What role do local governments play in promoting sustainable economic development? This thesis uses the most recent 2014 national survey to analyze the relation between development strategies (business incentives and community economic development strategies) and environment and equity goals, and seeks to differentiate factors driving different policy actions. Municipalities that have both environmental sustainability and social equity goals use higher levels of community economic development tools. These communities are also more likely to have written economic development plans, be driven by new development motivations, and involve more participants in the economic development process. By contrast, communities with higher levels of business incentives have lower income, and are driven by traditional motivations, but they use a larger number of funding sources. Other capacity measures have no effect, and do not differentiate types of economic development strategies. This suggests sustainable economic development strategies can be pursued by a broader array of communities. Results of spatial analysis are similar to OLS regression controlling for geographic differences.