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Economic development, agency by agency in Tri-State area

March 18, 2013

There are different models of economic development organizations in the Tri-State area and beyond, some operating as organs of county government, others as independent authorities or public-private partnerships and, in the case of Washington County, a hybrid of a government department with a board of directors largely from the private sector.

Following is a look at several of them:

 
Washington County

Agency: Hagerstown-Washington County Economic Development Commission

Operational status: Government agency with a 12-member board of directors, mostly from the private sector.

Headed by: Executive director position is vacant. Economic development team staff is under the management of County Administrator Gregory B. Murray.

Size of staff: The EDC office will have five positions once fully staffed, with assistance from a small-business specialist who works for the state and two members of the county Department of Public Affairs and Community Development assigned to economic development work.

Annual budget: Approximately $440,000 in county funding.

Biggest success in 2012: A business visitation and retention program in which EDC members visited about 50 businesses to gauge their needs and learn about their plans.


The Hagerstown-Washington County Economic Development Commission is an agency of county government, although it receives much of its direction from a 12-member board of directors. Many of the members represent area businesses and business organizations, board Vice Chairman Ron Bowers said.

The EDC has undergone restructuring since its former executive director, Timothy Troxell, was dismissed last year. Afterward, the EDC had consultants prepare an economic development strategic plan. The EDC is in the early stages of deciding what recommendations to implement.

On March 14, the board of directors voted to recommend that the Washington County Board of Commissioners hire a strategic plan coordinator to work with the EDC, county staff and economic development organizations to put the plan into action.

Before that happens, the county commissioners have asked that the EDC develop five priorities. The EDC board indicated March 14 that the organizations interviewed for the strategic plan should submit their lists of priorities to the EDC by the end of March.

A special EDC meeting to consider the priorities of the various stakeholders is tentatively scheduled for April 8.

— Don Aines


Franklin County, Pa.

Agency: Franklin County (Pa.) Area Development Corp.

Operational status: Public-private partnership, with an emphasis on private involvement.

Headed by: President Mike Ross, with a 15-member board of directors.

Size of staff: Five full-time employees, including Ross.

Annual budget: $1.5 million, most of that income from its own investment projects, and through its low-interest loan fund; some private contributions.

Biggest success in 2012: Retention of World Kitchen in Antrim Township, Pa.; kept 400 employees and spurred $18 million in renovations to facility on South Antrim Way south of Greencastle.

 
The Franklin County (Pa.) Area Development Corp. is a public-private partnership, with an emphasis on private involvement, President Mike Ross said.

“Because we have Franklin County in our name, a lot of folks, I believe, think we are funded by the government,” Ross said.

With a budget of $1.5 million a year, the FCADC gets a fraction of its funding from the county, Ross said. In fact, county funding was cut a few years back by 8 percent to $82,800 a year, and state funding is limited to $15,000, largely because of the strings attached, he said.

The FCADC derives most of its income from its own investment projects, through which it owns and leases property and buildings to businesses. Income also comes through its low-interest loan fund and some private contributions, primarily from financial institutions, Ross said.

As far as its own development projects, Ross said the FCADC is not trying to compete with private developers.

“We’re taking on projects where the operating companies may not be Triple-A tenants,” Ross said. These are companies whose returns might not “develop the returns a private developer might want,” he said.

Being a public-private partnership, the FCADC also has some flexibility not available to a government department or agency, Ross said.

“On the face of it, it sounds clandestine ... but we’re not subject to the same operating procedures as a county government would be,” Ross said. “We can do things, oftentimes more confidentially, which in our world is a big thing.”

Companies that are exploring an expansion or a new location often want to conduct that exploration confidentially, for a variety of reasons, before making a commitment and announcing a project, Ross said.

With a government agency, “it typically involves a lot more public debate and buy-in,” he said.

The FCADC recently restructured its bylaws, reducing the membership of its board of directors from 25 to 15, Ross said. Each of the three Franklin County Commissioners has a permanent seat on the board, along with five representatives from community based-organizations, and the president of the Franklin County Farm Bureau, with six members to be elected at-large, Ross said.

