While the national economy grapples with recovery, mayors offer a blueprint for growth

After this year’s economic recession kicked off with the cancellation of the annual SXSW conference and festivals – easily among the city’s highest-profile and revenue-producing events – why is Austin, Texas, doing … ok?

The mayor of Austin, Steve Adler, as well as mayors from Dayton, Ohio; Oklahoma City, Oklahoma; and Birmingham, Alabama, believe their cities found themselves in a better position to handle this year’s economic crisis because they had taken steps to make their cities attractive during economic boom years, so that when COVID-19 and the ensuing economic disaster beset their cities, they were prepared not just to survive but, also, to thrive.

As the former mayor of Albuquerque, New Mexico, and a member of the Kauffman Foundation’s Mayors’ Council, I hosted these elected leaders for a conversation on the heels of Kauffman’s annual Mayors Conference on Entrepreneurship, to discuss how to best help small businesses prosper as part of their communities’ broader coronavirus recovery strategies.

The mayors broke down how they used entrepreneurship and emerging new industries to create a wider economic base in their communities and worked to build a supportive environment for entrepreneurship during periods of economic stability. This allowed their cities to leverage entrepreneurship, and the economic mobility and social equity it provides, to recover from the economic shock the pandemic wreaked.

Each of the mayors emphasized that their abilities to make change are finite; that, often, they can merely hold the line for a short period – especially in times of such historic crisis. They agreed that a comprehensive federal approach to deal with the pandemic, and funding to cover budget shortfalls for all cities, regardless of the size, will be necessary to avoid more dire economic outcomes.

Yet, in the absence of a comprehensive federal approach, local leadership has the opportunity to create enormous impact in cities across America. Mayor Nan Whaley of Dayton, Mayor David Holt of Oklahoma City, Mayor Randall Woodfin of Birmingham, and Mayor Adler of Austin, believe cities willing to embrace change and act boldly – in other words, be a little entrepreneurial themselves – will grow stronger from this moment.

Growing the economy through entrepreneurship

After the Great Recession more than a decade ago, Whaley said the city of Dayton learned the hard way of the need to diversify a local economy heavily reliant on manufacturing.

“We’ve been very aggressive about it [diversification],” she said. “It has helped us in this COVID recession, because we’re not reliant like we were on just one sector of employment.”

The city’s recent job growth has instead been concentrated in advanced manufacturing, logistics and distribution, and information systems and software. Dayton’s commitment to growing entrepreneurs was further solidified last year, when the private University of Dayton and a local technology accelerator and business incubator signed a 10-year, $10 million lease for space in the historic Dayton Arcade downtown.

A generation ago, Holt said Oklahoma City embraced a similar approach. It built on the foundation of its energy-industry origins, and then, continued to move forward while also benefiting from its status as the home of state government.

“We’ve diversified so much that we were really weathering what was already an oil and gas recession… even before COVID-19,” he said.

Providing support and stability to entrepreneurism

Mayor Woodfin of Birmingham emphasized his administration’s efforts to actively engage small business owners before the pandemic, and how it allowed the city to respond quickly to the COVID-19 economic shutdown.

“Moving forward, it’s going to be really important that mayors, municipal governments, and administrations to have a sense of urgency and keep the needs of small business owners on Main Street at the front,” he said. “If you don’t take care of Main Street, not only will you not collect taxes, but what will happen is they’ll go to some other city [where] government works with an open hand for how to engage small businesses.”

In Austin, federal CARES Act funding, augmented by local support, allowed the city to funnel emergency assistance — from food and childcare support, to rental subsidies and local eviction moratoriums — to musicians, artists, restaurant workers, and other members of the city’s extensive creative class. Even amid the prolonged pandemic, the city is forging ahead with a planned early November vote on a property tax increase that would help fund a $7 billion mass transit initiative, including several light rail lines, which is known as Project Connect.

Adler asked rhetorically: “Is this really the time, with all the hardship, to invest in the future?” His answer was a definitive “yes.” Through times of such disruption, when so many plans are taken off the table, what he’s hearing from the community is that they feel like there is a blank slate and the opportunity to create anew.

Generating equity with entrepreneurship

“With the awakening that we’re having in our country after the murder of George Floyd, I think we’re going to have a lot more conversations about ‘how do we extend these opportunities and lift up all communities,’” Holt said. “What we haven’t been as focused on is, ‘How do we lift up people in our own communities that already live here, who are people of color, who haven’t had those opportunities?’ I think that’s the new frontier that cities are going to be grappling with.”

In Oklahoma City, voters in December 2019 approved a temporary, one-cent sales tax to fund nearly $1 billion for 16 capital improvement projects during the next eight years, with a focus on parks, youth and senior centers, and other human needs’ projects. It was the fourth such successful vote in the Oklahoma capital since 1993 – and as Holt noted, an inadvertent “post-pandemic stimulus plan” that has “really turned out be timely and prescient.”

“It’s never been for police stations, or water pipes, or streets. It’s always been for quality-of-life projects,” he said. “But the definition of quality of life has evolved.”

There was easy consensus that much has evolved, and that change, though inevitable, provides great opportunity for bold leadership in a time of both uncertainty and promise.

“We’re in a special moment here, and it’s really up to us and up to our communities, if we’re going to see a real difference,” Whaley said.