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Note to Self: Why Is the Business Community Threatening Itself About Regional Economic Development? PDF Print E-mail
News/Features - Local News
Tuesday, 11 July 2006 22:46

589 cover Last month, a group of 27 business leaders from the Quad Cities sent a letter to the chairpersons of the area's four largest economic-development entities. That, in itself, is noteworthy, but the letter is full of curious features:

  • In many ways, it's like sending a letter to yourself. The signers of the letter represent a who's who of the local business community, including Deere & Company, both local hospitals, banks, higher-education institutions, and real-estate developers. The letter refers to its writers as the "principal private-sector funders of the Quad City Development Group, DavenportOne, the Illinois Quad City Chamber, and the Bettendorf Chamber" - the organizations to whose boards the letter is addressed.
  • Those signatories are some of those organizations' chief political powers. For example, 16 members of DavenportOne's 36-person board of directors signed the letter, including current DavenportOne Chair Caroline Ruhl, First Vice Chair James Russell, Vice Chair Michael Bauer, and Vice Chair Chuck Ruhl. And 12 of the Quad City Development Group's 41 directors signed the letter, including Mel Foster Company President Pryce Boeye, Genesis Medical Center President/CEO Leo Bressanelli, and Trinity President/CEO Bill Leaver.
  • The letter comes at a time when a task force made up of four members each from the four organizations is exploring the question of how best to structure community-wide economic-development efforts. That group was formed this spring and gave itself a four-month study period that will end this fall.
  • The letter also comes just months after DavenportOne, the Bettendorf Chamber, and the Illinois Quad City Chamber formed the Quad-City Chamber of Commerce Federation, an effort to present a unified front and eliminate some duplication.
  • Although they're also economic-development groups, the Development Association of Rock Island, Renew Moline, and East Moline's REDEEM aren't referenced in the letter. That suggests that the letter's signers believe there's a role for intensely local, ground-level organizations, even if there is a Quad Cities-wide economic-development organization.
  • The brief letter - all of 153 words outside of salutations and signatures - is at once mild and threatening. "You have a tremendous opportunity and important responsibility to regionalize our economic development, community development, and business advocacy efforts," it begins. Later, it sets out a timetable and a vague threat: "We expect you to propose a new regional structure within the allotted 120 days. It is important the task force and their respective boards understand that there will be funding consequences if the status quo is maintained." (For the full text of the letter, see below.)
  • The people who signed the letter and those to whom it's directed are being tight-lipped about its meaning, motivations, and repercussions. Thom Hart, president of the Quad City Development Group, twice refused to comment on the situation. First, he declined to talk about the letter. Then, he declined to provide even basic background on the task force studying the possibility of consolidation. Hart referred questions to Quad City Development Group Chair Tim Wilkinson, even though Wilkinson (and representatives of the boards of DavenportOne, the Bettendorf Chamber, and the Illinois Quad City Chamber) have themselves declined to comment on the letter or possible reorganization when questioned by other media outlets. Wilkinson was on vacation late last week and early this week and did not return a phone message.
  • Although the letter is dated June 12, it didn't become public until the Argus/Dispatch published an article on it on June 28. That would suggest that it was never intended to be a public document, except that it has the smell of a public-relations ploy. Why else would it be so circumspect, both in terms of what it's asking for and what the consequences would be?

 

"Inherent Drag"

The main thrust of the letter is found in part of one sentence: "The current system is not working ... ." The obvious complaints are twofold: (1) that economic-development efforts are ineffective because the organizations are too fractured and provincial; and (2) that having multiple organizations with some overlapping functions is inefficient. For instance, both DavenportOne and the Illinois Quad City Chamber of Commerce have groups geared toward young professionals.

Less obvious is another possible meaning: that the groups themselves are ineffective not because of fragmentation but because of the people running them.

That topic is something of a third rail. Kent Pilcher, president of Estes Construction and one of the people who signed the letter, said he wouldn't comment on which group is or isn't effective. Scott Tunnicliff, president and CEO of the Bettendorf Chamber, would only talk about what his organization could do better. When asked about external-marketing efforts (which are primarily undertaken by the Quad City Development Group), he said, "I'm not going to second-guess."

Yet the letter seems implicitly frustrated with the Quad City Development Group, because it's already charged with regional economic development. If business leaders were satisfied with its performance, they wouldn't be calling for a "new regional structure."

Publicly at least, people who signed the letter and business leaders are casting the letter not as a threat but as a public statement in support of regional economic development.

"The purpose of the letter was to encourage," Pilcher said. He also said that the task force studying the issue might need a little push. "It's the first time all four groups have sat down," Pilcher said. "There's a lot of inherent drag here."

Pilcher said that although he's been intimately involved in DavenportOne over the years, and although most people who signed the letter hold sway in their respective organizations, the kind of change that's being discussed couldn't be accomplished internally. "There are more organizations involved than DavenportOne here," he said.

The positive-push reading was seconded by Tunnicliff, who didn't sign the letter. "They want to encourage this group ... to stay on target," he said.

Steven Bahls, president of Augustana College and one of the letter's signers, was more direct. "We felt it was time to force the issue," he said. "We want to see real progress toward merger discussions."

He also said that he doesn't view the letter as a criticism of the groups currently handling economic development. "My view is that it's not an attack on the [Quad City] Development Group," he said.

