A municipality or regional district can incorporate or invest shares in an economic development corporation to do the work in a community or region.
A corporation is a legal entity separate and apart from its owners, the shareholders. Legally, it has all the rights and obligations of an individual.
A corporation can:
- Enter into contracts
- Own real property
- Sue and be sued
Establishing a corporation limits legal liability, protecting the local government from financial risk. A corporation:
- Engages external expertise, freeing up council and board time
- Can develop and adjust programming quickly based on community need
- Operates separate from local government
- Liability and financial risk rest solely on the corporation
- Potential income source goes to the corporation instead of back into the local government
- Challenges around communication and relationship building
- Performance metrics can be difficult to establish
How to Proceed
Learn more about establishing an economic development corporation.