While it appears both organizations are leaning toward the management agreement, the meeting turned into a discussion of how both organizations are funded. It then turned into a discussion of expectations of at least some of the BCEDC members that the organization has a legal or moral right to City of Warren Sales tax funds. It was questioned as to what right the city council has to budget city tax revenues. Comments were made going back 25 years to when the sales tax was adopted by the voters.
The two organizations voted to write a letter to the Warren City Council's Community and Economic Development Committee and seek a meeting. A comment was made made that the sales tax could legally be recalled by petition vote.
The City sales tax was approved in 1994 as a general one cent tax. It is totally under the control of the Warren City Council and always has been, just like all city taxes and fees. At the time the tax was adopted the council, at the time, pledged they would split the monthly receipts in half and set up an economic development fund to be used to development industrial sites, industrial buildings and infrastructure, as well as use for recruitment efforts. That has been done for 25 years. After the tax was passed, the city council voted to enter a contract with the BCEDC for $150,000.00 per year to help recruit jobs. That contract was renewed annually from 1994 to 2018, with some adjustments in the amount. The BCEDC was paid around $1.5 million dollars over that time period. The city also bought industrial land and made investments in buildings and industrial infrastructure during that same time period. Funds have also been loaned to businesses to help equip plants and improve property.
In 2018, the city council did not renew the BCEDC contract for 2019, as the council decided, after 25 years, the city needed to consider more effective ways of recruiting jobs. The council has been working on a plan. Funds continue to be set aside for economic and community development.
Some time in the past the council also contracted with the Chamber and the Tomato Festival Committee to help promote the community, especially the retail businesses and the special events. In 2018 the council did not renew the Chamber contract but continued to contract to assist the Tomato Festival.
It should be noted that neither the Chamber or BCEDC are governmental agencies. They are non-profit corporations that are authorized to raise money by memberships and fund raisers, and have done so in the past. It was reported during the meeting the BCEDC has over $125,000.00 available at this time. Under state law the city can only contract for services one year at a time unless revenue is tied to bonded debt.
There were comments voiced by one Chamber member that the concept of hiring one director to work for both organizations ( BCEDC and Chamber ) would not work, that no one can effectively serve two bosses. The idea is for an executive committee made up of an equal number of Chamber and BCEDC members to oversee the hired director. The question was asked what happens if the committee is tied on a decision. It was stated that will not likely happen and if it does, no action is taken. Another suggestion was made that the two groups hire a joint secretary to answer both phones and handle clerical work.
Several City Council members have told SRC, and have publicly stated, they intend to continue an economic development program utilizing sales tax revenue. They believe a different approach is needed to go along with other efforts.