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Growth Management Boosts Economic Development on Cape Cod |
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| James C. O'Connell | |||
| Session: April 15, 2000, 10:15-11:30 AM | Author Info | ||
Local and state entities can enhance growth management and economic development efforts by developing mutually supportive strategies. The Cape Cod Commission’s experience, since its establishment in 1990, have demonstrated this. The Commission has pursued a regional growth management and economic development strategy through: 1) analysis of regional economic base and development of a relevant strategy; 2) promoting desirable "clean, light industry" through regulatory streamlining and concentrating development in designated growth centers; 3) other initiatives, including upgrading the telecommunications infrastructure and promoting heritage and environmental tourism. Cape Cod’s job base has grown by 23 percent during the 1990s, while stringent land use regulation has been in place.
When powerful land use and environmental regulatory agencies are created, some business advocates may be concerned that the regulatory agencies might stifle economic development. Some agencies, such as state environmental protection agencies, tend to let the economic chips fall where they may in protecting the natural resources. Others, such as the Cape Cod Commission, have consciously pursued a fully-articulated economic development strategy.
When the Cape Cod Commission was established in 1990 by a Cape-wide referendum, Cape Cod, business proponents had a provision for an economic development officer included in the legislation. Fearing that regulators might strangle business, they expected such a person to balance off the environmental staff, though it was not entirely clear what that entailed. The legislation enjoined the Commission to pursue "a balanced and sustainable economic development strategy" along with protecting the region's groundwater, open space, natural habitats, and transportation network.
For several years, there was tension between "smart growth" initiatives of the Cape Cod Commission and some businesspeople, chain retailers, and developers who feared heightened efforts to control growth as the camel’s nose under the tent of "anti-business" development restriction. This argument resonated some during the deepest recession to hit New England and Cape Cod since the 1930s, when the Cape lost jobs and real estate values declined. In the meantime, some environmental advocates argued that development should be curtailed as much as possible because they believed that Cape Cod had passed the threshold of acceptable development.
The debate that took place on Cape Cod resembled those that have taken place across the country. Each party has had a different concept of the end goals. Many in the business and development communities believe in ongoing economic "growth," with minimal constraints, as the ultimate goal. "Smart growth" advocates choose to pursue economic "development," which connotes wealth generation and social development that does not over-tax environmental resources and the physical infrastructure--much the type of development that is characterizing the Information Age Economy. Meanwhile "sustainable" development proponents would tighten the regulatory parameters to permit only "zero impact" development, which does not deplete the resources of air, water, and land. So far, sustainability has been more an ideal that an achievable program.
The Cape Cod Commission Experience
It was into this dialogue that I stepped when I became the Cape Cod Commission’s Economic Development Officer. My first week on the job, I was assigned to write a draft of the economic development section of the Commission’s new Regional Policy Plan to complement the land use, transportation, groundwater, open space protection, and community character components of the regional plan. I had to create an economic development strategy that encouraged desirable development that minimized environmental damage.
It turned out that planning and environmental protection measures are essential to Cape Cod's economic development strategy because, as a popular local saying goes, the Cape’s "environment is the economy." A glance at an economic base analysis prepared for the Commission indicates that most of the Cape’s economy relies upon the region’s attractiveness and outstanding environmental resources as the basis for its wealth:
• Tourists & Vacation Homeowners (33 percent)--two-thirds represents overnight visitors; the other third is second-homeowners;
• Retirees (26 percent)--includes the health, service, and home maintenance industries serving retirees;
• Business Services (11 percent)--includes legal, accounting, software, research (eg. Woods Hole), and management consulting;
• Commuters (7 percent)--wealth produced by people who live on-Cape and work off-Cape;
• Other (7 percent);
• Manufacturing (6 percent)--includes marine electronics;
• Defense (5 percent)--Massachusetts Military Reservation, U.S. Coast Guard, and U.S. Army Corps of Engineers;
• Marine (5 percent)--includes fishing, marinas, boat-building, and related businesses.
The Commission’s economic development strategy has sought to maintain the vitality of the tourism, second-home, and retirement sectors, and increase the business services and industry that serves as a year-round counter-balance to the resort sector. The keystone for supporting these sectors is growth management and environmental protection.
