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11.437 Financing Economic Development

Spring 2006

Downtown New Orleans flooded by Hurricane Katrina.Student projects in this class focus on economic recovery for New Orleans, shown here shortly after it was flooded during Hurricane Katrina in 2005. (Photo courtesy of the National Geodetic Survey.)

Course Highlights

This course features a set of assignments and descriptions of the student projects, which focused on rebuilding New Orleans after Hurricane Katrina.

Course Description

This course focuses on financing tools and program models to support local economic development. It includes an overview of private capital markets and financing sources to understand capital market imperfections that constrain economic development; business accounting; financial statement analysis; federal economic development programs; and public finance tools. Program models covered include revolving loan funds, guarantee programs, venture capital funds, bank holding companies, community development loan funds and credit unions, micro enterprise funds, and the use of the Community Reinvestment Act to leverage bank financing.



Syllabus

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Course Description and Objective

Economic Development Finance focuses on the tools and programs available to the economic development practitioner to addresses capital needs for businesses and economic development projects. After an introduction to the role of financing in the economic development process, the course provides a foundation in how firms and development projects are financed and the interpretation and analysis of business financial statements to understand capital needs and evaluate the ability to support financing. The third part considers how capital market imperfections result in financing gaps and focuses on the policy and institutional models that exist to address these capital gaps and stimulate private investment in community and economic development. Program management is the focus of the fourth part of the course where issues of program design, operations and capitalization will be reviewed. Finally, students will be introduced to public finance tools and their application to economic development.

The course objective is to provide students with a comprehensive overview of economic development finance practice in the United States and develop a knowledge base and skills to either be a development finance practitioners or apply economic development finance approaches to other fields of planning and community development. Students can expect to gain the following knowledge and skills from the course:



Reading Materials and Assignments

Reading assignments are specified for each class. Optional readings are listed for some classes and students are encouraged to read or skim these materials as well. Reading assignments are primarily from the course textbook with occasional supplementary readings.

Many classes include a case study discussion to apply concepts and tools from the readings and help develop students' thinking from a development finance perspective. Careful reading of case studies is required to determine key facts and circumstances of the case, to identify the critical issues raised by the case, and to be prepared to present your idea on these issues and how to address them.



Required Course Text

Amazon logo Seidman, Karl F. Economic Development Finance. Thousand Oaks, CA: Sage Publications, 2004. ISBN: 0761927093.



Course Requirements

In addition to the completion of all reading assignments and participation in class discussion, students are required to complete the following assignments:



Case Study Analyses

Five case study write-ups are listed in the syllabus. Case study write-ups include financial analysis and a brief (3 page) write-up that address specific questions posed in the assignment. The five case assignments are:


SES #CASE ASSIGNMENTS
5Working Capital Loan Request Analysis (Crystal Clear Window Company)
8Employee Buyout Loan Request Analysis (Phoenix Forge)
11CRA Campaign (Bank of America)
18Financing Plan for an Inner City Supermarket
23Manufacturer's Fund Recapitalization





Term Project

The term project entails a team of three or four students working on a finance project for a client. This spring, the term projects are focused on financing issues related to the rebuilding of the New Orleans region working with three client organizations: Jefferson Economic Development Commission, New Orleans Mayor's Office of Economic Development and the East New Orleans Vietnamese neighborhood (with the National Alliance of Vietnamese Service Agencies). This work will be done in conjunction with the University of New Orleans class, Economic Development Policy and Planning, being taught by Ivan Mieschovitch. One student from this class will assigned to each team to assist with its work. A brief description of each project and client is included in the project section. Only one team may work on a project. A list of the team members and the project selected by the team is due by Ses #4. A brief (1- 2 page) project work plan is due during Ses #9. Subject to funding, one week will be devoted to site field research for the project with one or two representatives of each team. The field work will include meetings with clients, interviews with key stakeholders and joint sessions with the UNO class. The final written project is due on Ses #27.



