Federal Agencies Align to Support Regional Growth

December 20, 2012

In March of this year, the Organization for Economic Co-operation and Development (OECD) released its Territorial Review of the Chicago Tri-State Metro Region.1 The first time a U.S. region has been reviewed by the OECD, the findings gave perspective to challenges familiar to the region’s leaders and residents. The Review area includes 21 counties stretching from Wisconsin into Indiana (Map 1) and encompasses more than 2,000 local governments.   According to the OECD, these reviews offer analysis and guidance to national and sub-national governments seeking to strengthen territorial development policies and governance.  The OECD’s work centers on regional issues that address the spatial implication of public and private policy challenges, including governance, innovation, and urban development. These bodies of work include both thematic reports and reports on specific countries or regions, of which the Chicago Tri-State Metro Region is one of many.

1. County map of the Chicago metro region

County map of the Chicago metro region. There are 14 counties in the Metropolitan Statistical Area, and 21 counties in the 'tri-state' region
Source: OECD elaboration with data from Census 2000 County and County Equivalent Areas Cartographic Boundary Files, US Census Bureau

More than 300 pages in length, the OECD's report is premised on two key assumptions:

  1. The Tri-State Metro Region’s economic development strategies to date are not sufficient to meet the demands of the global marketplace.
  2. This economy extends beyond the borders of any one jurisdiction and there is a mismatch between how political/geographical boundaries are defined and how the functioning economy actually works.

The report2 synthesizes the region’s international position relative to its peers and highlights four areas that require attention if the region wishes to remain globally competitive:

  • Matching Skills to Jobs
  • Innovation and Entrepreneurship
  • Transportation and Logistics
  • Green Growth3

Eight federal agencies convened at the Federal Reserve Bank of Chicago on October 29, 2012 to present the ways in which their agencies’ work aligned with the objectives of the Territorial Review. The regional directors, or their deputies, of these agencies , including:  the U.S. Department of Agriculture, Rural Development (USDA-RD), the U.S. Department of Housing and Urban Development (HUD), the U.S. Economic Development Administration (EDA), U.S. Employment and Training Administration (ETA),U.S. Environmental Protection Agency (EPA), the Federal Highway Administration (FHWA), Federal Transit Administration (FTA), U.S. Small Business Administration (SBA) – presented their programs to an audience of county and municipal leaders, as well as economic development agencies, chambers of commerce, metropolitan planning organizations and academic institutions representing the 21 county area covered by the report, with the goal of helping the affected communities develop durable regional economies.

Framework for Regionalism

The publication of the report has spurred local communities and non-profits to begin to align their resources.  Therefore, the federal agencies active in the region are also compelled to align their efforts to support regional economic growth.  As a first step, the agencies have designated a single point of contact to streamline access to the federal government on issues of regional importance.

Jeannette Tomayo, Regional Director for the EDA stressed in her opening remarks that the “boundaries of the region are defined by issues and by the affected people and are ever-shifting.  The conversation is about inclusion, representation and direct access to the federal government.”

The remarks of Thomas Guevara, Deputy Assistant Secretary for Regional Affairs at the EDA who was not able to attend due to Hurricane Sandy, were read by Ms. Tomayo and highlighted the urgency of addressing the findings of the OECD report.  Noting the high level of economic interdependence amongst the region’s 11.5 million people, “the tri-state region is a global economic powerhouse but it is also significantly underperforming.”  Data presented by Dr. Lance Pressl, Senior Policy Fellow at the Institute for Work and the Economy demonstrated that growth in the Chicago region (GRP) has not kept pace with that of the rest of the country. (Chart below)

2. Ratio of Chicago GRP growth to U.S., 1980-2009

Ratio of Chicago GRP growth to U.S., 1980-2009. It has been steadily declining since 2000, and declined dramatically in 2008.

In addition to describing their individual programs, some presenters highlighted existing initiatives of regional cooperation:

  • Laura Frerichs, Director of the University of Illinois Research Park spoke about an upcoming convening of Tech Park directors from across the region.  Tech Parks/small business incubators take research from universities and turn it into economic development by creating new jobs and companies.  Incubators themselves can be catalysts for economic development and wealth creation that supports regional growth.
  • Antonio Riley, Regional Director for HUD, spoke about his agency’s Sustainable Communities initiative which encourages municipalities to work across borders and plan collaboratively and regionally.4 Director Riley also spoke of the Gary and Region Investment Project (GRIP) which is working to attract national attention and resources to the area.5

Finally, as a direct response to the report, the Tri State Alliance for Regional Development was created.  Housed at the Chicagoland Chamber of Commerce, which commissioned the Review, the Alliance is charged to create and execute an implementation plan for the Review’s recommendations.

Jeremiah Boyle, Managing Director for Economic Development at the Federal Reserve Bank of Chicago emphasized the Federal Reserve’s regional presence and its connection to individual communities through financial institutions.  He also referenced the Community Development and Policy Studies Industrial Cities Initiative that has examined 10 industrial cities across the 7th District.  Those cities that are doing well, he said, “are those that are aware of something larger than themselves.”

Suggested actions for the region are included in the final chapter of the OECD’s report.  In this chapter, the role of the federal government is not clearly stated.  However, the report clearly states “In the Tri-State region, the sheer range of public and private stakeholders with a vested interest in seeing (public policy issues) resolved dictates that policy advice be directed at this broader set of public and private actors operating on behalf of the Tri-State Region’s residents.”

All acknowledged that this is a long-term, perhaps multi-generational, effort.  In the short term, the regional leaders must report their progress to the OECD territorial development policy committee before the end of the year.

To learn more about:

The OECD and its work

The Tri-State Territorial Review

The Tri-State Regional Alliance

The presenting agencies:

Federal Reserve Bank of Chicago Industrial Cities Initiative.


1 Available online.

2 Ibid.

3 Ibid, page 33

4 Available online.

5 Available online.

The views expressed in this post are our own and do not reflect those of the Federal Reserve Bank of Chicago or the Federal Reserve System.

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