Previously, the five Chambers of Commerce — Chambersburg, Waynesboro, Greencastle, Mercersburg and Shippensburg — and the five associated economic development organizations were represented on the board, Ross said.

Now, it is one or the other from each community, with those organizations making the choice as to which will be on the board, he said.

One of the biggest responsibilities for any economic development organization, Ross said, is to be the readily identifiable “go-to” organization for companies seeking help.

“Let’s assume you’re in the mix on a project,” Ross said. When that’s the case, prospective companies “need to have someone they can call who is essentially their liaison with the community” to answer questions about sites, utilities, taxes, zoning and other issues.

“Somebody has to do that ... To use a basketball analogy, we’re the point guard,” getting all the parties involved, Ross said.

There are many factors that make up an economic climate, and the business along the Interstate 81 corridor is a good one. Whether a Macy’s distribution center in Martinsburg, W.Va., or a Norfolk Southern Intermodal Facility near Greencastle, Pa., the jobs they create will reach out across state and county lines, he said.

Still, there are a few things Ross and his staff have learned since the FCADC was created and he was hired in 1986.

“I tell them, ‘I’m paid to tell you this is the greatest place on earth,’” Ross said of his role as president of the FCADC. Then he tells prospects, “What we want you to do is talk to other employers out there” without FCADC representatives present.

— Don Aines


Berkeley County, W.Va.

Agency: Berkeley County (W.Va.) Development Authority

Operational status: Independent public corporation.

Headed by: Executive Director Stephen Christian, with a 21-member board of directors.

Size of staff: Three full-time employees, including Christian.

Annual budget: Approximately $400,000, with the bulk coming from the sale and leasing of industrial park properties and other contracts.

Biggest success in 2012: Expansion of the Tabler Station Business Park to include adjacent properties for future growth; increased from 260 available acres to about 580 available acres between Interstate 81 and Eastern West Virginia Regional Airport.


The Berkeley County (W.Va.) Development Authority is chartered by the state as an independent public corporation, said its Executive Director Stephen Christian.

“We are a public entity. We are not part of Berkeley County’s government,” said Christian, although the Berkeley County Council appoints its 21-member board of directors.

That structure “allows us some independence and flexibility in operation,” he said, noting that all organizational decisions are made by staff or the appointed board. “And I think that’s important.”

The board is made up of business leaders, as well as the mayor of Martinsburg, W.Va., and representation from the Berkeley County Board of Education, Christian said. One member of the council sits on the board, but has one vote, the same as each of the other 20 members, he said.

In addition to his position, Christian said the authority’s staff includes Business Program Manager Kathy Mason and Office Manager Stephanie Godley. It generates most of its own operating income, with just 13 percent of its approximately $400,000 annual budget coming from government sources, he said.

Similar to the Hagerstown-Washington County Industrial Foundation, or CHIEF, the authority owns and manages industrial parks, including the Tabler Station Business Park off Exit 8 of Interstate 81 and the Cumbo Yard Industrial Park at Exit 16, Christian said. The bulk of the authority’s funding comes from the sale and leasing of industrial park properties and other contracts, he said.

— Don Aines


Frederick County, Md.

Agency: Frederick County Business Development and Retention Department

Operational status: County-level department; operates under the umbrella of Frederick County’s Community Development Division.

Headed by: Department Manager Helen Riddle.

Size of staff: Six employees (five full-time; one part-time), plus a Small-Business Development Center counselor (funded through partnership with Frostburg State University).

Annual budget: $919,313, fully funded through Frederick County government.

Biggest success in 2012: Location of new Social Security Administration data center in Urbana, Md.; 400,000-square-foot building employs 200 people.


Nearby Frederick County, Md., runs economic development programs through its Business Development and Retention Department, operating under the umbrella of the county’s Community Development Division, said Helen Riddle, manager of Business Development and Retention.

The department has five full-time county staff members and one part-time employee, plus a full-time Small-Business Development Center counselor funded through a partnership with Frostburg State University, Riddle said.