Grading

Grading will be based on each student's demonstration of their knowledge of the course material and capacity to apply this knowledge to projects, programs and development finance needs. All course work will be considered in determining grades, with class participation accounting for 1/3 of the grade, case study write-ups for 1/3 and the term project for 1/3.


ACTIVITIESPERCENTAGES
Class Participation33%
Case Study Write-ups33%
Term Project33%




Calendar

SES #TOPICSKEY DATES
Part I: Course Introduction
1Course Overview

Definition of Economic Development

Role of Finance in Economic Development
Part II: Business Financing
2Business Finance Needs

Business Financing Instruments
3Analyzing Finance Needs I: Introduction to Accounting and Financial Statements
4Analyzing Finance Needs II: Evaluating Firms for Financing, Financial Statement AnalysisTerm project teams and selections are due
5Working Capital FinanceCrystal Clear Window Company case assignment due
6Fixed Asset Financing
7Real Estate FinancingCity Plaza case study assignment
8Analyzing Business Financing Needs IIIPhoenix Forge case assignment due
Part III: Program Models and Federal Resources
9Introduction to Capital Markets, Capital Market Imperfections and Financing GapsTerm project work plan due
10Private Market Interventions I: Guarantees and Credit Enhancement
11Private Market Interventions II: Community Reinvestment Act, Bank CDCsBank of America CRA case write-up due
12Private Market Interventions III: Community Development Banks, Bank Holding Companies
13Program Models I: Revolving Loan Funds, Plans for Field Work
14Program Models II: Venture Capital
15Project Work Session
16Program Models III: Community Development Credit Unions, Community Development Loan Funds
17Program Models IV: Microenterprise Development
18Federal Programs: SBA Programs, CDFI Fund, HUD 108 Program, Office of Community Services, New Market Tax CreditsInner City Supermarket Financing case study write-up due
Part IV: Program Management
19Issues in Program Management: Program Planning and Design
20Issues in Program Management: Marketing and Origination, Underwriting and Structuring Investments, Servicing and Portfolio Management
21Issues in Program Management: Capital Management and Recapitalization
22Term Project Presentations
23Term Project Presentations (cont.)Manufacturer's Fund Recapitalization case write-up due
Part V: Municipal Financing Tools
24Municipal Finance Tools I: Municipal Debt, Industrial Development Bond

Guest Speaker: Tobias Yarmolinski, RBC Dain Rauscher
25Municipal Finance Tools II: Tax Increment Financing Assessment Districts and BIDSOrlando Downtown TIF case study assignment
26Course Conclusion
27Wrap UpFinal projects are due today




Readings

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Required Course Text

Amazon logo Seidman, Karl F. Economic Development Finance. Thousand Oaks, CA: Sage Publications, 2004. ISBN: 0761927093.



Readings by Session


SES #TOPICSReadings
Part I: Course Introduction
1Course Overview

Definition of Economic Development

Role of Finance in Economic Development
Seidman. Chapter 1, pp. 3-7.
Part II: Business Financing
2Business Finance Needs

Business Financing Instruments
Seidman. Chapter 2.

Berger, and Udell. "The Economics of Small Business Finance." Journal of Banking and Finance 22 (1998): 613-673.
3Analyzing Finance Needs I: Introduction to Accounting
and Financial Statements
Seidman. Chapter 3.

Optional

Amazon logo Anthony, Hawkins, and Merchant. Accounting: Text and Cases. Boston, MA: McGraw Hill, 2004, pp. 25-44, 51-74. ISBN: 0072819502.
4Analyzing Finance Needs II: Evaluating Firms for Financing
Financial Statement Analysis
Seidman. Chapter 4.
5Working Capital FinanceSeidman. Chapter 5.
6Fixed Asset FinancingSeidman. Chapter 6, pp. 111-123.