Bahls said it's incumbent on the task force to explore the possibility of merging the area's major development and commerce organizations into a single entity, or explain why it's not feasible or desirable. He said that St. Louis - another metropolitan area spread over two states and many jurisdictions - consolidated its economic-development efforts in 1973 and has reaped the benefits since. The St. Louis Regional Chamber & Growth Association covers a 16-county area and combined three organizations.

Bahls said that with four organizations in the Quad Cities, "we don't get enough bang for the buck." With similar goals, the four groups include four different boards, four executive directors, four legal entities, and four budgets totaling several million dollars. And many businesses maintain memberships in multiple economic-development organizations. "Why do we have so much overhead?" Bahls asked.

Tunnicliff, though, said that view of the four existing organizations might be short-sighted. "Efficiency does not always equate with effectiveness," he said.

And Rock Island Mark Schwiebert, who sits on the Quad City Development Group board, cast a vote for clarifying the status quo. The goal of the current four-organization task force, he said, should be "making more clear who's responsible for what." He also said there should be a written memorandum of understanding among the groups to avoid confusion.

About a new, regional organization, Schwiebert sounded skeptical. "You walk before you run," he said. "I'm not sure we're at that point at this stage."

And therein might lie a primary reason for the letter: a preemptive strike against a task force that seems likely to endorse some variation on the status quo.

One challenge to forming a new, regional economic-development organization is political, in making all parties feel that their geographic region would be well-represented by the organization and its efforts.

Yet Bahls said there's already a model in the Quad Cities: the Illinois Quad City Chamber. "We have to a certain extent a regional structure," he said. "Why not expand it? ... We have not seriously looked at other models."

The resistance to that idea, though, would likely be fierce. As the letter suggests, the local chambers of commerce would lose their "big picture" roles to a regional economic-development authority, becoming the equivalents of the Development Association of Rock Island, Renew Moline, or REDEEM. Bahls said there is a role for street-level economic development in each community, even with a regional organization, but it might be a smaller one.

 

Is the Threat Real?

The letter would be most effective as an agent of change if it included specific targets and specific consequences. Yet the people who signed the letter aren't willing to publicly commit to specific sanctions if the task force doesn't come up with suitable action.

When asked whether a threat to pull funding from the four organizations was implied by the letter, Pilcher said, "You can read it either way."

He also wouldn't say whether his company would withdraw its membership from the organizations if there isn't a resolution that satisfies him: "I can't answer that. ... I don't know what the outcome will be."

Bahls also backed off any threat. "What happens if they don't [choose to create a new region-wide structure]? I don't know."

Bahls said that Augustana is a member of the Illinois Quad City Chamber and said its membership is not in jeopardy: "We will not be withdrawing funding," he said.

The main threat that these signatories could hold over the four bodies would be their membership dues. If the companies of the people who signed the letter withdrew their membership from the four groups, it could cripple them - a significant incentive to take the letter seriously. "That would be the primary leverage," Bahls said.

 

Discuss and contribute to this story at (http://wiki.rcreader.com).

 

Letter to Local Economic-Development Organizations

 

June 12, 2006

 

Mr. Tim Wilkinson, Chairman, Quad City Development Group

Mr. Frank Clark, Chairman, DavenportOne

Mr. Jim Richardson, Chairman, Bettendorf Chamber of Commerce

Ms. Mary Lagerblade, Chairwoman, Illinois Quad City Chamber of Commerce

CC: Boards of Directors Quad City Development Group, DavenportOne, Bettendorf Chamber of Commerce, Illinois Quad City Chamber

 

SUBJECT: New Regional Structure is Imperative

 

Dear Chairpersons and Task Force Members:

You have a tremendous opportunity and important responsibility to regionalize our economic development, community development, and business advocacy efforts.

As the principal private sector funders of the Quad City Development Group, DavenportOne, The Illinois Quad City Chamber, and the Bettendorf Chamber, we want to express our strong desire for a new regional structure.

We expect you to propose a new regional structure within the allotted 120 days. It is important the task force and their respective boards understand that there will be funding consequences if the status quo is maintained. The current system is not working and the healthy future of our region is at stake. We want to see more effective use of our resources which we donate to these organizations and a better return on our investment.

Your commitment to the execution of a more effective organization to help grow our region is vital and greatly appreciated by all of us.

Respectfully,

 

Mary Junck, Lee Enterprises

Dana Waterman, Lane & Waterman

Kent Pilcher, Estes Construction

Leo Bressanelli, Genesis Health Systems

Jim Kadavy, RSM McGladrey

Nancy Donovan, Isle of Capri

Chuck Ruhl, Ruhl & Ruhl Commercial

John Stavnes, Wells Fargo

Caroline Ruhl, Ruhl & Ruhl Realtors

Ken Koupal, US Bank

Jim Russell, Russell Construction

Jim Collins, Deere & Company

Bill Leaver, Trinity Regional Health System

Pat Keir, Eastern Iowa Community College

Tom Robinson, Southeast National Bank

Pryce Boeye, Mel Foster Company

Steven Bahls, Augustana College

Jack Bush, McCarthy Bush Corporation

Mike Bauer, Quad City Bank & Trust

Harry S. Coin, American Bank & Trust Company

Frank Clark, Nestle Purina Pet Care Company

Carrie O'Neill, National City Bank

Pete Pohlman, Lujack's Northpark Auto Plaza

Todd Reed, Tyson Fresh Meats

Bob Imler, Riverstone

Cynthia Tidwell, Royal Neighbors of America

Gene Blanc, Midland Information Res.


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