New Mexico First’s 2008 Statewide Town Hall

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4March 27-29, 20084Inn of the Mountain Gods,Ruidoso, NMBackground ReportAuthorsLead Town Hall SponsorsAdditional Town Hall SponsorsJo Carter, New Mexico FirstHeather Balas, New Mexico FirstIntelBHP BillitonContributing EditorNMF Sustaining SponsorsCarl Moore, Ph.D.Hatton W. Sumners FoundationPNMNew Mexico MutualSandia National LaboratoriesHunt Development GroupEastern New Mexico UniversityNew Mexico Economic Development Dept.New Mexico TechNew Mexico Bank and TrustMajor Town Hall SponsorsLESMesa del SolNew Mexico State UniversityTechnology Ventures CorporationYates PetroleumScholarship SponsorsAmBankBueno FoodsIreland, JudLos Alamos National BankLos Alamos National LaboratoryNew Mexico Highlands UniversityNew Mexico Hospital AssociationRegional Development CorporationWells FargoWestern New Mexico UniversityAlbuquerque Economic DevelopmentCharter BankResearch SponsorKettering Foundation

Background Report for New Mexico First’s 2008 Statewide Town HallCopyright 2008New Mexico First320 Gold Avenue SW Suite 300Albuquerque, New Mexico 87102Phone: 505-241-4813 (Albuquerque)Fax: 505-241-4819Email: info@nmfirst.orgWebsite: www.nmfirst.orgPermission is typically granted to reproduce all or part of this document for educational or public policy purposes, provided NewMexico First has provided consent. Contact us at 505-241-4813 or for reproduction authorization.Business as UNusual: A Town Hall on Rural Economic Developmentpage 1

Background Report for New Mexico First’s 2008 Statewide Town HallTable of ContentsForward .5About New Mexico First.5The Town Hall Process.5This Report .5Authors & Editors .5Research & Review Committee.5Regional Forum Participants .6Introduction .7Rural Life .7What is Rural?.7What is Economic Development? .7Water Barrel Metaphor .8Primary Industries.8Secondary Industries.9Measuring Economic Development .9New Mexico’s Economic Rankings.9New Mexico Industries.10Federal Investments.10Affordable Housing .11Environmental Sustainability.11Potential Process Difficulties.11Making Choices .11Economic Development Approaches.12APPROACH 1: Focus on Business Development .13Summary .13Economy and Population .13Traditional Strategies.13Labor Shortage .13Addressing the Labor Shortage.14A Quality Workforce.14WorkKeys .14CASE STUDY: Rio Rancho & Intel.15Actions That Grow the Economy .15Charting a Path.15CASE STUDY: Clovis.16Implications and Tradeoffs of the Business Development Approach.16Notes/Comments on Approach 1 .16Business as UNusual: A Town Hall on Rural Economic Developmentpage 2

Background Report for New Mexico First’s 2008 Statewide Town HallAPPROACH 2: Focus on Community Development .17Summary .17Improving the Community .17Internet Workers .17Creative Class .17Community Attractions.18CASE STUDY: Silver City .18Are New People Always a Good Thing?.18Smart Growth.19MainStreet .19Community Leadership.19CASE STUDY: Santa Rosa.19Implications and Tradeoffs of the Community Development Approach .20Notes/Comments on Approach 2 .20APPROACH 3: Focus on Regional Development .21Summary .21Regionalism .21CASE STUDY: Bueno Foods .21What is a Region? .21CASE STUDY: Southeastern New Mexico Regional Air Service .22Why Collaborate Regionally?.22Shared Public Services .22CASE STUDY: Sirolli Projects.22Increased Local Responsibilities .22Regional Trading Partners.22CASE STUDY: Gallup and the Navajo Nation.23Broadband.23CASE STUDY: Spaceport America .23Implications and Tradeoffs of the Regional Development Approach .24Notes/Comments on Approach 3 .24Concluding Thoughts .25Appendices.26APPENDIX A: Current Economic Development Programs .26Job Training Incentive Program (JTIP).26Small Business Development Centers (SBDCs) .26Other EDD Activities.26U.S. Department of Agriculture.26U.S. Small Business Administration .27Small Business Investment Corporation.27New Mexico Economic Development Partnership (NMEDP) .27New Mexico Community Capital.27New Mexico Rural Development Response Council (NMRDRC).27Local Economic Development Act (LEDA) .27Business as UNusual: A Town Hall on Rural Economic Developmentpage 3

