Bruce Seifer: Creating A Durable Local Economy

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In a recent podcast with Michael Shuman discussing local economies, Shuman praised the progress made in Burlington, Vermont over the past 25 years -- largely led by a local activist named Bruce Seifer who co-authored the book Sustainable Communities: Creating a Durable Local Economy. This caught the attention of a number of PeakProsperity.com readers and, at their request, we invited Bruce to speak specifically about the urban revitalization he has helped bring about in Burlington, and what other communities can learn from that model.

In a nutshell, Burlington's success is due to:

  • beginning with a data-driven understanding of what local needs are most important to meet
  • creating a clear, long-term vision of the developments efforts that will be required to meet these needs
  • electing leaders who can inform and inspire the populace
  • empowering and encouraging local citizens and businesses to participate in reaching the goals
  • making smart trade-offs (e.g. investing in efficiency before and/or instead of new infrastructure)
  • maintaining clear transparent 2-way (top-down & bottom-up)  communication throughout

I recently looked at the Bureau of Labor Statistics unemployment rate, something I used to track when I worked for the city for 28 years. They have 372 municipal regions where they track the unemployment rate, which is one factor of many that you look at when you're looking at an economy. And, Burlington has the fourth lowest unemployment rate in the United States currently, out of 372 municipal regions. We were usually in the top two percentiles of the unemployment rates for many years, but it’s gotten even better.

Another piece of information that we tracked during the Great Recession that we as a nation felt, and we had the lowest foreclosure rate of any city in the United States, which mean that people’s net worth didn't shrink like many cities around the United States where people lost their house value. So, those are two pieces of information.

The other one we look at is our vacancy rates for commercial buildings in town and whether or not there are vacant buildings. Basically, there are virtually no vacant commercial buildings, so the vacancy rate is extremely low. Companies now want to be in Burlington and want to grow in Burlington, But that wasn’t always the case...

Some of the lessons learned is that vision is important, but you have to create the capacity to implement the vision. And, we felt that development created with the principles, with a priority for sustainable development was important. One of the things that we learned, that was one of the big lessons we learned in about 1993 was to serve the people in your community first by building facilities for yourselves and then other people will come.

The other thing that we did, which is not rocket science but it’s pretty much behind everything that we did, is pretty simple. We asked people in need what they needed and then we tried to figure out how to meet their needs. We were more like a gardener for small businesses. We’d focus on small businesses and try to find ways to help them grow to become major employers and economic players. So, we did things…you know if they needed financing we ended up starting a small business loan fund. If they needed training around understanding finance, we set up training programs for them. Sometimes they said they’d like to work with other like type of businesses and learn from each other. So we would set up trade associations working in concert with them. You know, we would tend to them over the years. We provided ongoing technical business advice to those business people so if they had an issue on getting a permit or they had problem with sewer overflow or whatever it may be, we were always there trying to solve their problems. As a result of all of that, we ended up helping a lot of small companies become bigger companies.

Part of what you're talking about is also, we had political leaders that were able to articulate the shared values of people. And by doing that, people felt empowered to make things happen and become…they become unstoppable. So, there was a whole range of things that we were doing, but it was really listening to the public and responding to their needs. And also, identifying weaknesses within our community, and we did that through a long-term economic development plan 

Click the play button below to listen to Chris' interview with Bruce Seifer (48m:20s):

This is a companion discussion topic for the original entry at https://peakprosperity.com/bruce-seifer-creating-a-durable-local-economy/

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finding out what people want and working together. two of the many take aways for me.

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What I loved about this interview is that it clearly demonstrated what local investing is all about; hard work.
Where sending your money to Wall Street is 'lazy money' finding and developing local opportunities just takes time.  And effort.

The story in there about Burlington's approach to electricity is a perfect example.  Faced with needing to spend tens of millions to get more electricity to their growing city, they instead 'ran the numbers' and determined they could get more return for that same money by investing in conservation efforts.

Bringing a tear to my eye, they even went further and added up all the externality costs of various fuel types and added those to the ultimate cost of provided electricity even though their community might not be the one bearing those costs.

Nuclear is cheap energy until you are the one who has to pay for the eventual decommissioning costs and near permanent storage of the resulting waste.  Most communities would only consider the cost of provided nuclear electricity assuming, perhaps rightly, that their community would not have to shoulder the eventual costs as those would be shared by everyone in the country eventually.

That was the very best example of mature, prudent and conscious decision making I've encountered so far.  Really, if we humans are to have any sort of a chance at all, that level of maturity is what we're going to have to emulate on a grand scale.

