Objective: This What Works for Cities case study highlights how the Nashville metro has formed a true public-private partnership across a 10-county region that has led to tremendous economic and population growth in each of the areas served over the past 25 years.
Geography: Nashville Metro
Major Participants: Nashville Area Chamber, Cheatham Connect, City of Gallatin Economic Development Agency, City of Goodlettsville, Clarksville/Montgomery County Economic Development Council, Dickson County Chamber of Commerce, Forward Sumner Economic Council, Joint Economic and Community Development Board of Wilson County, Maury County Chamber and Economic Alliance, Metropolitan Government of Nashville and Davidson County, Robertson County Chamber of Commerce, Rutherford County Chamber of Commerce, Tennessee Valley Authority, Williamson, Inc.; and 250+ other corporate, association and government entities
Background: In the 1960s, Nashville’s urban core was losing population. There became a growing need for parity and availability of services and infrastructure across the region. In 1963, the City of Nashville and Davidson County made the bold decision to combine governments—laying the foundation for a truly regional approach to economic development. The benefits were almost immediate. Rather than a collection of disparate areas competing for job and population growth, the region started to function as a unified economic unit. What benefitted the City benefitted the County and vice versa.
Still, the region’s competitiveness lagged its peers. In 1989, the Wall Street Journal featured an article that highlighted how poorly Nashville was performing at a time when the nation – and in particular, other southern cities like Charlotte and Austin – were doing well. So in 1990, a group of governmental, business, community leaders came together to form the Nashville Partnership 2000 (P2000). The goal of the 10-year effort was to work together as a region, raise money to market the region and cultivate relationships to lure businesses to the Nashville area.
How it Works: P2000 began by examining target industries where the region already boasted a competitive advantage, including its existing base of industry, talent and educational infrastructure. The group then identified five industry clusters (corporate operations, healthcare, advanced manufacturing, music and entertainment, and supply chain management) to target. The four cornerstones of the strategy would include: recruiting of corporate headquarters and administrative offices; retention of existing businesses; entrepreneurship through fostering growth and supporting start-up businesses; and community improvement.
Initially, the economic region consisted of the eight counties that comprised the Nashville Metropolitan Statistical Area (MSA). In 1994, the Partnership made the decision to add nearby Montgomery and Maury counties. Each member county is expected to make a financial contribution to the Partnership, though some contribute more than others given their size or business activity. Each year, the Nashville Area Chamber of Commerce signs an agreement with each member county that outlines what services will be performed. Funding includes a dedicated economic development staff, housed at the Nashville Area Chamber of Commerce, that functions independently and on behalf of the entire region.
Since its founding, P2000 evolved into P2010 and now, P2020. Every five years, following a year-long period of data-driven research and interviews with thousands of business leaders, local officials and other community stakeholders, the Partnership releases a new five-year action strategy. In its most recent iteration, P2020 is focused on four strategic drivers: (1) economic diversity; (2) talent development; (3) place/livability; and (4) regionalism.
Specific goals of the current P2020 economic development strategy (2011 to 2016) include:
P2000’s annual budget began with just $4 million, the bulk of which was provided through private sector contributions. Funding remains primarily dominated by the private sector today, although the public-private initiative has since grown to include more than 275 businesses, investors and government organizations; its budget exceeds $20 million for implementation of the P2020 strategic plan.
Results: Since the Partnership began, the region has seen a radical transformation in economic development. Accomplishments include:
In the last year alone, 154 companies announced relocations or expansions in the Nashville region, creating more than 17,500 new jobs and investing more than $2.7 billion. Global brands such as Under Armour, HCA, Amazon and Warby Parker have all moved to the region and are thriving. In January 2015, Fortune magazine recognized Nashville as the second fastest-growing city for technology jobs, and the following month, the Brookings Institute named Nashville as the top metro for advanced manufacturing job growth. P2020 has already exceeded each of its goals around business, employment, population and income growth just four years into its 5-year strategy.
Remaining Challenges: As the region continues its ascent, there’s growing concern over public education, workforce development and transit. The Metropolitan Nashville Public school system has experienced a decline in its rankings. Employers report challenges finding talented workers, and in industries like advanced manufacturing and healthcare, some leaders warn of a growing skills gap that must be addressed if the region hopes to maintain long-term prosperity.
Meanwhile, commutes in the region continue to get longer as traffic congestion worsens. The problem is only expected to worsen, as a projected 1 million people will move to the area over the next 25 years. The Partnership has backed a regional transit system that would include light rail, street cars and bus rapid transit, but it would also cost an estimated $5.4 billion through 2040. The new P2020 plan has identified metrics related to traffic congestion and educational attainment that will be measured and reported on each year moving forward.
Lessons: One of the reasons the Partnership has been so successful is that the assets Nashville needs to compete nationally and internationally – such as major employers, colleges and universities, and healthcare facilities – are spread throughout the region. In other regions where the assets are concentrated primarily in one county, a similar approach might be more challenging.
Moreover, unlike regional collaborations that ultimately operate in name only, P2020 requires each member county to make a financial contribution to sustain the effort. A portion of funds goes toward a dedicated economic development staff that acts independently of any one city or county within the region. The P2020 team then coordinates with economic development officials in all 10 counties. Having outreach and other activities managed through an independent staff is one of the reasons that P2020’s regional economic development efforts have proven so successful.
Finally, investor support is critical – and investors want to see a return on their investment. Because investment in P2020 is an investment in the growth, prosperity and economic future of their region, private sector partners demand accountability. P2020 has taken an aggressive approach to aggregate data that is compiled into an annual scorecard to assure investors that the Partnership is delivering the anticipated returns. Significant resources are required to fund an aggressive and proactive economic development strategy of this scale, and data has proven crucially important to securing investor support on an annual basis.
To learn more about the Partnership, visit www.nashvillechamber.com.