Background Report for New Mexico First’s 2008 Statewide Town HallAPPENDIX B: Economic Development Recommendations from Previous New Mexico First Town Halls .282004 Statewide Town Hall on Small and Emerging Business .282005 Statewide Town Hall on Federal Investments in New Mexico .292006 Statewide Town Hall on Higher Education .292007 Statewide Town Hall on Healthcare Reform.30APPENDIX C: A Brief Economic Evaluation of 27 Non-Metropolitan Counties .31Population .31Worker Earnings (place of work) .32Employment – Jobs.33Earnings Per Worker – Wages .34Per Capita Income Maintenance .35APPENDIX D: USDA County Demographic & Socioeconomic Information .36APPENDIX E: Remedial Education .38APPENDIX F: County-Level “Creative Class” Measure.39Business as UNusual: A Town Hall on Rural Economic Developmentpage 4

Background Report for New Mexico First’s 2008 Statewide Town HallForwardAbout New Mexico FirstNew Mexico First is a nonpartisan, nonprofit organizationthat engages citizens in public policy in order to improvethe state. Co-founded in 1986 by U.S. Senators PeteDomenici (R-NM) and Jeff Bingaman (D-NM), theorganization brings people together for two- and three-daytown hall meetings. These town halls use a uniqueconsensus-building process that enables participants tolearn about a topic in depth, develop concrete policyrecommendations addressing that topic, and then workwith fellow New Mexicans to help implement thoserecommendations with policymakers.New Mexico First was created to answer the question:“What would it take to make New Mexico first in nationalrankings, instead of near the bottom? (Historically, thestate often has ranked poorly in factors like poverty,education, or health.) Regardless what topic is beingcovered in a town hall or forum, we continue to focus onhow to strengthen the state.The Town Hall ProcessNew Mexico First town halls are not typical conferenceswith day after day of presentations. There will be a fewguest speakers to help set the context, but the bulk of thetown hall is comprised of small group discussions amongcitizens who care about the topic.Using New Mexico First’s proven consensus-buildingprocess, the three-day town hall will ask participants toshare their best ideas for improving the state’s ruraleconomies. Because citizen discussion is at the heart ofthis process, we ask participants to take an active part inall three days of the event.On day one of the town hall, participants are divided intotheir small groups to discuss the issues and answer acommon set of questions. On day two, participants beginrefining and combining those answers. On day three,participants come together as a full group and finalize theirconsensus recommendations.Business as UNusual: A Town Hall on Rural Economic DevelopmentThis ReportNew Mexico First’s Board of Directors chose the topic ofthis town hall in August 2007, based on input from citizensthroughout the state. Regional forums were held in fiveNew Mexico communities to hear people’s concerns andhopes regarding economic development issues. Thisreport is based on the feedback received from thoseregional forums and from a committee of volunteerreviewers.A number of New Mexicans contributed to this report. Thereviewers were not paid; instead they donated their timeas a demonstration of their support of the town hallprocess. New Mexico First thanks all the people who lenttheir expertise to this document.Authors & EditorsAuthorsJo Carter, MBA, New Mexico FirstHeather Balas, New Mexico FirstContributing EditorCarl Moore, The Community StoreResearch & Review CommitteeBrian Sanderoff, Research & Polling, Inc. – ChairmanGarrey Carruthers, NMSU College of BusinessSteve Carter, Sierra TitleRyan Gleason, USDA Rural DevelopmentBob Grassberger, I-Nexus / New Mexico State UniversityJami Grindatto, IntelMichelle Henrie, Atkinson & Thal, P.C.Jack Jekowski, Innovative Technology PartnershipsJim KadlecekBarbara Kimbell, University of New MexicoSharon King, Roosevelt County Chamber of CommerceMark Lautman, Mesa del Sol, NM Economic DevelopmentCommissionJoe Maestas, Mayor of EspanolaBeverlee McClure, Association of Commerce and IndustryTom McHugh, McHugh & AssociatesRay Mondragon, ENMR-PlateauJohn Montgomery, Eastern New Mexico UniversityBob Rosebrough, Jordan and Rosebrough, P.C.Mike Skaggs, DW Turnerpage 5