———. "Cambridge Biotechnology Corporation Fixed Asset Financing Case Study." Unpublished Case Study. Cambridge, MA.
7Real Estate FinancingSeidman. Chapter 7.
8Analyzing Business Financing Needs IIISeidman. Chapter 6, pp. 123-132.
Part III: Program Models and Federal Resources
9Introduction to Capital Markets, Capital Market Imperfections and Financing GapsSeidman. Chapter 1, pp. 7-19.

Yago, Zeidman, and Schmidt. Creating Capital, Jobs and Wealth in Emerging Domestic Markets. Milken Institute Research Report. Santa Monica, CA, 2003, pp. 1-18.
10Private Market Interventions I: Guarantees and Credit EnhancementSeidman. Chapter 8.
11Private Market Interventions II: Community Reinvestment Act, Bank CDCsSeidman. Chapter 9, pp. 184-205.

Immergluck, and Weinstein. "Mellon Bank Profile." In Small Business Lending for Economic Development. Vol 2. Chicago, IL: Woodstock Institute, 1995, pp. 35-38. (PDF)

Amazon logo Lowe, and Metzger. "A Citywide Strategy: The Pittsburgh Community Reinvestment Group." In Organizing Access to Capital. Edited by Squires. Philadelphia, PA: Temple University Press, 2003. ISBN: 1592130267.

Seidman, Karl F. "Bank of America Merger Case." Unpublished Case Study. Cambridge, MA.
12Private Market Interventions III: Community Development Banks, Bank Holding CompaniesSeidman. Chapter 9, pp. 205-211.

Amazon logo Taub, R. Community Capitalism. Boston, MA: Harvard Business School Press, 2004, chapters 1, 2, and 5-8. ISBN: 0875845533.
13Program Models I: Revolving Loan Funds, Plans for Field WorkSeidman. Chapter 10, pp. 406-410.

Burchell, Robert. EDA RLFs: Planning, Local Structural Change and Overall Performance. New Brunswick, NJ: Rutgers Center for Urban Policy Research, 2002.
14Program Models II: Venture CapitalSeidman. Chapter 11.

Amazon logo Hebb, and Mackenzie. "Canadian Labour-sponsored Funds: A Model for the U.S. Economically Targeted Investments." In Working Capital: The Power of Labor's Pensions. Edited by Fung, et al. Ithaca, NY: ILR Press, 2001. ISBN: 0801439019.
15Project Work SessionProject Team Field Reports
16Program Models III: Community Development Credit Unions, Community Development Loan FundsSeidman. Chapter 12.

Kolodinsky, Jane, Sue Holmberg, Caryl Stewart, and Antonia Bullard. Vermont Community Development Credit Union: A Community Program that Works. Burlington, VT: Vermont Development Credit Union, 2002.

Opportunities Credit Union 2004 Annual Report.

Immergluck, and Weinstein. "Center for Community Self-Help." In Small Business Lending for Economic Development. Vol. 2. Chicago, IL: Woodstock Institute, 1995, pp. 51-54. (PDF)
17Program Models IV: Microenterprise DevelopmentSeidman. Chapter 13.

Taub, R. "Making the Adaptation Across Cultures and Societies: A Report on an Attempt to Clone the Grameen Bank in Southern Arkansas." Journal of Developmental Entrepreneurship 3, no. 1 (Summer, 1998) (DOC)

Servon, Lisa. "Microenterprise Development as an Economic Adjustment Strategy." New Brunswick, NJ: Rutgers Center for Urban Policy Research, 1998, pp. 37-51. (PDF)

Optional

Edgcomb, and Klein. Opening Opportunities, Building Ownership. FIELD Report, February 2005, chapter 5, pp. 79-106. (PDF - 1.2 MB)
18Federal Programs: SBA Programs, CDFI Fund, HUD 108 Program, Office of Community Services, New Market Tax CreditsSeidman. Chapter 14.

New Markets Tax Coalition. New Markets Tax Credits: A Progress Report. Washington, DC, May 2005. (PDF)

Optional

Taylor, B. "Investor Perspective: How to Evaluate the Purpose, People and Projects for NMTC Investments." Community Development Investments Review 1, no. 1 (2005): 33-36.

