Frequently Asked Questions for the Investing in Manufacturing Communities Partnership Designation for Manufacturing Communities

(Updated 12/18/2014)

What is IMCP?
A: The Investing in Manufacturing Communities Partnership (IMCP) program is an initiative designed to revolutionize the way federal agencies leverage economic development funds. It encourages communities to develop comprehensive economic development strategies that will strengthen their competitive edge for attracting global manufacturer and supply chain investments. Through IMCP, the federal government is rewarding best practices – coordinating federal aid to support communities’ strong development plans and synchronizing grant programs across multiple departments and agencies. Non-designated communities nationwide can learn from the best practices employed by these designated communities to strengthen American manufacturing.

Is IMCP an ongoing initiative?
A: IMCP is an ongoing initiative comprised of several phases. In September 2013, the Obama Administration awarded $7 million in planning grants to 44 communities nationwide to support the development of their strategies. On May 28, 2014, U.S. Secretary of Commerce Penny Pritzker announced the first 12 communities that will be designated as Manufacturing Communities, the second phase of IMCP. Later this year, the Administration will launch a second IMCP competition to designate the next round of communities. In the meantime, the Administration and federal agencies will work with all the applicant communities to help them strengthen their plans and to identify opportunities for communities to work with the federal government on their local economic development priorities. Later this year, the White House will convene the more than 70 communities that participated in IMCP to share best practices in economic development planning and attracting new jobs and investment in manufacturing.

How many applications were received in the 2nd phase?
A: More than 70 communities from across the country applied for the Manufacturing Communities designation  

How were the designated communities selected?
A: An interagency panel evaluated the applications on several key criteria:

• Proposals must demonstrate regional cooperation through a consortium of public and private partners and the strength of their partnerships.
• Applicants must define a geographic scope for their proposed community. The community must be large enough to contain critical elements of key technologies and supply chains, but small enough to enable close collaboration.
• Another important objective was to show how an IMCP designation will help a community build on its existing strengths and comparative advantages – not start from scratch – and have a substantial impact on a community’s overall prosperity.

There were three major areas that reviewers were asked to look at when scoring applications: the quality of the community’s implementation strategy, partnership capacity and commitment of the partnership. Applicants were asked four important questions in each area: what is your region’s current capability, what are the current institutions for improving capability, what are the gaps in your region’s industrial ecosystem, and what is your community’s plan to address those gaps.
Scoring was based on the quality of their implementation strategy, which included a detailed, data-driven assessment of the local industrial ecosystem as it exists today, what is missing, and an evidence-based path to development that could make a region uniquely competitive. Communities were asked to evaluate their strengths and weaknesses in the following six “public good” areas: workforce and training, supplier network, research and innovation, infrastructure and site development, trade and international investment, and operational improvement and capital access.

The second element for scoring was based on the extent to which the proposal demonstrated the capacity to carry out the implementation strategy, including an evidence-based assessment of: overall leadership capacity, sound partnership structure, partner capacity to carry out planned investments, state of the ecosystem’s institutions, and the depth and breadth of communities’ development and employment goals.

The third element for scoring proposals was asking communities to demonstrate a verifiable commitment from existing and prospective stakeholders, both public and private, to executing a plan and investing in a community. For this area, reviewers looked at the cohesion of the partnership; the strength and extent of partnership commitments that were not contingent on federal funding; and investment commitments.

How long will this designation be good for?
A: Manufacturing Communities will remain designated for two years. Current designees will have the opportunity to reapply to keep their designation. 

Will communities that were not selected have the opportunity to receive designations in the future?
A: Any communities can apply for designation next year. Regions that were not designated this year still gained a great deal from this process. Many of the applicants reported that, regardless of whether they were designated, the coordination and comprehensive planning effort that this initiative spurred in their region and at the local level will prove to help strengthen their public-private partnerships that will lead to more job creation and economic growth.   

What are the benefits to communities that went through the designation process, but were not selected?
A: Many of the applicants reported that, regardless of whether they were designated, the coordination and comprehensive planning effort that the initiative spurred in their region will help to strengthen local public-private partnerships that can lead to job creation and economic growth. Communities were asked to define their own regions, build strong and durable industrial ecosystems, and align industry needs for worker training, research, supply chains, capital access, infrastructure and site development and trade. However, because the IMCP designation process helped drive wide collaboration and helped focus regions on their assets, it is expected that communities that did not receive a designation will move forward with their strategies using state, local, and private resources. Further, communities that did not receive designation this year are still eligible for federal economic development funds, and may apply for IMCP designation next year.

