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e x c e l l e n c e f o r A r k a n s a s

Site Selection Considerations for Urban Research Parks

Institute of Government

July 2012

Site Selection Considerations for Urban Research Parks

Christopher Diaz Hunter Bacot

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In Brief—Recommended Considerations

Potentially affected stakeholders should be brought in to the site selection process

as active participants.

A clearly defined set of best practices should guide the site selection process that

considers, and tries to mitigate, the impact that the research park will have on the

community in which it is sited.

Information from the “Facility Siting Credo” should inform the Little Rock

Technology Park Authority in engaging the community directly affected by site

selection.

Scope

This whitepaper provides a brief overview of the advantages, disadvantages, and issues

surrounding research parks. In particular, what lessons have other communities learned in

choosing locations for research parks, and how can the Little Rock Technology Park

Authority apply those lessons to its own proposed Research Park? These lessons should

answer the following questions:

What issues surround the location of a research park in an urban neighborhood?

What opportunities do research parks bring to communities in which these are

located?

Is there a set of “best practices” to follow in research park location decisions and, if

so, what are these?

How are plans for locating proposed research parks communicated to stakeholders

directly affected by site selection?

Can these experiences of other communities locating research parks be applied to

the Little Rock Technology Park?

Questions and Answers

What problems have arisen in locating research parks in urban neighborhoods?

There is no body of extant literature that speaks directly to the question of problems with

siting research parks in urban neighborhoods. However, much literature addresses this

question indirectly in terms of siting other types of facilities, such as landfills, power

plants, waste incinerators, and prisons in a variety of urban and non-urban locations. The

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conclusions drawn by this body of literature can, by inference, be applied to research parks

in urban neighborhoods as well.

Regardless of the nature of the facility, locating it in an urban neighborhood invariably

results in relocating residents, many of whom are elderly, low-income, and minority.

Relocating residents involves compensating them for their property at fair-market value,

providing assistance with identifying potential properties, and assisting residents in their

relocation. Should the authority and residents not be able to negotiate a property agreement,

condemning property through eminent domain authority may be used. Eminent domain is

the power possessed by government to appropriate property for public use, welfare, or

interest. Eminent domain actions, for example, are commonly used throughout jurisdictions

across the country to acquire land for road and bridge construction as well as for placing

power, water, or gas lines. Based on the Fifth Amendment to the United States

Constitution, the owner of any appropriated property is entitled to reasonable

compensation, usually defined as the fair market value of the property. Proceedings to

acquire property through eminent domain are generally used as a last resort. How the land

acquisition process is conducted for locating a public facility often shapes resident reaction

to the siting process. Unless potentially-affected residents are included in the facility-siting

process as equally relevant stakeholders, the facility-siting process will likely encounter

project delays due to sustained community resistance, which often results legal and

political battles during and after the site selection decision is made.

Much of this NIMBY-ism (Not In My Back Yard) is unavoidable because such change is

difficult and frightening for those affected directly by it, even more so for those who

already feel alienated and disenfranchised. However, the entity (which in this case is the

Little Rock Technology Park Authority) seeking to locate a facility such as a research park

in an urban neighborhood can ameliorate residents’ anxiety by integrating them into the

site-selection process, rather than presenting it to them as a “done deal.” Every effort must

be made to assess and mitigate the effect of the facility’s location on lives of these

residents, and ideally, this impact assessment should occur simultaneously with the site-

selection process.1

Research on efforts to acquire property and relocate residents as part of the process in siting

research parks is minimal; there are, however, a two specific examples that can inform the

Little Rock process. An example involving a high-density urban area that affected

stakeholders in the facility site-location process is the East Side Biotech Project in

Baltimore, Maryland’s Middle East Neighborhood. In fact, Phase I of that project is

somewhat similar in size and scope to the effort currently underway in Little Rock – it

consists of 30 acres and encompasses 831 properties. The East Baltimore Development

Inc. (EBDI), a nonprofit organization created in 2002 to take charge of the project, worked

1 Laws, David and Lawrence Susskind. “Changing Perspectives on the Facility Siting Process.” Maine Policy

Review. 1(1991): n.p.

