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Challenges ahead for downtown

March 01, 2011|By DAVID HANLIN
  • David Hanlin
David Hanlin

For two decades, the revitalization of downtown Hagerstown has been one of the biggest challenges facing our community. Even the residents of Washington County who live the farthest from downtown Hagerstown have a vested interest in its success. I believe downtown has tremendous potential and am one of its biggest advocates.

So, when the City of Hagerstown looks to hire an individual to help recruit businesses to downtown, I can’t help but notice. The job listing reads in part, “to develop downtown (city center) initiatives to support existing business, recruit new business, and increase foot traffic.” The job carries a salary of $50,877 to $80,600. Add in benefits, telecommunications, office supplies, travel, office space, etc.; this venture will likely cost at least $150,000.

I will not complain about the cost. Simply put, in the private sector a business will invest in a new job if the person in that job can reduce expenses or increase revenues to offset compensation and operational cost. Granted, a business might make the investment for long-term growth, but ultimately the position must generate a margin to cover the cost. For those of us with jobs, if we don’t generate more value for our employers, we find ourselves unemployed. So this individual must ultimately generate $150,000 per year in additional revenue for the city to warrant the hire. It is my opinion that this will not be a successful undertaking.

I have three concerns as to why I think this effort will fail. The first is that the recruiter is really a salesperson. Even with a mandate “to develop downtown initiatives to support existing business” this is a salesperson. Ultimately, the recruiter is charged to “sell” downtown to businesses as a profitable location.

Can a downtown business recruiter generate more than $150,000 in additional value for city government? In theory, a successful downtown will result in rising real property assessments. Rising assessments will generate additional property tax revenue. But in order to generate $150,000 in additional property tax revenue, demand for downtown property would have to increase significantly. To generate this much additional real property tax revenue, the assessed value of those properties would have to increase $18 million. That is huge!

The second concern I have is that there might not be sufficient demonstrable value for a business to locate downtown. In the end, no amount of professional salesmanship will convince a business to locate downtown unless it is seen as being in the business’ best interest to do so. Businesses look for the best place to generate value. In today’s environment, can a business generate more value by being downtown? I don’t see how a business will save money, generate more profit, and have happier employees or more satisfied customers in the near term without some other action.

The third reason I think this is likely to fail is because it is being made a part of city government. Governments generally have a hard time creating anything. Governments are great at regulating, restricting, molding or assisting enterprise. Don’t get me wrong. There are excellent people in City Hall with the best of intentions. But the cultures of City Hall, like governments everywhere, are not conducive to the kind of entrepreneurial creative spirit that is needed. Governments are constrained by state and federal regulations, open meeting requirements, public notice, procurement restrictions, limited resources, freedom-of-information requests, bureaucratic infighting, their own political bases, and an inability to respond to market conditions quickly.

The private sector is where creativity emerges. The private sector is far more flexible. A private sector organization would be far more productive with that $150,000. The Western Maryland Blues Festival Committee is a great illustration.  Carl Disque, a private citizen, sold the city on the idea. A strategic partnership has developed. The city facilitates the work of the committee. It provides grant money, security, and logistical support. I can’t image the city organizing hundreds of volunteers to work ungodly hours year after year to make the Blues Fest the success it is. But the private sector can do it.
The city would be better served to take a private sector-oriented approach instead. Issue a call for proposals. Describe the goals. Delineate the public tools available. Offer $150,000 each year for up to three years, and invite new ideas. Set up a panel of city employees, elected officials and private sector representatives to evaluate the proposals. Engage the entire county. Then let the panel choose, but with no guarantees of renewal. Then get out of the way. There should be accountability, but with minimal red tape. We want a different approach to solving this vexing problem of delivering value to our region.

I hope I am wrong about the city’s strategy.

David Hanlin is a Hagerstown resident and development coordinator at Washington County Free Library. Readers can e-mail him at davidhanlin54@gmail.com.

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