Alliance contract talks continue

Jul 13, 2010 — Waterloo-Cedar Falls Courier

Tim Jamison

Jul. 13, 2010 (McClatchy-Tribune Regional News delivered by Newstex) -- WATERLOO -- The Greater Cedar Valley Alliance may have to produce results to get paid in the future by the cities of Waterloo as well as Cedar Falls for economic development efforts.

Members of the Waterloo City Council are considering a new contract with the Alliance tying city payments heavily on the new development and jobs the organization helps bring to the community.

The city has paid an $85,000 flat annual fee to the Alliance in recent years. But the proposed contract calls for a $28,500 base payment, which could grow to a maximum $85,000 amount based on a set of performance criteria.

Mayor Buck Clark pulled the contract from the agenda shortly before the meeting at the request of Alliance representatives who were going to be at the Cedar Falls City Council meeting to discuss that community's economic development contract.

Waterloo's potential move to a performance-based contract with the Alliance grew out of concerns council members raised in May about the Cedar Falls contract. Cedar Falls' contract includes a $25,000 base fee with the possibility of another $25,000 in incentives.

During the Cedar Falls Council's Administration Committee meeting Monday, members unanimously agreed on payments owed for the fiscal 2010 contract, which include $22,000 in incentives. Discussion of the 2011 plan will continue in two weeks.

Cedar Falls' base contribution represents about 3 percent of the Alliance's total revenue, said Alliance director Steve Dust.

General economic conditions are slow amid an uncertain economy, but the Alliance has been aggressive in marketing strategies, Dust said. Currently, officials are working with 10 businesses looking to locate in Cedar Falls.

"Trade shows are one of the most effective ways for us to leverage our marketing money," Dust said. "We get in front of a lot of people."

But Cedar Falls Council memberTom Hagarty raised concerns, firing off questions from his 11 pages of handwritten notes.

Among them was the Alliance's failure to file paperwork to receive additional money from 2008 dating back at least as far as 2003, despite having had a hand in several projects that located in the Cedar Falls Industrial Park.

"You probably had the bonus coming," Hagarty said. "Is there any reason why we didn't get those reports?"

Dust said the unclaimed incentives stemmed from not having systems in place to track successes. That has since changed, he added.

Waterloo Council members had questioned whether the incentive offers would, at least in appearance, encourage the Alliance to steer companies to Cedar Falls. Dust disputed that, but indicated he would prefer not to have incentive-based funding in one community but not the other.

The Alliance primarily operates in Black Hawk County and maintains partnerships with surrounding counties, generally within a 30-mile radius of the metro area. Home communities have every shot to retain existing businesses, Dust said.

Cedar Falls has had an incentive-based contract for about 10 years, according to the city's developmental services director Ron Gaines.

Waterloo's proposed fiscal year 2011 contract would also require the Alliance to provide the city with detailed financial information about the Alliance's operations.

Newstex ID: KRTB-0150-46944955