What will the agencies coordinating on IMCP do to ensure that grant funding still goes to the non-designated communities?
A: Communities that did not receive designation are still eligible to apply for funding from the participating federal agencies.

How can non-designated communities receive feedback on why their applications did not lead to a designation?
A: EDA is planning to host a webinar in the coming weeks to offer general feedback on the application process. More information about that will be forthcoming. In addition, EDA is planning to organize an opportunity for non-designated applicants to make appointments to receive individual feedback on their applications.

IMCP Q&As for Top-Third Requirement

How can a community provide evidence that it ranks in the top third in the nation for their key manufacturing technology or supply chain (KTS)?

The purpose of a top-third ranking requirement for a community’s KTS is to ensure that regions are building on existing strengths (rather than starting from scratch). Thus, we encourage applicants to provide as much evidence as possible that points to the importance and growth of their KTS compared to other similar regions and the nation. This enables reviewers to better understand the strength and growth of your community’s KTS and assess whether it is a national leader. Communities may measure their top-third status either by using the absolute scale of activity (such as employment or sales) in their KTS, or by using location quotients (LQs).

The following sections offer guidance that may be of use to applicants. While communities may find this material helpful for demonstrating that the community ranks in the top-third nationally in their KTS, it is not required that applicants use the data we offer. However, applicants that choose not to use the guidance below should provide clear details on data and methods used to demonstrate that your community ranks in the top-third in your defined region and KTS.

Information and guidance on LQs and top-third rankings

Location quotients (LQ) compare an area's business composition to that of a larger area (i.e., nation or a state). Economic development opportunities may exist for additional growth of the exporting or related industries because of the presence of an existing skilled labor pool or other resources such as suppliers, facilities or transportation hubs in the region.

The LQ is a measure of an industry's level of concentration within a location compared to a larger region, with an LQ greater than 1 (LQ>1) indicating a higher than average concentration in that location. An LQ greater than 1 indicates that an area has proportionately more workers or firms than the larger comparison area in a specific industry sector.

Calculating a LQ for employment is based on the following formula:

For LQs based on firms, use the number of establishments in that particular KTS rather than number of employees.

The following is an example of how applicants would calculate an LQ for a 4-county region that had employment in Pharmaceutical and Medicine Manufacturing (NAICS = 3254). Note that this same method can be applied to one or more counties. The example uses hypothetical data for the 4 county region and actual national data for Pharmaceutical and Medicine Manufacturing using the 2011 County Business Patterns data (http://www.census.gov/econ/cbp/):

4 county Region’s Pharmaceutical and Medicine Manufacturing = 600 employees

4 county Region’s Total Employment = 250,000 employees

Nation’s Pharmaceutical and Medicine Manufacturing = 227,894 employees

Nation’s Total Employment = 113,425,965

Then, the LQ based on employment would be:

(600/250,000)/( 227,894/113,425,965) = 0.002400/.002009 = 1.19

From this example, the applicant’s LQ is 1.19.

To determine if their community is ranked in the top-third nationally, use the linked table that provides manufacturing employment and establishment LQ cutoff numbers for states. That is, the numbers in the table provide the LQ for each 4-digit NAICS manufacturing industry for the 17th-ranked state (including the District of Columbia) (Table: Top-Third Ranked Location Quotients for Establishments and Employment by 4-digit Manufacturing NAICS Codes (xls)).

Following the example given above and referring to the table, the LQ for the top third in employment in Pharmaceutical and Medicine Manufacturing is 1.05. Therefore, this region, with an LQ of 1.19, has demonstrated its eligibility to be considered for IMCP funding based on LQ. Also, for simplicity, even those communities whose regional boundaries do not conform to state borders can compare themselves to the state LQ rankings in the table provided.

To learn more about IMCP, visit http://www.eda.gov/challenges/imcp/index.htm. Communities are also encouraged to reach out to their regional EDA office for technical advice on receiving federal grants. For a list of locations and contact information, visit http://www.eda.gov/contact/.