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Home My WebLink About32. 14-144 MARCH 25, 2014 14-144 RESOLUTION (CARRIED___6-1____ LOST _______ LAID OVER _______ WITHDRAWN _______) PURPOSE: APPROVE BUDGET ADJUSTMENT FOR COMMUNITY DEVELOPMENT INITIATED BY: CITY ADMINISTRATION WHEREAS, Whereas, in 2012 the Oshkosh Common Council directed its City Manager to study how economic development services could be centralized within the Oshkosh community; and WHEREAS, the City hired the Prager Group to conduct an analysis of best practices for economic development with the City of Oshkosh, and involve the cooperation of many stakeholders throughout the Oshkosh community to provide input into this study; and WHEREAS, the Prager Study recommended a public-private partnership as a model to improve economic development in the greater Oshkosh area; and WHEREAS, the Prager Study identified the need to have all levels of public and private entities involved in economic development; and WHEREAS, the City currently funds its economic development services through a variety of contracts and grants to other entities on behalf of the City of Oshkosh; and WHEREAS, in order to centralize economic development services within the Oshkosh community, the City needs to centralize its own resources and designate a repository of information and services that will be available to existing and prospective businesses for the City of Oshkosh; and WHEREAS, a budget adjustment is necessary to reallocate resources within the City of Oshkosh so that the City’s resources are centralized, thereby making the City’s economic development program more effective in accordance with the Prager Study; and WHEREAS, the City of Oshkosh believes that consolidating its own public resources will help make for a stronger public-private partnership with all of the City’s economic development stakeholders. MARCH 25, 2014 14 -144 RESOLUTION CONT'D NOW, THEREFORE, BE IT RESOLVED by the Common Council of the City of Oshkosh that: 1. A budget adjustment in the amount of $115,000 is approved, with the resources being allocated as follows: Increase Acct. No. 100 - 0730 -4811 -00000 Community Development TIF by $15,000 Decrease Acct. No. 100 - 0730 - 6466 -00000 Misc. Contractual Services by $100,000 Increase Acct. No. 100 - 0730 - 6102 -63XXX Payroll — Direct and Indirect by $115,000 2. That staff be directed to employ the necessary staffing and resources to consolidate the city's economic development resources within the Department of Community Development; and 3. That the city of Oshkosh continue to work with its economic development partners, including but not limited to the GO -EDC effort, to engage public and private entities in more effectively delivering economic development services to the Oshkosh community. OYHKOf H ON THE WATER TO: Honorable Mayor and Members of the Common Council FROM: Allen Davis, Community Development Director DATE: March 19, 2014 RE: Budget Adjustment for Community Development X -; • Economic Development is a very high priority for the City of Oshkosh. The City's Strategic Plan identifies multiple goals and objectives related to economic development. Economic development plays a very important role in the City's Comprehensive Plan. In addition, the City Council has identified goals for the City Manager that included centralizing economic development efforts and creating performance measures. In the past, the City has depended on two economic development partners, partially funded by the City — Chamco and the Chamber. Chamco has received direct funding from the City and received a commission on industrial land sales. The Chamber, (operating as OAEDC for many years) received funding that transitioned to commissions on business park land sales. This funding formula for the economic development activities seems to have fragmented the City's economic development strategy and effectiveness over the years. This situation was documented by the Prager Study in 2012. The recently created Greater Oshkosh Economic Development Commission (GOEDC) remains a viable strategy for centralizing economic development efforts and increasing our effectiveness. In the mean time, the City should stop contributing to the fragmentation and concentrate its efforts in making itself a better and more effective partner in economic development. To that end, I am proposing to create three economic development positions in the Community Development Department. As a result, a budget adjustment within Community Development is required. Instead of contracting with CHAMCO and the Chamber, the City's resources will now be concentrated in the City's Economic Development Division. The new positions include an Economic Development Manager, an Economic Development Analyst, and an Office Assistant. The City also created the Economic Development Specialist — Expeditor, position two years ago. The reasons for creating these positions are: • More effectively market the City's assets including industrial parks, business park sites and redevelopment sites. • Provide a 1 -stop, point of contact for economic development services. • Improve the City's business retention and expansion activities. • Improve the City's economic development effectiveness which will then strengthen future public /private partnerships. • Create and provide economic development performance measures to the community and City Council in order to demonstrate the City's accountability for our economic development efforts. FISCAL IMPACT The budget adjustment required is $115,000 and is based on creating the positions on April1, 2014. The budget adjustment includes: 1. The City will reduce the contract with Chamco to $50,00.0 and only include Chamco's efforts related to the development and marketing study for the Aviation Business Park and Accelerator Project. Chamco has been instrumental in both projects. The remaining contract services funding of $100,000 will re- allocated to this economic development program. 2. The City has recently received several grants that will pay for City staff to administer the grants, and that additional $15,000 in revenue will be allocated to Economic Development. 3. The City will not renew the industrial park and business park land sales agreements with Chamco and the Chamber and the City will not be paying commissions in the future. The Economic Development Division budget for 2015 and beyond will include a combination of reduced contract services, grant administration funds, transfer of housing administration funds, economic development time charged to various TIDs and the new Economic Development Revolving Loan Fund. The City's share of $25,000 for economic development marketing remains in the 2014 budget. The detailed breakdown of the budget adjustment is attached. RECOMMENDATION City Council approves budget adjustment for Economic Development Services. Approved, City Manager Current 2014 Budget Economic Development 2014 Director of community Development 107,700 Director of Community Development 107,700 Economic Development specialist 65,200 Economic Development Specialist 65,200 Economic Development Technician 15,200 Economic Development Manager 56,900 Grants Coordinator 53,700 Grants Coordinator 53,700 Overtime 3,000 Economic Development Analyst (.8) 29,90.0 PT Clerical Assistant 14,300 - Health Insurance 75,600 Office Assistant 24,400 Retirement 8.40% 21,600 Overtime 3,000 Social security 7.65% 19,600 Health Insurance 95,300 Life Insurance 800 Retirement 28,600 ICI - Social Security 26,100 376,700 Life Insurance 1,100 ICI - 491,900 Difference from 2014 Budget 115,200 Assumptions - Family coverage for 3 positons for 9 months. -Start date for 3 positions is April 1 (19.5 pp) - Prorated Life insurance for 3 positions Additional Resources Contractual services ($50,000 for Chamco) 100,000 Grant Administration (existing grants) 15,000 Land Sales - Commission? Total Additional Resources 115,000