BY CHUCK VANDENBERG
MONTROSE – It took the Lee County Economic Development Group about 90 minutes to convince county supervisors their money is being well spent.
At a budget workshop 10 days ago, the Lee County Board of Supervisors questioned whether their annual $210,000 contribution to the LCEDG was being well spent, specifically the 10% allocated to new business attraction.
The economic group’s Executive Director Joe Steil, Operations Director Dennis Fraise, and Marketing And Communications Director Dana Millard, along with the LCEDG board addressed the supervisors’ concerns.
Board Chairman Rick Larkin asked the board directly why the county should continue to support the group when they have private contributions and hold fundraisers.
“At one time you had a big fundraiser and it did well and through that time we’ve been contributing money, and some people question that if you had that good fundraiser why is taxpayer support still needed,” Larkin said.
Steil said the fundraiser Larkin was referring to was Campaign 2018, a five-year capital infusion campaign from the private sector.
“The funding from that 5-year campaign through 2018 is about $200,000/year and the county is funding at $210,000. As far as I’m aware with LCEDG, at least two separate times there was a step back in funding from the county and where we’re at today is about half of what that once was. Things are more expensive, so we’ve replaced those funds with those fundraisers and the county wasn’t raising their contributions.”
Supervisor Matt Pflug said initially the county was in for close to $400,000 when the group was first formed with Lowell Junkins at the helm.
Fraise addressed the steps LCEDG is taking to make sure any RFPs (Request for Proposals) from industries and businesses looking to this part of the state are handled properly.
“Almost all of our major leads come from the state, so we’ve worked diligently to improve how we handle those RFPs,” he said. “We work very hard to make sure we have all that material ready to go.”
He referred to what’s called a reciprocal agreement with Henry and Des Moines counties where all the counties work together to make sure the three counties are helping each other market as one entity to try and meet more of the needs of inquiring businesses. One county may have an asset a company is looking for when others don’t and that communication is made among the representatives of each county.
“I get emails and phone calls from Tim Gobble (Executive Director of Fort Madison Partners) and he funnels a lot of economic development work so I know those calls are being made,” said Matt Morris, a director on the LCEDG board. Morris is also President and CEO at Connection Bank.
Fraise also outlined current expenditures for the first half of the current fiscal year.
“Not including wages right now we’re spending 46% on workforce (development), 32% on business attraction, 13% on marketing and 9% on BRE (Business retention and expansion),” Fraise said. “When you figure in wages attraction goes to 48%, workforce is 23%, BRE is 19% and marketing is 10%.”
“I think it’s very important that we have skin in the game. I think it’s important that we don’t interrupt that $210,000 and I think that is very reasonable,” Pflug said.
Supervisor Ron Fedler asked if the LCEDG staff and board thought at some point the group could be self-sufficient.
“When we first started, the goal was for it -at some point- to be self-sustaining and tax payer money wouldn’t go in,” Fedler said. “At what point would you say it would be self-sustaining without tax payer dollars? We would still help with places like AmJet, because that brings more money into the county, but when would it be self-sustaining?”
Morris said his bank’s board decided to be involved in the capital campaign because of the direction of the board, and because local governments were vested as well.
“You know its one of the reasons we as a bank made a commitment to their capital campaign because they are focused on how they are using those resources. But another thing is that the county is involved. Personally I feel really good about where it is going. I mean let’s be transparent, I was pretty vocal 5-7 years ago about the direction it was going, but I’ve changed my tune and I like the direction it’s going.”
Fraise referred to Iowa officials including Gov. Terry Branstad, Lt. Gov. Kim Reynolds and Iowa Economic Development Authority Director Debi Durham who have all indicated in speeches, platforms and programming that 80% of Iowa’s future economic growth will come from expanding Iowa industries.
“We think it’s very important to pay close attention to that,” he said.
Supervisor Gary Folluo said the county should be invested in its economic health in one way or another. But he said expansion over attraction comes with a price.
“I think we should always be invested in economic development. To what degree is based on the board’s direction,” Gary Folluo said.
“One of the problems we run into is when a new industry comes in they cannibalize current workers. What is going on with the rapid response team and how do you see that working? The LCEDG is growing and I like the way it’s going, but I’d like to hear more about the rapid response team.”
Fraise said LCEDG is currently working on a rapid response team from members of the Fort Madison Economic Development Corp. and The Keokuk Economic Development Corp. to react quickly to RFPs because he says inquiries are getting shorter time frames and potential investors want information in a matter of days and not weeks.
“You guys truly have a plan here and that’s what I’m really looking at. Everything you have here on the table today makes sense,” Pflug said.