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with neighborhood residents to assist them in relocation and job-training to take advantage

of the 6,000 biotech jobs that the project’s backers predicted upon the project’s

completion.2 Homeowners in the affected neighborhood were awarded relocation packages

guided by federal, state, and local regulations, laws, and ordinances.3 In addition, EBDI

maintained constant communication and outreach with the neighborhood’s affected

residents throughout the redevelopment process from “pre-acquisition to post-

displacement”.4 Though not without challenge, Phase I of that project included acquisition

of 831 properties affecting 396 households.5 Although there was lingering mistrust and

anxiety throughout the relocation process, a survey of former residents of the Middle East

neighborhood indicates an overall satisfaction rating of 8.1 out of 10. Additionally, 69

percent of 157 families relocated said they were “much better off” after being relocated.6

Another example is found in Oklahoma City’s Presbyterian Health Foundation Research

Park (PHFRP), which played an integral part in developing the city’s urban redevelopment

policies. The PHFRP’s current boundaries included the city’s Harrison-Walnut urban

renewal area when the area was specified for development in 1981.7 These redevelopment

policies included a comprehensive renewal effort marked by:

A comprehensive urban renewal plan;

the establishment of a Planned Urban Development (PUD) subdivision

arrangement;

a sizeable federal Community Development Block Grant (CDBG) ($4 million); and,

the creation of a Tax Increment Financing (TIF) district.

The City of Oklahoma City outlined its relocation plan for residents and businesses located

in the Harrison-Walnut area affected by PHFRP’s continued growth and expansion (which

was last updated in 2008). The acquisition process used in the PHFRP’s siting and

expansion specifies that residents “will be relocated upon discovery of at least one

comparable, replacement dwelling and the offer of its availability to each subject household

2 Cohen, Charles. “Moved and Shaken: As the East Side Biotech Park Comes In, Area Residents Come to

Terms with Getting Out.” City Paper. (2/22/06) http://www2.citypaper.com/news/story.asp?id=11505 3 For example, using guidelines based on the federal Uniform Relocation Act, the Eastside Biotech Project

awarded relocation packages that included compensation in addition to the appraised value of homes; renters

were given a number of years’ worth of their current rent to be applied toward their new monthly rent

elsewhere. In addition to the federal guidelines associated with the Uniform Relocation Act, this project was

further guided by Maryland state laws and Baltimore local ordinances; together these regulations imposed

comprehensive guidelines for relocating residents and businesses, as well as for handling compensation for

vacant lots. For a thorough discussion of these regulations, see pages 7-20 of Phillip A. Hummel’s “East Side

Story – The East Baltimore Development Initiative.” (December 2007); the manuscript is available through

the University of Maryland Francis King Carey School of Law Digital Commons. Accessed June 2012: http://digitalcommons.law.umaryland.edu/mlh_pubs/11/. 4 Hummel, ibid, p. 29.

5 Hummel, ibid.

6 Cohen, ibid. 7 Warner, Larkin and Robert C. Dauffenbach. “The Presbyterian Health Foundation Research Park: a Major

Oklahoma City Asset.” Prepared for the Greater Oklahoma City Chamber, (2008): 18.

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or individual. Businesses will be relocated or compensated in a uniform manner as set out

in the Policies.”8

What opportunities do research parks bring to communities in which they are

located? Research parks’ proponents argue that these parks bring the community

opportunities that ultimately offset start-up and carrying costs. Among these opportunities

is the potential for fostering university-industry partnerships, financing and supporting the

commercialization of intellectual property, retaining and attracting talent, and revitalizing

urban communities.9 Other than the number of companies started, the number of jobs

created, and the increase in property values as a result of research parks, the extant

literature cites greater income equality, expanded opportunities within the existing labor

force, growth in educational attainment, and growth of employment and payroll outside the

park in support and ancillary sectors.10

None of these studies addresses the question of

whether these opportunities and benefits produce positive externalities for neighborhoods

affected by these projects.

In any event, these opportunities do not accrue automatically to communities with research

parks. Some research suggests that these parks either have no effect in attracting biotech

industry, or may in fact be counter-productive or superfluous to fomenting research and

development activities in a community.11

The primary reason that many research parks do

not perform to expectations is due to research funding and commercialization revenues

being heavily influenced by the “Top 15” universities that dominate technology transfer.12

Thus, what follows is a brief capitulation of a few technology parks across the country that

have or have not performed to expectations.

