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Austin’s creative culture holds weight in economic incentives revision

Friday, September 22, 2017 by Jessi Devenyns

In response to City Council direction in March, Austin’s Economic Development Department has spent the better part of the year meeting with specific groups in the community that have a stake in how the city approaches policies such as business recruitment, real estate planning and business incentives packages in the coming years.

In an effort to gather feedback and recommendations to retool the city’s Chapter 380 incentive agreements, David Colligan, the city’s manager of global business expansion, presented the initial findings from community engagement meetings to the Arts Commission on Sept. 18. The goal was to understand if the suggested community values were aligned with the revision recommendations that the Arts Commission sees as crucial to maintaining Austin culture in the face of continued economic growth and immigration.

Colligan began by presenting the current policy, which he said is essentially the same as what was adopted in 2003. The only difference, he explained, is that “15 ordinances and resolutions have been added on top” of the existing incentive packages, but that it “really hasn’t made it more effective.”

He did say that since 2010 incentivized projects have earned an estimated 239 percent in returns on investment for the city.

Now, however, he said the question has become: How can the city take advantage of large-scale projects to enhance small businesses and local creative initiatives rather than simply spur more economic activity through high-profile tech and health care company recruitment?

At this point in the presentation, Commissioner Bruce Willenzik stopped Colligan to say, “We got 13 minutes in before there was any mention of culture. Technology came in because of the culture.”

Many of these cultural preservation questions, according to Commissioner Brett Barnes, revolve around the larger question of equitable policy implementation within the city. To explore the larger question he said, “It would be interesting to know which districts didn’t get a presentation.”

Colligan explained that over 400 different parties in multiple districts received information through the stakeholder meetings and surveys from which the Economic Development Department collected 2,500 pieces of data. Through this, it was determined that the creative sector was an element that would be heavily featured in the revision of the Chapter 380 incentives. In fact, “The creative focus group was probably the largest that we have,” he said.

For Commissioner Bears Fonte, simply supporting creatives wasn’t going deep enough. He said that a critical component of the new incentive agreements should be for companies that are coming in and getting allowances in Austin to make a concerted effort to become involved with smaller liberal arts and creative sectors because “arts organizations are desperately looking for sponsorship from other places than personal donors.”

Vice Chair Michelle Polgar agreed with the assessment. “My big concern has been that there is a small pool of donors that support the arts community broadly,” she said. For a revision of the economic development policy to effectively support the arts community, it would need to incentivize corporations to be part of that environment “to create a larger pot from which we can pull those dollars.”

“It’s the smaller organizations that give us the diversity that makes us attractive,” Willenzik noted.

Although the commission appeared to fully support the requirement for incentivized companies to become further involved in the arts community, Barnes saw the implementation of a stipulated collaboration with small-scale creative organizations as a lofty goal due to concerns with affordability within the city.

Wilnezik agreed that affordability was an issue saying, “We’ve got to get some earning opportunities for these (creative) people. Some good ones.”

Affordability is a main tenet driving the review of the current Chapter 380 incentive policies, which should be presented to City Council next spring.

Colligan ended his presentation by saying, “The slate is kind of clean here and we get the opportunity to see what we can do.” However, he did warn the commissioners not to take the easy route and “slide into some of the deals we’ve made in the past.”

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