Plus, we weigh in on how Amazon's recent moves to buy Whole Foods and launch a public auction for its second headquarters impact independent businesses.
The Hometown Advantage Bulletin
8 Policy Strategies Cities Can Use to Support Local Businesses
Stacy Mitchell | Aug. 28, 2017

If you're reading this newsletter, you probably already know that locally owned businesses play a central role in healthy communities. It's something that many people understand intuitively, and it's also borne out by research that finds that the presence of locally owned businesses is linked to higher rates of job creation, less income inequality, and stronger social networks.

Despite these benefits, in many communities, small businesses are disappearing. Contrary to public perception, this decline isn't because local businesses aren't competitive. In many cases it's because public policy and concentrated market power are working against them, like with misguided zoning policies or economic development subsidies that disproportionately flow to big corporations.

Policymakers can do better. We teamed up with Local Progress, a network of elected officials that's organized by the Center for Popular Democracy, to produce this short policy brief that looks at 8 of the strategies that smart city officials and citizens are using to ensure that their communities are places where local businesses can thrive.  Continue Reading
New Podcast Episodes: What Neighborhood Retail Gets Right, and Unpacking Amazon's Purchase of Whole Foods

Image:Podcast logo.In these two recent episodes of our podcast, we dig into both the benefits of small and the dangers of big. In the first episode, ILSR's Stacy Mitchell talks with Gina Schaefer, the owner of several hardware stores in the Washington, D.C., area, about what neighborhood retail does so right. It's an in-depth conversation about what Gina has learned opening her stores, the role that she sees her businesses play in their communities, and how independent hardware stores around the country are fighting off the chains. Listen to the Episode.

In the second episode, Stacy unpacks Amazon's purchase of Whole Foods, and what it means for independent businesses, fair competition, and Amazon's growing market power. Listen to the Episode. And if you enjoy these conversations, make sure that you don't miss an episode — and help us reach more people — by subscribing in iTunes or wherever you get your podcasts. 
By Launching a Public Auction for Its Second Headquarters, Amazon Is Angling for a Massive Public Handout
Sept. 7, 2017

Image: Amazon logo above doors.When Amazon announced that it was opening a search for a second North American headquarters (HQ2), it wasn't subtle about the fact that public subsidies would be, as Amazon itself put it in its Request for Proposals, "significant factors in the decision-making process." Now, cities and states around the country are busy putting together deals to offer Amazon before the first round of bidding closes Oct. 19.

Amazon's decision to make this process a public auction is only the latest play in the company's long-time strategy of financing its growth through public subsidies. It's a strategy that's paid off for the company: We've found that between 2005 and 2014, at least half of all of Amazon's new fulfillment centers received public incentives, and data compiled by Good Jobs First shows that the total value of public handouts that Amazon has received is now well over $1 billion.

But for taxpayers, local businesses, workers, and local governments, Amazon's strategy has been costly. In response to Amazon's HQ2 RFP, public officials would do well to invest in smart economic development for their communities instead of engaging in Amazon's arms race. Read our full statement on Amazon HQ2.

For additional reading on HQ2, we recommend this New York Times op-ed from former Delaware Gov. Jack Martell, "Let's Stop Government Giveaways to Corporations;" This piece in Fast Company that puts Amazon's announcement in context; This piece in Motherboard on how the deal could be the "mother of all civic giveaways;" This local business advocate asking if giant subsidies are the best use of economic development dollars; This piece about the riskiness of putting your city's eggs in Amazon's basket; And this column from a Seattle-based planner who explains Amazon's impact on his city and why no city should want HQ2
Watch: ILSR's Stacy Mitchell and Olivia LaVecchia Speak on the Benefits of Local Businesses, and How Policy Can Support Them
Sept. 28, 2017

Photo: Olivia LaVecchia presenting at forum.ILSR's Stacy Mitchell and Olivia LaVecchia recently spoke at an event organized by Portland Buy Local, the independent business alliance in Portland, Me., about strategies to keep Portland's locally owned businesses strong, even as chain stores are moving in and rents are rising. The event was inspired in party by ILSR's April 2016 report, "Affordable Space: How Rising Commercial Rents Are Threatening Independent Businesses, and What Cities Are Doing About It."

The event also featured AnMarie Rodgers, Senior Policy Advisor in the City of San Francisco Planning Department, who gave a detailed talk on San Francisco's successful formula business policy, including how it was implemented and how well it works. In this recording of the event, Stacy's presentation begins at 9:30, AnMarie Rodgers's presentation begins at 35:00, and Olivia's presentation begins at 1:43:00.  Watch the Presentations.

Upcoming Events

Stacy Mitchell will present at the National League of Cities' annual conference, "City Summit," in Charlotte, N.C., Nov. 15-18, and moderate a session, "Creating a City Where Small Businesses Thrive."  Learn more. 

News Stories We’re Following
  • Quality service, curated selections, and distinctive experiences are helping neighborhood toy stores succeed, the Washington Post reports, even as Toys R Us files for bankruptcy.
  • New research from Gallup finds that while just 21 percent of Americans have confidence in big business, 70 percent have confidence in small business, citing that they're the backbone of the economy, accountable to their customers, and involved in their communities.
  • Thanks to a new series of state laws requiring online retailers to collect sales taxes, the U.S. Supreme Court is set to finally revisit the issue of the online sales tax loophole.
  • In order to drive economic development and lending in its neighborhoods, Chicago deposits $20 million in city funds in the city's last Black-owned bank.
  • From product knowledge to convenience, independent bookstores and independent hardware stores are making use of their shared competitive strengths.
  • Amazon is already acting to centralize decision-making about what's sold at Whole Foods, a move that threatens to cut out local farmers, suppliers, and businesses.
  • John Oliver's Last Week Tonight takes on corporate consolidation, and comes up with a segment that's as laugh-out-loud funny as it is informative — including on how all that consolidation is impacting small businesses and entrepreneurs.
  • Sweden has four times as many new businesses created each year as the U.S. The Atlantic finds that anti-monopoly laws and a stronger social safety net are among the reasons why.
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