Bystry, D. "Case Study from Application to Construction: Clearinghouse CDFI Puts NMTC to Work." Community Development Investments Review 1, no. 1 (2005): 37-42.

Wells, J. "Case Study from Application to Construction: Lenders for Community Development Puts NMTC to Work." Community Development Investments Review 1, no. 1 (2005): 43-48.
Part IV: Program Management
19Issues in Program Management: Program Planning and DesignSeidman. Chapter 16.
20Issues in Program Management: Marketing and Origination, Underwriting and Structuring Investments, Servicing and Portfolio ManagementSeidman. Chapter 17.
21Issues in Program Management: Capital Management and RecapitalizationSeidman. Chapter 18.

Robinson, Kelly. Structured Finance for Economic Development Loan Funds. Newark, NJ: Rutgers University Cornwall Center for Metropolitan Studies. Paper presented at the 2001 Annual Conference of the Association of Collegiate Schools of Planning.

Seidman, Karl. "Case Study: South Eastern Economic Development (SEED) Corporation." Unpublished Case Study. Cambridge, MA.

Optional

Bullard, A. "High-Impact Capital: Using Secondary Capital to Expand Community Development Credit Union Capacity." Community Investments Online 16, no. 2 (September 2004).
22Term Project Presentations
23Term Project Presentations (cont.)
Part V: Municipal Financing Tools
24Municipal Finance Tools I: Municipal Debt Industrial Development Bond

Guest Speaker: Tobias Yarmolinski, RBC Dain Rauscher
Seidman. Chapter 15, pp. 341-348.
25Municipal Finance Tools II: Tax Increment Financing Assessment Districts and BIDSSeidman. Chapter 15, pp. 348-361.

Amazon logo Johnson, C. L. "The Use of Debt in Tax Increment Financing." In Tax Increment Financing and Economic Development. Edited by Johnson and Man. Albany, NY: State University of New York Press, 2001, pp. 71-86. ISBN: 0791449769.

Mitchell, J. "Business Improvement Assessment Financing Districts and the New Revitalization of Downtown." Economic Development Quarterly 15, no. 2, 115-123.

Kildee, Dan. "Genesee County Land Bank Initiative." (DOC)
26Course ConclusionSeidman. Chapter 19.

Pinsky, Mark. "Taking Stock: CDFIs Look Ahead After 25 years of Community Development Finance." Capital Xchange (December 2001). (PDF)
27Wrap Up




Lecture Notes

SES #TOPICSCOURSE NOTES
Part I: Course Introduction
1Course Overview

Definition of Economic Development

Role of Finance in Economic Development
This class provides an overview of the course content and objectives, and it discusses the definition of economic development and the role of financing in the economic development process.
Part II: Business Financing
2Business Finance Needs

Business Financing Instruments
This class looks at the many instruments used to finance business enterprises to understand the difference between debt and equity financing, the varied forms of debt financing, and the advantages and disadvantages associated with different financing instruments. The appropriateness of different financing instruments for various stages of business development and businesses' capital needs is also discussed along with the distinct capital needs and issues faced by small firms. Finally, we will review the basic finance terms and calculations related to debt and equity instruments.

Business Finance Basics (PDF)
3Analyzing Finance Needs I: Introduction to Accounting and Financial StatementsIn this session, basic accounting principals are reviewed and the three primary financial statements produced by accounting systems are explained: the balance sheet, the income statement, and the cash flow statement. The difference between cash and accrual accounting and the relationship of financial statements to business cash flow is a key theme for this class.