Many research parks meet the expectations promised by their promoters. For example, the

Piedmont Triad Research Park (PTRP) in North Carolina is a downtown redevelopment

project in Winston-Salem built largely upon land and using buildings deeded by the R.J.

Reynolds Tobacco Company in 1992. Set on 145 developable acres in downtown

Winston-Salem, PTRP has currently developed 554,011 gross square feet on approximately

12 acres for laboratory, office, and mixed-use space. When the site is fully developed in 25

8 See “Amended Harrison-Walnut Urban Renewal Plan,” Sec. H, p.12.

http://www.okc.gov/agendapub/cache/2/2cadqqjorqdw2du2qwymnu55/49467306182012105055789.PDF 9 Characteristics and Trends in North American Research Parks: 21

st Century Directions. Battelle

Technology Partnership Practice (October 2007): 35-36. 10

Pinkowski, Jack. “Running Head: Research and Science Parks for Economic Development.” Presented at

the St. Lucie County Research & Education Park Planning Workshop, Ft. Pierce, FL (4/21/05): 10-11. 11 Appold, Stephen J. “Research Parks and the Location of Industrial Research Laboratories: an Analysis of

the Effectiveness of a Policy Intervention.” Research Policy. 33(2004): 225-243. 12

Levine, Marc V. “The False Promise of the Entrepreneurial University: Selling Academic Commericalism

as an ‘Engine’ of Economic Development in Milwaukee.” University of Wisconsin-Milwaukee, Center for

Economic Development. Working Paper (September 2009).

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to 30 years, it is expected to create 28,000 new jobs.13

At present, the PTRP proudly

advertises it successes, which include:

attracting approximately 40 companies, professional firms, and organizations;

employing approximately 1,000 people with a collective annual payroll of more

than $50 million;

creating more than 100 park jobs related to infrastructure since 2008;

catalyzing three jobs in the community to support biotech for each new park

position;

enjoying a tenant population representing 25 countries and five continents;

projecting that at the 30-year build-out point, PTRP is anticipated to produce $80.1

million per year in measurable fiscal impact to North Carolina, $27.8 to Forsyth

County, and $15.7 million to Winston-Salem.14

Another example of a successful research park is the University of Delaware’s Delaware

Tech Park, which is situated on 40 acres of land in Newark, Delaware, which lies in the

middle of the Philadelphia-Baltimore urban corridor. As of May 2006, the Delaware Tech

Park proclaimed success based on several measures, which include:

having 56 tenants ranging from business consulting, biotech, pharmaceuticals, and

chemical engineering;

having 72,000 square feet and three buildings;

planning for the future development of three additional buildings and 350,000

square feet of office, laboratory, and light manufacturing space;

generating $300 million in federal research dollars since the park opened (in 1993);

estimating an economic impact between $70 million and $80 million annually;

being named the 2005 Outstanding Research/Science Park of the Year by the

Association of University Research Parks.15

The Evanston Research Park (in Evanston, Illinois) provides one more example of a

successful research park venture. The Evanston Research Park, which is situated on 22

acres and comprises 400,000 square feet of space, is a partnership between Northwestern

University and the City of Evanston. Like the other parks discussed, the Evanston effort

has succeeded in:

creating a new technology sector for the community;

establishing new business relationships for the university; and,

converting 22 acres of unused land into taxpaying uses and new jobs.

13

See Piedmont Triad Research Park’s Media Kit at

http://www.ptrp.com/about/mediakit/PTRP_Media_Kit_02-15-2012.pdf. 14

Ibid., p.5 15

See Appendix B of Harriman Research and Technology Park—Final Report. Prepared for New York’s

Empire State Development. Saratoga Associates (May 2006) at

http://esd.ny.gov/subsidiaries_projects/hrtdc/Data/AppdxB_Final_Report_05-23-06.pdf .

