Each rural town in America is a little different — they all have something that makes them unique. And yet, when it comes to economic development and revitalization, many rural towns and cities face similar challenges: retention of young people, access to high-quality jobs, affordable housing, and pushing back on the perception that rural areas are nice to visit, but not to live. 

Charles Whitson, executive director of Taos MainStreet in Taos, New Mexico, understands. He grew up in the town, which has a population of less than 6,000. And he couldn’t wait to move away. 

“I probably had a similar path to a lot of young people in rural communities around the country,” he says. “It was kind of like you can’t get out fast enough. You’ve got to escape this small rural town.”

And yet after living in Albuquerque for years, Whitson and his family wanted a slower pace of life. To his surprise, Taos topped the list of places they wanted to live. Now, Whitson works full-time to help Taos thrive and become a place where other young families want to live. 

To see how rural communities are handling economic development, we spoke with leaders in three communities — Taos; Durango, Colorado; and Bozeman, Montana. These towns represent different sizes and stages of development and have each discovered ways to overcome the challenges of rural revitalization. 

“One of the most important things for rural communities to do is to learn from each other,” Whiteson notes. “You must realize that you don’t have to reinvent the wheel.

Three Approaches to Rural Rejuvenation

Taos, New Mexico

Taos is a mountain town in New Mexico. It has a long-standing reputation as an artistic town and destination for skiers and other outdoor enthusiasts. Just outside the town is Taos Pueblo, a Native-American reservation and one of the longest continuously-inhabited sites in the United States. 

  • Population: 5,929
  • Median Household Income: $30,893
  • Median Home or Condo Value: $254,200
  • Percentage of Residents Living Below Poverty Line: 
  • 26.2% (based on 2019 census data)

Diversifying an Economy Built Around Tourism

In Taos, New Mexico, home prices have nearly doubled in 20 years, even as a quarter of the population lives in poverty. Leaders hope that having a more diverse economy and investing in local manufacturing will help all residents thrive. 

If you had asked Karina Armijo, director of marketing and tourism for Taos, New Mexico, how things were going a year ago, she would have been gushing. Taos was seeing record-breaking tourism numbers, in part due to a concentrated effort by Armijo to market not only the town of Taos but the entire surrounding region in Northern New Mexico. A charter jet service opened, connecting Taos non-stop to destinations in Texas and California. 

“I felt like Taos grew up a little bit,” says Armijo, who has lived in the town for 25 years. 

When the pandemic hit, all of that came to a halt. Taos had some of the strictest ordinances in New Mexico, requiring face masks and implementing a curfew. The town scaled back tourism marketing funds that would normally be spent attracting visitors from states suddenly hard-hit by the coronavirus.  

The pandemic highlighted the discrepancies in Taos’ economic development. Tourism had been booming, and average home prices had nearly doubled from 2000 due in part to seasonal owners and people doing short-term rentals. Yet more than a quarter of residents still lived in poverty, and many business owners were unable to get their operations off the ground. 

“We are a one-sector economy — how do you even begin to go about changing that?” says Charles Whitson, executive director of Taos MainStreet, an organization dedicated to downtown revitalization.

One step is by investing in small local manufacturing efforts that already exist. Artisans in Taos have a long tradition of making products for tourists. Since the pandemic, some funding that would otherwise be spent on tourism has been redirected to support these operations. In addition, Taos MainStreet has been helping small business owners build their web presence and launch stores online. 

Taos has the advantage of strong internet, something the local electrical cooperative invested in years ago, Whitson and Armijo note. With that in mind, the town is focused on attracting people who can work remotely, a population that’s only increased since COVID-19. To do that successfully, Whitson believes that Taos must address misperceptions about rural living, particularly among young people. Many young people write off rural life, worried that there’s nothing to do or no good opportunities for jobs — but Whitson says that isn’t the case in Taos. 

“The perception of rural communities doesn’t always match the reality,” he notes. “We have to get better at storytelling, communicating to the outside world that Taos is not only a place to take an awesome vacation, but it’s a place you can come live and experience those things on a weekly basis.”

As Taos continues to focus on diversifying its economy, there are some tensions between different groups in the town. Hispanic residents — many of whom are young and have families that have lived in town for generations — favor more business and manufacturing, Armijo says. Transplants — often older, white retirees — want the Taos to keep its small-town feel. 

“There is a little bit of friction between the people who want sustainable growth and people who want no growth because they like it the way it is,” she says. 

Most residents in the town meet in the middle, looking for sustainable, responsible economic development that benefits all residents. Recently, the town passed an ordinance limiting the number of short-term rentals in Taos to keep housing more affordable for residents.

