Brief Summary of Minutes of Annual Meeting

At the annual meeting, general business was quickly conducted, including acknowledgements, approval of previous minutes, elections and plans for future meetings. Most of the meeting time was spent discussing the proposal for the new project proposal which will begin when the current project ends (in 2007). The three external reviews of the proposal were generally quite positive. There were four major points that require some response, including: (a) a request for more participation from researchers in disciplines other than economics; (b) a request that more attention be paid to interactions with state Workforce Investment Boards; (c) a call for more explicit inter-linking of the proposals four objectives; and (d) a request that more attention be paid to developing an explicit work plan laying out measurable outcomes and impacts as well as the timing of activities generating those outcomes/impacts. Strategies for responding to those points, as well as suggested language for the final edited version of the proposal were developed. Finally, participants also shared state accomplishments and individual activities/areas of interest and discussed new research ideas and extensions of work ongoing or completed as part of this project. A research paper session was also held in which five research papers were presented and formally discussed. Topics included the spatial distribution of entrepreneurial talent; participation and employment dynamics of child care subsidy users; the economic geography of population dynamics; firm relocation; and managerial skills. Research papers presented in related sessions examined the impact of tax and expenditure limits on economic growth; reform of municipal government structure; the economics of bio-fuels production; economic impacts of off-road vehicle recreation; and determinants of childcare choices among working mothers. Detailed meeting minutes are attached.