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Great success story. A must listen for everyone who lives in a local community. (Isn't that all of us?) 
Closing thought by Bruce.  "St. Francis de Assisi said that first do what’s necessary. Then do what’s possible. And before you know it, you're doing the impossible."

Also loved the group name  "Socialists for Capitalism".   Fantastic!

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We lived just outside of Burlington for three years. We just love that city. A great interview and so many great examples for towns and cities to follow!
Thank You!

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Aloha! I appreciate the "local" initiative here towards durable community and to me that means higher efficiency in capital expenditure, capex. I would like to hear more on the "governmental interface" in terms of State and Federal funds for infrastructure.
I spent some 20 years as a contractor within the public works sector in various California communities and found it to be one of the most corrupt and inefficient systems to either build new infrastructure or renew existing infrastructure. From day one preparing a bid for a new school or prison or park you were faced with institutional corruption. As anyone knows when you build anything one of the most costly inputs is labor. Every project we bid that had State or Federal funding was subject to Davis Bacon Act, known as prevailing wage to us commoners. This is where the Federal government allows unions to have a virtual monopoly on the cost of labor and the union trades like IBEW police this like the Mafia. You first see them at job walks, whereby prospective contractors show up to walk the job(project) with the architect and engineers in order to see the site to prepare a competitive bid. You are warned by the union enforcers to abide by Davis Bacon. What is Davis Bacon? Well, it started in the 1930s in the FDR days and has morphed since then into a politicized wage control. In layman's terms it means as a contractor I must pay a ditch digger in Honolulu, Hawaiii $91,000 a year to hold a shovel. There is further corruption in terms of the "material" side of public works that I will not get into now. You can see with just the labor side of a public works bid the huge cost to not only the communities, but the Nation over the 80 or so years that the Davis Bacon Act has been in existence. More so in the past four decades as money buys less and less in terms of goods and services. The bridge that cost $100 million to build in the 1980s now is $1 billion. The labor costs with Davis Bacon have a built in increase while those in the private sector stagnate or decline over the long term. I cannot but wonder how communities can get around such institutional corruption whenever and wherever State or Federal funding is involved. 

As we watch Detroit go down and next Chicago and the other major US cities like Los Angeles it seems the cost for funding will rise in a sort of domino effect. Its all about the cost of debt …

Socialists for Capitalism … I never understood the hate of Capitalism since really all it is based on is the accumulation of capital. We all do that every day when we wake up to go to work. We're all Capitalists, even Environmentalists and Socialists and Progressives, it's just some of us do it better than others and some of us do it in a more legitimate way. Even a devout communist must "accumulate capital" to live. Its just the average communist operating in an impure communist system must struggle more to succeed or be related to Putin. The rule of thumb seems to be the more government intercedes in your daily life the harder it is to accumulate the capital needed to provide for your family.

The Wall Street way like the Union way has always been about manipulating the political system to their advantage. There is nothing fair or ethical about that and it damn sure isn't efficient capex! With some $17.5TRIL in US Debt and counting just imagine the savings to all US communities without politicized monopolistic labor and material costs. Not exactly a level playing field and it surely has nothing to do with ethics and free markets.

For that view you can label me the "Radical Center"!

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[quote=cmartenson]What I loved about this interview is that it clearly demonstrated what local investing is all about; hard work.
Where sending your money to Wall Street is 'lazy money' finding and developing local opportunities just takes time.  And effort.
The story in there about Burlington's approach to electricity is a perfect example.  Faced with needing to spend tens of millions to get more electricity to their growing city, they instead 'ran the numbers' and determined they could get more return for that same money by investing in conservation efforts.
Bringing a tear to my eye, they even went further and added up all the externality costs of various fuel types and added those to the ultimate cost of provided electricity even though their community might not be the one bearing those costs.
Nuclear is cheap energy until you are the one who has to pay for the eventual decommissioning costs and near permanent storage of the resulting waste.  Most communities would only consider the cost of provided nuclear electricity assuming, perhaps rightly, that their community would not have to shoulder the eventual costs as those would be shared by everyone in the country eventually.
That was the very best example of mature, prudent and conscious decision making I've encountered so far.  Really, if we humans are to have any sort of a chance at all, that level of maturity is what we're going to have to emulate on a grand scale.
[/quote]
As most here know, I moved south to escape the harsh winters of New England. I moved to a small town (they call it a city) in coastal North Carolina. I chose NC because of all of the good work coming out of the likes of NC State University, UNC at Chapel Hill, yes and even Duke University. What I didn't realize was that once one got outside the circle of influence those Universities had on their local communities, everything went back to pushing the "status quo."
My little town here "runs" it's own electric department like Burlington. However, several years ago, they got bamboozled into joining a power co-op to support a nuclear power plant by being lulled into the, "nuclear power is cheaper" mantra. What has resulted over the last several years, has been much higher electric rates because of, at first, the plant's cost over runs during construction, and now the non-sustainable crush of debt surrounding the bonds issued at the time to pay for the plant. Since I am in the city limits, I pay a much higher electric rate than my neighbors just one block over who are outside of the city limits. Both neighborhoods are supplied by the same transmission lines, same sub-stations and local lines. The only difference is being in the city limits. Had the city taken the approach that Burlington did years ago, we would be enjoying the fruits of conservation.
Now, most folks want to sell the service to Duke Energy, (yup the same one that has been in the news over coal ash pollution.)
I want to take Burlington's blueprint to the city and see what happens.
C.

