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Wednesday, July 21, 2010

Commissioner Abraham Asks for LAIC Budget; Now How About Benchmarks?

Many of us wonder just what the Lake Area Improvement Corporation does with our money. Now, thanks to Madison City Commissioner Nick Abraham, we may find out. At Monday's night's commission meeting, when LAIC director Dwaine Chapel made his request for $240,000 in taxpayer dollars, Commissioner Abraham asked the economic development corporation to submit a detailed budget. Chapel agreed to do so.

The request seems logical enough. Combine the LAIC and Chamber of Commerce funding requests, and Madison taxpayers are pouring over $300,000 into economic development activities. $140K of that comes from the third-penny sales tax, a levy that was supposed to sunset when the Community Center was paid for but which has somehow remained on the books. When taxpayers are footing the bill, they're entitled to see the budget.

But what we really need are benchmarks. What is our $240K investment in the LAIC getting for us? Here's the LAIC's explanation, as summarized in the Madison Daily Leader:

Chapel said that LAIC has worked with two companies, one for about 1 1/2 years and another for about seven months, concerning Madison expansion. He added that the development corporation was also negotiating with several other businesses. Chapel described the work as "an ongoing process" and added that LAIC officials had "focused real hard" on retaining jobs already in the community [Chuck Clement, "LAIC, Chamber Officials Request Annual Funding from City," Madison Daily Leader, 2010.07.20].

Talking, negotiating, and focusing real hard are important. But shouldn't we expect some quantifiable performance? If I were getting $240K from the city, I would expect the city to demand some proof of return on investment. Along with a detailed budget, the city should demand answers to the following questions before giving the LAIC one more penny:
  1. How many jobs has the LAIC created? (Context for that answer: four years ago, the LAIC set a goal of creating 400 new jobs in five years. Lake County has since lost 435 jobs.)
  2. How many new businesses has the LAIC directly recruited (not every single business that has started, but only those businesses that the LAIC can demonstrate wouldn't be here without specific LAIC action)?
  3. How many affordable houses has the LAIC sold in its TIF district?
I remain appalled at the lack of accountability and transparency in how the LAIC spends our money and at our local governments' willingness to keep throwing money down this hole without asking questions. Commissioner Abraham's request for a detailed LAIC budget is a step in the right direction, and I will be eagerly awaiting the publication of that budget in the city commission agenda packet. Now it's time for the city (and county!) to say, "You can use our money, but here's what we expect for the investment."


  1. Corey:
    It is not often I agree with you, but this is one of those times. I too think the LAIC should be accountable to the tax payers of both Madison and Lake County, particularly salaries paid to the staff of LAIC. It seems, lately we are not getting a return at all on our investment.

    Tim Higgins

  2. Tim, citizens have demanded to know how federal stimulus is being spent. I think such demands are perfectly justified... and the Obama Administration has made some effort to put that information online. We should expect at least as much transparency and accountability from our local leaders spending our local money in our backyard.

  3. We've had a drought of about four years for new business development including industry, retail and local expansions. We've seen some shuffling around of existing firms, but not much new. While the economy can be blamed for an expansion slowdown the past 20 months, there are always firms who position themselves, even during tough times. If we're working with two solid firms in the past several months and talking to a few others, it would appear we should be generating more industrial interest, or setting up additional initiatives for downtown renovation, with the dollars that are being spent and raised.

  4. Why is it just the youngest, newest counsel member who's asking? How could accountability not be part of city expectations? Who is benefiting from a lack of it?

  5. I'm going to have to dig into how the funding is setup, but I bet that we can get all of the information you're looking for via a freedom of information act request. Pretty much every dollar that goes through SDSMT comes with a FOIA rider for how it's spent. I bet the city has been putting the same riders onto their contracts for compliance sake.


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