By Ariella Cohen, The Lens staff writer
City Council leaders gave a cool reception Wednesday to Mayor Mitch Landrieu’s plan to finance an economic development office within City Hall as well as the new Nola Business Alliance, a separate nonprofit entity funded with a mix of public and private dollars to generate jobs and investment in New Orleans.
“I don’t see the need to have a city office of economic development working while we have Nola Business Alliance,” said Arnie Fielkow, City Council President and Chair of the Economic Development Committee, at Wednesday’s budget hearing.
The mayor is asking the council to spend $2.24 million from the city’s general fund to staff and operate an executive branch office that would focus on generating jobs and luring new businesses to New Orleans. The request comes on top of $1.5 million that has been set aside for the Nola Business Alliance to fulfill the same basic mission.
That cash comes from a separate economic development fund generated by a dedicated millage. While the mayor and his staff say both commitments are necessary if the city wants to see results, Fielkow and Councilwoman-at-large Jackie Clarkson voiced concerns about paying for duplicate services at a time when every dollar counts.
Why spend more of the city’s money when the business community has “the resources and the expertise,” Clarkson asked. Clarkson emphasized that while she doesn’t want to “privatize” economic development, she felt that the Nola Business Alliance was created in order to relieve the city of the need to operate a fully staffed city department. “We didn’t want to keep doing it the way we’ve been doing it,” she said.
Fielkow said that he believes the $2.2 million a year the city raises from the Economic Development dedicated tax is “enough to fund a business loan program, the Nola Business Alliance and a skeletal office.”
“It would save us $2 million in general operating money,” he said.
Chief Administrative Officer Andy Kopplin responded that both the alliance and the city department are needed to attract businesses and make over of the city’s economic landscape. The city department is charged with improving the city’s Disadvantaged Business Enterprise program and helping small businesses scale up for government contracts, as well as other responsibilities shared with the Alliance, Kopplin said.
“We can debate how we fund economic development,” Kopplin said, “but the fact is the city needs its own money and staff to make deals happen.”
The tension stood in contrast to the spirit of cooperation that has characterized previous conversations about economic development between the council and the administration. Since even before Landrieu’s election, the two branches of governments have agreed on the need for professionals from the private sector to be formally engaged in the city’s business retention and recruitment.
In August, the mayor announced the creation of the Nola Business Alliance. In a release marking the announcement, Landrieu described the alliance as “single coordinated effort” that would leverage the resources of government, the nonprofit sector and business.
A similar debate was seen Tuesday when Fielkow argued the city should not hire more New Orleans Recreation Department employees until after the public-private partnership charged with overhauling the city’s recreation program does its own assessment of the needs.
On literacy programming:
– The mayor’s budget includes $207,500 in general funds and $500,000 in federal grant dollars for adult literacy education. After council members asked the administration to explain how duplication of services would be avoided, Councilwoman Stacy Head said that the city should prioritize low-level literacy classes. “We have almost enough GED classes, but there are a lot of people that don’t have the literacy to get to that level,” she said, adding that she believes it is the city’s “responsibility” to educate illiterate adults. “The Department of Labor doesn’t take ownership. The Department of Education doesn’t take responsibility. We have to.”
– Councilwoman Clarkson and others asked the administration to ensure that there won’t be “overlap and underlap” of services. Clarkson notes she is expressing “20 years of frustration” with unaccountable outsourcing to nonprofit service providers.
On the Job 1 Program:
– Councilwoman Kristen Giselson Palmer reiterated a request made Tuesday that the administration explore collaboration with non-profit organizations that have the money in place for a program similar to Job 1.
– Head corrected Landrieu officials who said that only individuals living at 200 percent below the poverty level are eligible for the federal program. The requirement is that individuals participating in Job 1 can’t be more than 200 percent above the poverty level.
– The administration reminded the council that Job 1’s $7.6 million budget is paid for by federal grants, not general funds.
– Councilman Jon Johnson suggested working to bring big-box retail to Canal Street. The new stores would generate jobs, sales tax revenue and give people a place to shop, he said.
On the Mayor’s Office of Cultural Economy:
– The administration wants $489,405 for a new office of cultural economy that will promote industries related to the arts and media. Of that, $474,405 will pay for five employees and the remaining $15,000 will cover operating costs. The administration said this amount represents no more than the city in previous years put towards promoting film, art and cultural economic development via multiple other offices. The council didn’t say much about the proposal beyond voicing general support for supporting the city’s thriving cultural economy. Councilwoman-at-large Jackie Clarkson said that the “creative class” is essential to the city’s economic growth.
– On the Vieux Carre Commission
– – The budget proposes spending $496,870 on the French Quarter commission, $171,206 more than 2010. The council was generally supportive, citing the huge role of the commission in keeping the quarter safe and attractive for tourists. After a few minutes of conversation about permitting issues for businesses, Councilwoman Head asks about another troubling issue: “the gutter punks…the Vasser graduates with dogs and a trust fund.” No one seemed to know what to do about this problem. Head also inquired about “Phish fans” in the quarter before being told by an in-the-know council staffer that Phish broke up years ago, and the young denizens are on to other things these days.
On the city’s funding of Essence Festival
– To support Essence Fest, the city kicks in $250,000 in general obligation dollars and another $250,000 in public safety and overtime costs. In return, the city nets $5 million in increased tourism dollars, CAO Andy Kopplin said. The council had no response beyond a few supportive murmurs.
On the Arts Council
– Councilwoman Kristin Palmer urged the council to consider giving more than the budgeted $315,000 for the Arts Council, citing the importance of artists to the city’s tourism sector as well as its overall economy. Head echoed her call, noting jokingly that this is the first time she’s supported putting more taxpayer dollars to any one budget item.