Heartland States and Communities Advance Innovation and Economic Development With the Support of Massive Federal Funding

Dave Shideler, Angie Cooper


How Can Communities Maximize these Opportunities?

Billions of federal funds are being delivered across the country for new programs, investments in local innovation and infrastructure improvements. What’s more is that much of these dollars are flowing directly to the American heartland. 

As a think-and-do tank with the mission to improve economic outcomes in the middle of the country, we at Heartland Forward could not be more thrilled to see these important investments flow into our communities, many of whom had been previously left behind as Treasury Secretary, Janet Yellen has herself pointed out. And unlike much of the pandemic aid that was meant to address emergency needs, this new funding is aimed at longer-term efforts to revitalize parts of the country that have long needed an economic jolt, even before the pandemic took hold. 

That’s why we are in a unique moment. But what we make of these investments and how effectively these opportunities are leveraged to ensure sustained long-term growth will be a function of on-the-ground community-driven activity. Here’s our how-to guide on maximizing federal spending.

First, clarify what funds are available and for what purposes. It seems almost every day there is a new announcement about a new initiative, grant, investment, implementation of legislation or more. Many of these funding streams can get confusing. Here are the major categories:

  • Regional Grants. The Biden administration announced a package of $1 billion in economic grants through the Build Back Better Regional Challenge (BBRC) directed at 21 regions for investments in strategic industries. This includes advanced manufacturing, green technology, agriculture and health. Examples of selected projects in the heartland are
    • $52.2 million for the Global Epicenter of Mobility in Michigan
    • $45 million for the mountain Plains Regional Native CDFI Coalition in South Dakota
    • $50 million for the H2theFuture Greater New Orleans Development Foundation in Louisiana
    • $25 million for the St. Louis Tech Triangle in Missouri
    • $39 million for the Tulsa Regional Advanced Mobility Cluster in Oklahoma
    • $25 million for the Heartland Robotics Cluster in Nebraska
    • $35 million for the Oklahoma Biotech Innovation Cluster Initiative in Oklahoma
    • $40 million for the West Texas A&D Cluster for the University of Texas at El Paso
    • $51.4 million for the South Kansas Coalition for the Wichita State University in Kansas
  • Public-Private Partnerships. We are seeing investments aimed at reshoring crucial manufacturing jobs in tech and science industries that had previously gone abroad. For example, under the $52.7 billion CHIPS and Science Act, “the Commerce Department will spend $10 billion over four years to establish 20 technology and innovation hubs that bring together state and local governments, universities, business and labor groups to develop local technology intensive industries and jobs.”  The CHIPS and Science Act also allocates $2 billion to incentivize semiconductor production specifically for the parts industry and automakers, particularly in Michigan, which is home to GM, Ford and Stellantis. One prominent example under the CHIPS Act is the deal struck with Intel in Ohio that will feature a $100 billion investment in the largest silicon manufacturing location on the planet to create 7,000 construction jobs and 3,000 permanent jobs.

Second, communities must be involved but also prepared. Much is discussed about “community involvement” and “stakeholder engagement,” and these are extremely important. But what we mean when we say this is that local government officials, community groups, non-profits, businesses and families must actually be prepared to take advantage of these resources. Here’s how:

  1. Focus on education. Local governments should invest in training pipelines and initiatives so the labor supply is well positioned to take advantage of new jobs. In our Labor Crisis and the Future of the Heartland report, Joel Kotkin, former Heartland Forward fellow, describes how new training programs in the St. Louis area, for example, are providing practical skills training and in Mississippi, training emphasizes construction and solar installation, much needed skills for many of the jobs being created with the help of federal funds. Training should focus on producing laborers that will work in tech, manufacturing, agriculture and the trades. 
  1. Close the digital divide. To participate in our modern economy, people must have access to high-speed internet, which is so crucial for work, school, health care and  communities overall economic success. Fortunately, federal funding is available to help close the digital divide but many residents and local leaders that could benefit most from government funding do not know that these programs exist. The Affordable Connectivity Program is a great example. To get the word out on this vital resource for families that will connect them to life in the digital age, Heartland Forward partnered with the Benton Institute to establish the Accelerate program in Illinois, Ohio and Arkansas. Accelerate is a 14-week program that educates communities on the funding available and begins the process of assisting communities to develop their broadband plan to ensure all residents have access to high-speed internet. Through our Connecting the Heartland initiative, we did outreach to 328,450+ Latino individuals through our partnership with the League for United Latin American Citizens (LULAC) that hosted on-the-ground educational workshops. More local governments will need to be involved in getting the word out to constituents on these opportunities. Our American Connectivity Corps fellows are supporting communities to build their digital equity and literacy plans because once you have the technology and infrastructure for high-speed internet it must be affordable and we need the digital skills to know how to use it.
  1. Incentivize people to work and live in regions that are receiving investments. Heartland Forward has written extensively on how the map of talent is changing in the United States, largely due to the ability for people to work remotely and the attractiveness of regions that feature higher quality of life, access to natural amenities and cheaper cost of living. Much of these trends are also being supported by initiatives specifically targeted at incentivizing migration, such as Tulsa Remote, which pays people $10,000 to relocate or our home region Northwest Arkansas – Life Works Here – where you get money and a bike! Many heartland states and other areas across the country are implementing similar  strategies to recruit and retain talent. We must also be increasingly accessible to immigrant populations, such as recent refugees from Afghanistan that have become key targets for manufacturers in cities such as St. Louis; friendly to working mothers and the elderly, especially in an environment where healthcare costs are going up but the supply of healthcare workers is dwindling. 
  1. Develop pipelines for talent and entrepreneurship. Our research points to the need for innovation and entrepreneurship. A major component of a region’s entrepreneurial ecosystem is its ability to attract and retain young firms, start-ups that are 5 years and under, a topic we explored through our report, America’s Entrepreneurial States. To support these early-stage businesses, policymakers should fund entrepreneurial support organizations that invest in the workforce that will be essential to growing and emerging economies. Many people have great ideas and want to become entrepreneurs, but don’t know where to start. That’s why we’ve founded the Community Growth Program and Toolkit in partnership with Builders + Backers to accelerate ideas in the heartland and give entrepreneurs the technical skills, resources, network to execute, plus pebble grants to seed and test their experiments. By developing a supportive infrastructure to attract entrepreneurs, cultivate young firms and invest directly in people, policymakers can facilitate a sustainable environment to grow successful, long-term economies -even after federal funding is depleted.       

We are eager to see the vast spending in heartland communities that have long been in-need of additional resources, funding, skills training and jobs. What we are more excited to see is the unique ways in which local policymakers, organizations and stakeholders will invest in themselves to maximize these opportunities and ensure that the middle of the country, the heartland, thrives.