Economic Development Programs Essay Example for Free

Economic Development Programs Essay Within my community, there are several development programs which have been established for the purposes of making the community more directly participative in economic development. Such programs include agricultural development programs, business development programs as well as higher education economic development programs. These programs will be addressed in this paper, with specific attention to the key actors/players in the programs, the short and long term goals of these programs, and also the political and economic issues they face in the process of promoting economic development in the region. Agricultural finance programs To begin with, there are special loan programs for new ranchers and farmers in this region, the most infamous one being the Aggie Bond Beginning Farmer Loan Programs. Through Aggie Board Loan Programs, the state helps the newly established farmers in the region to obtain loans for purchasing land and equipments, for breeding farm animals and for the construction of farm buildings (NCOSAFP, 2010). The main players/actors in Aggie Bond Program include the lending institutions (which are in collaboration with the state administration), state administration itself—playing the role of assisting beginner farmers and ranchers to obtain low rate interest loans which are exempt from federal income tax—and the ranchers/farmers who participate in the program. The federal government is also indirectly involved in these programs since it is the one that facilitates the provision of tax exemption on the interest income. Besides obtaining loans at reduced interest rates, the financial risks on loans solely rest with the lending institutions which have established for these purposes (NCOSAFP, 2010). The short term goals of Aggie Bond Programs are to act as the capital base for individuals or partnerships within the state who desire to engage in ranching, farming or both, but lack adequate financial resources to do so (NCOSAFP, 2010). In so doing, they provide all the necessary financial resources to individuals and transfer the credit decisions to the lending institutions. On the other hand, the long term goal of Aggie Board Programs is to facilitate economic growth and development within the state and the nation at large, through optimum utilization of the agricultural resources within the state and taking advantage of the tax-exempt provisions by the federal government. The program also aims at encouraging the spirit of entrepreneurship within the state through assisting potential entrepreneurs in the agricultural sector to unleash their potential (NCOSAFP, 2010). The key economic problem that the actors in these programs face is mostly the failure of the farmers to repay loans granted due to unproductive farm activities or catastrophes which damage the farming/ ranching establishmentespecially nature catastrophes (NCOSAFP, 2010). This becomes a setback all the players involved because the farmers undergoes serious financial losses, the lender incurs bad debts, the state and the federal government loses the potential economic contribution from the entrepreneur. Political issues on the other hand arise from the Aggie bond allocations and apportionments among the lending bodies. For instance, after a serious debate on the farm bill, the maximum bond allocation was increased from $469 200 in 2009 to 470,100 this year and the actors have been involved in political discussions regarding the meager increments and how it would be equally apportioned to the lending institutions (NCOSAFP, 2010). Business financing programs The other type of economic development programs are the business financing development programs. These programs are so closely related to the Aggie Bond Programs in that they offer loans for many kinds of business businessmen in the state. However, there is a slight different from the one discussed above because this program finances both established as well as new business-people in the industry. For the new entrants, capital is provided while for the already existing business people, the required funds for activities such as expansion and boosting for those experiencing serious financial traps is availed (OK Commerce, 2010). The actors in these programs are established lending institutions and the business community. They include; Economic Development Administration, the Bureau Of Indian Affairs Loan Guaranty Fund, The Industrial Finance Authority, Capital Access Program, and the Linked Deposit Loan Programs. The short term goals of these programs is to provide short term business financing to the business community to solve short term cash problems, while the long term goals are to offer long term low interest loans to major business persons/ institutions to solve serious and long range financial issues (OK Commerce, 2010). Mostly, these programs do not face much political issues as compared to the economic issues which are tied to the unsecured loans and competition. While the unsecured loans may sometimes compel the lending institution to file cases in the legal system against errant and faulting business people, the competition from other existing lending institutions makes them too congested in the estate (OK Commerce, 2010). Higher education programs The state also has a Higher Education Economic Development Program. This program is designed in such way as to generate partnerships between businesses and higher education institutions within the state in order to nurture higher learning via State Regents’ Economic Development Grants. Nominations are made from the institutions and assessed by State Regents’ staff committee. Submissions are made just once for every partnership, and a limit of twenty five recognitions can be made annually (OK Highered, 2010). The actors in this program are basically partnering institutions, which usually pay $500 coordinated by the state regents. The money provided is used for internships for students of institutions to work in the enterprises of partnering business, faculty externships with partnering businesses, tuition waivers to partnering businesses’ staff members, and development of partnerships with supplementary equipment, supplies and materials (OK Highered, 2010). The short term and long term a goal of this program is the same: to facilitate economic development through partnering for the purposes of higher education. In so doing, the partnering members are able to assist each other in catering for the expenses of higher education to ensure that none is left out. In addition, they promote economic growth growth of the member businesses through materials and other kinds of supplies using the funds contributed by each partner (OK Highered, 2010). Just like the other economic development programs mentioned above, this program also faces a number of political and economical problems in its endeavors to accomplish goals and objectives. On the economic part, the program currently has a capacity of twenty two member universities and sometimes, the resources available from the partnership funds cannot meet all the needs of the partners: consequently, the process of assisting members cater for higher education needs has to take longer than the members desire (OK Highered, 2010). This basically, has the result of slowing down the accomplishment of goals and also sometimes results to withdraw of some impatient partners. In addition, the members have too much higher education needs such that the partnership has only to cater for a small percentage of the required amounts. In so doing, the economic goals are partially and not wholly accomplished. Politically, the program is not affected by external politics, but rather by internal politics among the members which mostly results from conflicting interests amongst the members and also in the selection of the leaders who will foresee the management of operations and finances (OK Highered, 2010). However, such issues have been solved successfully within the environs of the partnership. References NCOSAFP (2010). Types of state agricultural finance programs. Retrieved from http://www. stateagfinance. org/types. html OK Commerce (2010). Business financing programs. Retrieved from http://www. okcommerce. gov/Start-A-Business/Financing-Programs/ OK Highered (2010). Economic development grant for the partnership development program. Retrieved from http://www. okhighered. org/econ-dev/partner-recog. shtml