Planting economic seeds-Littleton’s ‘garden’ strategy for growth nurtures innovators

One September afternoon 10 years ago, two idealists came to a Littleton City Council meeting with a vision.

It was 1992, the pit of the recession. The city had lost 7,000 jobs. One million square feet of retail space stood empty.

By Rachel Brand, Rocky Mountain News

The pair spoke to a packed room about a masterpiece attraction that would restore civic pride. The catch: The city had to guarantee a $60 million loan. With much regret – and because the city doesn’t back loans – Littleton walked away.

The speakers wanted to bring Ocean Journey to Littleton.

Refusing to offer financial incentives is a cornerstone of Littleton’s unconventional economic-development strategy. The city won’t grant tax breaks or pose in corporate beauty contests. It doesn’t offer startup classes or micro-enterprise loans.

Instead, the economic development department aids local entrepreneurs by acting like an outsourced business development unit.

It’s based on the concept of "economic gardening" rather than "economic hunting." By this, the city attempts to grow jobs through entrepreneurial activity instead of recruiting them.

It’s working. Littleton, http://littletongov.org/bia/ population 43,000, has added 12,000 jobs in the past 15 years. Retail sales taxes have soared to $20 million from $6 million in 1987. And the program has spawned imitators in Steamboat Springs, Santa Fe and Chico, Calif.

"It’s tremendous, just tremendous," said Brian Vogt, president of the South Metro Chamber of Commerce.

Jeff Finkle, president of the International Economic Development Council, also lauded Littleton’s approach, despite its unpopularity.

"Do you want to put your taxes toward paying corporate welfare, or do you want to put them toward needy individuals in the state?" he asked.

The director of Littleton’s Business/Industry Affairs Office spends his days doing office work near bucolic old town Littleton, not preaching from pulpits.

Dressed in a comfortable sweater and worn wingtip shoes, Chris Gibbons appears more librarian than revolutionary.

His message is heretical at a time when the majority of big cities, including Denver, spend a hefty portion of their economic development dollars wooing outside companies.

"We’re not in the deal-making business," Gibbons said. "It’s not fair to tax local people for packages to give to people who may or may not come."

That strategy began in 1987, after Bethesda, Md.-based Martin Marietta sliced 7,000 jobs in Littleton. The mayor directed Gibbons to nurture small companies.

Local bosses would have to face employees in the grocery store, and it would be harder to ax jobs with a pen stroke, he thought.

At first Gibbons looked at all small business. Then he found that 80 percent of jobs were created by 3 percent of businesses – the rapidly growing, innovative firms called "gazelles."

Gazelles flock in clusters such as Austin, Texas; Boulder; Minneapolis; and Seattle. They thrive on information, grow and die quickly, learn from each other.

Once a pioneer town, Littleton decided to become a feeding spot for gazelles.

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A meeting of economic gardening practitioners will be held June 12/13th (Thursday-Friday) in Littleton, Colorado. Participants will meet all day Thurs (starting at 9:00 a.m.) and through lunch on Friday. This will allow time to catch flights out in the afternoon. No meals will be served. For those who want to stay over the weekend, there will be an informal follow up at one of our local establishments Friday afternoon.

For further information contct Chris Gibbons:

[email protected]

303-795-3760

http://littletongov.org/bia/

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On a $500,000 budget, the city bought sophisticated databases to mine information. Staff boned up on analyzing business plans. They learned to hold focus groups or perform competitive intelligence.

While these free services are open to companies of any size, they help small firms the most.

One beneficiary was CulturePrep, a one-man cross-cultural training company that relocated to Littleton two years ago.

Owner Peter Vogel received marketing mailing lists, labels and even the insights of a focus group on his brochure.

"They’ve been so supportive all along. It’s hard to put a price tag on all the services they’ve provided," he said.

Daniel Rosacci, owner of specialty food store Tony’s Meats, also used the office to map his customers’ demographics and profile their purchasing habits.

The information helped him pick a store location, and then, "once we got that data, it better helps us define where we advertise," he said.

Economic development experts say a diverse economy contains both big and small companies. Big companies spend the money that small companies feed from.

"There’s a role for hunting and gardening. You have to do both," said Vogt.

But Littleton’s approach spreads the risk.

"We don’t bet on any one company," Gibbons said, tapping his index finger on a conference table with every word. "We do gardening. These are plants," he tosses his hands up in the air. "Some of them will flourish."

[email protected] or (303) 892-5269

http://www.insidedenver.com/drmn/business/article/0,1299,DRMN_4_1804989,00.html