Good planning is increasingly recognized as critical to maintaining high-quality resorts. As tourism marketing consultant Dr. Stanley C. Plog commented in Leisure Travel: Making It a Growth Market...Again! , vacation destinations "must take charge of their own destinies" and pursue "a greater degree of master planning and controlled development....in order to maintain the original character of those areas and avoid inevitable physical and social decay from over-development."
To complement environmental preservation, the Cape Cod Commission has spearheaded promotion of heritage and environmental tourism. Since 1993, the Commission has supported an initiative called Heritage Cape Cod, which sponsors Cape Cod Heritage Week, Maritime Days, Historic House Weekend, as well as a 40-page annual heritage events guide and a searchable Website. Over 100 museums and organizations participate in Heritage Cape Cod. Historic landmarks such as the Highland and Nauset Lighthouses have been preserved from falling into the sea and have become iconic attractions for Cape visitors.
The Commission has also been developing Cape Cod Pathways, a network of walking trails linking all communities in the region. Bikeways are also being constructed. The Commission also has worked with a private developer on a 26-room eco-inn project on a bike trail in Brewster. These initiatives have influenced chambers of commerce and hospitality businesses to adopt heritage and ecological themes.
The Cape Cod Commission has its most direct impact on maintaining a high-quality environment and buttressing the local economy when it reviews permits for commercial/industrial projects over 10,000 square feet and residential developments of thirty units or more. These "Developments Regional Impact" are required to meet minimum performance standards for groundwater protection, transportation, open space conservation, design, solid and hazardous waste disposal, and community character.
Perhaps the most important effect of the Commission’s review process has been improving the quality of the proposed projects and mitigating their impacts. Commission review has helped preserve open space and plant and animal habitats and made building designs more sensitive to community character. The Commission has insured that projects protect the groundwater, including utilizing advanced septic treatment technologies. The review has insured that projects pay for needed traffic improvements and reduce projected automobile traffic by 20 percent. The Commission's review has probably screened out projects that would have had blatantly damaging effects.
Growth Centers Attract the Technology and Office Sectors
One of the critical pieces in any economic strategy is having appropriately planned areas for developing technology businesses to locate. This is often referred to on Cape Cod as the "growth center" strategy. This strategy emanates from the idea that Cape Cod has limited land, groundwater, and traffic capacity and that to conserve it, new development needs to be concentrated in specific areas.
The Commission has deployed a multi-faceted strategy to make sure that parcels of land are available for developing clean, light industry:
• Commission maintains an "Industrial Land Inventory" of 41 industrially-zoned sites in thirteen Cape towns. Over 1400 acres are available for development.
• Commission prepared pre-screening reports for the seven most promising industrial areas. These reports indicate how much industrial/office development can be built in these areas and describe the site, transportation, and water quality measures required to obtain permitting.
• Commission instituted development agreements for the Falmouth Technology Park and Mashpee Industrial Park, which pre-permit development and allow businesses to bypass Cape Cod Commission review. The industrial parks use this as an incentive when they are marketing to businesses.
• In order to encourage redevelopment as opposed to new construction, the Commission raised the Developments of Regional Impact threshold for industrial and warehouse projects reusing existing buildings from the customary 10,000 square feet required for new construction to 50,000 square feet for reuse.
• Cape Cod towns have designated several industrial areas as state Economic Opportunity Areas (the Massachusetts version of enterprise zones), which offer new developments various tax credits including tax increment financing.
The "growth center" strategy has encouraged numerous businesses, usually in the technology sector, to develop in Cape Cod communities. No industrial or office project, representing the "clean, light industry" advocated by the Cape Cod Commission and the Cape Cod Technology Council, has been denied by the Commission. Since 1998, the Commission has reviewed and approved eleven office and industrial projects with a total of 355,000 square feet, mainly in pre-screened areas. Several of the permitted businesses are either reusing vacant space or expanding an existing building. The "growth center" concept has not worked so well at concentrating retail development, which seems to prefer undeveloped "green field" sites and avoids redevelopment of built-up sites as too constraining.
