Council eyes UCEDC funding

Written by Bill Rautenstrauch, The Observer March 07, 2013 07:44 am

by BILL RAUTENSTRAUCH / For The Observer

La Grande City Council ponders withdrawing funding for county development board

A budget battle looked to be shaping after the La Grande City Council’s Monday work session with the Union County Economic Development Corporation’s board of directors.

After UCEDC Executive Director Dan Stark spent time talking about activities in the last fiscal quarter, including unsuccessful attempts to attract businesses to either the Baum Industrial Park or the 

La Grande Business and Technology Park, Mayor Daniel Pokorney dropped a bombshell.

Pokorney said that during their recent annual retreat, city councilors talked about withdrawing funding for UCEDC, a non-profit corporation that works to foster economic development in
La Grande and throughout Union County.

Pokorney said the council questions whether UCEDC is effective in its work for the city, and wonders whether the $30,000 the city gives UCEDC should go instead to the city’s community and economic development department.

The department then would take over business recruitment, expansion and retention efforts and other economic development functions on behalf of the city.

“At the retreat there was talk that if we kept that money we could do more with it,” Pokorney said. “We’ve been doing this for a long time and it’s frustrating not to see more coming down the pike.”

The City of La Grande and Union County each contribute $30,000 to UCEDC.

The rest of the non-profit corporation’s operating budget comes from membership dues and interest on investments.

The city and UCEDC are partners in the La Grande Business and Technology Park, a 65-acre tract at the corner of Gekeler Lane and Highway 30 that remains almost entirely vacant six years after its construction. UCEDC is in charge of marketing for the park.

Giving a progress report Monday, Stark said that as part of business recruitment efforts, UCEDC sent some 2,500 postcards to businesses who might be thinking about relocating. The vast majority did not respond.

Stark said the campaign yielded four businesses that showed interest in the area and wanted to remain on the mailing list. He said the recruitment effort will continue.

Long-time UCEDC board member Steve Anderson, also present at the session, said the results were disappointing but not disheartening.

“I think the fact that we got four businesses is better than a jab in the eye with a sharp stick,” Anderson said. “I feel good about the effort but bad because we didn’t get a live one.”

Stark also said there has been an “uptick” in interest in the La Grande Business and Technology Park lately, but stumbling blocks remain. Those include the fact that all but 25 acres of the park lie within a flood plain, and also that only half of the park infrastructure is complete. The city’s urban renewal district spent some $2 million in park infrastructure, but another $2 million of work is needed.

Stark also talked in his report about Union County’s recent acquisition of a large lot industrial parcel at the Baum Industrial Park near Island City. The county bought that land with a $300,000 loan from UCEDC.

UCEDC President Mark Davidson said city money was not part of that loan. He said the money for the loan came from reserve accounts.

Stark said UCEDC recently had a serious inquiry from a company wanting to relocate to the Baum site, but the deal fell through because of family problems within the company. Stark defended the county’s decision to acquire and market the Baum property with UCEDC help.

He said large lot industrial land is scarce. The Baum parcel is particularly valuable because it is located adjacent to the Boise Cascade particleboard plant and to rail service.

“It’s going to be one of the prime pieces of industrial land in Union County,” he said.

A joint city council-UCEDC board discussion was on the work session agenda following Stark’s report. As it got underway, Pokorney brought up the possible withdrawal of city funding for UCEDC.

Davidson, who also serves as a member of the Union County Board of Commissioners, showed irritation. He said the city is an active participant on the UCEDC board, and that the partnership should be preserved.

“You bring us in, you grill us, then at the end of the meeting you say you’re thinking about pulling your funding,” Davidson said. “It isn’t all just us (UCEDC). Four of the people sitting here are your appointees. We’ve given our best effort. I challenge you that if you try to do it yourselves, you won’t do any better.”

Other UCEDC board members urged the council to keep the funding in place, saying the public-private partnership is important to the community.

“I think we need to remember that collectively we can accomplish more than if we’re going in different directions,” Davidson said.

Stark told the council the city money pays for staff time that would otherwise be more expensive. The services include management, maintenance and marketing of the La Grande Business and Technology Park, plus activities related to business recruitment, retention and expansion.

“The city is basically getting services for $22 an hour. That’s not a bad rate,” Stark said.

Questions about city funding for UCEDC are nothing new, as City Councilor Mary Ann Miesner pointed out during Monday’s session. Miesner said the council feels the time has come once again to explore other options.

“Every year we wrestle with this because we ask what we’re getting for the money. It’s been one of the frustrations the city has had,” she said.