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April 6, 2009

My Turn: Economic development needed more than ever


Economic development has taken on an increased awareness in these trying times. The term seems ubiquitous in newspapers, on TV, the Internet and all other media. It has become a top priority for communities and job creation has emerged as an important responsibility for public officials.

There are four general approaches to stimulating economic growth: the attraction, retention, formation and expansion of new or existing companies.

In order to achieve these goals, it is necessary to implement comprehensive and inclusive strategies that address the needs of this growth, including access to capital, workforce development, housing, transportation, regulatory policies, physical infrastructure and quality of life. Hence, there must be a multifaceted approach to stimulating development and economic growth.

The Otsego County Economic Development Agencies, which, in addition to the county department, also includes the County of Otsego Industrial Development Agency and the Otsego County Development Corp., has focused its attention and resources toward the formation and expansion of small, local businesses.

It is recognized that the birth of new firms and the expansion of younger firms are a significant source of job growth, experience faster growth in sales, are more flexible, incorporate technological innovations and provide for economic diversity.

Furthermore, homegrown and locally owned companies tend to play important roles in community affairs, profits from these companies remain in the community, and local firms provide more stability because of a greater willingness to “ride it out” than close their doors.

The process of starting a business is as unique as the business owners themselves and the environments and markets they respond to. However, it is safe to say that almost all new or growing businesses face the same difficulties and barriers to development. They are short of capital and they have needs for managerial and technical support.

People starting new ventures find it difficult to obtain sufficient start-up capital through debt or equity financing. Because of the inherent risks involved in new business formation, most financial institutions are reluctant to invest in new enterprises.

Although our local banks are strong, the current economic climate has exacerbated this hurdle. In an effort to bridge the gap and provide new or growing businesses with sufficient capital, the Otsego County Economic Development entities have low-interest loan programs for qualified businesses. By partnering with traditional funding vehicles, the Economic Development office helps these companies secure working capital, research and development, inventory and equipment funds.

Since 2003, the Economic Development partners have lent more than $3 million to local businesses, while leveraging more than $15 million in debt and equity financing for start-up or expansion purposes. Furthermore, a dedicated loan program was developed specifically to assist businesses with five or fewer employees.

The second significant cause for small-business stress or failure is lack of managerial and/or technical expertise. This lack of expertise can range from the development of a marketable business plan to identification of appropriate resources, personnel issues, accounting practices, manufacturing processes and strategic planning.

Our office works with businesses to identify and resolve these immediate and ongoing needs.

To best facilitate assistance, we often partner with other organizations to utilize additional resources.

These partners include chambers of commerce, the Service Corps Of Retired Executives, the Alliance for Manufacturing and Technology and the Center for Agricultural Development and Entrepreneurship Inc. Beginning April 28, our office and the State University College at Oneonta Center for Community and Economic Development will partner with Executive Service Corps to offer a free “How to Operate a Successful Business Venture” workshop.

This six-week course is designed to facilitate business-plan development and address many issues new and young companies face.

We have also recently developed a local products questionnaire.

Results from this questionnaire will be used to populate a “local products guide” and help us tailor future programs for businesses developing and manufacturing products in the County.

The Otsego County Economic Development agencies are committed to fostering new business development and expansion in our area. We believe these enterprises are the key to generating economic growth, job creation and technological innovation.

Yet we also know that in these challenging times, economic development should be recognized as an interconnected web of community stakeholders, business managers, nonprofits and governmental entities. If you have any questions about our programs or would like to participate in the local products survey or Small Business Development Class, please contact our office at 432-8871; e-mail lewisc@otsegocounty.

com; or visit www.otsego economicdevelopment. com.

To write for “My turn,” contact Daily Star Publisher Tanya Shalor at tshalor@thedailystar.com or 432-1000, ext. 214.