In Pursuit of Business
Tax abatement, historic tax credits, tax increment financing, enhanced enterprise zones, transportation development districts in the stew with subsidies of various sorts are continuing to generate a ruckus. Historically, Columbia’s first growth spurt began almost two centuries ago when area residents subscribed the funds as an incentive to locate the state university here. Eschewing the fast-paced metropolitan lifestyle, Columbia was celebrated for decades because it was a tranquil out-of-the-way speck devoid of smokestacks, labor strife and the riff-raff associated with a main line railroad.
As the municipality’s infrastructure began to develop a century ago, some community leaders recognized the need to diversify the economic base to supplement the area’s top-heavy dependence on education. In one case, the Columbia Commercial Club — predecessor to the present Chamber of Commerce — financed construction of the four-story factory building that still stands on Wilkes Boulevard, which was occupied until 1939 by the Hamilton-Brown Shoe Co. of St. Louis. Then the factory closed; the shock of losing hundreds of factory jobs, many of them female, would reverberate for years. The sting to local banks would linger, making them reluctant to advance funds except for the surest projects for years.
Growth and the development divide
The vicissitudes of Columbia’s economy then saw wide swings from the significant collegiate enrollment declines during World War II to the post-war boom years and spurts of retail, commercial and residential development tied to renewed activity at the university and two colleges. With insurance developing as a major employer during the 1950s about the same time the university landed its new medical school and teaching hospital, a group of community leaders in 1953 organized the for-profit Columbia Industrial Development Co. (CIDC) to pursue new business and industrial development activities.
The story of CIDC based on a clutch of personal interviews is summarized in a monograph authored about 15 years ago by Don Laird, the retiring director of the Columbia Chamber of Commerce. Over the years, one theme that courses through communitywide debates about economic development divides the population into the typically opposing factions of “town versus gown,” modernized perhaps to “growth versus no growth.”
By 1953, CIDC and the Chamber of Commerce realized the need to set aside and develop land in the Columbia area dedicated to future business and industrial purposes. Plans to transform U.S. Highway 40 into a divided transcontinental super-highway were under way by then while the buzz across America’s business world spoke of factory openings especially in the West and Deep South. At first, the CIDC and the community at large were wary of most of the prospects that came across the transom. Still, CIDC purchased property that would later figure as the location for several significant industrial projects.
Industrial prospects, seeking incentives
One example of an early industrial prospect was the Pomona Tile Manufacturing Co., which would have employed 125 people. On June 25, 1953, the CICD rejected their application terming it “a project of doubtful value.” Others came and went including an asphalt plant, a trailer court and a nursing home. In 1965-6, negotiations were under way with the E.I. DuPont Co., but they opted instead for Moberly and cited Columbia’s limited labor supply and the absence of a main line rail connection. Then success. By 1968 with the acquisition of land in the city’s northeast industrial corridor tied to the relocation and improvement of Route B, CIDC was set to land a couple of big ones including Clow Corp., 3M and Square D.
As incentives go, there had been none until the 1970s when the City of Columbia began issuing Industrial Revenue Bonds with the caveat that there would be no deferral of taxes. Then came Regional Economic Development Inc., the private-public entity that brought together the City of Columbia, Boone County, the University of Missouri and the Columbia Chamber of Commerce. CIDC’s original landholding and development role had largely passed, and on December 31, 1992, the group went out of existence.
Now REDI and its supporting agencies are left to negotiate, find property, seek out incentives (if any) and take the heat in the cauldron of widespread public debate. Economic development has entered into a cruel, highly competitive world and pitted the Columbia area against a seemingly infinite number of competitors not just in this country but literally anywhere. Without passing on the merits or sins of particular incentive, we should appreciate the fact that they may be available to use and leave it up to responsible parties for assessment and subsequent applicability here.