Shift in funds raises debate

Columbus Mayor Jim Lienhoop’s plan to redirect some capital improvement funds for economic development resulted in questions and some confusion during and after Tuesday’s city council meeting.

Lienhoop is recommending that the city take $136,000 in Economic Development Income Tax (EDIT) funds each of the next three years and direct the money to the 40-year-old Columbus Economic Development Board. The purpose would be to strengthen local economic development efforts, a plan Lienhoop detailed in a Monday interview with The Republic, published Wednesday.

Lienhoop said he wanted to expand efforts to recruit new companies to Columbus in ways that would diversify the city’s economic base, targeting pharmaceutical and medical device manufacturing companies, engineering and research-and-development firms and administrative support service companies. The additional monies to the economic development board would raise the city’s annual investment to $150,000, to be used for trade shows and site-selector events, a talent-recruitment campaign and other marketing efforts.

The mayor said he had intended to also discuss the matter in detail during Tuesday’s City Council meeting. But due to an internal miscommunication, the discussion item was not included on Tuesday’s council agenda, he said.

Rather than amending the agenda at the last minute, Lienhoop said he decided the best course of action would be to delay the full discussion with the public until the March 1 council meeting.

During Tuesday’s meeting, however, Matt Caldwell — the city’s director of operations and finance — presented a resolution to the council to amend the city’s $1.87 million EDIT fund budget in the city’s 2016 capital improvement plan.

That budget, which had been prepared by outgoing Mayor Kristen Brown, solely included projects for public safety — the biggest of which are $500,000 for police vehicles and $500,000 to replace a firetruck.

The change presented by Caldwell showed a $90,000 reduction in equipment spending for the Columbus Fire Department and $145,668 in savings on a citywide radio project. It moved those combined savings of $235,668 to a line item for miscellaneous grants. That is the money Lienhoop plans to use for economic development. It would be spent by the economic development board on the city’s behalf, with $136,000 of it to be used this year.

If the fire department needs some or all of the $90,000 proposed in the reduction, however, Lienhoop said it could request additional funds.

Lienhoop said about $2.9 million in EDIT receipts are expected to be collected this year for future uses by the city.

This year’s capital improvement project list for the city includes spending plans for monies generated through seven different revenue streams, including EDIT proceeds. It includes money for road repair, sidewalk improvements, traffic signals and building repairs, among other things.

One member of a city committee who unsuccessfully sought a city council position in last year’s election was critical of Lienhoop for his handling of the funds transfer.

“I have more concerns than ever before,” said Justin Hohn, an appointed member of the Columbus Park Board who attended Tuesday’s meeting.

Although he now has a better understanding of the long-term plan for the EDIT funds and the grants line item, Hohn said he was angry that the mayor did not fully explain his plan during the public meeting.

“I’m most concerned about the way it went down,” Hohn said Wednesday.

Lienhoop focused part of his mayoral campaign on the need for more rigorous efforts toward economic development in the city, so Hohn said he is not surprised by his decision to spend city money in this manner.

Hohn acknowledged that Lienhoop is within his rights as mayor to decide to allocate funds toward economic development.

A second appointed city official, who also unsuccessfully ran for city council last year, was also critical of the mayor.

Russ Poling, a member of the Columbus Plan Commission who attended Tuesday’s council meeting, said Lienhoop’s move to eliminate $90,000 from EDIT funds to purchase jaws of life equipment jeopardizes public safety.

Fire chief Mike Compton, who also attended the meeting, said his department hopes to purchase both the new squad and the jaws of life equipment with the $500,000 still in the EDIT budget, Compton said.

Poling then asked if the fire department could return to the council and ask for more EDIT funds if the $500,000 is not enough to purchase both items, and Lienhoop said that option would remain open.

Reading about Lienhoop’s economic development plan after the meeting did little to alleviate Poling’s concerns, he said on Wednesday.

“I’m worried that they’re not going to have enough money,” he said of the fire department regarding its equipment needs.

Poling said it does not seem possible for the fire department to purchase the equipment it needs for just $500,000. However, Lienhoop’s promise to offer more EDIT funds to the department, if needed, did make him feel a little bit better about the reallocation, Poling said.

Hohn said the way the funds were reallocated gives the impression that economic development is the only area of capital improvement that needs additional funding. Based on his experience on the park board, Hohn said that is not the case.

“We’ve identified $1 million in capital improvements, and you’re saying we’ve got nothing better to spend this money on?” he said.

The council ultimately chose to pass the resolution to amend the capital improvement fund, but with a change of its own.

Councilman Frank Miller proposed an amendment to change the name of the line item from “miscellaneous grants” to “refund to EDIT,” which he said would more accurately reflect the mayor’s intentions for the money and alleviate public concern.

Council members voted in favor of Miller’s amendment, with only council president Frank Jerome voting against. District 1 councilman Dascal Bunch did not attend the meeting.

The council, including Jerome, then unanimously passed the amended resolution, which officially altered the 2016 EDIT fund. The resolution also reflected budget changes for parks and recreation projects in the cumulative capital fund.

Lienhoop's economic development plan

Mayor Jim Lienhoop wants to redirect $136,000 in Economic Development Income Tax (EDIT) funds, already being collected from city taxpayers, for each of the next three years to significantly increase economic development efforts through the Columbus Economic Development Board.

The proposal would raise the city’s annual dues to the board from $14,000 now to $150,000 a year through 2018.

The city would contract with the economic development board as its primary economic development and marketing agency, recruiting companies to Columbus by having a bigger presence at industry trade shows and greatly increasing other marketing efforts.

What's next

Mayor Jim Lienhoop said he will bring his full plan to redirect EDIT funding to the city council for discussion at its next meeting on March 1. The council will not act on the plan, but will only discuss it. Then, the plan will go before the board of works for a vote on March 8.

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Olivia Covington is a reporter for The Republic. She can be reached at ocovington@therepublic.com or 812-379-5712.