The US Economic Development Administration (EDA) invests in economic development projects throughout the country to promote innovation, competitiveness, and economic growth. This brief summarizes the local impacts of EDA’s construction projects on establishments (for-profit firms and nonprofit organizations), jobs, and the incomes of nearby residents at both the census tract and county levels. We estimate these impacts beginning three years after the grant award.

This analysis provides an updated estimate of impacts from EDA projects using new sources of data and more advanced quasi-experimental estimation techniques. We find that EDA construction projects are associated with additional jobs in the vicinity of the project (the census tract) and across the county, though outcomes vary by community type and project type.

Our analysis reveals the following:

• We estimate that tracts with EDA construction projects awarded between 2010 and 2014 had up to five more establishments for every $1 million invested (including both EDA grant funding and leveraged local investment) through 2017 than they would have had in the absence of the project. We do not detect an increase in the number of establishments in the county where projects are located.
• Tracts with EDA construction projects awarded between 2010 and 2015 have between 3 and 67 more jobs in the tract for every $1 million invested through 2018. This amounts to an average cost of between $15,000 and $333,000 per additional job (averaging $29,000) in the immediate vicinity of a project. Counties with EDA construction projects have an additional 175 to 1,578 jobs for every $1 million invested through 2018.
• EDA construction projects are not associated with a statistically significant increase in the number of jobs held by residents in the census tracts where projects take place, but projects awarded between 2010 and 2015 are associated with additional jobs at the county level, resulting in 178 to 1,612 more jobs held by county residents for every $1 million invested through 2018.
• Job growth is concentrated in counties that had more jobs before the EDA project (i.e., the top half of counties in terms of number of jobs in 2004). In contrast, income growth is concentrated in nonmetropolitan counties.
• The high levels of job growth across counties appear to be driven by facilities and transportation projects but not utilities projects. Utilities projects, however, are associated with growth in the number of establishments in the county.

The Economic Development Administration (EDA) has a distinct and growing role in disaster recovery and resiliency planning. To better understand EDA's role, we conducted semi-structured interviews with EDA staff, grantees, local collaborators, and staff at the Federal Emergency Management Agency (FEMA). We also examined disaster funding appropriated to EDA. EDA coordinates federal economic recovery assistance to state local, tribal, and territorial governments and supports communities for extended periods following disasters. Leading the Economic Recovery Support Function under the National Disaster Recovery Framework, EDA helps agencies work in a more integrated and synchronized manner, maintains partnerships at the community level, and helps communities determine which agencies can offer funding that is most appropriate for their needs. At the same time, EDA makes flexible grants to support economic recovery and resilience. These grants support local innovation and allow communities to tailor projects to their specific economic development goals. As disasters intensify and become more frequent, more EDA staff and grants will be needed to support communities.

RECOMMENDATIONS

EDA’s role in disaster recovery has been evolving for decades. The agency fills voids in support for long-term community recovery planning and coordination among agencies, but there are several potential areas for growth. We identify the following actions that could improve EDA’s disaster recovery support:

• Extend the period of support provided by recovery coordinators beyond two years
• Expedite funding timelines and provide reimbursement for early recovery planning expenses
• Create more predictable funding streams that are available for longer periods after disasters
• Reduce the competitive nature of disaster funding applications
• Increase the understanding of EDA funding among potential grantees
• Increase full-time EDA staff
• Clarify EDA’s value-add to other agencies through demonstrative examples
• Use EDA’s coordinating role to elevate gaps in disaster response that hinder economic recovery and resilience

The US Economic Development Administration (EDA) supports regional economic development through investments in areas such as planning, infrastructure, small-business lending, and technical assistance to state and local governments and nonprofit organizations. This brief provides an overview of the locations of EDA grants over the last decade (2010–2021) and describes the areas that receive those grants. We describe the geographic eligibility criteria for EDA programs that limit or encourage where those programs are implemented. We then present the results of our analyses that examine the characteristics of places that receive EDA investment and the distribution of EDA investments across state, metropolitan area, urban and rural, and economic development district designations

Our analysis reveals the following:

• Based on the locations of EDA projects, rural communities—specifically, areas that are not in a Census Bureau–defined urban area—receive the most per capita funding at $37 per person. Urban areas receive $13 per person.
• Less populous states, including Alaska, Maine, Iowa, Montana, South Dakota, West Virginia, and Wyoming, received higher total EDA project investment per capita. (Total investment refers to EDA funding and matching funding provided by grantees.)
• EDA investment is much more likely, on a per capita basis, to be located in an area covered by an EDD than in an area that is not.
• Places that receive EDA funding tend to have higher levels of need—such as higher poverty rates or lower median incomes—than areas that do not.

The US Economic Development Administration (EDA) promotes economic growth, innovation, and competitiveness among regional markets in the US. Through eight programs, EDA funds planning grants, technical assistance, large-scale construction projects, revolving small-business loan funds, and various other economic development activities. This brief analyzes EDA data from 2010 to 2019 to paint a broad picture of the agency’s programs and grantmaking activities. During this period, EDA invested an average of $361 million a year across its programs. Physical construction projects accounted for about one in five grants but more than two-thirds of funding. EDA provided 50 percent of the funding for construction projects and 60 percent of the funding for nonconstruction projects.

Brett Theodos, Leiha Edmonds, Daniel Teles, Christina Plerhoples Stacy, Christopher Davis, Benny Docter, Jonathan Schwabish, and Tanay Nunna

Established in 1965, the US Economic Development Administration (EDA) supports regional economic development through investments in areas such as planning, infrastructure, small-business lending, and technical assistance to state and local governments and nonprofit organizations. This brief describes the history of EDA and contextualizes its approach to economic development. We first describe EDA’s origins and objectives and examine changes in its funding. We then describe EDA’s programs and their evolution. The brief is informed, in part, by interviews with current or former designers, implementers, or administrators of EDA programs and the agency’s partners. The brief concludes with a discussion of future and emerging economic development needs that EDA hopes to address through its programming.

Brett Theodos, Leiha Edmonds, Daniel Teles, Christina Plerhoples Stacy, Christopher Davis, Benny Docter, and Jonathan Schwabish