MEDOFAB Canceled

Tuesday night the Manhattan City Commission dissolved the Manhattan Economic Development Opportunity Fund Advisory Board.

This Board would recommend to the City which companies would get money from the 1/2 Sales Tax. More than $10 Million was given out in grants and loans over the past seven years. With little money left in the Fund the board asked to be dissolved.

Some companies had complained because when making application for the money Kansas Open Records Act required those records be open to the public. The Board has recommended that the City us the Manhattan Chamber to process loans in the future.

At Tuesday's meeting Debbie L. Nuss, President of the League of Women Voters of Manhattan/Riley County gave a very good talk on why the City should not use the Chamber. Here are her remarks:

The League of Women Voters - a nonpartisan, political organization - believes that democratic government depends upon the informed and active participation of its citizens and requires that governmental bodies protect the citizenís right to know by giving adequate notice of proposed actions, holding open meetings, and making public records accessible.

The League of Women Voters also believes that efficient and economical government requires coordination among the different agencies and levels of government and the clear assignment of responsibility, and that the structures and practices put into place to accomplish this must be characterized by openness, accountability, representativeness, decision-making capability and effective performance so that citizens are able to hold its leaders, committees and members responsible for their actions and decisions.

Through its leaders, committees, and members government has not only a legal responsibility but an ethical responsibility to ensure that entities which provide services to the community represent the interests of the community as a whole, not just their own.

A decision to approve the recommendation before you tonight to dissolve the Manhattan Economic Development Opportunity Fund Advisory Board, that a different process be developed to review and analyze economic development proposals, and that review authority be turned over to another "appropriate, private group," such as the Manhattan Area Chamber of Commerce changes making decisions about awarding public tax dollars from a public to a private process and cannot be supported by the League.

The League strongly urges the Commission to not approve this resolution. We also ask that the following issues and/or questions be fully addressed:

1. By all accounts and based upon its own annual reports to the community and the Commission, MEDOFAB has worked. No one has argued otherwise. Why then is there seemingly such an urgency to dissolve it? Comments have been made regarding the expiration of the sales tax and the depletion of funds, but yet at the same time discussions are underway regarding the possibility of yet another sales tax being placed on the November ballot that might include an economic development component. We also know that beginning in 2004 MEDOFAB funds loaned to businesses will begin to be repaid. Why be in such a hurry to get rid of a process that did its job and replace it with an unknown, unproven process that is not public?

2. Unsubstantiated statements have been made that Manhattan has missed opportunities with businesses because they were intimidated by or unwilling to invest the time in the two-step process. How many businesses? What other reasons do businesses cite as to why they donít want to relocate to Manhattan? How many of those have there been? Even if we lost a couple of interested businesses we donít know if it mattered because we donít know what they were. If they didnít want to go through our process, perhaps they werenít the type of business worth having anyway. And, if we lost a couple of businesses, well maybe thatís the price to be paid for having a proper, public process for awarding city tax money for economic development.

3. We hear there are other economic development models to consider. What are they? How do they differ from what we have done? Are they better or worse, and by whose criteria?

4. We have also heard that the MEDOFAB process is cumbersome, that it takes too long, that there is sometimes a need to "fast-track" an application. Cumbersome to whom? How long does it take to process an application under the other models? Can we modify the MEDOFAB process rather than abandon something that again has been noted as being a success? We may find that the MEDOFAB process may not be as detrimental to the interests of business as some have asserted it has been.

5. When the economic development sales tax was passed and MEDOFAB was established, the community was told then that the economic development "game" necessitated our having funds to entice businesses to our community - we needed to have incentives. Now we hear that the "business climate has changed" since MEDOFAB was developed. What specifically has changed?

6. Statements have been made that at present MEDOFAB does not have a role because there are no funds to disperse and that making appointments to fill expired terms when there is no activity is difficult or awkward. Other City advisory boards and committees cease to meet or go on hiatus during times of reduced or no activity, but the Commission is not asked to dissolve them. Why should the Commission do so in this case?

The way the city - or any governmental body - goes about making decisions is as important as the decisions themselves. In fact, a faulty process can undermine the best decisions. The League is not willing to settle for anything less than process that is open, thorough, and inclusive regardless of how inconvenient that might be [paraphrased from the October 14, 2001 editorial in The Manhattan Mercury]. In fact, the very process MEDOFAB has used to make its decisions - decisions which have resulted in economic development successes could be one of THE primary reasons we had the successes weíve had.

Research around the country has shown that civic engagement - that is, citizen involvement - is positively related to a strong economy and good government. In his book, Bowling Alone: The Collapse and Revival of American Community, Robert D. Putnam concludes: "Communities...did not become civic because they were rich. They became rich because they were civic."

The League would remind you that the MEDOFAB policy manual was developed in 1995 during the mayoral term of Edith Stunkel, a respected former city official and League member whose commitment to public input - input from everyone regardless of their point of view - commitment to public process, commitment to civic engagement are quite possibly the very reason Manhattan enjoys the community riches it has to date. Were she here with us tonight she would be at this podium championing the public process part of managing city financial affairs and she would remind you - much more eloquently than I have been able to - why the MEDOFAB process was kept public in the first place - because citizens have the right to know the details of how their public tax dollars are going to be used, and have a right to know how the decisions regarding their use are being made.

You should not dismantle a process that by all accounts has been successful - one that the community considers proper - and replace it with an improper one. We are certain Edith would have opposed this recommendation and so does the League.

The League respectfully asks the City Commission to vote no on this proposed resolution.

Thank you.