EDGE is now shelling out $1.7M to their own special projects and beneficiaries using funding that should come back to the taxpayers for appropriation. But, whether legislative bodies will take up the concern is an open question in the valueless FedEx/Memphis Tomorrow decline by design complex, where its “tough and cool man to rip off a community in need” under the heading of “economic development”.
Per the EDGE website, established in 1997, the purpose and scope of the Depot Redevelopment Corporation of Memphis and Shelby County is to acquire and redevelop the former Memphis Defense Depot with approximately 4.25 million square feet of space.
As the Depot disposes of its property assets and closes out, that money should come back to taxpayers for appropriation. Instead of coming back to taxpayers, EDGE budgeted $1.7M in Depot funds per the EDGE 6/20/18 minutes on page 27 as contained in footnote 5 for the following pet projects and interests:
5 Based on the Service Agreement between EDGE and the Depot Redevelopment Corp [DRC]., EDGE also approves the following DRC funding during FY 2019:(1) a $900,000.00 grant to the Greater Memphis Alliance for a Competitive Workforce (GMACWorkforce) for operating expenses related to workforce development efforts; (2) $200,000 to help Improve rail service to industrial customers on Presidents Island through a new intermediary service provider; and (3)$600,000 total in grants to the Arlington, Bartlett, Collierville, Germantown;Lakeland and Millington Chambers of Commerce for local economic development initiatives. A Committee created by the EDGE/DRC Chairman will allocate funds to the individual chambers and approve disbursement of all funds. FY 2018 proposed projects will be evaluated and funded during FY 2019, along with the FY 2019 projects.
Analysis
First, its easy to see how Councilman Jones, Commissioner Brooks or even the EDGE Board itself would have missed the out of scope appropriations from Depot proceeds as they are buried deep in the footnotes of the budget document. But now, legislative bodies know about it. Legislative bodies should move to recover their respective proportions of the $1.7M for the taxpayers with leadership from Council Chair Kemp Conrad, Council Budget Chair Martavius Jones, Council EDGE Liason Worth Morgan, Commission Chair Van Turner, Commission Economic Development Chair Willie Brooks and Commission Budget Chair Eddie Jones.
It may be just a formality for re-appropriation just as EDGE budgeted the $1.7M, but at a minimum that should be done. At the same time, I cannot see legislative bodies allocating $900K to the Greater Memphis Alliance for Competitive Workforce (GMACW) who has not executed for taxpayers under deficient board leadership over 4 years and for a Board who as not met in over a year. And the municipal Chamber of Commerce appropriations would likely be reduced or taken back altogether. The $200K Presidents Island rail connection, would probably be reallocated as shown.
As far as the allocation of funds to GMACW and generally related to footnote 5 above, there never has been a committee set up by the EDGE/DRC Chairman, Al Bright. And besides, operating under the charge of the Depot, the Depot Board should be the Board that allocates the funding. Further, no public notice has been given for any Depot Board or committee votes on the allocation of budgeted funds as contained in footnote 5. At the same time, $834K in funds were transferred from the Depot to GMACW in August of 2018.
The above activity suggests that EDGE Board members themselves were not comfortable being on the committee and voting for the allocation of funds that came from Depot proceeds for work outside the Depot scope of work. Nor, was there ever a vote by the Depot Board on the funding allocation found in footnote 5 and the Depot Board has not met since 6/20/18.
All of the above points to an allocation and distribution of funds without EDGE/DRC special committee or Depot Board approval. Reid Dulberger was especially concerned at the last EDGE Board meeting where the concern was brought up in public comment. Dulberger, spoke up out of order without Chair recognition, to shut down any potential discussion on the matter. And even with Depot Board and/or EDGE/DRC committee approval, the appropriation would be outside of the Depot scope of work where $1.7M should come back to the taxpayers.
Conclusion
In a FedEx/Memphis Tomorrow decline by design framework, legislative oversight does not occur. This works to undermine true community and economic development work while making Memphis less attractive for external investment. Further, in this decline by design framework, local corporations and businesses are paying the price in various forms to include slower growth due to a workforce development system botched by Fred Smith and Pitt Hyde costing business and taxpayer millions. How business friendly is that? Remember, “Its tough and cool man to rip off a community in need”.
In the end, really, the only people that consistently win, is the seemingly ever expanding local tax abatement industry advocated for by the FedEx/Memphis Tomorrow complex. Again, its a design for decline where the corporate socialists will run themselves out of town while blaming taxpayer funded public entities for community decline.
EDGE often points to their authority as provided by state law but in the end local legislators have oversight and authority over EDGE. And if there is any potential for a legal standoff based on state law, local legislators have the leverage to mount that case, thereby bringing EDGE into compliance. To that extent, if local government needs to take EDGE to court for $1.7M, there is likely an additional opportunity to recover $800M based on EDGE’s use of a bogus accounting platform for 8 years that overestimated tax proceeds in order to justify excessive corporate/real estate incentives for the small few.
So how about some legislative oversight in a culture where its “tough and cool man to rip off a community in need”?