Latest numbers on ‘The Big Switch’ show draft budget soars to $450,188 (up 26.2%); SPLOST dollars sought to rehab fire building for offices. City’s share would more than double annual chamber  contribution.

Latest numbers on ‘The Big Switch’ show draft budget soars to $450,188 (up 26.2%); SPLOST dollars sought to rehab fire building for offices. City’s share would more than double annual chamber contribution.

The Floyd County Commission is a file photograph from Facebook.

The story lines on The Big Switch:

  • The initial budget for the first year of operating the industrial recruitment office has jumped by 26.5 percent to $450,188 in just two months (they left out marketing in the original draft).
  • Those extra pennies you pay in SPLOST taxes set aside for economic development would provide the economics (money) to refurbish the fire garage behind the chamber for a new industrial recruitment office. That’s not the pitch that was made to voters.
  • And… didn’t the chamber just go through a massive redesign last year to make 1 Riverside Parkway even more attractive when hosting prospective businesses?
  • In the city of Rome’s case, the first year contribution to The Big Switch would be more than double what the city has provided to the chamber in each of the past five years. And that doesn’t take into account whatever money the city would send to the chamber when economic development moves from it to the Rome Floyd Development Authority.
  • Plus there’s been some tweaking of the formula — with Greater Rome Existing Industries, for example — and the job description of one of the new hires now is project manager sans GREIA ambassador.
  • And the Floyd County Commission, in a brief called meeting, blessed the concept of working with the city and Rome Floyd Development Authority going forward.

Here’s the longer version:


 

The Floyd County Commission, by a 4-0 vote, has endorsed a second take on “The Big Switch,” a concept that takes economic development from the Rome Floyd Chamber and puts it under the Rome Floyd Development Authority. Already approved following a contentious Rome City Commisson meeting on Monday, the idea now needs review and a final blessing from the development authority.

As reported Saturday by Hometown Headlines, the city, county and development authority would each contribute $150,000 initially to create the industrial recruitment team. What’s new Thursday from that meeting: Several hundred thousand dollars will be needed to make “The Big Switch,” including the tapping into SPLOST funds earmarked for other projects, most likely real estate and infrastructure needed to lure new jobs.

Based on the draft budget shared at Thursday’s county meeting, they’ll need that $450,000 from the city, county and development authority — and a few dollars more. The figure presented Thursday, for $450,188, already is 26.2 percent higher than the first draft presented by City Commissioner Sammy Rich in November. The biggest change over those two months: $95,000 for marketing (nothing was included in the first draft other than $1,000 for “advertising” which remains in draft no. 2). A couple of other budget items were tweaked as well, according to the copies posted by WRGA (below). What’s missing: What happens in years two through five and beyond.

So how much more will it cost taxpayers? Let’s use the city of Rome as an example. Hometown Headlines filed an Open Records Request with the city for several packets of information, including economic development funds since 2014.

  • In that budget year, Rome paid the chamber $38,500 for economic development, $40,000 for the Partners in Progress Campaign and $1,775 in annual dues.  Total: $80,275.
  • Between 2015 and this year, the city trimmed $10,000 annual from Partners in Progress. The annual chamber annual payment was $70,300 (although one year shows no dues paid and another shows $1,550 in expenses for the annual chamber trip to Washington, D.C.
  • Under The Big Switch, the city is pledging $150,000 to the Rome Floyd Economic Development Authority — more than twice the annual chamber allotment. What we don’t know yet: How much goes to the chamber in the new reality?
  • We’re still awaiting the county reports related to our Open Records Request.
Your SPLOST dollars at work? The latest  proposal calls for funds from the extra penny sales tax to rehab this building behind the chamber to house the new industrial development team. Hometown photo.

What’s new from Thursday’s meeting:

SPLOST dollars would be used to renovate the “government-owned fire building behind the chamber.” As reported by Hometown Headlines on Saturday, the garage-like structure was targeted for economic development use but the question was funding. None of the recent SPLOST packages mentions such a project but there are millions available or due in soon that likely would be tapped for such purposes — even though those funds were specifically real estate purchase and infrastructure.