Objective 1: To better understand the emerging opportunities and threats to the economic structure of non-metropolitan communities arising from forces that change the size or structure of rural markets. We focus on electronic commerce, financial liberalization, and health care. Research focused on both farm and off-farm structural changes in rural economies. A number of researchers focused on value-added agriculture. Topics of analysis included quantifying the importance of bioenergy production in the rural economy; assessing the impact of the meatpacking and processing industry on economic growth of non-metropolitan counties in the Midwest and Southern U.S.; measuring the nationwide impacts of specialty crop (especially nursery crops) on rural versus urban counties; analyzing the relative importance of human resource management practices across various sub-sectors of the agricultural economy; measuring the economic impact of Colorado's wine industry; and (e) assessing the impact of state programs aimed at promoting value-added agriculture. Research was conducted on the role of the Internet in rural economies. One study examined the economics of communication and information service delivery and on-line economic activities - particularly e-commerce - with respect to farm and rural businesses. A survey was developed for administration to 18,000 farms. It addresses how much economic activity (purchases and sales) farm operators conduct through the Internet. Results will be forthcoming in a briefing room on rural telecommunications( http://www.ers.usda.gov/Briefing/telecom/). Another study analyzed the relative costs and benefits of Federal underwriting (as part of the Farm Bill) of deployment of broadband connectivity to rural places. That work is part of a forthcoming edited volume analyzing various aspects of the Farm Bill, and is already eliciting significant interest. Other research efforts were oriented toward understanding structural changes in rural economies. Several members investigated the costs and benefits of "big-box" retail development on local economies. These studies delineated the uneven distribution of impacts (positive and negative) on employees, shoppers, other businesses, and local communities, as well as analyzing the role of state policies with respect to planning and regulation of these businesses. Some research under this objective used shift-share analysis to quantify the changing structure of rural economies. One study focused on the incidence of hunger across different demographic groups. Other studies in this vein linked structural change to changes in human capital levels, tax policies, population growth, and worker mobility. Objective 2: To determine the root causes of changes in rural labor markets, the employment and demographic growth that are likely to occur in the future, and the degree to which these factors are modified by workforce development policies. Work was conducted on the role of immigrants into the Mountain West's agricultural sector. This work was presented at a summer 2006 conference in Washington DC during the height of the debate on immigration reform. Research was also conducted on migration out of rural counties across the United States, and the impacts that this "brain drain" has had on rural labor markets. Other research projects explored the determinants of innovative activity in nonmetropolitan areas and the role of innovation on nonmetro economic development. Focusing on patent activity, this research indicated that nonmetro innovative activity was associated with county employment in scientific and technical occupations, industrial diversity, large share of small establishments, a base of high-tech manufacturing, and patenting activity in nearby counties. Importantly, this research revealed that most nonmetro areas benefit little from state policies that focus research and development activities in metro areas. Research investigated changes in human resource practices of supermarkets in response to the entry of large discount retailers. This work - a companion to analyses of big box retailers noted under Objective 1 - found that traditional food retailers did not make major changes in their wage, hiring and promotion policies. But it also revealed that overall labor market changes resulted from the closing of stores as mass merchandisers entered a market or expanded their sales of fresh food and grocery items. Other research focused on child care assistance as a work support program in rural versus urban areas. It was found that despite higher county poverty rates and higher overall unemployment rates, families in rural noncore counties had slightly fewer months of child care subsidy use, food stamps and TANF compared to those in metropolitan and micropolitan counties. Understanding land use changes requires understanding of the evolving spatial distribution of residence and workplace. Several members developed models for examining that issue. One project explored the extent to which observed land use patterns are consistent with major theories of suburbanization and rural land development. This work indicated that accessibility to urban centers provides a better explanation of residential sprawl patterns at a more aggregate scale of analysis than a local one and that substantial differences exist in the determinants of residential land use patterns in exurban (or peri-urban) regions versus urban and suburban areas. For example, accessibility to urban centers explains a substantial amount of the variation in land development patterns in urban and in particular suburban areas, but explains almost nothing of the observed variations in pattern in exurban areas. Other work developed methods for estimating how job growth in a particular county confers benefits and costs to residents of nearby counties. This research has provided important inputs into ongoing debates over the local effects of plant relocation and the value of industrial targeting programs to local economies. It has also apprised local policy makers of the fiscal implications of spatial spillovers (both positive and negative) associated with residential development. Objective 3: To understand the effects of public policy on rural areas and rural industries. In 2006 three members of the project published an edited book on community policy which includes contributions from many of the project's other members. The book describes the most recent theoretical and methodological bases underlying local policy analysis, summarizes a number of case-studies where impact analysis aided local communities in decision-making, and most importantly, outlines a detailed educational program using the impact model as a teaching tool. This project reflects an ideal interface between research and extension outreach education. Other research under this objective continue to explore the problems and issues involved in measuring the impact of economic development policy. New research has begun on the impacts of Tax and Expenditure Limitations (TELs) - such as the Colorado Taxpayer's Bill of Rights - on state and local economies and governments. The work to date on this topic has focused on state-level budgeting, and the arguments made both for and against such laws. One argument fits into the body of literature concerning the impact of taxes on economic growth. Proponents of TELs argue that government is too large, and that redirecting revenues to the private sector would result in greater economic growth. However, research to date has uncovered no significant link between state and local TELs and increased economic growth. Fiscal impact models continue to be developed and refined for analyzing the impacts of various policy interventions. Examples include use of a combined social accounting matrix and linear programming model to assess alternative public lands policies; use of cross-sectional time-series procedures to estimate fiscal impact models; development of county and sub-county interindustry models for analyzing the economic impacts of industrial targeting policies and programs for attracting healthcare professionals; and use of a standard fiscal impact model to assess the local budgetary impacts of farmland protection programs. Finally, research is underway to assess the effectiveness of establishing tax-free zones for purposes of encouraging new economic activity in economically distressed non-metro communities. This work links to on-going (but still inconclusive) work on the effectiveness (or lack thereof) of urban enterprise zones. Objective 4: To identify community characteristics associated with viable and healthy rural communities and investigate policy alternatives to enhance these characteristics. Several researchers examined the impacts of policy on poverty. One study focused on the effect that transfer payments to poor people had on transitions in and out of poverty. The primary findings were that (a) income maintenance programs were effective in fostering exit from poverty but more so in metro areas than in nonmetro areas; (b) retirement and disability insurance programs did not play a significant role in alleviating poverty in both metro areas and nonmetro areas after welfare reform; (c) unemployment insurance programs had a greater effect in reducing poverty after welfare reform than before, especially in nonmetro areas; and (d) medical benefits had more effect on poverty reduction in nonmetro than in metro areas. A second study focused on transitory versus persistent poverty. The findings of this study support arguments in favor of policies that differentiate persistent poverty from transitory poverty. They also highlight the importance of spatial attributes in the fight against poverty. Current antipoverty strategies revolve around the provision of safety nets to prevent entry into poverty and foster exit from poverty through job markets. This strategy is not sufficient for persistently poor households who remain in poverty because they are unable to self-finance investments needed to sufficient returns from their assets. Persistently poor households would benefit from strategies that enhance their capabilities to accumulate assets and transform them into entitlements through social, economic, cultural and political institutions. A third study focused on food insecurity among the poor. It found that food insecurity is influenced by much more than demographics and individual choices. County level factors such as residential location (urban or rural) and housing costs significantly affect the likelihood that a low-income household will be food insecure. Other work analyzed the capacity of rural communities in the western U.S. to deliver quality K-12 education and a full complement of social and community services to their residents. This research used telephone surveys and face-to-face key informant interviews with a diverse mix of local policymakers. Respondents were queried about their perceptions of education quality in rural communities and community infrastructure that supports the delivery of a quality K-12 education. Papers based on this research explore how education in the rural west is evolving and how the decision making dynamics are impacted by resident perceptions; and how collective actions is evolving in the rural west as population demographics change. Finally, research is underway to explore the determinants of community development and its interface with saltwater marsh environments of the southeast United States. Mounting evidence shows that these environments are very susceptible to damages from urbanization. Urban water runoff, boat dock construction, septic tank leakage are examples of causes of considerable direct harm. Unfortunately, the land bordering the marshes are being developed at a fast pace, and in a manner that places the environment at the most risk. This research examines how the real estate market responds to designs of houses and neighborhoods that are more sensitive to environmental protection, using a hedonic price model with data from Georgia, South Carolina and Florida.

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