UPDATE OF THE MUNICIPAL ECONOMIC DEVELOPMENT PLAN AND BUSINESS INCENTIVES PACKAGE OF HASKOVO
Summary
In Phase IV of the Bulgaria Resource Cities Program , the cooperation between the municipalities of Haskovo and Abington was an upgrade of previous phases. Since the partnership was involved in the Local Economic Development and Marketing of Bulgarian Municipalities Project, the focus was once again on business support and investment recruitment . The joint efforts resulted in the formation of a team of local economic development specialists which created a municipal incentive program for potential investors. This team was also trained in how to create appropriate marketing support for this initiative. A n action plan was developed for the team, as well as business incentives and business retention and expansion measures.
Local government in Bulgaria is often a passive participant in the investment recruitment process . Opportunities are scarce and obstacles are great to the implementation of a pro-active business policy. In general, the municipalities do not have trained staff in this field and the legislative framework is not very favorable. Due to this, the implementation of this project was aimed at increasing the role of the Municipality in the process of recruiting investment and initiating activities to improve local government capacity.
A local economic development (LED) team of four employees was formed and trained in cooperation with the American partners to pursue the goals of the project: Establishment of a Municipal ED Team (staff, organizational structure, roles, and responsibilities) to work towards retention and expansion of the existing businesses and recruitment of new businesses by developing an incentives package. The action plan and the incentives package were developed with the involvement of the following individuals: the Chair of the Municipal Council, municipal councilors, representatives of a regional business association, municipal management /directors and department heads, the mayor, and the American partner city, Abington.
Project DescriptionThe project was implemented in two stages : The formation and training of LED team, and the development of an action plan, including business incentives, which will eventually be incorporated in the new municipal economic development plan .
The first stage began with the formation of the team and the identification of roles and responsibilities of team members. Of high importance was the FLGR training facilitated by American specialists, which was attended by three team members. Each training component was implemented at the office, thus transferring the experience accumulated by a specialist to other team members. The topics included: strategic and economic planning; marketing a municipality to an investor; basic elements of communication with investors; marketing of available buildings and lots; presentations to investors; and simulations. A delegation from
Haskovo visited Abington and further developed the action plan of the LED team by adding specific elements.
The second stage included the identification of measures that the Municipality needed to implement in order to achieve progress in economic development. An Economic Development Plan was elaborated, including a business incentives package. The main elements of the package included:
Adequate description of all known business support opportunities under the current legislation;
Precise presentation of all current business incentives available under an agreement with the city. These included: lot grading, infrastructure delivery electricity, water and sewer, development of architectural and investment designs, etc. These activities save the investor time and money and provide a basis for sustainable public-private partnerships.
The team has a competent expert who is aware of the available private and municipal property and can help the investor in the site selection process;
The team is ready to help the investor in the selection and training of employees. To this end, we cooperate with the Labor Bureau and the local professional schools;
Provision of a trained interpreter for an initial grace period agreed upon by both parties;
Free use of office space in the Corporate Office Center , a part of the municipal Business Center , for a certain period;
Presentation of the Business Orientation Program to the investor. The program was developed by the LED team and provides an idea of all aspects of life in the region.
The package is already being used and is producing results that make us proud. Should national legislation change to allow the Municipality more control on local taxation or incentives, the LED team would be prepared to provide recommendations on what needs to be done to support business at the local level.
Having identified the existence of good market demand, we developed a corporate database. The presentations of the Haskovo region to the business community focus attention on the identification of the most comprehensive and real incentives package. This will improve the city s position in the economy and will benefit the realization of potential investment deals.
Implementation TimelineThe first stage incorporated the following timelines:
Formation of team, division of roles and responsibilities between team members: November, 2003.
Staff training under the Local Economic Development and Marketing of Bulgarian Municipalities Project: December, 2003 January, 2004.
The second stage included:
Identification of the main elements of the incentives package: January March, 2004.
Studies, data collection, and package design: March April, 2004.
Presentations to investors, networking and continuation of project activities: April, 2004 ongoing.
Solutions Overview and Specific ResultsThe team has been working successfully for two years and the results are encouraging. The Municipality intends to continue this process and expand its economic development activities.
The short-term results achieved so far include :
A municipal LED team formed;
Municipal employees trained in economic development issues;
Understanding of global marketing principles with regard to investor recruitment on behalf of the local government;
Delivery of professional services to local and foreign investors;
An incentives package developed;
Municipal economic development plan elaborated, which will be incorporated in economic development section of the new municipal development strategy.
Long-term results :
Increased role of the Municipality for the economic prosperity of the community;
Development of new successful public-private partnerships;
Investors recruited and jobs created;
Retention and expansion of existing businesses;
Stable long-term municipal marketing program, incorporated in a long-term economic development plan (5 10 years).
BenefitsThe implementation of this project has produced the following benefits:
Good partnership relations established and increased confidence of businesses in local government;
Active role of the Municipality in investor recruitment, a sustainable long-term opportunity;
The incentives offered by the Municipality of Haskovo led to the expansion of Daemon- Bulgaria Ltd. as well as to the final implementation of the public-private partnership project for covering four bridges and redesigning them to include parking and retail sites.
Contacts with national and international organizations potentially dealing with economic development in the future;
Ongoing delivery of updated marketing information about business buildings, lots, bids, etc. on the two websites, www.invest.bg and www.haskovo.bg ;
Municipal LED experts trained .
The quantitative description of the above is as follows:
Number of municipal specialists trained to work with investors 5;
Number of presentations made to potential recruits 3;
Number of team involvements in international forums 4;
Number of jobs created as a result of municipal business retention and expansion efforts 50.
ConclusionBased on the above, it may be said that the goal of the Municipality of Haskovo was to prepare itself for effective economic development. This goal was achieved by the formation of a LED team which works in a network with counterparts in other municipalities. The municipal economic plan, including the incentives package, has already played, and will continue to play, a key role in future marketing and recruitment efforts. Attention is given not only to new, but also to existing businesses, by means of the adopted retention and expansion measures. The experience shared by our American partners in this area was critical. The mayors of Haskovo and Abington have agreed to focus their future efforts on the development of a 10-year economic development plan for Haskovo. Abington already has such a plan and has expressed willingness to share experience in this field.