The development authority would work with existing chamber staff until a new team is hired. Al Hodge, the chamber’s president and chief executive officer for 21 years, announced last fall he would be “retiring” in April; he no longer reports to work at the chamber office at 1 Riverside Parkway as of Jan. 24 but is on call through his notice period. Jeanne Krueger has been appointed interim chamber director.

The bottom line as we see it:

“The Big Switch,” at minimum, will cost taxpayers an extra $300,000 in the first year. And that’s just for the same duties the Rome Floyd Chamber has performed for decades. The math is weird on this but as we see it:

  1. The new industrial team budget is $450,188 not counting the thousands of unbudgeted SPLOST dollars that would go into refitting the “fire building” behind the chamber (we estimate a low six digits).
  2. Some of the combined $300,000 city and county dollars possibly could be made up from the $200,000 the two governments already contribute to the chamber each year (that’s the combined amount, not individual).
  3. If that’s the case, we’re still looking at more than $300,000 in new expenses (half from the development authority’s $150,000 kick-in, which didn’t have such expenses prior to The Big Switch proposal).
  4. And, if so, how would the chamber compensate for the loss in budget? Possibly the loss of positions currently tied to economic development even though the proposed action plan contains several references about the chamber still being somewhat involved in the process.
  5. We have copies of both the revised budget draft and original draft below for your review.

Here’s an expanded report on the meeting from WRGA:

The Floyd County Commission has joined the Rome City Commission in approving a new concept for economic development. During a called meeting on Thursday, commissioners rescinded a previous action to create a new economic development authority and approved a model which would see the already established Rome-Floyd Development Authority providing industrial recruitment services in the community.

“We made a recommendation that came out of the Joint Services Committee back in November and there had been a lot of discussions back and forth,” said County Manager Jamie McCord. “We were pretty much on the same page but we were asked by the city to take a second look at it. We did that and continued to work on this to come up with a solution that’s best for everybody to make economic development stronger in our community.”

The next step will be for the concept to be approved by the development authority.

“I think we are all in a good position going forward,” McCord added. “I’m sure there will some changes, as with anything that we do, it will be fluid. There may also yet be some details to work out, but I think we at least have a path we are going down, and we will work on that going forward.”

Initially, funding will come from the city, the county and the development authority with each paying $150,000 each.

“I think it’s a somewhat aggressive budget,” McCord said. “I don’t think we’ll get anywhere near that the first year. It’s not unlike the process we have now. The Chamber submits a budget to us and we either approve or deny it. It’s been a fluid process. It’s been much more than it is now and it has been much less. It’s probably average now with what has been done historically.”

You can view the proposed model and get more information below.


INDUSTRIAL DEVELOPMENT DRAFT BUDGETS: Jan. 14 (on top) vs. Nov. 27 (second file).

  • The biggest difference: $95,000 for marketing, which wasn’t included in the first draft.
  • Overall budget grows to $450,188 from November estimate of $356,688 — a 26.2 percent increase in two months.


DRAFT Economic Development Budget November 27, 2018 (provided by City Manager Sammy Rich)

Economic Development Operating Budget Original Appropriation
Payroll* $235,000
Retirement $30,550
Insurance Group Health $30,540
Workers Compensation $1,440
Social Security $14,570
Medicare $3,408
Postage $500
Office Supplies $1,600
General Operating $300
Technology Equipment $1,000
Food $5,000 (January budget cuts this by $500)
Uniforms $0
Small Tools $0
Service Contracts $2,200
Gas and Oil $0
R&M Internal $0
Prof Serv Medical $100
Prof Serv Legal $1,000
Prof Serv Other $300
Utilities Electrical $1,400
Utilities Telephone $2,000
Utilities Natural Gas $0
Utilities Water and Sewer $100
Garbage Collection $80
Advertising $1,000
Dues & Subscriptions $2,000
Printing $500
Business Travel $10,000 (cut by $1,000 in January budget)
Training & Education $3,500
Miscellaneous $200
Vehicle Allowance $8,400

What’s new: Marketing at $95,000

Total Economic Development $356,688
*Payroll Includes:
Director of Economic Development $130,000
GREIA Liaison/Project Manager $65,000
Administrative Assistant $40,000
Salaries Subtotal $235,000
This draft budget was created based on the 2019 budget variables for the City of Rome.

 

 

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