Who’s Your Daddy?

A recent Newark Advocate local news story flew under the radar (disappeared from the screen quicker than…well, you know). Kent Mallett submits “Grow Licking County, Heath reach deal about economic development” (4-22-14). The name says it all. The city of Heath has been subsidizing the Licking County Chamber’s Grow Licking County (a “community improvement corporation”) to the tune of $10K per year. Now it has upped the payment to $12K with a bona fide written agreement, designating the “improvement corporation” as the city’s “economic development director.” ““I think it’s a great example for other communities going forward,” Hottinger said [“Cheri Hottinger, president of the Licking County Chamber of Commerce”]. “It’s no additional work. It’s just in writing.”” At the end of the short news report, Mr. Mallett writes “The CIC has written agreements only with the county and port authority, but it received funding from 25 sources in 2013 and at least 20 already this year. “It’s just been a little bit informal, and we want to formalize these relationships,” Licking County Commissioner Tim Bubb said.”

For those of you keeping score at home Mr. Bubb and the commissioners voted to fund the Chamber’s improvement corporation with revenue from an increase in the real estate transference fee. At start up, Grow Licking County was heralded as a public private partnership with the county providing 60% of the funding, private 40%. Like JobsOhio (upon which the Chamber’s CIC was modeled), private funding did not need to be disclosed. For those of you continuing to keep score at home, with the county transference fee “contribution,” public (tax payer generated) funding became 85% of the public private partnership income. Now we learn that the Chamber has been receiving even more public funds under the table (“It’s just been a little bit informal”). Individual municipal entities “contribute” to the public private partnership along with the already completely public funding provided by the county within which these entities are located (double your money, double your fun!).

For those of you still following the game, let alone the score, the Chamber’s “community improvement corporation” does PR with any and all business start-up or expansion news in Licking County. Not so much with down-sizing or shutdowns like Meritor or Advocate printing. The public is to believe that the Chamber is the sole agent of development in the area. No development or improvement takes place without their involvement. What is elided is that there is no fiduciary relationship, no fiduciary obligation, responsibility or contract here whatsoever (“we want to formalize these relationships” ?). Even more troubling is that agency, without fiduciary obligation, begs the question of who benefits? In the parlance of today’s economic imperative, the Chamber’s corporation is “Selling Licking County!” We are always told this is oh so necessary because it is so competitive out there. Let’s look at selling. Sales, whether real estate, automobiles, cameras, or banks (yes, banks sell money in the form of loans, like pawn shops do) looks different from the sales clerk’s side than it does from the buyer’s side. The sales clerk can sell “up” or “down” depending on the customer as well as sales commission incentives (and perks). A good sales person will use this technique to earn a greater return on their selling expertise. Sometimes the clerk can earn separate perks from the product’s source in addition to her salary as a sales agent. It’s just a little informal. So there is incentive to “promote” certain “desirable” offerings to a buyer while denigrating or ignoring less lucrative selections. Happens all the time. It is an integral part of private business within a capitalist economy. Does it work within a private corporation subsidized by a democracy? History tells us no, repeatedly. Steering and red lining within real estate and bank loan sales are as much a fact of America’s history as slavery and union busting. County funding is not enough for the Chamber. “It’s so competitive out there” has been used to justify selling Licking County to outside commercial interests. Now that same competitiveness requirement has been extended to include the individual membership within the county itself who need to contribute financially in order to sell themselves to those already tasked with selling the county. Who’s your daddy?

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Tags: Democracy