Economic Development

Overview: Why Economic Development?

The direct economic impact of colleges and universities on their surrounding communities is well documented and substantial. There is, however, a great deal more that campuses do to support local and regional economic development, because economic development is inextricably connected to the missions of higher education institutions and the vitality of a college or university is intimately tied to that of the communities that surround its campus.

The Winter 2004, Economic Development America, a journal of the Economic Development Administration was dedicated to “University-Based Partnerships in Economic Development”. In an article titled, “Our Universities: Accelerators for Economic Growth,” Dr. David A. Sampson, Assistant Secretary of Commerce for Economic Development suggests that universities “must acknowledge that economic development is part of their core mission.”

A 2002 report issued jointly by Initiative for a Competitive Inner City and CEOs for Cities titled, “Leveraging Colleges and Universities for Urban Economic Revitalization: An Action Agenda,” colleges and universities have become engines for economic growth with the advent of the knowledge-based economy. The report calls colleges and universities, “perhaps this country’s greatest untapped urban revitalization resource.”

Further Reading

A Small Sampling of Economic Development Engagement by Minnesota Campuses

Centers

A number of Minnesota campuses host federal small business development centers. Campuses also support centers that offer other services promoting economic development.

Bemidji State University,  Northern Tier High Technology Corridor An online business resource for northern Minnesota, providing Minnesota economic development tools, information on Minnesota assistance for nonprofit businesses, RFP listings, Minnesota communities of practice and collaborative knowledge management.

University of Minnesota Duluth Center for Economic Development Each year UMD CED works with more than 900 of the 8,500 plus companies in Northeastern Minnesota, facilitating more than $20 million in loans, and assisting in the creation, retention, and stabilization of more than 3,000 jobs. UMD CED has locations throughout Northeastern Minnesota to provide assistance close to where you live. Help can be as simple as answering a question about compliance over the phone or as comprehensive as having several one-on-one meetings with a counselor to turn your idea into a profitable business. Many of the services are free.

The University of Minnesota is involved in a number of economic development support efforts including its Office for Business & Community Economic Development , Extension’s community economics experts and programs such as it Business Retention and Expansion Strategies Program, and a wide variety of research from the Center for Urban and Regional Affairs, Carlson School of Management and Humphrey Institute of Public Affairs. The University of Minnesota Outreach, Research and Education. UMore Park is a 5,000-acre site 25 miles southeast of the Twin Cities, near Rosemount, Minnesota.  It is the largest contiguous property in the United States that is owned by a land grant university. The University has a number of goals related to the long-term development of this property including to serve as a catalyst for regional economic development.

The University of Minnesota, Crookston operates the Center for Rural Entrepreneurial Studies (CRES). The mission of the CRES is to encourage entrepreneurship through educational leadership, applied research, and insightful consulting.

Community Investment

Community investing 1) helps low-income individuals and communities take control of their own financial destinies; 2) creates opportunities for housing, jobs, and social services in low-income communities; and 3) works in both urban and rural communities. What kind of difference you could make? A number of campuses are engaging in community investment through directing deposits to locally-owned banks that have an “outstanding” Community Investment Act rating. The idea to leverage higher education bank deposits for community reinvestment already has some early adopters.  In 2006, Earl Schwartz, Associate Professor of Religion at Hamline University, taught a course in which students interested in the idea of acting on individual and institutional values related to community, conducted research and prepared a presentation to convince their university to deposit funds in a locally-owned community bank. The students’ case was compelling enough for Hamline staff to look into the options and ultimately make a deposit in Park Midway Bank.

In 2007, Macalester College deposited $500,000 of its operating budget into an account at University Bank. Months earlier, Macalester had issued a request for proposals that sought to both leverage the college’s deposits for community development and create and enhance educational opportunities in neighborhoods where they had ongoing civic engagement activities. Read a case study here.

Individual Projects

St. Cloud State University College of Business Micro Loan Program
The St. Cloud State Micro Loan Program is a partnership between the Initiative Foundation community of St. Cloud and the Herberger College of Business.  Business students provide technical assistance and review loan applications from local entrepreneurs. The program’s goal is to build the local economy by providing technical/entrepreneurial expertise, educational assets, and small loans ($1,000 – $25,000) for individuals that ordinarily would not qualify for traditional financing.

Winona State University – Professor Bhaskar Iyengar completed a year-long collaboration with Mugby Junction, a locally-owned coffee shop to develop a Web-based Training Program for its employees. This involved a complete software development cycle as part of three Computer Science courses. Kathryn Ready, Professor of Management and Chair of the Department of Business Administration at Winona State, has student projects in both Social Entrepreneurship and Strategic Management courses where students work with both local non-profits and small businesses.

The Northeast Higher Education District and Iron Range Resources share support of a regional workforce development coordinator who advances technical education program development and assists with marketing and recruitment for technical programs.

Students and faculty working through the Center for Small Towns, at the University of Minnesota Morris, have been instrumental in support of a number of economic development projects in the city of Hoffman, MN. See what’s going in Hoffman.

Augsburg College‘s Management Consulting Project engages MBA students in a capstone course in which students work as pro bono management consultants. Project teams develop business solutions and implementation plans for Minnesota-based businesses and community organizations. Consulting engagements conclude with a formal Plan Presentation to the client and faculty advisor. Students recently created a business plan that led to the establishment of the Coyle Community Café, a youth entrepreneurship project at the Brian Coyle Community Center in Minneapolis.

Students at the University of Minnesota Crookston are engaged in a number of projects that impact local economic development. A number of students have been involved in a project to turn Crookston’s old Winter Shows building into the Red River Valley Shows and Events Center, an equestrian and agricultural educational and community center. Also at UMC, students in the Animal Systems Management course are doing individual technical assistance consultations with local family farmers.

The Center for Small Towns, at the University of Minnesota Morris, has facilitated a number of projects that impact local economies. One example is the work being done in Hoffman, Minnesota, to revitalize that community’s downtown. UMM also supports the diversification of the local economy through its participation in projects like the Pride of the Prairie, local foods initiative and through their commitment to alternative energy production, by purchasing local crop residues for their biomass gasification plant.

The Cedar Humphrey Action for Neighborhood Collaborative Engagement (CHANCE) at the University of Minnesota participated in a variety of student-led projects around economic development. A partnership with the Carlson School of Business resulted in a Neighborhood Business Fellows program. The program has produced research and products that support businesses in the neighborhood. Here is an example.

The Northeast Higher Education District (NHED) is involved in dozens of economic development initiatives. NHED and Iron Range Resources, a regional development agency, collaborate to support a Regional Workforce Development Coordinator. In a partnership with the Northeast Entrepreneur Fund, NHED’s, Campus Entrepreneurship Initiative works to create an entrepreneur culture on the campuses of the NHED community and technical colleges by providing education and resources to foster innovation and inspire the spirit of entrepreneurship.

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