Slide 1

Economic Development

Model for Charles CountyOrganization, Structure, Resources

REPORT OVERVIEW

• Report addresses type of organizations, suggested annual

resource commitment and functional/staff structure

• Report’s recommendations rely substantially on results of:

- MEDA Roundtable

- Personal review of the structures of 28 AEDOs

- Georgia Tech Enterprise Innovation Institute’s Study of

best practices of 17 high performing EDOs

- Benchmarking against 12 MD and VA “peer” or high

household income counties

- Discussions with EDEB, IEDC instructors, colleagues

Personal experience over last 10 months and with prior

EDC

Slide 3

Organization• Report examines establishment as:

- A County department

- Non-profit Economic Development Commission (EDC)

- Authority

- Division or bureau within a County Department

- Entirely contracted out function

• Some 10,000 economic development organizations in U.S. in many forms

• No one form emerges as a “silver bullet”.

• Quality of director and staff, confidence in the ED entity by the elected governing body and

adequacy of resources are likely more critical than the organizational form embraced.

• Recommendation: Establish as County Department reporting to the County Commissioners

effective July 1, 2012.

Slide 4

Rationale for County Department• Support infrastructure already in place; low

overhead

• Internal relationships already established

• Best access to governing body for decision-

making

• Viewed by other County departments as very high

priority

• Commissioners already set economic development

goals and objectives

Slide 5

Rationale for County Department

(con’t)

• No time lost in addressing organizational start-up

and internal matters

• Best positioned to utilize cutting edge technology

in the economic development function

• Media and communications support group already

established and easily accessible

• 16 of 23 Maryland counties have established within

County government

Not-For-Profit Economic Development

Commission (Pro’s)

•Popular, next most common form

•Governing Board largely of business people responsible

for strategic planning and decision-making

•May decrease reliance on government funding

•Less hamstrung by bureaucratic procedure and more

flexible

•Easier to conduct affairs out of public spotlight

•Less turnover, as compared to public officials, and more

consistent economic development policies

•Businesses may place more trust in dealing with a non-

governmental agency

Not-For-Profit Economic Development

Commission (Con’s)

• Too much board and leadership time devoted to

organizational and internal process, especially in first

year or two

• Difficulty in getting right mix on Board of Directors due

to time demands

• More apt to be viewed as an outside agency and

business advocacy made more difficult

• Few examples of substantial outside fundraising

• Overhead is likely to be very substantial

• Ample flexibility already exists in county process and

procedure in hands of an experienced practitioner

Not-For-Profit Economic Development

Commission (Con’s) (con’t)

• A county commissioned and appointed EDC will be

subject to Maryland Open Meetings Laws in any event

• Flow of communication to elected board may not be

timely enough

• No evidence that business is less likely to seek the

help of a county economic development department

than a county commissioned EDC

Other Forms

• Authorities

– Normally created pursuant to specific state legislation defining

power

– May have eminent domain and bonding authority

– Seem better tailored to one target area or mission

– Howard County has a General Economic Development

Authority but no eminent domain or bonding authority

– Calvert County established authority to manage 2 industrial

parks. Also manages its revolving loan fund

Other Forms (con’t)

• Placement as a division or bureau within County

government department

– Not common in county-sized entities

– Would be viewed as 2nd or 3rd tier priority

– Recruitment difficulties

_ ED and regulatory agencies have fundamentally different

missions and perspectives

– Creates yet another layer of management between ED function

and Commissioners

– Important ED communications are likely to be lost in translation

– Span of control for any one department head may be too great

and ED skill sets lacking

Other Forms (con’t)

• ED entity contracted out to private firm

– No examples found

– Not a practical approach

– Knowledgeable contract administration staff would still be

required

– Potential conflicts with other clients

– Relationships with state or regional partners might prove

problematic

– Stability of and control over key persons are issues

– Community knowledge base deficiency

– Overhead/profit multipliers could make cost-prohibitive

– EDEB considered but rejected

TOURISM• Tourism

– No one answer as to where to best place function

– Retain as separate entity for foreseeable future

– CVB under study by consultant

– ED and Tourism marketing messages and audiences are often

different

– Re-invigorated Tourism program seems to be working well as

is

– TAB & EDEB both recommended it remain separate and

distinct

– EDD should be involved in business formation/expansion side

of tourism industry

– ED Director should sit on board of any CVB or TAB

– 7 of 23 counties in Maryland incorporate Tourism in their EDD’s

ED Advisory Board

• Advisory board to new department would be established

• EDEB as such is renamed and restructured, and some

existing core members invited to remain and form a nucleus

• A larger, but more informal board – quorums not req’d

• No formal voting

• Meet with Director and staff 2-3 x annually

• More diversity by employer size, industry sector, and

geography

• Director uses feedback in roundtable discussions. May

appoint committees for particular tasks and ambassadors

• EDEB recommended continuation as Advisory Board

ED Budget

• Benchmarked against the budgets of 12 Maryland and

No. Virginia counties of like household income

• Many also considered “peer” counties in other studies

• At least one from each MD region except Eastern Shore

• Computed FY 2012 per capita ED spending amounts for

each

• Average spending is $6.88 per capita on ED operations

• Based on per capita average, Charles County’s annual

budget for ED operations should be slightly in excess of

$1 million

• FY13 Charles County ED budget request done

independently of this computation but also $1 million

range

Staff Structure and Organization Chart

Economic

Research

Specialist

Business Development

Mgr. – Attraction &

Recruitment

Business Development

Mgr. – Retention &

Expansion

Office Associate

Director, Economic Development

County Commissioners

Client Services

Representative (PT)

Outsourcing

• Supplementary to core staff but staff maintains control

• Special services with particular expertise and/or

proprietary databases

• Examples include competitive intelligence, prospect

lead & qualification, economic gardening program

implementation, strategic marketing, web content,

project feasibility studies, economic impact analysis,

enterprise/BRAC zone applications, niche consulting

services to local business, targeted industry studies,

etc.

• Most ED organizations use in some fashion

• Maintain about 20-25% of budget in contracted

services a good benchmark

Lead Generation Methodology

Suggested Commissioner Actions

1. Approve report’s major recommendations:

– County department effective July 1, 2012

– Professional staff structure

– Tourism remains separate

– Restructured Advisory Board (July 2012)

– Commit adequate resources for FY 13 (benchmark level)

2. Act quickly on space recommendation (next 3

weeks)

3. Approve proceeding with lead generation firm

procurement

4. Commence recruitment of permanent ED Director

Slide 19

Presented by:

Charles County Government

Office of Economic

Development

Eugene T. Lauer, Interim Director

www.charlescounty.org

Mission Statement

The mission of Charles County Government is

to provide our citizens the highest quality

service possible in a timely, efficient, and

courteous manner. To achieve this goal, our

government must be operated in an open and

accessible atmosphere, be based on

comprehensive long- and short-term planning,

and have an appropriate managerial

organization tempered by fiscal responsibility.

Vision Statement

Charles County is a place where all people

thrive and businesses grow and prosper;

where the preservation of our heritage and

environment is paramount, where government

services to its citizens are provided at the

highest level of excellence; and where the

quality of life is the best in the nation.