Business Financial Statements (PDF)
4Analyzing Finance Needs II: Evaluating Firms for Financing, Financial Statement AnalysisThis class will expand upon the understanding of financial statements to develop analytical tools used to evaluate the financial needs of companies and the most appropriate financial instruments to meet these needs. A comprehensive framework for evaluating a firm for economic development financing is discussed and then key financial analysis tools are introduced. The primary tools discussed will be ratio analysis, common size financial statements and forecasting cash flow and debt service capacity.
5Working Capital FinanceThis class focuses on working capital financing needs to understand what working capital is and why it is important to a business. The difference between "cyclical" working capital needs and "long-term" working capital needs will be discussed along with the issues involved in evaluating a firm's need for working capital debt and extending working capital financing. A written analysis of the Crystal Clear Window Company financing request is due today and will provide a case example for exploring these topics. The range of financial instruments and institutional sources for working capital will also be reviewed.
6Fixed Asset FinancingFixed asset financing is essential for the growth and expansion of businesses. The greater uncertainty and longer repayment terms make it more difficult for firms to secure such financing. We will look at the role of fixed asset financing in business growth, the unique issues in financing longer term capital needs, and the evaluation of a firm to extend fixed asset financing, using the Cambridge Biotech Case Study to gain insight into these issues.
7Real Estate FinancingThis class provides an overview of the real estate development process and financing issues, including key needs for economic development oriented real estate projects, the financial statements used for real estate projects, analyzing a project's capacity to support debt and equity, and the different financial instruments and sources of real estate projects.

Real Estate Finance (PDF)
8Analyzing Business Financing Needs IIITo strengthen skills in evaluating a firm's financial needs and capacity to support financing, this class is devoted to an analysis of the Phoenix Forge case, using a role play enactment of a Community Loan Fund Board meeting to consider the Phoenix Forge loan request.
Part III: Program Models and Federal Resources
9Introduction to Capital Markets, Capital Market Imperfections and Financing GapsThis class covers the institutional structure and operations of private capital markets, including the direct "public" markets and the "private" markets of financial intermediaries. Discussion of these markets will emphasize what economic development role they play, which institutions are most important for community-based economic development and the capital market failures and imperfections that occur in private capital markets. These market failures define the financing gaps that economic development finance programs and institutions are designed to address. A two-part framework for interventions to address capital market failures and financing gaps will be discussed.

Capital Markets and Financing Gaps (PDF)
10Private Market Interventions I: Guarantees and Credit EnhancementLoan guarantee programs are one of the most common tools used to expand capital availability to businesses through private capital markets. This class reviews the different guarantee forms, the major guarantees programs and what research indicates about their impact and best practices. A case study of the Emerging Technology Fund is used to explore design issues for loan guarantee programs.

Loan Guarantees (PDF)
11Private Market Interventions II: Community Reinvestment Act, Bank CDCsAs the primary source of business credit, private commercial banks and thrift institutions are the key community institutions in making capital available to small businesses and economic development projects. As government regulated financial institutions, banks provide several opportunities to use specific regulations and the regulatory process to change bank practices and expand their supply of capital for economic development purposes. Under the Community Reinvestment Act, banks are required to meet the full range of credit needs of the communities they serve. Since its enactment in 1977, extensive efforts and programs have been initiated either directly by banks or under pressure from community organizations to expand credit for community development. Bank CDC regulations are a second regulatory vehicle that allows banks to supply higher risk financing and undertake non-traditional activities. In this class, the history of the Community Reinvestment Act is reviewed along with research on its impacts on bank capital availability. The use of the CRA in Pittsburgh provides and the 2003 Bank of America Fleet Boston merger provide two cases to explore the evolving nature of CRA practice. Bank CDC regulations and their use to implement new development financial products and institutions are the second focus for this session.

Community Reinvestment Act (PDF)
12Private Market Interventions III: Community Development Banks, Bank Holding CompaniesBanks can be organized and managed to supply capital with a community and economic development mission. Banks provide a core financial intermediary for supplying capital while a bank holding company allows the creation of related organizations and programs that supplement banking services with other development activities. The experience of Chicago's Shorebank provides a lens for examining how banks and bank holding companies can be vehicles for community economic development, and the challenges associated with this approach to development finance. We will also consider reasons for the limited replication of the Shorebank model and its current relevance to development finance.

