LCEDG loses $10K in latest county budget cuts


LEE COUNTY – Economic Development efforts in the county suffered another paper cut Thursday when Lee County Supervisors nicked the budget of the Lee County Economic Development Group by $10,000.

Supervisors have been hinting for several years now that the board should scale back its contribution to the LCEDG.

Supervisor Chairman Gary Folluo said he’d like to see the county’s contribution cut to $100,000 annually. With the $10,000 reduction, the county is allocating $200,000 to the LCEDG in the next budget year beginning July 1, 2019.


“I think Lee County needs to always be involved in economic developments, but I would be comfortable getting the contribution of taxpayers down to $100,000 over time, certainly not all at this time,” he said.

The county originally committed $400,000 per year and that was eventually whittled down to $210,000 last year.

“This has been kicked around and proposed by several different people over time. With the way the state is moving through the legislature, the backfill is in jeopardy every year. That fund will probably be around $180,000 for us.”

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Folluo originally proposed cutting the funding $25,000 on Thursday. He said he knows next year the state funding level to the county will drop, as well as other bills in front of the legislature that could hurt rural and general basic county funding.

Folluo said the LCEDG is getting more participation from industires and businesses in Lee County, which was the goal when they set the program up. The funding stream of LCEDG is set up for a private/public partnership.

“We’re in our second five-year stint of raising funds and we’ve had good participation and it exceeds that past five years.”

Dennis Fraise, chief operating officer for LCEDG, said after the meeting the cut brings the total of public contribution cuts to $60,000 in the past year. Fort Madison cut its contributions by $25,000 last year and then didn’t make that contribution and Keokuk followed suit cutting its contribution by $25,000.


“The flip side of that is in our capital campaign were gonna increase from $1.3 million to $1.45 million,” Fraise said.

But he said LCEDG will be paying $50,000 this year for site preparation studies to get a 2nd certified site underway in Lee County. A current site managed by the Fort Madison Economic Development Corporation is also working toward state site certification. The only currently certified site in southeast Iowa is in Middletown near the Iowa Army Ammunition Plant.

According to the Iowa Economic Development Authority, a credentialed Iowa Certified Site has relevant site-related data and documentation accumulated and is designated as “development ready”.

LCEDG board chair Dave Schwartz said the group was empathetic to budget constraints.

“Going forward that’s part of our ability to reach and do what we can do to represent Lee County in a lot of different facets. So I guess, if minimize is the right word, we’d like to go forward with as much of our budget as we can,” Schwartz said.

He said the uptick in participation from private sources is attributable to the work being done and cited the Iowa Fertilizer Co. as a product of that.

Board member Jenny Steffensmeier cautioned the board on not pulling back on the momentum that LCEDG and the county is seeing in terms of economic development.

“My two cents is that we have momentum going right now. It feels like we have traction and buy-in and some really important work that’s being done,” she said. “And I haven’t been around all these years, but who was doing this before. If we’re not doing it, who’s doing it?”

Fraise also said LCEDG has great momentum right now .

“I guess my charge would be if there’s ever a time to keep your foot on the gas, I think this is it from a workforce standpoint, and from a traction stand point,” he said. “We have great momentum right now. Our public/private partnership is outstanding and a real model for the state and I would like to see us continue that momentum,” he said.

Supervisor Ron Fedler recommended a compromise and suggested the $10,000 cut instead of a $25,000 cut.

Supervisor Rick Larkin, who ended up voting for the cut, said he didn’t think the time was right to be adding additional cuts to the board, especially in light of the work being done and the other cuts from public groups.

“You know the governor doesn’t come down here once or twice a year just because we’re doing economic development, but because we’re doing the best economic development in the state,” Larkin said.

“Just thinking economic development from public and private sectors, I think that’s a good combination and sends a positive message. And I don’t think we should be cutting their budget right now.”

In other action, the board reduced the Department of Veterans’ Affairs budget by reducing some travel expenses that Folluo said were a little inflated, amounting to about $2,000.

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