Danville awards $35,000 in matching funds to EDP

Published 11:57 am Thursday, August 31, 2017

In a 3-2 vote, Danville City Commission relaxed requirements on a grant it offered the Economic Development Partnership, meaning the city will now be giving the EDP at least $35,000 beyond its regular annual contribution.

The change adds some stability to a wobbly part of the EDP’s budget for the current fiscal year. The EDP budget anticipates receiving $40,000 from Danville for the matching grant, as well as $30,000 in new “Chairman’s Circle” donations that haven’t been raised yet.

Originally, Danville’s matching grant came with the requirement that new funds be raised by the EDP from sources other than the city. 

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That requirement was changed after a heated debate Monday, allowing the EDP to count $35,000 in funds held over from last year toward the matching grant. That secures all but $5,000 of Danville’s matching grant funds and covers half of the $70,000 in the EDP budget that wasn’t guaranteed to materialize.

The request for a change in the grant conditions came out of an Aug. 11 meeting between city and Boyle County Industrial Foundation members Greg Caudill and Alan Turbyfill, according to emails provided by Danville City Manager Ron Scott.

“The present policy as adopted during the city budget process specified that ‘new’ money was required to be provided by the EDP in order to qualify for the $40K grant funds from the city,” Scott wrote in an email to city commission members. “… However, as the prime intent of establishing the $40K grant was to encourage implementation of the RKG recommendations, the city commission may conclude it is more desirable to allow the EDP to use any funds carried over unspent from the last budget year in order to expedite implementation of the RKG recommendations (rather than first trying to raise funds to do so).”

Scott’s email noted that a main recommendation of the recently completed strategic economic development plan from RKG Associates is for the EDP to hire additional personnel. The hiring of Washington County Magistrate Hal B. Goode as EDP vice president fits with that goal, Scott wrote.

The EDP budgeted up to $75,000 to pay the new vice president’s salary. EDP Chair Ben Nelson has previously stated that if the questionable funding were not to materialize, he would recommend that the EDP board cut in other areas in order to keep the new staffing level.

When the issue came up on Monday night’s agenda, Commissioner Kevin Caudill made a motion to allow carryover funds  to be used for the matching fund conditions, “in order to get discussion going.”

Ben Kleppinger/ben.kleppinger@amnews.com

Danville Mayor Mike Perros was able to convince Commissioner Kevin Caudill to second a motion Monday that passed 3-2, allowing $35,000 in matching grant funds to be given to the Economic Development Partnership from the city.

Mayor Mike Perros asked if Kevin Caudill would consider modifying his motion to specify that it would be a one-time change, and that the $40,000 matching grant is “intended to be a one-time deal, and not intended to be a ramp-up of our annual contribution.”

“I’m OK with that for this one transaction,” Perros said.

Commissioner Caudill said stability of the EDP budget is important for its success.  He couldn’t get on board with the proposed change and his motion ultimately died for lack of a second.

Commissioner Denise Terry was against the idea of changing the grant conditions.

“Ben Nelson assured us at an EDP meeting that he had a plan for new money,” Terry said. “The word ‘new’ has always been in there and he assured us he had a plan. And now, apparently they don’t, and they’re asking us for more money.

“That will put us up to $250,000 to EDP in the last year. $145,000 that we upped from last year (by) $20,000; we paid $65,000 of the strategic plan … and now they’re asking for $40,000 more. That’s $250,000 that the City of Danville has given alone. How much is enough?”

Caudill said he looks at the money given to the EDP “as an investment.”

“Everybody has their opinion, I just think we need to get the thing off ground zero,” he said.

“But if we’re going to spend $250,000 for EDP, we could pay two, probably three people, for less than that and we can control it, we can manage it and we can measure it, and we can benefit,” Terry said.

“I disagree with that, but that’s OK,” Caudill said.

Perros attempted a new motion — “you can not second it or vote it down; it doesn’t matter.”

“I would make a motion that we grant (that) the $35,000 leftover money be used to access $35,000 out of our $40,000 grant as one time only. This time only,” Perros said. “Next year, at budget time, we will have a decision about whether that $40,000 grant actually gets included in the budget again, or not.”

“Again, that kind of goes back to the stability,” Caudill said, before declining to second Perros’ motion.

Perros’ motion then also died for lack of a second.

“Looks like we could move on to the next agenda item, huh?” Commissioner Rick Serres said. “I’m going to agree with Commissioner Terry on what we’ve invested in the EDP and I think (we’re) backing that group pretty well … we don’t talk about some of the things the city has done to help the efforts of the EDP in matching grants for BCTC, the expanded water line out at the industrial park — I think we’re doing a lot here.”

Caudill said the $65,000 the city spent for the strategic plan is not a recurring expense. “Yes, that’s what we spent, but that’s not necessarily what we’re going to spend.”

“I think the city has more than proven our commitment to economic development,” Terry said.

“I disagree,” Caudill responded. “We have never been behind them. It’s always been something. Put your foot out and shoot it.”

“Let’s talk about money,” Terry said. “We have given money every time they have asked. And now they’re asking for more. I don’t think the other partners have done their part.”

Terry reiterated that EDP Chair Nelson told city commission members “that he had a plan to raise the money” to meet the matching grant requirements.

City Attorney Stephen Dexter stepped in to note that with two motions that both died for lack of a second, the city commission would be free to move on.

“You don’t have to take a vote to affirm what already exists,” Dexter said. “… You’re free to make any other motions, but if no motions are successfully made, then you simply move to the next agenda item.”

“I say we move to the city manager’s report,” Terry said, referring to the next item on the agenda.

Ben Kleppinger/ben.kleppinger@amnews.com

Danville City Commissioner J.H. Atkins presided over Monday’s commission meeting, due to a late arrival by Mayor Mike Perros.

“I’d like to reiterate my motion, please,” Perros said.

“OK, Mr. Mayor,” said Commissioner J.H. Atkins, who was serving as the presiding officer for the meeting.

“My motion would be that we allow a one-time-only gesture of good faith, that $35,000 be used to access $35,000 out of this $40,000 grant, and I underscore that it’s a one-time-only transaction.”

This time, Caudill was willing to go along.

“I will second that,” he said.

City Manager Scott then made some comments to the commission.

“Our efforts to be more successful at economic development hinge upon the additional staff to carry out the pages and pages of work, implementation that the RKG report generated,” he said. “This will help us get it started. There are no guarantees that the city manager will recommend or the city commission will adopt any $40,000 grant in the future. So this is for the present moment, for attempting to move forward with the initial implementation of RKG.

“How far we get, what else is going to be necessary — those are all future issues to be determined. But I do think despite the grant being established, perhaps as a response to citizen objections about new staff, new expenses, etc., if we were sincere in really trying to develop the RKG study and improve economic development outcomes, this is a reasonable modification simply to say, ‘at this present point in time, we will grant that match to any moneys that are there, regardless of where they came from.’ Next year is a whole new ballgame.”

Terry requested a roll call vote on the motion.

Terry and Serres voted no; Atkins, Perros and Caudill voted yes.