The New Telecommunications Infrastructure
In order to nurture the technology sector, which comprises marine science and information technology companies (Cape Cod Technology Council has 300+ members) and the small business and home-based entrepreneurs which have flocked to the Cape for its quality of life, Cape Cod has sought to upgrade the regional telecommunications system. The telecommunications revolution has already enabled relatively-remote regions like Cape Cod to connect more easily into global networks, with commensurate business growth.
Several economic development and community organizations, including the Cape Cod Commission, established the "Cape Cod Connect" planning process to improve high-speed Internet service on the Cape. The cable company MediaOne offers its high-speed Roadrunner service to residents in 10 of the Cape’s 15 towns. Bell Atlantic has just initiated high-speed DSL (Digital Subscriber Line) service to residents and businesses across the Cape. And emerging telecommunications providers such as Harvard.Net, VITTS Network, and Digital Broadband Communications are offering competitive high-speed business services in certain Cape communities. Geographic limitations of DSL and high costs for high bandwidth services still are a problem, so Cape Cod Connect is continuing to pursue ways of achieving Cape-wide ability to acquire high-speed Internet service at a reasonable cost.
Economic Development in the 1990s
As the Cape Cod Commission has regulated large regional developments, the Cape’s economy has grown substantially. Since 1990, over 26,000 people (12 percent growth) have moved to the Cape (for total net population growth of over 30,000), and more than 14,000 new homes have been built. The Cape has added 15,000 jobs since 1991 (This does not capture the above-average number of self-employed and consultants working from Cape Cod.). The Cape’s job base had grown 23 percent, as the state’s has grown by 4 percent. Many of these new jobs are located in existing commercial buildings. They have not required significant new construction. The Cape's real achievement has been in nurturing hundreds of small enterprises, a growing number of which are in the technology sector, which tends to pay higher wages than the tourism and retail sectors.
Cape Cod’s Lessons
Cape Cod demonstrates how "smart growth" strategies can link to economic development efforts. By making this connection, growth management advocates can expand the efficacy and legitimacy of their initiatives. This approach seeks to emphasize what development can occur, not simply opposing objectionable development.
Yet Cape Cod continues to face considerable growth--30,000 new residents in the coming decade if it grows at the same rate as the 1990s. The Cape needs to become more effective at promoting economic development that is truly sustainable. Few places have had much luck in achieving economic development that does not deplete natural resources, but Cape Cod will have to try to get closer to that elusive goal.
Cape Cod has a lot in common with areas undergoing rapid growth. The Cape demonstrates that sprawl is not necessary for economic development. More efficient use of already developed land can provide plenty of space for job growth. Denser, more efficient development can occur if the regulatory atmosphere guides it in that direction.
Business development, especially in attractive places, is encouraged by environmental protection. Entrepreneurs and workers of all sorts are drawn to communities with a high quality of life, especially as advanced telecommunications permit people to live and work virtually anywhere. That is the thinking behind the expanding technology sector, represented by the Cape Cod Technology Council and its advocacy of the "Silicon Sandbar."
Other regions demonstrate similar economic development benefits from sound planning and environmental protection. MIT Professor Stephen M. Meyer, in his paper "Environmentalism and Economic Prosperity: Testing the Environmental Impact Hypothesis," (1992) studied the state rankings of for economic performance and environmental protection and found that states with stronger environmental policies consistently out-performed the weaker environmental states on all economic measures. Meyer concluded that the belief that rigorous environmental management hampers economic development "has no empirical foundation and focuses attention on what is certainly one of the least influential factors affecting the pace of economic growth and development."
Michael S. Malone’s article "Is Silicon Valley Over the Hill?" Upside, April, 1994, described the flight of talented professionals to resort areas, where they can enjoy the quality of life while working. Malone argued that economic development strategies of the future would be based on creating attractive places: "Why not ... begin thinking of individual cities having unique looks and styles? Abandon the notion of homogeneity we've all been taught was the future, and consider instead the reestablishment of regionalism, or distinct local characteristics." This is just what Cape Cod has always offered and continues to offer through strong planning and environmental protection.
Copyright 2000 By Author
James C. O’Connell has been Economic Development Officer of the Cape Cod Commission since its inception in 1990. He worked in community and economic development positions in Springfield, MA, prior to that. He has a Ph.D. in Urban History and has written four books and numerous articles on aspects of Massachusetts history and planning.