Course Meeting Times
Lectures: 2 sessions / week, 1.5 hours / session
Course Description and Objective
Economic Development Finance focuses on the tools and programs available to the economic development practitioner to addresses capital needs for businesses and economic development projects. After an introduction to the role of financing in the economic development process, the course provides a foundation in how firms and development projects are financed and the interpretation and analysis of business financial statements to understand capital needs and evaluate the ability to support financing. The third part considers how capital market imperfections result in financing gaps and focuses on the policy and institutional models that exist to address these capital gaps and stimulate private investment in community and economic development. Program management is the focus of the fourth part of the course where issues of program design, operations and capitalization will be reviewed. Finally, students will be introduced to public finance tools and their application to economic development.
The course objective is to provide students with a comprehensive overview of economic development finance practice in the United States and develop a knowledge base and skills to either be a development finance practitioners or apply economic development finance approaches to other fields of planning and community development. Students can expect to gain the following knowledge and skills from the course:
- An understanding of the operation of private financial markets and their limitations in serving economic development finance needs.
- Familiarity with the program models and institutions that can be used to address community and business finance gaps.
- An understanding of different business capital needs and the appropriate financial instruments and institutions used to address these needs.
- An introduction to interpreting and analyzing business financial statements.
- Tools to evaluate and structure financing plans for firms and real estate projects.
- Knowledge of federal economic development financing programs.
- An understanding of operational needs and best practices in managing economic development finance programs.
- The ability to match feasible program approaches and models to address specific development financing gaps and business capital needs.
- The capacity to identify institutional and program resources that can be used to meet economic development financing objectives.
- An introduction to public finance tools and their economic development uses.
Reading Materials and Assignments
Reading assignments are specified for each class. Optional readings are listed for some classes and students are encouraged to read or skim these materials as well. Reading assignments are primarily from the course textbook with occasional supplementary readings.
Many classes include a case study discussion to apply concepts and tools from the readings and help develop students' thinking from a development finance perspective. Careful reading of case studies is required to determine key facts and circumstances of the case, to identify the critical issues raised by the case, and to be prepared to present your idea on these issues and how to address them.
Required Course Text
In addition to the completion of all reading assignments and participation in class discussion, students are required to complete the following assignments:
- Five case studies analyses.
- A term project report.
Case Study Analyses
Five case study write-ups are listed in the syllabus. Case study write-ups include financial analysis and a brief (3 page) write-up that address specific questions posed in the assignment. The five case assignments are:
|SES #||CASE ASSIGNMENTS|
|5||Working Capital Loan Request Analysis (Crystal Clear Window Company)|
|8||Employee Buyout Loan Request Analysis (Phoenix Forge)|
|11||CRA Campaign (Bank of America)|
|18||Financing Plan for an Inner City Supermarket|
|23||Manufacturer's Fund Recapitalization|
The term project entails a team of three or four students working on a finance project for a client. This spring, the term projects are focused on financing issues related to the rebuilding of the New Orleans region working with three client organizations: Jefferson Economic Development Commission, New Orleans Mayor's Office of Economic Development and the East New Orleans Vietnamese neighborhood (with the National Alliance of Vietnamese Service Agencies). This work will be done in conjunction with the University of New Orleans class, Economic Development Policy and Planning, being taught by Ivan Mieschovitch. One student from this class will assigned to each team to assist with its work. A brief description of each project and client is included in the project section. Only one team may work on a project. A list of the team members and the project selected by the team is due by Ses #4. A brief (1- 2 page) project work plan is due during Ses #9. Subject to funding, one week will be devoted to site field research for the project with one or two representatives of each team. The field work will include meetings with clients, interviews with key stakeholders and joint sessions with the UNO class. The final written project is due on Ses #27.
Grading will be based on each student's demonstration of their knowledge of the course material and capacity to apply this knowledge to projects, programs and development finance needs. All course work will be considered in determining grades, with class participation accounting for 1/3 of the grade, case study write-ups for 1/3 and the term project for 1/3.
|Case Study Write-ups||33%|