Revitalizing Rural Communities: How One Small Town Gained a Huge Economic Boost

By Leah B. Thibault

Adam Cyr’s story began in a fashion typical of his generation in rural America. Before leaving for college, Adam planned to join the family business in northern Maine after graduation. Following college, however, he landed a management position at a nationally branded hotel downstate, in the city of Portland. That opportunity for reliable employment led Adam to leave his rural roots and pursue a promising career in hospitality, an option not available back home. He joined the ranks of thousands of young Americans who are leaving their rural homes in pursuit of job security and diverse opportunities in cities, in a movement referred to as 'outmigration.'

Adam grew up near Presque Isle, a town of less than 9,700 in northern Aroostook County, where agriculture and forestry are the primary industries. The region lacks the economic diversity to weather a mill closing or bad crop – when jobs go, there is no other industry or enterprise to pick up the slack in its shallow economy. For this reason, Presque Isle has experienced a high outmigration rate for years. In fact, Aroostook County has lost more than 10 percent of its population over the last two decades. Maine’s northern region is not alone: The U.S. Department of Agriculture reports that, nationwide, rural counties as a whole lost population between 2010 and 2012.

Yet rural communities, which are home to only 20 percent of our country’s population but comprise 75 percent of the country’s land mass, support a wealth of extremely valuable resources. Rural America provides nearly all of the clean water to urban centers, provides the majority of domestic energy production and is the primary source of food production.

Investing in rural economies is vital to sustaining these resources, but finding the means to do so can prove challenging, as there are low levels of available and affordable bank and investment capital to support business growth in these often remote areas. The New Markets Tax Credit (NMTC) program, enacted by Congress in 2000, is designed to help business in low-income communities break through these obstacles. Knowing that these funds are just as important in rural communities, the NMTC program has required since 2006 that a proportional amount of this funding be invested in non-metropolitan counties.

Through careful community development planning and public/private investment partnerships, NMTCs stimulate economic growth in low-income communities to support and grow businesses, create jobs, and sustain healthy economies. In fact, since its inception, the NMTC program has delivered more than $60 billion in capital to business and revitalization projects, and it has created more than 550,000 jobs in some of the poorest communities in America. The success of just one project can have a ripple effect that makes waves throughout an entire region.

Back to Adam. His role with the hotel company grew, and he was dispatched to help distressed properties regain their footing across the country. At the same time, local business leaders and private investors were collaborating on a plan to help revitalize Presque Isle, in part by leveraging capital from New Markets Tax Credits. The project entailed demolishing an abandoned armory in the center of town and building the areas’ first nationally branded hotel on the site. The next nearest flagged hotel is more than two hours away, limiting the area’s ability to attract visitors.

This is where Adam’s story takes a turn from the typical: He was invited to become general manager when the 93-room Hampton Inn Presque Isle -- built to meet the industry’s top sustainability standards -- opened in 2009. Adam was excited for the opportunity to return home and put his professional skills to work. Furthermore, he was excited to offer 35 new full-time employment positions to his fellow community members as well -- jobs with pay and benefits above the going rate in the area.

Today, the Hampton Inn Presque Isle is a significant economic driver that accommodates a steady pace of business visitors and recreational travelers alike. It was also a deciding factor in helping the local Nordic Heritage Ski Center and the Maine Winter Sports Center secure hosting rights to the 2014 IBU World Youth/Junior Biathlon Championships and the U.S. Biathlon Association’s World Cup twice. The availability and quality of accommodations were vital in securing these world-class sporting events, since organizing committees must ensure there are sufficient housing and dining facilities for the athletes, coaches and support staff. The events, which bring hundreds of athletes and supporters to town, generate a significant ripple effect of revenue for other local businesses as well.

Rural America bears the majority of our nation’s vital resources – food, water, energy – yet employment opportunities there are scarce. With the careful planning and capital that New Markets Tax Credits deliver, areas like Aroostook County are enjoying greater economic diversity and are stemming outmigration. The effect that such projects deliver lifts entire communities so they can once again flourish – helping preserve the populations that live there and the vital resources they hold.

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Image courtesy of the author

Leah B. Thibaul is director of Operations at CEI Capital Management LLC.