Several staff members specialize in specific industries in the area, such as the growing biotech industry, agriculture, health care, commercial real estate and start-up companies, Riddle said.

Riddle said the department also employs a research specialist, who handles all data collections and manages social media accounts, and a business development specialist, who essentially works as a “salesman” for the county to its various businesses.

“Our department is sales, so the No. 1 rule in sales is keep the customers you already have,” she said. “We don’t want to lose the businesses we already have, so he’s (business development specialist) out there ... turning the stones over to see if anyone’s not happy.”

While some large employers — mostly in the mortgage business — have departed in recent years, Riddle said biotech industries have continued to expand in Frederick County, both in workforce and facilities.

“We were very happy during those tough times to have those companies continuing to expand,” she said. “We’ve seen, I would say in the past year, a real flavor for entrepreneur spirit in Frederick. A lot of the businesses we’re working with are 50 employees and less.”

Something Riddle called “business hoteling” also has gained popularity in Frederick, Riddle said, explaining that the model involves a company offering space to other businesses at low costs.

Does having a vibrant and robust downtown environment in the City of Frederick improve developer and investor confidence in a county overall? Riddle said she thinks so.

“I work in Frederick City, so when I’m meeting with a prospect it’s amazing when they walk in and the first words out of their mouth is, ‘I love your Market Street.’ ... Frederick City sells itself,” she said.

Riddle gave credit to Frederick City staff members who have done well to meet the needs of businesses downtown.

“It didn’t happen by mistake,” Riddle said. “There are really good plans and really good support to keep downtown Frederick, ... and the city as a whole, vibrant.”

— C.J. Lovelace


Somerset County, Pa.

Agency: Somerset County (Pa.) Economic Development Council.

Operational status: IRS-designated private non-profit 501(c)(6) organization.

Headed by: Executive Director Gary DuFour, with 24-member board of directors.

Size of staff: Two full-time, including DuFour.

Annual budget: $216,061, funded primarily through membership dues, loan administration and property sale revenues.

Biggest success in 2012: Working to retain and relocate jobs for companies within the area’s coal and medical supply industries; also helping with facility improvements.


The Somerset County (Pa.) Economic Development Council is an independent private organization, designated as a 501(c)(6) nonprofit by the Internal Revenue Service, according to Executive Director Gary DuFour.

DuFour is joined by Assistant Director Debbie Gary-Taskey as the only two paid employees of the EDC, which receives direction from a 24-member board of directors.

DuFour said the board of directors has 12 members from permanent organizations, such as the county, financial institutions and utility companies, and 12 members who are elected by geographical region — north, central and south.

Although most of the organization’s funding of about $216,000 comes from membership dues, loan administration and property sale revenues, Somerset County government supplies some funding, including $32,000 in the current fiscal year, DuFour said. The EDC’s charter was amended several years ago to include seats for the three county commissioners, he said.

“We work with them very closely,” DuFour said of county leadership.

The organization dates to 1957, but the next couple of years might prove difficult financially, DuFour admitted.

“Our real estate isn’t moving,” he said. “That used to be one of our prime generators.”

It’s been a struggle to retain businesses in the county with the current economic climate, DuFour said, noting that he doesn’t know “anybody regional that’s having a ... great year.”

“I think we’re all working under the same struggle,” he said.

DuFour said location traditionally has been a strength for Somerset County, located in a largely rural region southeast of Pittsburgh and north of Frostburg, Md., near the Pennsylvania-Maryland border. The area’s major industries include coal, logistics, transportation, distribution, tools and customized trucking services.

“We have a lot of the smaller, more specialized businesses,” DuFour said.

Although the EDC has historically operated with a small staff, DuFour said the organization has positive working relationships with economic development entities in the surrounding area, and is part of a six-county cooperative called the Southern Allegheny Business Resource Network.

“We’re able to draw on the resources of the member organizations as well as make referrals to one another,” he said.

DuFour said the EDC also receives help through the Small-Business Development Council at St. Francis University in Loretto, Pa.

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— C.J. Lovelace

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