo for letterhead, business cards, promotional materials, and website. Accredited organizations are also profiled in IEDC publications including ED Now and Economic Development Journal.
A common issue with most communities is the time that development permitting requires, often delaying project timelines and incurring greater costs to the applicant. While the goal is to improve the approval time by a fast-tracking method, we must recognize that building code and fire safety reviews cannot be subject to shortcut. What can be expedited, however, is the coordination between various departments and some pre-permitting by land use and zoning conditions, plus on-line management of the permitting process.
Cape Coral has made good efforts at streamlining the process through its Development Services Dept. The online permitting resource featuring the EnerGov Citizen Self-Service plugin (CSS) seems to be an efficient approach toward permit review and approval. What is not apparent, however, is the behind-the-scenes process including interdepartmental coordination. Retaining an expert in the identification of bottlenecks and efficiency improvements might be in order to assist with the process.
For Cape Coral, review of some examples of successful fast-tracking by other public agencies may shed light on strategic improvements for the City (see Task 4 – Appendices for more detailed descriptions):
Loudon County, VA
Fast Track is available for targeted industries including information communication technology, federal government contracting agencies, aerospace and airport supportive businesses, and projects supporting those industry groups. Other commercial projects meeting the criteria may also be considered. Key feature include: Dedicated Project Manager; Top of the List-- reviewing agencies will move the project to the head of review lines for the entire development review process; Special Review Team; and, Aggressive Timelines.
Empire State Economic Development, NY – Shovel-Ready Grant Program
Under New York’s FAST NY Shovel-Ready Grant Program, Empire State Development will provide up to $200 million in grants to prepare and develop sites statewide to jumpstart New York’s shovel-readiness and increase its attractiveness to large employers, including high-tech manufacturing, particularly semiconductor manufacturing, interstate distribution and logistics businesses. The program will help diversify New York State’s economy while propelling new investments for businesses, communities and job creation.
Georgia GRAD Certified Sites The Georgia Ready for Accelerated Development (GRAD) Program offers 60 industrial certified sites that are ready for fast-track construction projects through advance due diligence. Since the program's inception in 2008, more than 8,000 jobs have been created on GRAD sites. The GRAD Certification and Certification Renewal due diligence requirements include surveys of a site's topographical, geotechnical, wetlands and environmental conditions. A full description of the certification and certification renewal processes and all other requirements are provided below. The GRAD Certification is valid for thirty-six (36) months after which the site will be subject to renewal.
HuntleyFirst, IL
The Village of Huntley’s permitting process provides for fast permitting and development approvals. Fast tracking demonstrates Huntley's understanding that time is money. Efficient and timely approvals minimize construction related costs and represent an important economic advantage. Qualified sites are parcels:
From review of the above examples, an underlying theme appears to be pre-certifying sites and properties for targeted uses. Review of the City’s CapeIMS reveals that data encoding includes the Future Land Use of any parcel. What is needed on the OEBD website is a search tool (Site-Finder) that will allow the user to enter a land use category and then display all available properties on the map. A downloadable database of the selections should be able to provide a list of the type of permits needed, the links to those applications from Development Services, and an approximation of the time required to obtain approvals if the intended use is executed. Another possibility is the illustration of available incentives or benefits provided (for example within Cape Coral’s two Opportunity Zones).
What is missing at this point, however, is a review of all future land uses in commercial and industrial lands that focus on the goals of the new targeted industries developed in Task 3. We will address this issue in Task 9 – Land Use and Real Estate Analysis.
For Cape Coral, the growth of small business, especially home-based establishments, is beginning to be a major factor. According to the Institute for Justice (IfJ) “In cities across the country, the path for getting a business up and running is riddled with steep costs, frustrating delays, and confusing steps. Not only must entrepreneurs satisfy a tangled web of regulatory requirements, but they also must often do so without receiving clear guidance from local officials. Red tape on the books and officials’ poor communication and lack of transparency all contribute to the hurdles small businesses face from local government.”
The IfJ suggests that establishing a cheaper, faster, and simpler regulatory environment for small businesses is possible. Municipal leaders can use actionable reforms and best regulatory practices as a roadmap for streamlining the process in their community. Recommendations include:
In the opinion of the IfJ, “the creation of a one-stop shop to support new and existing businesses can be one of the best things a city can do to make it a more friendly environment for small businesses. Ideally, it’s in a centralized location where they can find all the information about what is required to start a business, rather than having to navigate through multiple departments and agencies. It’s a place where an entrepreneur can go, and in a single visit, get all the permits, licenses, approvals, or any other kind of permission that they need to legally operate their business.”
One-stop shops should provide a streamlined process that can help entrepreneurs cut through the red tape and get their businesses off the ground more easily. The idea is that the process is being streamlined, more efficient, and reducing the amount of time that an entrepreneur has to spend dealing with bureaucracy.
As an example of the IfJ’s analysis or 20 American cities, the total effort to establish a bookstore in Jacksonville, FL currently requires the following:
The City of Cape Coral could effectively create a One-Stop Shop for Business Development perhaps in a vacant downtown storefront or within a space in City Hall that would have mostly virtual self-services, minimal staff, printed materials for take-home, and an accompanying on-line presence. The goal would be to facilitate all the requirements necessary to establish a new business and to ease the level of confusion by applicants.
It is likely that new business creation in Cape Coral follows a similar path as Jacksponville. To change this in the future, Cape Coral’s One-Stop Shop for Business Development would be administrated by the OEBD which would coordinate its activities with other departments. As the OEBD current offers, the Ombudsperson Services would have a greater role in overseeing the approval process. OEBD’s careful record-keeping of applicants’ costs, numbers of steps, and success rate would form the basis for a database of business development metrics. Analytical results would then help to fine-tune the process for streamlined business development growth.
We conducted a video conference with the Project Review Committee on February 21, 2024. Work product to date was discussed and the materials covered were previously uploaded to the website.