Thursday, February 18th, 2010
Most people get it by now that cities compete in the marketplace as regions. Of course it matters that individual cities, towns, and unincorporated areas that make up a region all prosper, but the fate of a region is generally collective. The real battle is not between city and suburbs, but between regions, including those around the world. Now the competition metaphor is somewhat flawed since the economy is not a zero sum game, but clearly some places are more attractive than others to human capital and business. Place that spend less time fighting amongst themselves and more time working on success for their city-region will differentiate themselves.
Cleveland has long been a city and a region with challenges on this front. It is an area with traditionally high levels of distrust between city and suburbs. This was illustrated a year or so ago when the Cuyahoga County dominated metropolitan planning organization voted to block the construction of a new interstate interchange in a suburban county even though a developer had agreed to pay for it. Cuyahoga County demanded a cut of the tax revenues in return for voting to approve the interchange. I castigated this approach at the time and still think it was a big mistake.
On the other hand, there have been a lot of positive developments on the regionalism front in Cleveland as well. Clearly Northeast Ohio knows that this has been a problem area for them. They’ve responded with a number of regional initiatives, including a regional strategic planning organization called Advance Northeast Ohio, an economic development group called Team NEO (which alas uses the unfortunate brand of Cleveland+ as well), and Bioenterprise, a life sciences promotion group. There’s also a very interesting program called Tech Belt, which is about creating a technology corridor along the “Cleveburgh” corridor from Cleveland to Youngstown to Pittsburgh. That’s an even megaregional type of effort.
Many cities have a roster of similar type groups, but one that really stands out is a philanthropic effort called the Fund for Our Economic Future. Founded in 2004, this is an association of local foundations that agreed to pool their money and jointly decide on regional grants designed to boost the economic fortunes of the greater northeast Ohio area. And it isn’t just a few. There are 69 foundations that pledge a minimum of $100,000 per year to be part of the fund. That’s pretty incredible.
I’m not aware of anything quite like this out there. Detroit had an organization that was somewhat similar and was actually headed by Brookings’ John Austin for a while, but that was a separately chartered organization while this is an unincorporated association of foundations. Foundations often don’t work well together, so having this group come together is noteworthy. It’s not just regionalism, it is also about building trust among organizations. And it is a non-profit foray into the economic development world. That’s not without risk, but places like Cleveland need to take a few to change the game.
The Fund for Our Economic future was in the news recently as the largest foundation in the group, the Cleveland Foundation, all but pulled out and decided to start making its own grants in the space again. Part of the rationale appears to be a desire by the Cleveland Foundation to focus its giving on the city of Cleveland:
Richard and David Goldberg, chairman of the Cleveland Foundation’s board, said in an interview that the future fund’s mission and 16-county target area grew beyond the foundation’s Cleveland-centered goals.
Cleveland “is the core of the region,” Richard said. “Unless we revitalize downtown Cleveland and its neighborhoods, we can’t bring back the region.”
But leaders of the future fund said the foundation has essentially rejected the collaborative spirit of an effort that’s helping spur the region’s economy.
This is a bit of a bad news/good news situation. In trying to do something ambitious like this, setbacks are to be expected. The Cleveland Foundation is a community foundation (actually, it was the very first community foundation ever, and is still the second largest in the country), and they are generally restricted as to the geographic scope of their giving. A community foundation is one type of organization whose mission has been traditionally focused on a particular community. In fact, it’s almost the definition of a community foundation. Still, there were likely some personality conflicts along the way. And I can’t help but wonder what it takes to utter with a straight face, as the Cleveland Foundation’s president did, “There is no doubt in my mind that the Cleveland Foundation is the most magnificent collaborator of any foundation in the United States of America.”
But despite this, the Fund is not collapsing and other foundations are committed to continuing it. This is the good news part of the equation. Again, every endeavor is going to suffer setback and disappointments. Any real personal relationship is going to undergo some period of stress and conflict. That’s just human nature. The real question is not how to avoid all troubles, but how to react to them. If Cleveland can move forward in a positive direction from this, not allowing the Fund to die or creating a permanently poisonous situation, then this type of conflict might be one that shows a region that is growing beyond the fragile flower phase and into something more substantive and real.
Ed Morrison is generally a Cleveland critic, but he sees significant upside potential in the Cleveland Foundation decision. In his view, the Cleveland Foundation can concentrate on Cleveland, while the Fund becomes a more truly regional entity.
The recent decision by the Cleveland Foundation to reduce its commitment to the Fund for our Economic Future (the “Future Fund”) opens the door to a new, promising future for Northeast Ohio. In the past, the Future Fund concentrated its investments on a handful of important regional initiatives.
Now, it appears, these regional organizations will continue to move forward, but with different funding formulas. The Cleveland Foundation has invited these organizations to apply directly for support. This step frees the Future Fund to concentrate on the development of a more network-based approach to regional economic development.
The development of a truly regional strategy in Northeast Ohio has been slowed to some extent by the perception that most regional initiatives are anchored in Cleveland. In other words, the regional entities based in Cleveland (including the Future Fund) faced difficulty to overcome the perception of being too “Cleveland centric”.
Concentrating too much on Cleveland ignores the major competitive strength of the region. Unlike most regional economies, which rely on a single anchor metropolitan economy, Northeast Ohio operates with multiple metros. This diversity creates strength, if the assets of each of these metros can be strategically linked.
Morrison, an economic development consultant who also is affiliated with Purdue University, is a strong proponent of networks, with methodologies he refers to as open source economic development and strategic doing. His web site goes into much more detail on these. (As an aside, it is also clear that Morrison understands his region’s geography and its applicability to urban success).
The types of positive outcomes are what Cleveland should look to achieve. This Cleveland Foundation move is a test for the community. Will it deal with the fallout and move on positively, or fall back into bickering and recrimination? The answer will be a sign of how far Cleveland has come on the regionalism journey.
And it is a journey. Regions don’t get there overnight. Whatever happens here, Cleveland has gone from being a metro that was nowhere on regionalism a decade ago to having many active regional programs underway today. Regardless of how far northeast Ohio may still have to go, it has come a long way already, and that’s a real accomplishment.