Many Applications for $1B Economic Development Program Had a Missing Element
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New research finds a notable gap in proposals from the 60 finalists for the Build Back Better Regional Challenge.
Equity was a key consideration the Biden administration took into account with a new, $1 billion regional economic development program that it launched last year. But early research shows finalists had mixed success when it came to embedding equity elements into their proposals.
Only about a third of the Build Back Better Regional Challenge’s 60 finalists “laid out strong, clear equity arguments,” according to a recent report from Brookings Metro.
In September, the U.S. Department of Commerce’s Economic Development Administration announced 21 winners for five-year grants from the program, ranging from $25 million to $65 million. The challenge was created under the American Rescue Plan Act, the $1.9 trillion Covid relief package signed into law last year.
More than 529 regional coalitions—which can include governments, private sector organizations, colleges and universities, and nonprofits—applied for the Build Back Better Regional Challenge. The finalists represented more than 300 organizations. In total, those coalitions identified 467 projects and requested $4.3 billion.
The overwhelming interest in the challenge illustrated “how competitive federal programs can not only align regional leaders around a shared vision, but also inspire tremendous effort among those coalitions to develop comprehensive plans under ambitious deadlines,” the report said.
And ambitious deadlines they were. Those 60 finalists had three months to develop their final proposals, which included submitting files outlining goals, assets, partnerships, resources to complement EDA grants and hundreds of pages in supporting documents, the report notes.
The grant challenge sped up typical regional economic development planning. Processes that normally span months—or even years—were completed in a matter of weeks.
That push seemed to come at a cost, researchers found. In addition to improving regional economies, the challenge’s top priority was to benefit historically disadvantaged communities. But in part due to the tight timeline, it was difficult for applicants to develop and include equity initiatives into their planning.
“Embedding equity in economic development strategies very much remains a work in progress,” said Joseph Parilla, one of the report's authors and director of applied research for Brookings Metro, in a recent presentation.
Most coalitions failed to create plans that: fully integrated equity into governance models; described project outcomes for marginalized communities; and outlined concrete metrics to track progress in those communities as projects roll out. Of the challenge’s 60 finalists, most addressed only one or two of those elements, and only about 33% had strong equity components throughout their proposals, the report said.
At a Brookings Institution panel earlier this month, representatives from two coalitions lauded the Economic Development Administration for the challenge’s design and focus on equity, but noted there are plenty of hills ahead.
In Northern Virginia, a coalition is looking to revitalize the pharmaceutical industry in the region through initiatives like creating new education opportunities and building innovation and manufacturing facilities. Chandra Briggman, president and CEO of Activation Capital in Richmond, said engaging the public is one of her primary concerns, noting that she’s “seen the ebb and flow of diversity being important and not so important” throughout her life.
“This is our opportunity to make sure that people understand they know what's happening, they know how they can be involved, and they truly see it as an opportunity for them to be engaged in this cluster and thereby change their status in life,” Briggman said.
Researchers described the challenge as a place-based policy that aims to benefit targeted economies and populations by focusing on challenged areas. Looking toward the future, there’s likely to be more such policies created at the federal level and beyond, the report said.
As federal officials shape programs under the Infrastructure Investment and Jobs Act, CHIPS Act, and Inflation Reduction Act, they can look to the Build Back Better Regional Challenge for lessons in design and implementation, the report said, as can the states and philanthropies that are developing other grant challenges.
To read the full report about the Build Back Better Regional Challenge’s first year, click here.
Molly Bolan is the assistant editor for Route Fifty.
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