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EDP discusses new partnership agreement

The Economic Development Partnership voted Wednesday to move forward on creating a new memorandum of agreement between its partners, since the existing one expired June 30.

EDP Chair Ben Nelson said he’s “volunteered pro bono for the last two to three cycles to facilitate the partnership’s dialogues on what it would take for us to work together.” The document, referred to as an MOA, outlines the terms and conditions of the agreement of services provided by the EDP to its partners, he said.

The EDP partners include the Industrial Foundation, Chamber of Commerce, Convention & Visitors Bureau, Heart of Danville, Boyle County Fiscal Court, the City of Danville, Main Street Perryville, Junction City and City of Perryville.

“We intentionally set out to reorganize this board as partners. The plan is intended to change the composition of this board and the dynamic of the partnership, and we’re well on our way to doing that,” Nelson told the board. “And so the question becomes: what do you all want to do with this memorandum of agreement that is probably in need of some rethinking?”

Earlier in the meeting, the board agreed to obtain independent legal counsel for advice needed on some questions about what a public-private partnership can and cannot do legally.

Board member and Danville Mayor Mike Perros asked if it would make sense to extend the existing MOA through the rest of the calendar year as the EDP seeks answers from legal counsel.

“We should have a legal opinion — or a second legal opinion — and that gives the Executive Committee time to address any changes that we might want to do,” Perros said. The Executive Committee could have time to decide whether an MOA is appropriate or if an interlocal agreement is needed, instead, he said.

Nelson asked if the board wanted to hold the current MOA in place to keep the partnership solvent while the questions are resolved.

“We intentionally said the Heart of Danville, Chamber of Commerce, CVB, Main Street Perryville — they would become advisory partners,” Nelson said. “What that meant to us is, you all go do your jobs. Don’t worry about the governance of the partnership. You all go do your job. You’re here, you’re on the team, you have a voice, you matter … but you were spending so much energy trying to force collaboration. We said let those go do their mission.”

“I don’t want to be a pain,” board member Harold McKinney said. “But we don’t have the authority to approve (a new MOA) on our own.”

He said the individual partners would need to vote to approve a six-month extension to the MOA.

Jody Lassiter, president and CEO of the EDP, explained the MOA is only the statement of the partnership’s mutual responsibilities and obligations to one another. He said the articles of incorporation as well as the partnership’s bylaws are what bind; the MOA is “more or less the contract on how we serve one another. So, just to give everybody some insurance that we’re not under an unsupportive roof.”

“So, with that, would you not have an MOA? Or go with (McKinney’s) recommendation and say let’s go back to our governing bodies and say, ‘let’s have an extension?’ How do we gauge? What’s the rules of the road on how we work together?” Nelson asked.

Board member Alan Turbyfill pointed to the fact that the MOA is no longer accurate.

Nelson said the dream is “we just write a memo and say you know what? We’re going to work together … that we didn’t have to have a 30-page document drafted on the practice of how we talk to each other. Alan, are you suggesting we’d let it expire and work on something new?”

Turbyfill said exactly — “Those entities aren’t going to accept it if it’s not accurate.”

“So, would you still need the CVB’s signature?” CVB director Jennifer Kirchner asked. Nelson said yes, if they want to remain a partner.

“I would agree with Alan. I wouldn’t assume the CVB would re-sign this for six months without asking …” Kirchner said.

“So it sounds to me like you’re advocating that we stand down on extending the as-is document and work on generating a new and improved document, and we’re OK to keep working together in good faith, is that where we’re at?” Nelson asked. “We will imagine a new document and take it to our nine governing bodies for approval.”

The partnership agreed.

“We are moving forward, and this is expired,” McKinney said. “We still are living under a ‘supported roof,’ as Jody so eloquently says.”

Lassiter reminded the board it still hadn’t gotten payment from Junction City for the “$1,500 and change which is now due for this fiscal year, if they want to be a bona fide partner of the EDP Partnership.”

In other business

• Committees: Nelson reviewed past-appointed members to the Asset Development and Workforce Development committees, as well as the Executive Committee. Those committees, he said, have been formed and meeting for some time.

The Marketing and Finance committees are in the process of being launched, too. There are a total of five committees Nelson said the partnership envisions helping to do its work.

As far as the Finance Committee, Nelson told the board Ron Scott (Danville’s city manager) has offered to serve, as well as citizen Tom Poland. Turbyfill will chair the committee, Nelson said, and appoint further members.

“The role of this committee is to advise this board in human resource management and financial oversight,” Nelson said.

The Marketing Committee will work to help facilitate ideas to generate business recruitment to the area. Marty Gibson and Mayor Perros will co-chair.

“Membership of these committees should be determined by the chair of the committees. I just get them started and recommend people,” Nelson said. He said all should be “dynamic in membership.”

“We need to get the core group launched so we can get started getting this work underway,” he said.

• Independent legal counsel: A month ago, the board agreed to research obtaining legal counsel to review several questions it has it thinks are “worthy of an independent legal opinion,” Nelson said.

Part of the issue leading to obtaining legal counsel is concerning past debates about whether or not the board could legally pay an incentive to former EDP vice president, Hal Goode, who is no longer with the partnership. The incentive payment to Goode, if he had stayed and the EDP had paid it, would have been 10 percent of an estimated $45,000 in new private contributions he had helped raise during his short time as VP.

Board member Gibson said a law firm out of Lexington, Stoll Keenon Ogden, with expertise in dealing with corporations both public and private, would analyze that question and others, and it would cost up to $1,500. The board unanimously voted to move forward with contracting the firm.

After the meeting, Nelson explained the funding of the partnership budget is shared; all nine partners are asked to “pitch in.” He and Lassiter said the current budget is 58 percent private and 37 percent public, plus other reimbursements for shared expenses that represent 5 percent of total income.

“If you count revenues only — at $372,500 — then it is 38.8 percent public and 61.2 percent private,” Lassiter said.

“So one of the basic questions we hope to answer would be something like ‘Does receipt of a minority portion of public funds (39 percent in the 2018-19 budget) dictate that all operations as a collective partnership of the nine organizations constitute a public agency as defined by law?’” Nelson asked. He said the newly reorganized board has encountered several issues as to what this private partnership structure can or cannot do.

“We have as a group agreed to abide by Kentucky sunshine laws, but have hit other issues we cannot get consensus on,” Nelson said. “These are examples of possible questions a neutral third-party law firm might help us clarify, as we all want to be buttoned up in our operations for the community’s well-being.”

• Year-end budget: Lassiter said he felt the report, showing that EDP ended the fiscal year with a net profit of $19,405, is important. “We’re not rich by any means…” Lassiter said, but current assets are higher than they were last year at this time.

For June 30, assets total $50,719. Last year at this time, they came in at $32,369.

“This net income is carried over funds from the chairman’s circle investments received,” Lassiter explained.

He said some payments last year were made according to companies’ and organizations’ calendar years, not the fiscal year, so they carry over to this year’s budget.

• Closed session briefings: The board went into closed session Wednesday to be briefed by Lassiter on the sites of the six remaining child daycare center projects. Lassiter said he also briefed the board on the finalist candidate list and the next steps for an offer for the VP/COO position, left open by Goode’s resignation.