Forget the out-of-date notion about the three grand divisions of Tennessee – West, Middle and East. According to the University of Tennessee Center for Business and Economic Research, there are actually 10 distinct regions in our state.

Now, the real challenge if for state government to frame its policies, especially taxing authority, within the reality of these regions.

Region 1 is comprised of Shelby, Fayette, Hardeman, Haywood, Lauderdale and Tipton Counties. Other regions are divided similarly with a cluster of counties bound together in a region by economic and demographic similarities that lend themselves to shared economic growth strategies.

In the profiles of the 10 regions, our region has the flattest population growth between 1990 and 2003 – 11.1 percent. Meanwhile, the Nashville region recorded 31.2 percent; Knoxville saw 21.3 percent growth; and Chattanooga had 14.6 percent. To put it into perspective, our population growth was well below the state’s average of 20 percent and the U.S. average of 17 percent.

Therein lies a serious problem. It is not population growth for growth’s sake. It is Memphis’ lack of success in attracting talent that is needed to compete and succeed in the knowledge economy. With population growth that is essentially births over deaths in Shelby County, we are on an economic bubble unless we can attract new, young, technologically-savvy workers to the Memphis region.

The news was also bad in the category of employment growth between 1993 and 2003. Of the regions centered around one of the state’s major four cities, Memphis was the lowest performer. The 13.9 percent rate of employment growth is below the Tennessee average of 14.9 percent and well below the national average of 17.2 percent. As a frame of reference, the Nashville region recorded 24.7 percent employment growth.

The glimmer of good news was found in our place as second highest percentage of people with bachelor’s degree and per capita personal income. In the Memphis region, 23 percent of the people older than 25 years old have college degrees. Only Nashville is higher – 26.2 percent. The state average was 19.6 percent, but the national average was 24.4 percent.

As for per capita income, Memphis trailed only Nashville – by $1,150, but we were well ahead of Chattanooga and Knoxville – by an average of about $4,100. The Memphis region is higher than the state per capita income, but less than the U.S. average.

The development of this new regional context for Tennessee was a welcome development, because it’s based on a more rational approach to economic development. In the past, state government simply dealt with the three “grand divisions of Tennessee,” or the 95 counties of Tennessee, but both were based on geographic boundaries that had nothing to do with shared economic factors and a shared economic future.

While the report about regions makes for an interesting look at the way the state’s economy really works, the test is for state government to now apply them to economic development and public policy development. Already, the Tennessee Department of Economic and Community Development refers to the 10 regions in its plans, but as we know from past experience here, it’s much easier to adopt the language of regionalism than create the reality of regionalism.

The ultimate test lies in ECD’s ability to rally the various city and county jurisdictions within each region around a shared vision and shared plans for the future. Rather than just reconfigure already existing state programs around the new 10 regions, state government should do something really visionary, such as passing the authority for regional tax-sharing authorities for each region.

Now, that would be a breath-taking in its leadership.

Tomorrow: Lessons From Other Cities