The Regional Cities Initiative has an impact of $1.6 billion in Indiana

Indianapolis, Indiana – A recent Ball State University study found that 18 Indiana counties benefited greatly from a state regional development project.

According to research conducted by the university’s Center for Business and Economic Research, real GDP growth, employment, and population increase were produced by the Indiana Regional Cities Initiative (RCI), a one-time $126 million funding program established by former governor Mike Pence in 2015. The RCI industry generates around $1.6 billion in revenue.

The goal of the RCI program was to incentivize surrounding communities in Indiana to collaborate on “quality of life” initiatives that would enhance the state’s appeal as a place to live and attract and retain skilled professionals. To create these strategies, three Indiana regions—the Northeast, North Central, and Southwest—received $42 million apiece in 2015.

The study’s co-author and BSU professor of economics, Michael Hicks, stated in a press statement that the findings “can be interpreted as casual.”

“Funding provided through the Regional Cities Initiative likely accredited some existing projects and provided key funding for projects not yet started,” Hicks said in the release.

Hicks, Dagney Faulk, and David Terrell, the study’s authors, predicted that the counties that received RCI money would experience an increase in GDP of $37 million annually and the addition of about 1,088 jobs.

“The implications of these results are that well-targeted, place-based programs with substantial input from local communities can positively influence economic outcomes of a region,” the researchers wrote in the report.

In several of the counties that benefited from RCI assistance, employment in the construction industry increased. In order to address a labor shortfall, the Indiana Construction Roundtable Foundation projects that the state’s construction sector will require 1,100 additional employees by 2026.

The food service industry showed growth in employment throughout the counties as well. The study also discovered that there were no appreciable wage benefits or greater earnings in these counties as a result of the RCI funding.

Even though enhancing local arts and cultures was one of RCI’s primary objectives, researchers found that the counties did not see an increase in employment in these fields.

The Regional Economic Acceleration and Development Initiative (READI), a grant program that expands upon the RCI’s framework, was introduced by Governor Eric Holcomb in 2021.
Approximately $1.25 billion has been provided by the program to communities in all 92 counties of Indiana to address challenges related to housing, employment opportunities, small company development, and child care. The state announced $500 million in new grants and the Lilly Endowment’s $250 million investment for READI 2.0 in 2024.

A total of $703.4 million in capital investments were made in 39 distinct projects supported by RCI in the North Central region, which includes South Bend and Elkhart. The initiatives included developing housing developments, constructing an aquatic center, enhancing the South Shore train route that connects to Chicago, and increasing broadband internet access.

The Northeast region, which includes Fort Wayne, improved performing arts venues, increased broadband access and launched a number of riverfront and downtown improvement projects with the help of the money. The $400 million sum of these 38 initiatives. A portion of the funds were also utilized by Fort Wayne to build the 12-story office and residential complex known as the “Skyline Tower” in the city center.

RCI funds were awarded to the Southwest area, which includes Evansville, to upgrade the downtown YMCA and the Evansville Regional Airport, increase STEM programming at a nearby charter school, and construct a new conference and housing complex.

The BSU researchers discovered that RCI money aided in advancing ongoing initiatives in these three regions more quickly.