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Given its urban location, the Evanston Research Park experience is quite relevant to the

plans for the Little Rock Technology Park; the Evanston park plan was centered on the

viability of “mixed-use” as a model for an urban research technology park. Yet, despite its

success, the Evanston experience may encounter difficulty in meeting its original, long-

term vision of the park as a means of building a new economic development sector in the

city and region.16

With these successful examples of technology parks, two research parks cited as models for

the Little Rock Technology Park – the Virginia Bio-Tech Research Park and the University

of South Carolina’s Innovista Technology Park – are performing below expectations in

terms of attracting biotech firms and generating expected revenue.17,18

For example, at the

Virginia Bio-Tech Research Park, two of the three publicly-held companies have moved

out. As recently as last year, the Virginia Bio-Tech Research Park was in negotiations with

Virginia Commonwealth University to sell two of its buildings. Furthermore, much of the

park’s space is “occupied by entities that have nothing to do with the original purpose of

incubating biotech start-ups and spinning them loose. Very little ‘clustering,’ or big-time

corporate contract work, has been achieved. At times, it’s difficult to tell what

distinguishes the biotech park from any other office park.”19

In South Carolina, the story is

similar: few biotech firms and high vacancy rates at the technology park. As of 2009, the

technology park had only one tenant—the University of South Carolina’s Arnold School of

Public Health. At the same time, only one of the park’s three buildings was completely

occupied (by the Arnold School); the second building was occupied at 20 percent (by

university employees), while the third building remained incomplete due to lack of

funding. Finally, the cost to taxpayers is staggering; according to one assessment, Innovista

has cost South Carolina taxpayers over $100 million. 20

Given the current economic climate and efforts to locate such a park in central Little Rock,

the Little Rock Technology Park Authority can utilize these experiences of other similar

research park developments to inform its efforts as it moves forward with development.

Are there “best practices” to follow in deciding where to locate a research park, and if

so, what are they? Yes, there are. At the 1989-90 National Workshop on Facility Siting,

sponsored by MIT and the University of Pennsylvania’s Wharton School of Business,

16

Ibid. 17

Galuszka, Peter. “Bio-bust?” Style Weekly. (5/24/11) http://www.styleweekly.com/richmond/bio-

bust/Content?oid=1494982 18 Dietrich, Kevin. “USC Seeks Another $13.3 Million for Innovista.” The Nerve. (5/4/12)

http://thenerve.org/news/2012/05/04/usc-seeks-another-13-million-for-innovista/ 19

Galuszka, ibid. 20 “Innovista: a Public-Private Partnership That’s All Public.” South Carolina Policy Council. (2009).

http://www.scpolicycouncil.org/research/economic/innovista-a-public-private-partnership-thats-all-public

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participants devised a “Facility Siting Credo”21

for making siting decisions that reflect and

respond to the concerns of potential host communities.22

Many of these items are

applicable to the Little Rock project. The “Facility Siting Credo” provides the following 13

elements:

1. Seek consensus—Seek active involvement by all groups who may be affected

by a siting decision. Participation by potentially affected stakeholders in the site

decision-making process helps to assuage uncertainty, ambiguity, and legitimate

differences of opinion. They should be consulted before key decisions are

made.23

2. Work to develop trust—Lack of trust is a major barrier to seeking consensus.

Laws and Susskind (1991) argue that “a major source of mistrust is the

assumption that affected communities must accept siting decisions if the

technical justification is sufficient and procedural requirements have been met.

Ambiguity over benefits and risks will give rise to doubts regardless of the

weight of the technical evidence. A failure to acknowledge these ambiguities

leads to mistrust. Locating multiple facilities in poor or otherwise disadvantaged

areas (regardless of the compensation required or the openness of the process) is

another source of mistrust.”24

Building trust requires honesty about the

challenges of decision making and acknowledging that mistakes have been

made in the past. Every effort should be made to avoid obfuscation, and

ignoring the legitimate concerns of potentially affected stakeholders will further

undermine trust.25

3. Set realistic timetables—Building consensus takes time and should not be

rushed. Rushing consensus building with potentially affected stakeholders is

likely to be unsuccessful in the long-term, and undermines trust in the short-

term. Deadlines should be sufficient for careful deliberation, but also should

require that key decisions be made at specific intervals so that the consensus-

building process itself is not manipulated to stall for time.26

4. Get agreement that the status quo is unacceptable—A siting process must begin

with agreement that a facility is needed. This need should be clearly defined

and widely understood. Proponents of a facility should be able to specify who

will benefit from the project. Laws and Susskind (1991) make the point that “if

a problem is not considered important, or the status quo is deemed acceptable

by many interest groups, it is unlikely that the need for a facility will be

21 See also Susskind, Lawrence. “A Negotiation Credo for Controversial Siting Disputes.” Negotiation

Journal. (October 1990). 22 Laws and Susskind (1991), ibid. 23 Ibid. 24 Ibid. 25 Ibid. 26