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It turns out that now it’s half as expensive to invest in efficiency and conservation than it is to buy new power.
I have been saying that for YEARS. Nice to have a study to back it up.

One of the advantages of my being a science fiction and fantasy editor is that I get to have very conservative and very liberal authors "friend" me on places like Facebook where they share their interests, views, and lives. I cannot emphasize this enough: both sides of the political spectrum have good ideas and pretty much want the same outcomes. I am privileged–both here at Peak Prosperity and there–to hear people of good will propose solutions. But to see them work together! And get results! (My day job is engineering; I am all about the outcomes). So I loved hearing this:

Our office was created during the height of—in 1983. It was created—there was a city council, passed a resolution trying to figure out what do we do in order to recharge our economy. So, the head of the industrial development group, a republican, co-chaired by Mayor (Bernie) Sanders’ treasurer (a democrat), and the two of them came up with a strategy.
Also, Chris, the description, "Department of business prevention, how may I stop you?" LOL

PS - Bruce? I was personally disappointed that the Todd Lockwood associated with "Socialists for Capitalism" was (probably) not the one I know of. Just think of the art at your downtown Burlington Festivals!

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Like most here, I'm all for shopping locally and make an extra effort at keeping our capital within the community.  I can't remember the last time I was in a big box store? My family buys from farmers markets, eats at privately owned local restaurants, buys from clothing exchanges, even the gas for my diesel Volkswagen I try and get from the local privately owned service station.  If we're spending our money, it is almost exclusively with local business.That said, those are our choices.  I'm always hesitant when govt people are getting involved & taking taxpayer money to make decisions for an entire community.  After living in Baltimore for some time, I saw firsthand at how awful they are at managing money.  Residents are totally clueless as to the amount the city has borrowed.  They've gotten away with it (for now) because their credit rating is good.  But like Detroit, Stockton, etc. the day of reckoning is coming for Charm City.  People will lose out and suffer because inept, clueless bureaucrats have made terrible decisions with their money.  Not to mention the city is dilapidated & infrastructure in ruins. 
Mr. Seifer seems like an intelligent man and when you have a small community like Burlington with almost all like minded people in it, the plan will have some success.  The other end of the spectrum is a place like Baltimore, where they're trying the same thing with what will be catastrophic results.  

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Bruce said "It turns out that now it’s half as expensive to invest in efficiency and conservation than it is to buy new power."  I'll accept that, but would like to know where he drew the data from.
Anyway…Our personal energy epiphany was to install a high SEER mini-split in our bedroom. (We live in Texas where 100 degree days are common and most homes have central AC). We bought a small, cool only unit, and at night during the summer we shut down the Whole House Central unit and only the cool the space we are in. Mini-splits have up to 23 SEER (efficiency) whereas central units top out at 17 or 18. They are relatively inexpensive. My 12,000 btu unit was about $1,025.00 installed.

I was worried about condensation at first cause there is a 15-20 degree temperature differential at our bedroom door, but that has not been a problem. We are entering our 3rd summer and the system is still working fine. And by the way, they are quiet. The compressor is outside like a central unit and the inside unit that mounts up high on a wall only has a fan in it. They have no ducts, so a 2 inch hole in the wall is all that you need to connect the line sets from the outside compressor to the inside unit. They also come with heat and cool options.   

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I live in the beautiful small town of Verona, WI "Hometown USA," an edge suburb of the Madison, WI metropolitan area.  
Verona, Madison and Wisconsin are liberal and environmentally conscious.  Yet, Verona is still attempting to grow their job opportunities by converting surrounding farmland to empty industrial parks.

