By Rob Rishel
In 2011, many Central Ohio communities endorsed a development "anti-poaching pact" that sought to prevent any single community from offering economic development incentives to any company proposing to relocate to a different Central Ohio community.
The theory was that eliminating competitive economic incentives would improve inter-community cooperation and result in greater inter-community benefit. The pact gained some initial momentum in 2012 but ultimately stalled. The pact's failure resulted in an increased sense of a regionalism that will promote prosperity far better than the pact ever could.
The anti-poaching pact rested on a faulty proposition and would have negatively affected Central Ohio. Economic incentives don't cause companies to leave one location for another. Economic incentives are rarely the motivating factor in site selection. Typically, a company has already identified a location for its expansion project well before inquiring into incentives. However, incentives are incredibly important; they may decide whether the project moves forward or stalls. Thus, economic incentives may dictate if a company will be able to expand in the region rather than the motivating factor of where a company will expand.
A Central Ohio company might expand, for example, if business booms and it requires additional space or wants to take advantage of a new economic niche. It might relocate for the name recognition of a "Columbus" address or a negative experience with its current community. In some instances, companies move to a different community to take advantage of a place that better fits current and future business needs.
The anti-poaching pact would not have fixed companies in place. The motivation to move would have remained. However, the ability to do so within Central Ohio would have been diminished, forcing companies to seek relocation outside of the region. The anti-poaching pact would have stripped local communities of the tools necessary to keep relocating businesses in the region.
Fortuitously, after the anti-poaching pact stalled in 2012, collaborative regionalism took its place. Collaborative regionalism uses development incentives to direct the economic investment that is already occurring in Central Ohio companies. The result is a regional approach focused on promoting companies currently within the region with a plethora of incentives for companies of all sizes. Economic incentives are no longer limited to out-of-state companies trying to move into Central Ohio. Additionally, community Development Directors have learned to facilitate a diverse range of business investment through equally diverse incentives. This approach more accurately addresses the economic situation to the benefit of all Central Ohio communities.
As managing partner of Rinehart, Rishel & Cuckler, Ltd., Rob Rishel represents Ohio business clients in matters concerning land-use planning and regulation including zoning, annexations and permitting, as well as clients in economic development projects. Since starting his practice in 2002, Mr. Rishel has helped businesses obtain and maintain more than $30 million in government financial incentives for expansion and relocation projects in Central Ohio.