Background Report for New Mexico First’s 2008 Statewide Town HallRegional Forum ParticipantsLos LunasArthur D. Baca, USDA Rural DevelopmentJim Covell, Los Lunas Economic DevelopmentPeter Fernandez, Village of Los LunasMarcos Martinez, NM Department of Workforce SolutionsKathy McCormick, NM Economic Development DepartmentTom McHugh, McHugh & AssociatesHector Moreu, NM Department of Workforce SolutionsSuzan Reagan, NM Department of Workforce SolutionsClaudette Riley, Greater Belen Economic Dev. Corp.Roberta Scott, NM Small Business Development CenterAnn Simon, Mid-Region Council of GovernmentsBob Wessely, Middle Rio Grande Water AssemblyEric Zamora, Valencia CountyEspanolaAndres Aragon, USDA Rural DevelopmentMichael Bain, Cimarron Watershed AllianceJulianne Barbee, NM Small Business Development Cmty.Simon Brackley, Santa Fe Chamber of CommerceCarlos Chacon, LANL Community Relations OfficeNancy Chatfield, EBS InitiativePreston Cox, Embude StationCindy Evans, NM Economic Development DepartmentSteve Gonzales, NM Economic Development DepartmentRobert Griego, Sante Fe County Community PlanningMiro Kovaceich, Wells Fargo BankRebecca Latham, Town of Red RiverCharles Lehman, Northern New Mexico CollegeRichard Lowenberg, 1st Mile InstituteOlivia Martinez, Greater Espanola Valley CDCCristina McCandless, Regional Development CorporationAnthony J. Mortallaro, Los Alamos CountyRobert Ott, Center for Relational LearningJohn Rice, IMPACT-NMDennis Roybal, Los Alamos National LaboratoryLucia Sanchez, New Mexico State UniversityAshley Sanderson, North Central Regional Transit DistrictDonna Schroeder, United Way of Northern New MexicoSigmund Silber, NM Weather Modification AssociationVangie Trujillo, LANL Community RelationsJack Valencia, North Central Regional Transit DistrictCatherine Zacher, Santa Fe Economic DevelopmentGallupBecky Apel, Gallup Chamber of CommerceVanessa M. C de Baca, Office of U.S. Senator DomeniciGeorges Duval, Heavenly HealthBusiness as UNusual: A Town Hall on Rural Economic DevelopmentPatricia Duval, Heavenly HealthPhil Garcia, Gallup Title CompanyPaul GravesDonna Jacobs, UNM-GallupIrvin JonesMarianne Joyce, Joyce Planning and DevelopmentJeff Kiely, NW NM Council of GovernmentsKevin Killough, Gallup IndependentEvan Williams, NW NM Council of GovernmentsLarry Winn, McKinley Soil and Water Conservation DistrictsLas CrucesLes Baldock, Mesilla Valley Economic Development AllianceHilary R. Brinegar, NM Department of AgricultureBonnie Burn, League of Women VotersSteve Carter, Sierra TitleGarrey Carruthers, NMSUTim Darden, NM Department of AgricultureGary Esslinger, Elephant Butte Irrigation DistrictMadeline Gillette, NMSU School of Social WorkClyde Hudson, USDA Rural DevelopmentWin Jacobs, Housing Authority of Las CrucesJim KadlecekAnthony V. Popp, NMSU College of BusinessRobin Roberts, Doña Ana Community CollegePriscilla Saulsgiver, North Valley Neighborhood Assoc.Sharon ThomasDan TownsendPortalesWayne Baker, farmerRonnie Birdsong, Eastern New Mexico UniversityJan Bradburn, Workforce ConnectionClaire Burroughes, City of ClovisPatrice Caldwell, Eastern New Mexico UniversityIra Kaye Frasher, Eastern New Mexico UniversityCharlene Hardin, Roosevelt County ManagerSharon King, Roosevelt County Chamber of CommerceRandy Knudson, Doerr & Knudson, P.A.Debi Lee, City Manager, City of PortalesDennis Lopez, Roosevelt County CommissionerRay Mondragon, ENMR PlateauJimmie Shearer, Sunland, Inc.Gordon Smith, Clovis Small Business Development Ctr.Gene Smith, Eastern New Mexico UniversityJudy H. Stubbs, NM Economic Development DepartmentJeremy Sturm, Roosevelt County Chamber of CommerceBernarr Treat, Roswell Chamber of CommerceNicole Wilkening, City of PortalesGregg Williams, Eastern Plains Council of Governmentspage 6

