Thank you Mr. Chairman. I am pleased to be here today to discuss the reauthorization of the Economic Development Administration. Under the leadership of Dr. Sampson the Economic Development Administration has begun the transformation into a results oriented agency that maximizes the economic impact of each and every dollar while at the same time, maintaining its core focus on empowering distressed communities to develop and implement their own economic development and revitalization strategies.
EDA has been successful over the years because it has remained true to the guideline that “distressed communities must be empowered to develop and implement their own economic revitalization strategies.”
EDA assistance in Missouri has truly been a boon to local investment and economic growth. For instance, over the last decade EDA has implemented over 300 projects and invested more than $115 million in Missouri. Since 1998, EDA funds have led to the creation of over 5,000 jobs in my state and leveraged an additional $684.7 million in private sector funds and $83.1 million in state and local funding.
Recently, EDA has invested in several economic development initiatives in Missouri that have continued to diversify the job base with a focus on high-tech, high-growth industry. For example, last August EDA awarded a $2 million grant as seed capital for the “North 8” shell wet lab space.
It is important that EDA continue its transformation from a "culture of compliance to a culture of performance." I support implementing further incentives that reward deserving projects and their communities based on their performance.
Economic development districts are rewarded for simply being a member of an economic development district. A change in this structure will reward districts for their achievements while motivating others to improve further.
While it is important for EDA to achieve the maximum impact with every dollar, the Administration must also remember its legislative mandate to aid distressed communities.
Specifically, I am referring to EDA's new standards regarding the minimum amount of money leveraged and jobs created per EDA dollar. It is my understanding, that under the new "balanced score card" measurement rules, the region must meet an average of no less than 22 non-EDA dollars per each EDA dollar and more no more than $5,000 EDA funds per job created. It is my concern that EDA may become overly focused on funding only projects that can leverage a maximum amount of jobs and investment.
These new criterion will be devastating to distressed rural and urban communities throughout Missouri.
One recent example of a project that has been rejected based on the new standards is the Southwest Area Career Center in Monett, Missouri. It is my understanding that this project was turned down expressly for not meeting the new direct job creation requirements.
A better example of EDA’s role in our nation’s evolving economy can be found in my hometown of Mexico. As the economy continues to grow and diversify away from natural resource heavy industries such as firebrick, businesses in the surrounding area will need a highly skilled workforce.
My testimony has highlighted just a few examples of the opportunities and needs for economic development across my state.
I look forward to hearing the testimony from our witnesses today and look forward to working with you all in the future towards a multi-year reauthorization of EDA.