A $750,000 budget for the Lawrence Chamber of Commerce’s economic development division won the blessing of a key city-county board on Friday. But members of the new Joint Economic Development Council said a recently launched private fundraising campaign by the chamber will be critical to future economic development efforts.
“The direction you are heading right now is spot on, in terms of engaging the community with this campaign,” Mike Gaughan, a council member and Douglas County commissioner told chamber leaders Friday. “But it is crucial that you are successful with the campaign. Otherwise, we are going to have a more difficult conversation in the future.”
One possibility: a special local sales tax to pay for economic development efforts. But officials said that idea is premature.
The proposed 2014 budget for the chamber’s economic development division includes a projected $275,000 from the recently-launched three-year fundraising drive. That would be the largest private-sector contribution to the chamber’s economic development effort in recent memory. Typically, private fundraising has netted around $100,000 a year.
“But even at $275,000 or even $325,000 a year, that is still on the low end of what many other communities are generating from private fundraising,” said Brad Finkeldei, a member of the council and a member of the chamber’s board of directors.
For 2014, the Lawrence City Commission and the Douglas County Commission are each being asked to provide $218,000 in funding for the chamber’s economic development division. City and county commissioners still need to approve those amounts, but the council on Friday unanimously recommended approval of the request.
Some council members, however, questioned whether city and county financial support for economic development also is going to have to grow in the future. Council members were told that several communities — notably Topeka and Manhattan — have sales taxes that are dedicated to economic development.
Doug Gaumer, a council member and chair of the chamber’s board, said he would like Lawrence to develop some concrete economic development goals, such as increases in the average median income for families and increases in the city’s gross domestic product.
“But to be realistic about achieving those type of goals, we’re going to need more than $200,000 a year from the city and county and $275,000 from the private sector,” Gaumer said.
Previously, some city and county leaders have mentioned the idea of a new sales tax that could fund economic development initiatives. The idea has been to implement a local sales tax that would replace the sixth-tenths of a percent state sales tax that is scheduled to expire.
But council members said they aren’t confident the state will allow that sales tax to expire, and some questioned whether the public would support a new sales tax at the moment. “I think the conversation of a sales tax is entirely premature,” Gaughan said.
Any discussion of future funding for economic development needs to take into account the sizable amount of money local governments are investing in economic development efforts outside the chamber, council members said.
The city and county provide figures showing that they are budgeted to provide about $1.6 million in ongoing support for various economic development initiatives that don’t involve the chamber’s economic development division.
The biggest beneficiary is the Bioscience and Technology Business Center, based on Kansas University’s West Campus, which, is budgeted to receive about $840,000 from the city and $440,000 from Douglas County in 2013. The funding helps pay for operational and capital expenses at the the center's two business incubators.
City and county commissioners will consider the chamber’s budget requests as part of their budget deliberations this summer.