Making Smarter State Investments

Authors: 
Stephen Herzenberg
Publication Date: 
June 9, 2010


Making Smarter State Investments: The Geographic Distribution of Business Subsidies in Pennsylvania

Authors: Dennis Bellafiore, Maria Cristina Herrera, Stephen Herzenberg

Release Date: June 9, 2010

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Press Release

Keystone Research Map: Look up where business subsidies are being invested in communities across the state

 

EXECUTIVE SUMMARY

The state of Pennsylvania currently gives out roughly $300 million dollars each year to attract businesses to Pennsylvania or retain existing ones. This report raises the question: does Pennsylvania invest these subsidies in the right places? The report analyzes where subsidies given out by three of the largest Pennsylvania business subsidy programs go, including the extent to which they go to older communities with existing infrastructure versus outlying communities. 

This report replicates a 2003 study in which, as a subcontractor to the Brookings Institution, Keystone Research Center undertook the first-ever systematic examination of the geographical distribution of Pennsylvania business subsidies.

As before, we focus on three of the most important Pennsylvania Department of Community and Economic Development (DCED) business assistance programs: the Opportunity Grant Program (OGP), the Infrastructure Development Program (IDP), and the Pennsylvania Industrial Development Authority (PIDA) program. 

In this new period, we track 1157 subsidies worth a total of $631.1 million. Our previous study examined 1333 business subsidies worth $719.5 million.

Our analysis examines dollars received by what Brookings defined as “older Pennsylvania” and “outer townships.” 

As the label implies, older Pennsylvania includes older municipalities, established for the most part before the 20th Century—cities, boroughs, and first-class townships. Outer townships, or newer parts of Pennsylvania, are the larger, less dense, second-class townships that comprise the rest of the state. 

Continuing earlier trends, from 2000 to 2008 older Pennsylvania lost population, shrinking by about 320,000 people, or 4.4%. Meanwhile, outer areas gained 400,000 people (7.8%) in the same period. By 2008, 56% of the state’s population resided in older Pennsylvania, down from 58% in 2000.

Along with this statewide report, our new analysis of the geographical distribution of business subsidies includes two other components: short reports that highlight where subsidies go in Pennsylvania’s nine largest metropolitan areas; and an online interactive map showing the location of each business site receiving a subsidy, along with other available information on that subsidy. The map, accessible at www.keystoneresearchmap.org, also provides 

summary reports on all subsidies distributed to a municipality, metropolitan area, or school district. Interested readers can check out the reports for their part of the state and also user-defined maps for any region which interests them.

Only individuals at the regional level—such as economic developers, land-use planners, and advocates for smart growth—have the local knowledge needed to interpret and use the data here to greatest advantage. In every part of Pennsylvania, we hope our new data and subsidy map will be the start—more properly, a deepening—of the conversation about wise use of scarce public investments to strengthen communities, bolster regional economies, and protect natural assets. We hope these data whet people’s appetites for routine public disclosure of more comprehensive information that enable Pennsylvania to institutionalize smart investments.

Acknowledging the limits of our own ability to interpret local nuances, the rest of this report summarize the key findings observable based on comparison with our earlier analysis and based on comparison of different regions within the state.

Metro Reports: Making Smarter State Investments

Erie   |   Reading   |   Harrisburg-Lebanon-Carlisle   |   Philadelphia    |   Scranton-Wilkes Barre-Hazleton   |   Pittsburgh

Pittsburgh (excluding Armstrong County)   |   Lancaster   |   York   |   Lehigh Valley   |    Lehigh Valley (excluding Carbon County) 

Follow this link to view all of the Keystone Research Center's work on Economic Development Accountability