Ibid.

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established. A siting process that proceeds without agreement on need is

unlikely to succeed.”27

5. Choose the design that best addresses the problem—Many possible alternative

sites should be reviewed and considered, and each alternative should be

analyzed carefully for both its long-term and short-term implications. The

“best” site should be judged relative to the extent to which the interests of all

stakeholders are likely to be met.28

6. Guarantee that stringent safety measures will be met—Potentially affected

stakeholders in a facility-siting decision should be assured that the facility will

comply with all federal and state health and safety standards, and reflect current

knowledge of “best practices.”29

7. Fully compensate all negative impacts of a facility—Compensation should be

negotiated with potentially affected stakeholders. Compensation agreements for

potentially affected stakeholders may include property value guarantees,

relocation assistance, housing vouchers for renters, job training, and ensuring

that public transportation is readily accessible to dislocated stakeholders.30

8. Use contingent agreements—Contingent agreements specify what will be done

in the case of accidents, interruptions of service, changes in standards, or the

emergence of new scientific information about risks or impacts. Such

agreements should describe the triggers for action, delineate responsibilities for

taking action, and provide means of guaranteeing that contingent promises will

be met.31

9. Keep multiple options on the table at all times—This works for the benefit of

both a facility’s proponents and the potentially affected stakeholders. For the

former, it prevents the project from being held hostage by a particular

community over compensation or benefit packages. For the latter, it prevents a

community being considered to host a facility from perceiving that theirs is the

only site under consideration. Parties on both sides are less likely to be

suspicious of each other, and the acceptability of the eventual outcome will be

enhanced if multiple options remain open.32

10. Make the host community better off—Proponents of siting a facility in a

particular community should respond to the real needs of potentially affected

stakeholders in that community. Comprehensive benefits packages offered to

residents could include tax abatements, providing amenities to residents (e.g.,

parks, access to public transportation), or even direct cash payments to

residents. The net effect is that the potentially affected stakeholders feel that

they are better off than before the facility displaced them. Laws and Susskind

27 Ibid. 28

Ibid. 29 Ibid. 30 Ibid. 31 Ibid. 32

Ibid.

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(1991) suggest that “incentive payments or promises to take actions of various

kinds should be made over and above commitments to mitigate impacts or

compensate a community for impacts that cannot be mitigated.”33

11. Seek acceptable sites through a volunteer process—If the benefits of a proposed

facility are clear and unmistakable, and the risks and adverse effects are

compensated or mitigated by the facility’s proponents, some communities may

compete to host that facility.34

12. Consider a competitive siting process—If the benefits of a proposed facility are

high enough, communities may even compete to host the facility. A competitive

process should ensure that the level of benefits to a host community is

reasonable, and the competitive or bidding process should not be used to reduce

benefits to a level below that required to compensate for all non-mitigatable

impacts.35

13. Work for geographic fairness—No single community or neighborhood should

be the only site for facilities that no one else wants.36

Too often, facility proponents and their government partners ignore these recommended

siting parameters, particularly for dealing with potentially affected stakeholders. According

to Raab and Susskind (2009), “They [the entity] go through the motions, hunkering down

to defend decisions rather than engaging stakeholders in a timely and meaningful way.

This breeds even greater public cynicism.”37

While it is largely unknown given the sparse

research specific to siting technology parks, community or stakeholder engagement in the

policy process is a common facet of public policy research, as well as being a requirement

in most federal and many states’ policy process.38

How were plans for locating proposed research parks communicated to stakeholders

directly affected by the site selections? This is unclear from the extant literature and

media coverage of site selection for other research parks. However, the UALR Institute of

Government (IOG) is available to research communication practices of other research park

authorities and affected stakeholder groups in various parts of the country to answer this

question fully.