Program Planning (PDF)
13Program Models I: Revolving Loan Funds, Plans for Field WorkRevolving loan funds (RLFs) are the most common alternative development finance models with the longest history and track record. This class will review some of the key strategies and approaches employed by RLFs and guarantee programs and discuss important principles, issues and best practices. The Portland Industrial Site Loan Fund provides a case study to further explore these issues. We will also use part of this class to review plans for field work in New Orleans.

Revolving Loan Funds (PDF)
14Program Models II: Venture CapitalVenture capital and equity-like investments are a more recent and growing model of economic development financing, especially to support technology based business and commercial development of new technologies and products. Our discussion will include the unique nature of these financing sources, issues involved in managing venture capital funds, and the experience of state policy and then newer community development venture capital funds. Canada's experience with labor-controlled pension funds provides a third model for targeted venture capital investing.

Venture Capital (PDF)
15Project Work SessionThis class will be devoted to sharing and reviewing the information, initial findings and issues that emerged from the field work in New Orleans. Each project team is responsible for preparing a brief summary of its work, preliminary findings and issues/questions, all of which are required reading for this session.
16Program Models III: Community Development Credit Unions, Community Development Loan FundsCommunity based and controlled financial institutions have been a small but rapidly growing source of development finance. These institutions are privately funded through local deposits or philanthropic support or both. We will review the two major institutional models: credit unions and loan funds and look at the particular benefits, issues and constraints inherent in these models.

Community Development Financial Institutions (PDF)
17Program Models IV: Microenterprise DevelopmentThe capital and technical assistance needs of very small businesses pose special challenges. Over the past decade, numerous programs have been developed to support the creation and financing of "micro-businesses" as strategies to alleviate poverty, assist the unemployed and stimulate local job and income generation. In this class, we will examine the primary micro-business development and lending program models as well as review key operating issues and principals. Taub's article on the Arkansas Good Faith Fund and Sevron's assessment of microenterprise program impacts offer differing views of the economic development contribution of microenterprise programs while the Lawrence case study raises questions about effective strategies to heighten the impact of microenterprise programs.

Microenterprise Finance (PDF)
18Federal Programs: SBA Programs, CDFI Fund, HUD 108 Program, Office of Community Services New Market Tax CreditsThis session provides an overview of federal economic development programs administered by the Economic Development Administration, the Small Business Administration, HUD, the Office of Community Services (in the Department of Health and Human Services) and the U.S. Treasury CDFI Fund. Special attention will be paid to the New Market Tax Credit program and the experience with its initial implementation. The Inner City Supermarket Case provides an example for examining the advantages and issues related to using different programs and issues posed by utilizing federal programs within on overall project financing plan.
Part IV: Program Management
19Issues in Program Management: Program Planning and DesignThe first step in developing successful economic development finance programs is defining clear goals and designing a program to achieve these goals on a sustainable basis. In this session on program planning and design, we consider how finance programs relate to an organization's mission and strategy, how market analysis can be conducted and inform program design and how operational, institutional and financial factors influence program design. The Dorchester Bay Economic Development loan fund provides a case example to examine market analysis issues in designing economic development financing programs. Design issues and methods faced in the term projects will also be discussed.
20Issues in Program Management: Marketing and Origination, Underwriting and Structuring Investments, Servicing and Portfolio ManagementThe core competency in operating loan funds is making good decisions on which loans or investments to make and effective oversight of these deals to help keep them on track and resolve problems. This class will focus on these activities, including the options for organizing and managing these functions and best practices in the field. Effective program management with limited resources (typical of public sector and community organizations) is prominent concern along with linking financing programs to other economic development resources.

Managing Lending and Investing Operations (PDF)
21Issues in Program Management: Capital Management and RecapitalizationWith limited resources and capital needs that far exceed available funds, economic development finance programs are constantly challenged to manage financial assets to maximize capital for new investments and to expand their capitalization. We will analyze tools to enhance the use of assets and expand capital and discuss how to manage assets and liabilities for maximum effectiveness. Financial modeling of development finance institutions will also be reviewed.