During and after the pandemic, Taos’ leaders are focused on improving the town’s economic opportunities, particularly for young people, while helping Taos stay true to its character. 

“When we talk about economic development, it’s asset-based development,” Whitson says. “We’re trying to find different ways of capitalizing on and enhancing those assets we already have: history, culture and a rich arts community.”

Lessons from Taos:

  • Promote tourism in a regional way. When Karina Armijo, director of marketing and tourism for Taos, began working with the surrounding towns, she was able to better leverage her budget and promote the entire region as a destination. 
  • Take risks and act quickly. Taos’s town leadership, many of whom come from the private sector, aren’t afraid to leap into projects. They “sort of treated it like a start-up,” Armijo says. The result was action and progress. 
  • United public and private enterprise. The town of Taos worked closely with owners of the local ski area, Taos Ski Valley, to bring charter flights to connect Taos to cities, including Dallas, San Diego and Los Angeles. The ski area subsidizes flights during the winter, while the town subsidizes them during the summer using funds from lodger’s tax. Although it is on hold this summer due to the pandemic, the partnership aims to make affordable year-round flights to Taos available.

Three Approaches to Rural Rejuvenation

Durango, Colorado

Durango is an isolated town in the southwest of Colorado. The Durango & Silverton Narrow Gauge Railroad, which arrived in 1881, is a major tourist attraction in town. Fort Lewis College, a small public university, brings about 3,800 students to the town each year.  

  • Population: 18,973
  • Median Household Income: $63,167
  • Median Value of Owner-Occupied Housing: $442,900
  • Percentage of Residents Living Below Poverty Line: 9.6% (based in 2019 Census data)

Intentional Growth for a Colorado City

Durango, Colorado, is trying to develop its economy with an eye toward sustainability and long-term success. 

Durango, Colorado, is a city that is used to dealing with catastrophe. In 2017, the city faced drought and a small fire; 2018 brought a massive wildfire; 2019 was characterized by avalanches and road closures. Then, 2020 brought the pandemic. 

“We’ve been labeled a resilient community,” notes Jack Llewellyn, executive director of the Durango Chamber of Commerce.

Despite the challenges, Durango has continued to grow. The town attracts tourists who come for white-water rafting or to ride the historic railroad. In normal years, more than 3,800 college students come to Durango for the school year. All of that has created a unique atmosphere — Durango has more restaurants per capita than San Francisco, Llewellyn likes to say. 

However, the city isn’t wholly dependent on out-of-towners. The economy has strong sectors in oil and natural gas and healthcare, as well as tourism and higher education, says Theresa Graven, tourism and communications director for Visit Durango. 

“We are in a different situation than a lot of our neighbors that are purely a tourism economy,” she notes. 

Durango wants to learn from other Colorado towns, like Boulder, that have become overrun with tourists. Graven says that the town is focused on sustainable tourism and attracting tourists willing to spend, rather than just increasing the raw numbers of tourists at the risk of clogging roads and otherwise inconveniencing the locals. 

Durango’s Main Street, near the historic train station, is full of successful shops and restaurants. However, that wealth isn’t spread evenly through town. To combat that, the city established the Durango Renewal Partnership, an urban renewal authority aimed at revitalizing other areas in downtown. The partnership will offset some of the costs of development, such as paying sewer and water lines, to encourage private investment, says Alex Rugoff, business development coordinator for Durango.

“I see that having a big role in making the community more affordable to live and providing higher-paying jobs,” he says. 

An initiative in the city gives grants of up to $5,000 to businesses to beautify their area, with anything from better signage to landscaping. Last year, the city spent about $50,000 on that program, which resulted in $2 million in private investment, Rugoff says.  

With the revitalization processes, the city has sought feedback from residents and business owners. In some areas, that has led to a focus on walkability. In others, it has led to more light industry, big box stores and manufacturing, Rugoff says. 

“We want to really have the residents drive the type of district they want to see,” he notes. 

Because Durango is surrounded by mountains and national forest, there’s little opportunity for urban sprawl. With expansion limited, the city is trying to be intentional about where it encourages development. By investing in the infrastructure of certain areas, as is being done with the Durango Renewal Partnership, the city can control where people settle, Llewellyn says. 

Durango has many advantages — the natural attractions, the college, an involved business community and an early investment in broadband internet — says Llewellyn. Still, sustainable, long term development takes concentrated effort. Right now, the business community is trying to attract more people with experience in upper-level management. 

While many rural towns have the advantage of offering active lifestyles and easy access to the outdoors, Llewellyn says a proactive approach is needed to promote economic vitality. 

“You can’t eat the scenery,” he says. 