Can the experiences of other communities with research parks be applied to the Little

Rock Research Park? Yes, the “credo” and other tech park experiences discussed above

can serve as guides for developing a participatory process for siting the Little Rock

33

Ibid. 34

Ibid. 35 Ibid. 36 Ibid. 37 Raab, Jonathan and Lawrence Susskind. “New Approaches to Consensus Building and Speeding Up Large-

Scale Energy Infrastructure Projects.” Presented at Conference: The Expansion of the German Transmission

Grid, Gottingen University, Germany (6/23/09): 1-17. 38

See most recently, a special issue on “Deliberative Democracy and Participatory Practice” of Public

Administration and Management, vol. 15: 1 (2010).

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Technology Park. Further research based on cases similar to that of Little Rock and the

Little Rock Technology Park is recommended.

Issue Summary

This whitepaper provides a brief overview of issues and considerations for locating

research parks in urban neighborhoods. Most significantly, this research highlights best

practices that proponents of such facilities must recognize in communicating with and

involving potentially affected stakeholders in the process of site selection. Lessons learned

from other communities that have experienced urban renewal projects, regardless of the

specific nature of the project, offer information and guidance for stakeholders on both sides

of the site selection process.

All three of these prospective sites contain high densities of residents who have lived in

these neighborhoods for decades. Using the U.S. Postal zip code (72204) for these three

prospective sites, 72.5 percent of owner-occupied housing is occupied by individuals who

have owned their homes since at least 1994. Of these homeowners, 11.5 percent live below

the poverty level, and 28.9 percent rely on income from Social Security. African-

Americans comprise 58.6 percent of homeowners in these neighborhoods; those aged 65

and over make up 24.6 percent of homeowners in these neighborhoods. 39

39 These figures are derived from U.S. Census Bureau data from 2000, the most recent available.

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Background on the Little Rock Technology Park Project

In response to Governor Mike Beebe’s call to increase the number of technology-based businesses

in Arkansas through existing incubators on university campuses, the Little Rock Chamber of

Commerce commissioned a study by the technology consulting firm, Angle Technology Group, to

assess the need for a technology-oriented park and recommend strategies for bringing such a

facility to fruition should the need exist.40

As part of the effort to formalize the vision for a

technology park in Little Rock, in 2010, the City of Little Rock’s Board of Directors established

through ordinance the means for creating a Technology Park Authority. Further catalyzing the

impetus for creating a technology park, Little Rock voters approved a three-eighths-cent sales tax

increase for capital improvements in 2011 that included $22 million in funding earmarked for the

development of the Little Rock Technology Park. Three prospective sites for the research park

were identified based on their proximity to the UALR and UAMS campuses and their ease of

access to major thoroughfares and interstate highways.41

The first site is located in the area east of

Fair Park Boulevard to Jonesboro Drive and from I-630 south to 12th

Street. The second site is

bounded by 12th

Street on the north, the Madison Heights housing development on the east,

Franklin Elementary School on the south, and Tyler Street on the west. The third site is bounded

by Coleman Creek on the west, 19th

Street on the north, Filmore Street on the east, and 23rd

Street

on the south.42

The map in Figure 1 (see next page) provides a visual context of where these

prospective sites for the research park are located in the central Little Rock area.

40

See Study and Recommendations for a Research Park in Little Rock, Arkansas. Prepared for the Little Rock

Chamber of Commerce. Angle Technology Group. (June 2009). 41

Ibid., p.39 42

Ibid., p.40

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Figure 1. Map of Prospective Sites for Little Rock Technology Parks

Source: Little Rock Technology Park Authority, www.lrtechpark.com

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About the Authors

Christopher Diaz is a Research Associate with the UALR Institute of Government. Christopher

earned his PhD from Texas A&M University.

Hunter Bacot is Director of the UALR Institute of Government. Hunter earned his PhD from the

University of Tennessee.

The authors wish to acknowledge the comments and suggestions on this manuscript provided by Mr. Ron

Copeland and Dr. David Sink.

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