Aug. 17, 2010
West Virginia Development Agency Flunks Legislative Audit
By Tony Rutherford
Huntingtonnews.net Reporter
Charleston, WV (HNN) – Members of the West Virginia Economic Development Authority in May declined to issue $50 million dollars in tax-exempt bonds for the visionary River Place project near the Marshall University campus.
Now, the release of findings (unrelated to the River Place proposal)... legislative auditors can’t provide numbers that show the degree of success the job creation program(s) funded through the WV Economic Development Authority.
The agency attempts to lure employers to locate or expand in West Virginia. However, they only cite trade show outcomes as examples of achieving their mission, as well as tax cuts and alterations in the worker’s compensation program.
But among the missing documents --- a state Development Office 2007 report.
Searching on line, HNN found a December 3, 2007 Open for Business Report which “highlights projects and related announcements that will assist with the creation of new jobs and preservation of a significant number of existing jobs.”
Among the projects touted by the Governor, the Hino Motor of WV plant in Williamstown (Wood County), Warren Distribution (Marshall County), a trade mission to China, and the West Virginia Small Business Development Center has helped 301 clients with 523 hours of counseling and training. http://www.wvgov.org/O4B/Dec%202007%20open%20for%20business%20final.pdf
But, the audit results apparently fail to dispense with conclusions from a February 2009 report from the WV Center on Budget and Policy. The Budget and Policy study contends that since the 1962 creation of the West Virginia Economic Development Authority (WVEDA) to “promote, assist and encourage maximum opportunities for employment” that “private companies [have] cut jobs after receiving taxpayer funded subsidies. The 2009 report lists as examples, The Charleston Stamping Plant ($15 million loan); Tech-Seal Products of Ohio County (24 employees but promised 31); Sequelle Communications Alliance which received money from the state and federal government to create “50 good paying jobs”, yet the company closed and the CEO was indicted for misappropriation of $4 million in public funds.
Titled “Money for Nothing Do Business Subsidies Create Jobs or Leave Workers in Dire Straits,” the 2009 Budget and Policy report takes issue with a lack of transparency for review and accountability of tax credits. Click here for PDF: http://www.wvpolicy.org/downloads/WVCBP-Business_Subsidies_Report.pdf
Since January 29, 2004, WVEDA has awarded nearly $250 million dollars in economic development grants through Lottery Revenue Bonds. Among the prominent grants, $12 million for the Appalachian Power baseball park in Charleston; $12.5 million to the Marshall University Research Corp for its Biotechnology Development Center; $10.6 million to Tri-State Transit Authority for Pullman Square; $10 million to Chief Logan State Park; $250,000 for the Greenbrier Valley Theatre (Lewisburg); and $6 million to the Jefferson County Board of Education for a new high school building. (For other projects, click: http://www.wveda.org/program-grantrecipient.html )
AUTHORITY STATED RIVER PLACE APPLICATION PREMATURE
Although the River Place project which imagined a baseball park, hotel, conference center, retail shops and a law enforcement training academy between the Ohio River and Third Avenue where the mostly vacant ACF Plant sit was deferred pending completion of a study, the state economic development office wisely concluded that developers of this Huntington project as of mid-May “still had contracts to be negotiated.”
Representatives of ACF have not confirmed that they are negotiating or are near a contract with the RiverPlace developers. At the time, they did not have signed contracts with Marshall University or the West Virginia Port Authority.
The proposal raised questions following a Cabell County Commission green light to apply for funds, since one of the partners in the project, Brad Burgess, had a trail of proposals from Lexington, Ky. To Findlay, Ohio, that had not come to fruition. However, the approval was only to meet a deadline for the application for unspent funds; it was not an endorsement of the project.
The state authority determined that the partners were “not quite ready to proceed ” due to the lack of formal agreements.
Based on the audit, apparently, the EDA has some number crunching to do too.
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West Virginia Development Agency Flunks Legislative Audit
By Tony Rutherford
Huntingtonnews.net Reporter
Charleston, WV (HNN) – Members of the West Virginia Economic Development Authority in May declined to issue $50 million dollars in tax-exempt bonds for the visionary River Place project near the Marshall University campus.
Now, the release of findings (unrelated to the River Place proposal)... legislative auditors can’t provide numbers that show the degree of success the job creation program(s) funded through the WV Economic Development Authority.
The agency attempts to lure employers to locate or expand in West Virginia. However, they only cite trade show outcomes as examples of achieving their mission, as well as tax cuts and alterations in the worker’s compensation program.
But among the missing documents --- a state Development Office 2007 report.
Searching on line, HNN found a December 3, 2007 Open for Business Report which “highlights projects and related announcements that will assist with the creation of new jobs and preservation of a significant number of existing jobs.”
Among the projects touted by the Governor, the Hino Motor of WV plant in Williamstown (Wood County), Warren Distribution (Marshall County), a trade mission to China, and the West Virginia Small Business Development Center has helped 301 clients with 523 hours of counseling and training. http://www.wvgov.org/O4B/Dec%202007%20open%20for%20business%20final.pdf
But, the audit results apparently fail to dispense with conclusions from a February 2009 report from the WV Center on Budget and Policy. The Budget and Policy study contends that since the 1962 creation of the West Virginia Economic Development Authority (WVEDA) to “promote, assist and encourage maximum opportunities for employment” that “private companies [have] cut jobs after receiving taxpayer funded subsidies. The 2009 report lists as examples, The Charleston Stamping Plant ($15 million loan); Tech-Seal Products of Ohio County (24 employees but promised 31); Sequelle Communications Alliance which received money from the state and federal government to create “50 good paying jobs”, yet the company closed and the CEO was indicted for misappropriation of $4 million in public funds.
Titled “Money for Nothing Do Business Subsidies Create Jobs or Leave Workers in Dire Straits,” the 2009 Budget and Policy report takes issue with a lack of transparency for review and accountability of tax credits. Click here for PDF: http://www.wvpolicy.org/downloads/WVCBP-Business_Subsidies_Report.pdf
Since January 29, 2004, WVEDA has awarded nearly $250 million dollars in economic development grants through Lottery Revenue Bonds. Among the prominent grants, $12 million for the Appalachian Power baseball park in Charleston; $12.5 million to the Marshall University Research Corp for its Biotechnology Development Center; $10.6 million to Tri-State Transit Authority for Pullman Square; $10 million to Chief Logan State Park; $250,000 for the Greenbrier Valley Theatre (Lewisburg); and $6 million to the Jefferson County Board of Education for a new high school building. (For other projects, click: http://www.wveda.org/program-grantrecipient.html )
AUTHORITY STATED RIVER PLACE APPLICATION PREMATURE
Although the River Place project which imagined a baseball park, hotel, conference center, retail shops and a law enforcement training academy between the Ohio River and Third Avenue where the mostly vacant ACF Plant sit was deferred pending completion of a study, the state economic development office wisely concluded that developers of this Huntington project as of mid-May “still had contracts to be negotiated.”
Representatives of ACF have not confirmed that they are negotiating or are near a contract with the RiverPlace developers. At the time, they did not have signed contracts with Marshall University or the West Virginia Port Authority.
The proposal raised questions following a Cabell County Commission green light to apply for funds, since one of the partners in the project, Brad Burgess, had a trail of proposals from Lexington, Ky. To Findlay, Ohio, that had not come to fruition. However, the approval was only to meet a deadline for the application for unspent funds; it was not an endorsement of the project.
The state authority determined that the partners were “not quite ready to proceed ” due to the lack of formal agreements.
Based on the audit, apparently, the EDA has some number crunching to do too.
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