Guest blog post by Acting Assistant Secretary for Economic Development Matt Erskine

When a natural disaster hits a community—whether it is a flood, a tornado, or any other kind of disaster—it does more than wreak havoc on homes and personal lives. It also has devastating, long-term effects on the economic life of those communities, destroying vital infrastructure, such as public utilities, transportation links, and communications systems on which businesses depend.

I’m happy to announce today that the U.S. Department of Commerce’s Economic Development Administration (EDA) is making available $200 million in funds for communities affected by disasters in fiscal year 2011. These funds are designed to mitigate those long-term effects on business infrastructure and allow communities to bring their economies, and the jobs that come with them, back to life.

It’s no secret that the funding EDA provides is vital to ensuring the long-term economic health of communities affected by a disaster. In Joplin, Missouri, for example, EDA provided $341,000 after that community was devastated by tornadoes in 2010. Those funds allowed the state to hire economic recovery coordinators who were instrumental in building strong public-private partnerships that have been critical to restoring the economic vitality of that region.

When President Obama first announced the National Export Initiative (NEI) two years ago—with its goal of doubling U.S. exports by the end of 2014—there may have been some who wondered what this had to do with domestic economic development. But the answer is simple: a lot. From the worker in an auto plant owned by a foreign firm, to the many service businesses across the country selling to overseas visitors, to the U.S. companies from every sector selling their products and services to foreign buyers, America’s economic vitality is very much tied to the world market. And the benefits are many: more jobs, higher wages, and the overall prosperity that comes when we are selling to billions of consumers worldwide.

One often-overlooked element of international trade is foreign direct investment (FDI). The United States is the largest recipient of FDI in the world. Foreign-owned companies operating in the United States support more than 5.3 million U.S. jobs, and U.S. subsidiaries of foreign-owned firms account for 21 percent of U.S. exports. The total stock of FDI in the United States—$2.3 trillion—is equivalent to nearly 18 percent of U.S. gross domestic product.

But there is room for such investment to grow: the U.S. share of world FDI has been declining since the 1990s, as other economies aggressively compete to attract such investment. One impediment to FDI growth in the United States has been the lack of concrete tools and strategies available to local economic development practitioners that could help them more effectively leverage their communities’ competitive strengths to expand exports and attract FDI.

The Obama Administration today announced a $15 million multi-agency Rural Jobs and Innovation Accelerator challenge to spur job creation and economic growth in distressed rural communities. This competition, which is being funded by the U.S. Department of Commerce’s Economic Development Administration (EDA), the U.S. Department of Agriculture (USDA), the Delta Regional Authority (DRA), and the Appalachian Regional Commission (ARC), was designed by the Taskforce for the Advancement of Regional Innovation Clusters and the White House Rural Council.

The Rural Jobs Accelerator Challenge is expected to give out approximately 20 awards, depending on the number of eligible applications. To be eligible for an award, projects must benefit rural communities, but the applicant is not required to be located in a rural area. Nonprofits, higher education institutions, tribes and state and local governments can collaborate to apply for funding. Although businesses are not eligible to apply directly, applicants can also partner with the private sector on implementation.

Prospective applicants should register for a webinar on Tuesday, March 20, 2012, 3:00 – 4:30 p.m. EDT. Read the guidelines for submissions and note the deadline for applications is May 9, 2012. The complete FFO is available on grants.gov.

In addition to the four funding partners the initiative is supported by nine other Federal agencies: Commerce’s U.S. Patent and Trademark Office and National Institute of Standards and Technology Manufacturing Extension Partnership; Denali Commission; U.S. Department of Education; U.S. Department of Labor’s Employment and Training Administration; U.S. Department of Energy; Environmental Protection Agency; U.S. Department of Housing and Urban Development; and the Small Business Administration.

One of the chief architects of the Obama administration's bottom-up innovation strategies, U.S. Department of Commerce Assistant Secretary for Economic Development John R. Fernandez to return to private sector to promote innovation, job creation and global competitiveness.

U.S. Commerce Department Assistant Secretary for Economic Development John R. Fernandez has spent the last two and a half years–amid the most severe economic downturn in generations–successfully guiding the Economic Development Administration (EDA). In this role, he has led the Federal economic development agenda by promoting innovation and helping America’s communities build the foundation for long-term growth. He announced his decision today to return to the private sector, where he will continue to foster innovation, job creation and global competitiveness.

“The Obama administration has been fortunate to have a passionate leader like John who understands the president’s economic agenda and who has worked tirelessly to spur innovation, create jobs and an support an economy that's built to last,” U.S. Commerce Secretary John Bryson said. “John will be missed, but he has positioned EDA to continue to leverage private-public investments, support bottom-up strategies, and build 21st century infrastructure. We wish him success in his new role.”