Raising and Managing Capital (PDF)
22Term Project PresentationsThis class will be used to review and discuss term projects. Each team will make a 10-15 minute presentation on their term project, analysis and preliminary recommendations. The presentation will be followed by questions and class discussion.
23Term Project Presentations (cont.)This class will be used to review and discuss term projects. Each team will make a 10-15 minute presentation on their term project, analysis and preliminary recommendations. The presentation will be followed by questions and class discussion.
Part V: Municipal Financing Tools
24Municipal Finance Tools I: Municipal Debt Industrial Development Bond

Guest Speaker: Tobias Yarmolinski, RBC Dain Rauscher
Multiple instruments are used to finance government capital expenditures, infrastructure improvements and projects. This class will provide an overview of how the municipal bond market operates and discuss the major types of municipal bond structures, their relative advantages and potential use for financing business and economic development projects. Our guest speaker will walk through the challenges technical aspects of an economic development bond transaction.

Municipal Finance (PDF)
25Municipal Finance Tools II: Tax Increment Financing Assessment Districts and BIDSTax increment financing and assessment districts are effective ways to finance projects or investments where the benefits are fairly localized and revenues to support these investments can be generated from new tax revenues or fees from this local area. The primary focus of this class will be to introduce TIF and assessment district financing and explore their application to economic development projects. The use of assessment financing to fund business improvement districts will be reviewed. We will also look at TIF financing of downtown improvements in downtown Orlando in the 1980s to explore the financing issues and debt structure options associated with TIF supported municipal debt.

TIF and Assessment Districts (PDF)
26Course ConclusionWe will also look back over the semester's work, including the term project experiences, to identify key themes and conclusions related to economic development finance. Possible areas of discussion include: How have your views evolved on the role of financing in achieving economic development objectives? What principles should guide economic development finance activities? What can we say about best practices in designing and managing programs and institutions? Can development finance institutions survive as an alternative capital market? What key challenges do they face?
27Wrap Up




Assignments

Case Study Analyses

Five case study write-ups are listed in the syllabus. The background, financial data and assignment for each case is found in the corresponding chapter of the textbook (except where otherwise indicated in the readings section). Case study write-ups include financial analysis and a brief (3 page) write-up that address specific questions posed in the assignment. The written discussion should incorporate the results of the financial analysis required in the assignment with the financial analysis or projections attached as an appendix. The five case assignments are:


SES #CASE ASSIGNMENTS
5Working Capital Loan Request Analysis (Crystal Clear Window Company)
8Employee Buyout Loan Request Analysis (Phoenix Forge)
11CRA Campaign (Bank of America)
18Financing Plan for an Inner City Supermarket
23Manufacturer's Fund Recapitalization



Two additional case-based assignments should also be completed by the session listed below:

Ses #7: Review the City Plaza Case Study and calculate the property's maximum mortgage loan and financing gap. Recommend how NHDC can address any financing gap.

Ses #25: Review the Orlando Downtown TIF Case in Chapter 15. Evaluate the TIF revenue's capacity to support a $19 million financing and answer the 3 questions at the end of the case.





Projects

Six teams of MIT students in the graduate Financing Economic Development course worked with students at the University of New Orleans' Economic Development Planning and Policy class from February to May to prepare proposals on pressing economic development issues for three client organizations: the Jefferson Economic Development Commission, the New Orleans Mayor's Office of Economic Development and the Mary Queen of Vietnam Church in New Orleans East. A summary of each project follows.



Jefferson Economic Development Commission



New Orleans Mayor's Office of Economic Development

  1. Small Business Incubator Report for New Orleans, Louisiana, May 19, 2006 (PDF)

  2. Feasibility Study of the New Orleans Digital Media Center, May 19, 2006 (PDF)



Mary Queen of Vietnam Church






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