Lessons from Durango

  • Take a long-term approach to planning. Think about economic development over 25 years, not five years, says Jack Llewellyn, executive director of The Durango Chamber of Commerce. This is especially important for a town like Durango that has limited physical space for growth. 
  • Be selective with tourism. Durango is focused on attracting high-value tourists that spend more, rather than increasing the number of tourists. The hope is that this will help with issues like traffic and overcrowding. 
  • Diversify the economy. Durango has an economy that is roughly equally divided between tourism, natural gas, higher education and healthcare.

Three Approaches to Rural Rejuvenation

Bozeman, Montana

Bozeman is a city in southern Montana. It is home to Montana State University, which enrolls more than 16,000 students each year. Bozeman was built as a cattle town but has attracted high-tech businesses in recent years. Ten percent of new businesses in Montana are formed in Gallatin County, which includes Bozeman.   

  • Population: 49,831
  • Median Household Income: $51,896
  • Median Value of Owner-Occupied
  • Housing: $343,000
  • Percentage of Residents Living Below Poverty Line: 18.6% (based on 2019 Census data)

Changing the Story 

For decades, the economy in Bozeman, Montana, relied on agriculture and natural resources. Today, the city is focused on developing the tech sector, while keeping its outdoors sector strong. 

Brit Fontenot, the director of economic development for Bozeman, Montana, was walking down the street one day last year when he glanced up. That’s when he noticed three cranes, all busily at work constructing new buildings. 

“To see a crane in our town is unusual. To see three of them, I felt like, ‘Wow. We got that one right,’” Fontenot says. 

Bozeman started as an agricultural hub, and for a long time, the city’s economy was built around natural resources and extracting wealth from the land. However, leaders in Bozeman wanted to change that story and position themselves as a tech hub, particularly for the photonics, software and IT industries. In 2009, the city crafted an economic development plan aimed at stimulating those industries, but the plan was too vague to be effective. 

“It had words like ‘supporting,’ ‘connecting,’ ‘encouraging,’” Fontenot notes. “Those are really great words, but they didn’t talk about measuring and accountability. There was no way to tell whether you were actually doing anything useful. Sitting there with aspirational ideas is nice, but at the end of the day, there wasn’t much happening.”

In 2016 the city tried again. This time, the economic development plan contained specific objects with measurable action steps. Suddenly, Fontenot felt like he had a framework to guide development and measure progress. 

The city decided to promote development in identified urban renewal districts by covering the cost of some infrastructure that developers normally would have to foot the bill for. In those districts, every $1 in public investment has led to $14 in private development, Fontenot says. 

At the same time, the city focused on nurturing local businesses, rather than providing tax breaks or other incentives for outside businesses to relocate to Bozeman. 

“We don’t have a budget for or an appetite to spend dollars on the recruitment of companies,” Fontenot says. “We have a lot of companies already here, so we focus on growing those. We wanted to support the companies and businesses that have supported our community since the beginning.”

Bozeman had the advantage of already having nationally companies, including Oracle and Simms, in town. Still, Fontenot says the city is working on attracting a greater pool of people with executive and management-level experience. That would allow people to move around within companies in Bozeman — rather than worrying that if they wanted to leave their current position, they would have to leave the city. 

Since the pandemic, Fontenot has been taking more calls from business owners interested in relocating to Bozeman from more urban areas. Although COVID-19 has made everything a bit more unpredictable, he continues to look to the nation’s big cities and the coasts to identify business and lifestyle trends that will eventually make their way to Bozeman. 

“We can see things on the horizon and prepare for what that might be,” he says. 

Taking a long-term look at economic development over the next 100 years, Fontenot is confident that Bozeman is on the right track. 

“Bozeman went from an agricultural to a tech hub,” he says. “We changed our story. Tell your story loud and proud, and if you don’t like what you’re seeing, take action to change it.”

Lessons from Bozeman

  • Use concrete metrics to measure success. Bozeman’s first economic development plan, passed in 2009, was an “aspirational” plan with little guidance for measuring success, says Brit Fontenot, director of economic development for Bozeman. The town’s updated development plan from 2016 focuses on specific objectives and action steps, such as “Based on interviews with businesses, identify any barriers to growth.”
  • Try economic gardening. The principal of economic gardening focused on encouraging local entrepreneurship and investing in existing businesses in a town, rather than providing incentives for businesses to relocate. “That strategy has done us well,” says Brit Fontenot, the director of economic development.
  • Invest in education. Bozeman prides itself on being able to provide quality education from kindergarten to Ph.D., Fontenot says. This is important for attracting management-level workers and young families. T

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