Background Report for New Mexico First’s 2008 Statewide Town HallIntroductionAbout this GuideThis background report is designed to help participantsprepare for the New Mexico First town hall, Business asUNusual: A Town Hall on Rural-Urban EconomicDevelopment. The event will be held March 27-29, 2008 inRuidoso.The town hall will focus on rural economies, including thepossible value of rural-urban partnerships. This guide isorganized around three main approaches that ruralcommunities might consider, along with an introductionthat provides context for all three. The approaches arenot mutually exclusive, and most readers will findtheir opinions reflected in more than one.Note: There are few right or wrong answers, and theproblems around economic development issues arecomplex. As a result, no brief explanation of the situation –including this report – can hope to cover all the informationand opinions available. The contributors have providedtheir knowledge and advice, but ultimately the people andpolicymakers of New Mexico must decide what to do.Rural LifeNew Mexico is a predominantly rural state. The vastmajority of our land is undeveloped, and many NewMexicans like it that way. However, while 79% ofour counties are classified as rural (26 out of 33),only 35% of our people actually live in rural areas1. Thispercentage continues to decline.Many people are emotionally drawn to the idea of living ina small town and are deeply concerned about thepreservation of agricultural lifestyles and cultural identities.However, practical issues like good jobs, salaries, accessto medical care, or convenience bring many small townresidents to the cities. Increasing numbers of NewMexicans eventually move to the Albuquerque area, LasCruces, or out of state.This outflow of people is making it difficult for ruralcommunities to remain vibrant. In some cases, they seekto maintain or grow their communities by offeringincentives to new businesses. Other places focus onUSDA Economic Research Service, New Mexico Rural-UrbanFact Sheet, as UNusual: A Town Hall on Rural Economic Developmentcleaning up their town so it is more welcoming. Others tryto build trading relationships with larger businesses inAlbuquerque or Las Cruces, growing their communitythrough partnerships. Some communities try to do allthose things and more.Whatever the approach, most New Mexicans agree thatrural life is a critical element of our heritage and culture.What is Rural?The federal government defines counties as “rural” andthe related term “frontier” (which essentially means reallyrural) using a complex set of measurements including thenumber of people in a county, the number of people persquare mile, and the distance of a community from ametropolitan area.For the purpose of this report and the town hall, we willkeep it simple. We are considering all New Mexico townsother than Albuquerque, Rio Rancho, Santa Fe, and LasCruces to be rural, since they face similar challenges. Wealso encourage readers to bear in mind that very smallrural communities, such as Elida or Roy, confront differenthurdles than their less rural counterparts like Gallup orArtesia. There are 12 New Mexico counties that areextremely rural with five or fewer people per square mile2(compared with Bernalillo County’s 477 per square mile).What is EconomicDevelopment?Economic development is a term that often gets usedwithout definition. Some people say that it is an activityexclusively devoted to increasing wealth in a community.Others take the opposite extreme and say that economicdevelopment is practically any activity that improves thecommunity. For the purpose of this report, we will adoptan explanation that meets in the middle.U.S. Census Bureau, Census 2000 Summary File 1, MatrixP1. Available at rvlet? lang en&ds name DEC 2000 SF1 U&ds label Census 2000 Summary File 1 (SF 1) 100Percent Data2page 7

Background Report for New Mexico First’s 2008 Statewide Town HallEconomic development is an integrated activitythrough which government, business, education, andthe community work together to create a vibrant localeconomy that3: Encourages local enterpriseServes the needs of local residents, workers, andbusinessesPromotes stable employment and revenues bybuilding on local competitive advantagesProtects the natural environmentIs capable of succeeding in the global marketplaceWater Barrel MetaphorA community’s economy can be described metaphoricallyas being like an old water barrel. Water flows into thebarrel from numerous sources each at a different rate.Within each community, the water in the barrel representsthe total money available, including local governmentfunds, business assets, individual accounts, and so on.That money leaks out of the community as it is spentelsewhere.products or services elsewhere, the more leakages areblocked, keeping more “water” in the barrel. Thesebusinesses that bring in outside money are called primaryindustries, and they produce the coveted “economic base”jobs.An economic base job is any job that produces aproduct or service that is sold outside the communityand thus brings in outside money. Most economistsbelieve that the economic base job is the most importantfactor to a healthy economy.Economic base jobs often include agriculture, mining, oiland gas, energy, manufacturing, tourism, federalemployment, and more recently, exported services.A community does not necessarily improve as water in thebarrel rises. It just has

Yates Petroleum Additional Town Hall Sponsors Eastern New Mexico University New Mexico Economic Development Dept. New Mexico Tech New Mexico Bank and Trust Scholarship Sponsors AmBank Bueno Foods Ireland, Jud Los Alamos National Bank Los Alamos National Laboratory New Mexico Highlands University New Mexico Hospital Association Regional .

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