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HomeMy WebLinkAboutR-86-0786s jo J-80-767 9/00/86 RESOLUTION N0. 86 -. 7 8 6 A RESOLUTION AUTHORIZING THE CITY MANAGER TO EMCUTE A CONTRACT IN A FORM ACCEPTABLE TO THE CITY ATTORNEY WITH COGrNETICS, INC., OF CAMBRIDGE, MASSACHUSETTS, TO PRODUCE AN ANALYSIS OF THE CITY'S ECONOMY AND RECOMMENDATIONS OF ECONOMIC DEVELOPMENT STRATEGIES AT A COST NOT TO EXCEED $28,000 WITH MONIES ALLOCATED FROM 11TH YEAR CDBG FUNDS BUDGETED FOR CITY-WIDE ACTIVITIES IN THE DEPARTMENT OF DEVELOPMENT. WHEREAS, the City Commission, by Ordinance No. 10070 has established the Department of Development to formulate and implement economic development programs and projects within the City; and WHEREAS, a. need exists for a current analysis of business activity, trends and opportunities within the Miami economy to formulate economic development strategies; and WHEREAS, the City has received a proposal from Cognetios, Inc., a nationally recognized firm specializing in economic development strategic planning, to produce this analysis; and WHEREAS, funds to conduct this study will be provided from the 1986-87 Community Development budget for City-wide economic development activities; NOW, THEREFORE, BE IT RESOLVED BY THE COMMISSION OF THE CITY OF MIAMI, FLORIDA: Section 1. The City Manager is authorized to execute a contract, in a form acceptable to the City Attorney, in an amount not to exceed $25,000 with Cognetios, Ina., of Cambridge, Massachusetts, to produce an analysis of business activity, trends and opportunities within the Miami economy to assist the Department of Development in formulating economic development strategies for the City with monies allocated from 11th Year Community Development Block Grant funds. OCT 7 1906 M6 ��` 4-UCA AS TO FORD AND COPMCTNSSS: (�2 - DOIIG88 TO: Honorable Mayor and Members of the City Commission FROM: Cesar H. Odio City Manager ep� DATM: EP 3 0 IAA MLft SUDJECT: Cognetirs Research Analysis of City of Miami Economy REFERENC98: October 9, 1986 ENcLosuREs: commission Agenda It is recommended that the City Commission approve the attached resolution authorizing the City Manager to enter into a contract in a form acceptable to the City Attorney with Cognetics, Inc., of Cambridge, Massachusetts, to produce an analysis of business development and economic change within the City and recommendations on economic development strategies at a cost not to exceed $25,000. This action involves a sole -source professional services contract for a specialized economic analysis which will accomplish the following: Profile economic change within the City, noting Both growtH and contraction of all businesses within the City of Miami above a home occupation. Identif Cit 's most rapidly -growing companies w ich have created almost 26,000 Jobs in the ast our years Document departures and interview exiting firms to eve op an of ective retention strategy. While firms are moving out of other Dade locations as well, 95% of job loss due to headquarters moving out of a e or contract n are rom� wt� nthe ty o M am�� Background The Department of Development has received a proposal from Cognetics, Inc. of Cambridge, Massachusetts, an internationally recognized economic research firm, to provide a detailed analysis of the Miami economy, identify Miami's rapidly growing businesses, and analyze why downtown Miami is experiencing significant loss of headquarter operations. David L. Birch, ABA, President of Cognetics and Director of the Program for Regional and Neighborhood Change at Massachusetts Institute of Technology, will meet with City staff to present and interpret the results of the study and assist the staff in formulating economic development actions which effectively utilize the new information. Dr. Birch has served on the faculties of Harvard University and MIT, and is a leading authority on employment, business growth, entrepreneurship, and economic change. He was the first to identify that job creation comes from small business development and expansion rather than large Fortune 500 companies, previously felt to be the big contributors to economic growth. Given the specialized expertise to be provided, this should be considered a sole -source contract. A. PROFILE ECONOMIC CHANGE WITHIN THE CITY Cognetics will perform two Economic Change Analysis studies focusing on employment growth and change and emerging growth companies. The studies will identify those businesses that are flourishing and those that are struggling in Dade County, generally, and the City of Miami specifically. Using several different sources available which incorporate nearly every business above a home occupation, Cognetics will determine the degree and nature of local economic change by reviewing past and present information and present recommended action. B. IDENTIFY CITY'S MOST RAPIDLY GROWING COMPANIES There are some 1200 small firms that are rapidly growing within Dade County. Ei ht -five eer cent L a dis ro ortionatel hi h amount) are locafted thin the city of Miami. This speaks we or our entrepreneurlal clImateg but the City must help them develop (or at least not hinder their growth) since Florida ranks fourth in business start-ups, yet 20th in the likelihood that Honorable Mayer and City -3- Commission growing compan:is, we must gain a better understanding of who and what they are. The Cognetics proposal will provide the City with a detailed identification of the 1200 small yet growing businesses with special focus on Miami's small businesses. The research will provide a brief history of each of the firms, their type of business, age, location, and the growth that they have experienced over time. C. DOCUMENT DEPARTURES FOR RETENTION EFFORTS The economies of Miami and Dade County are in transition periods. While a variety of small firms are continuing to lead the way in job creation, there is an increasing trend for larger businesses and headquarters operations to relocate to other areas. Job growth, therefore, is being offset by job loss. A stabilization of movement out of the City is urgently needed. While many of the firms that are leaving are moving from other parts of Dade County, 95 per cent of all headquarters job losses are from within the City of Miami. In an effort to better understand the dynamics that influenced the relocation, Cognetics will orchestrate a detailed market research survey that interviews all firms (through telephone survey) that have recently moved out of the area. The results of the survey, carefully administered and documented, will+ provide a good basis to develop an effective retention strategy. Such strategies are of critical importance if the City is to prevent losses from offsetting gains in job creation and business development. Funding for this contract will come from 11th Year Community Development Block Grant funds budgeted for city-wide economic development.