In economic development circles, mention of Wink, Texas, can prompt knowing looks. In 1961, Wink, population then 1,863, was on the downhill side of a boom-and-bust oil economy. According to news reports at the time, it applied for $336,000 in federal urban renewal funds to clean up its blighted downtown. The Urban Renewal Administration responded by granting Wink $891,868, plus another $1,034,758 in temporary loan authority. That’s about $17 million in today’s money.
Not surprisingly, folks in Wink were ecstatic. The town used the federal surfeit to buy up lots for far more than they were worth, and to build new roads, sidewalks, and sewers to accommodate what it imagined would be a flood of new stores, office buildings, and homes.
You can guess what came next: Nothing.
In fact, Wink’s population declined by 300 over the next few years, as property owners took the money and ran, or drove, to more vibrant communities. In 1964, The Reader’s Digest reported, “Downtown Wink is almost deserted. There is no building in progress, and no sign of the new stores or the new office building.” By the 2010 census, the town had just 940 residents.
I’ve been pondering the story of Wink as the federal American Rescue Plan Act has unfolded this spring. ARPA, signed into law on March 11, is a $1.9 billion stimulus package aimed at speeding the nation’s recovery from the effects of the coronavirus pandemic. The windfall is extraordinary: Every state, county and municipality in the country will receive money. Over the next few years, Jefferson County will get direct federal aid of $2.4 million, equivalent to 10% of its annual budget. Boulder will receive $325,000, and Whitehall about $300,000. Another $891,000 will flow to county water and sewer projects via state ARPA allocations.
And that’s just what we know about now. County officials expect that more ARPA opportunities, perhaps many more, will soon emerge. Local governments could be chasing grant funding for much of this year, if not longer. “It’s one of those once-in-a-lifetime opportunities,” according to Tom Harrington, the longtime co-head of the Jefferson Local Development Corporation who is retiring this summer (see page 1).
He’s right: The flood of federal grants under ARPA has the potential to shape communities for the next decade. But that tantalizing possibility is in tension with the laws of economics, which dictate that two things almost certainly will happen. First, contractors and supplies will become scarce and expensive. Plywood and wallboard prices have skyrocketed, and good luck trying to find a civil engineer until 2024. The Montana Highway Patrol, among others, has delayed its move to Boulder from Helena until August because it can’t get improvements on its new digs at the former Montana Developmental Center done by the original target date of June 30 (see page 1).
And second, money will be wasted. The scale of the federal grants, the rushed timetable to get money into the economy, and the confusion around continuously evolving government guidelines around how the grants can be spent all nearly ensure that we will see more Winks. (By way of comparison, Boulder received a $500,000 state grant commitment in 2017, in the wake of the MDC’s closure; a citizen-led committee spent two years mapping out a plan for investment – and even then, the results have been uneven.)
How can we do better? Kristin Smith is an economic geographer and researcher at Bozeman-based Headwaters Economics. She has studied boom-and-bust economies, and she observes that communities—especially smaller ones in rural areas—typically are limited by the capacity and expertise of their staffs and volunteers. They often don’t invest in strategic priorities, instead spending on splashy infrastructure projects without considering long-term operating expenses.
Smith proposes several guidelines for rural communities trying to navigate their ARPA windfalls. Jefferson County, to its credit, already is considering or acting on several of them.
1. Ask citizens what they think. “The public budget is something that’s often out of public view,” Smith said. “But it’s really everything, a manifestation of the public good. [Opening up the process] is how you democratize public finance.” Jefferson County’s commissioners and the JLDC have held a series of public meetings (some of them marred by communications problems—but still) to gather input on potential ARPA allocations. And while the Commission won’t present an updated plan for several weeks, it appears to be responding to that input.
2. Coordinate across governments. The county, Boulder and Whitehall, the Basin and Clancy water and sewer districts, and area schools all will be eligible for multiple ARPA pots. It doesn’t make sense for those entities to make plans in silos. That’s because, first, most of them lack the capacity and expertise on their own to know what grants are available; to apply for them and do the necessary reporting; and to develop corresponding strategies. “If you can use ARPA money to coordinate partnerships, that’s what rural places need,” Smith said. And also, complex social problems mostly aren’t bound by geography; solving them demands systemic cooperation by multiple actors.
Jefferson County has discussed hiring a dedicated grant strategist—and perhaps more than one—and sharing that resource with Boulder and Whitehall. That’s the right instinct. And the emerging partnership to bring needed child care services to Boulder, involving the city, the county, Boulder Elementary School, Jefferson High, and private money, seems both thoughtful and very promising.
3. Think regionally. “Cities are getting money place by place,” Smith observed, “and these problems should be addressed regionally.” Vermont, for example, has a robust regional planning structure that’s been in place since the ’70s. Its government decides on investment priorities that reflect shared needs across the state; communities can get matching funds for projects aligned with those priorities.
In Montana, where local control is something of a religion, regional planning of this sort mostly doesn’t happen. Knowledge-sharing and some coordination occur via regionally focused consulting firms like Headwaters Resource Conservation and Development, which serves clients in Jefferson and six other counties. But that’s not the same as intentional regional planning, which might better advance, for example, access to mental health services.
4. Don’t commit to a plan before you know the rules. The U.S. Treasury Department recently released its third iteration on guidelines for ARPA spending, once again changing its advice on what funds can and can’t be used for. That’s wreaking havoc on local officials trying to map out a strategy: In its initial allocations, for example, Jefferson County budgeted $300,000 of funds to support the long-imagined Western Legacy Center in Whitehall. It since has learned that that investment won’t be allowed.
In the face of ambiguity, Harrington argues that governments should set initial plans quickly to get funding while the ARPA window is open—but should stay flexible enough to accommodate both rule changes, shifting external conditions and evolving community needs. This thinking mirrors the approach of smart financial investors: The longer you can wait before pulling the trigger, the better the information you’ll have to inform decisions.
5. But have a plan. The rush to apply for ARPA funding is at odds with strategic planning, which typically requires considerable research, discussion, testing and iteration. A strategy is anchored intentionally in agreement on outcomes—what will happen as a result of the work; on the activities that will lead to those outcomes; and on measurable goals that describe success.
It would be ideal to have a strategic plan already in place to inform urgent investment decisions. Jefferson County doesn’t—and it’s been 12 years since its excellent growth policy was last amended. It’s time to reconsider questions like: What should this community look like in 10 years? What is the optimal mix of industries and employers? What is the right balance between economic growth, environmental sustainability and quality of life? Will we become a county of commuters or an economic engine in our own right? How much housing is needed? And whatever the vision, how do we get there?
In lieu of a plan, the county’s leaders are left to intuit their response to the ARPA opportunity. To their credit, they have been focused on investments that will promise long-term ripple effects on development—as opposed to one-time boosts that yield only immediate or narrow benefit. But county residents might have greater confidence that we’re headed in the right direction if the strategic logic was clearer. Jefferson County isn’t Wink — but what, exactly, will it become?