In a recent city council meeting the topic of "backyard chickens" was raised by local enthusiasts.  To paraphrase the response, basically the city council felt that all of their time was already taken up by their current initiatives, such as developing empty industrial parks, and that they couldn't be bothered to add such a frivolous idea to their current thinking.

I can't imagine a council that won't even vote on simple initiatives, spending the time that Burlington spent getting to where they are. 

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[quote]What I didn't realize was that once one got outside the circle of influence those Universities had on their local communities, everything went back to pushing the "status quo."[/quote]Sound observation.  At this point the whole localization movement is dependent on relatively wealthy towns, many of them college towns, like Chapel Hill, NC; Burlington, VT; Ithaca, NY; Madison, WI; Bozeman, MT; Austin, TX; and regions like Silicon Valley, Seattle, much of New England.and other places within the orbit of the megalopolises on the coasts.
For instance, we have CSAs locally, but if you want to subscribe, you need to travel to farmers' markets at least a half hour away in a small college town or an hour away in the wealthier parts of a nearby city and suburbs.  You can't go to the farms to pick up your food because the farmers are busy at the farmers' markets.  And, of course, you have to pay a lot higher prices than locals are prepared to pay.  Which brings up the whole question of whether "organic" is worth the premium you pay for it.  Plus, many have noticed that the farmers' markets carry products that are most decidedly not in season locally.  One would guess they are transported in the same fossil fuel intensive way non-organic food from the central valley in CA. is.
My conclusion is if you want to eat healthy on a budget, grow your own or share with other home gardeners.  If you want to participate in the other features of localization, live in areas that have been "enlightened" by centers of education and/or wealth.
Doug

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My small town in MN had the zoning administrator write a "chicken code" for the keeping of chickens in the town.  It took nine months from the initial mention at the planning commission to the unanimous approval by the city council.  The code is only one page!  Up to four hens, but no roosters, are allowed on a less-than-two-acre lot. Good luck with Verona!

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Chris, you mention the difference between Turners and Shelburne Falls. There's a lot of complex history around the prosperity of these two towns. One big difference was Turners Falls striking agreements, back in either the 70's or 80's, with the state to allocate a portion of their housing to low-income in exchange for state aid. Turners Falls became Boston's solution to some of its homeless and addiction problems during that time, and I can remember frequent police raids downtown in the early 90's. It's been difficult for the town to recover. Shelburne Falls, to my knowledge never entered into any such agreements. 
Turners has made substantial progress in comparison to where it was in the early 90's, but it still has a ways to go. Both towns do have their charm.

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[quote=gillbilly]Chris, you mention the difference between Turners and Shelburne Falls. There's a lot of complex history around the prosperity of these two towns. One big difference was Turners Falls striking agreements, back in either the 70's or 80's, with the state to allocate a portion of their housing to low-income in exchange for state aid. Turners Falls became Boston's solution to some of its homeless and addiction problems during that time, and I can remember frequent police raids downtown in the early 90's. It's been difficult for the town to recover. Shelburne Falls, to my knowledge never entered into any such agreements. 
Turners has made substantial progress in comparison to where it was in the early 90's, but it still has a ways to go. Both towns do have their charm.
[/quote]
Gillbilly, I'm glad, and not surprised, to hear that history.  There's something that happens when a certain critical mass is achieved, both on the positive and negative sides of the ledger.
Some negative insults indeed take a very long time to recover from.  All one has to do is drive around the east coast to see examples of this where the main productive asset of a town or city gave out.  It could be a coal mine that shut down,  or a steel mill or woolen mill.
In many cases that asset dried up many decades if not over a hundred years ago and somehow the bitterness and loss of hope remains lodged in that community.
It's like some winnowing process took place that saw all the people with vision and gumption pack up and head out for better climes, while those without those forms of resilience stayed behind and wallowed in various forms of despair.
Ultimately it's a reflection of our cultural resilience.  A recent set of examples on both sides of the ledger involve community responses to devastating hurricanes, one being New Orleans after Katrina and the other being Kauai after Iniki.
New Orleans saw a critical mass of people lost, unable to cope, waiting for rescue.  Kauai (which was hit far harder) dug itself out, took care of its own, and is still being studied by FEMA to better understand how the community self-organized so effectively.
One could imagine a similar self-contained rebuilding process running after a community loses its main productive asset, whatever that is.  Instead of wallowing in the shame and loss, the people could come together, discuss their options, and identify how best to use what assets they have.