Day 113: Public or Private?

Day 113:  Public or Private?  Whether a state economic development should be public or private seems to be a hot topic in our profession right now.  Ed Burghard wrote in one of his posts about the recent privatization of the North Carolina Economic Development Department.  I also ran across a report from Good Jobs First that they just issued this month.  I have noticed Good Jobs First a couple of times this past year.  I really don’t know anything about them, but they are obviously biased on how they feel about privatizing state economic development organizations.  So, I would ask that you read their report with that in mind.  Not that you wouldn’t be able to figure it out on your own.  But I don’t really care in what form an organization takes.   Good Jobs First,  Ed and me agree that when there is public money involved there does have to be transparency.  The problem is what should be transparent?   I think it is pretty simple.  When public dollars are used for any project, there needs to be proper reporting of that money AFTER the fact.  Too many of these projects involve competitive advantages that a company does not want to share with the public before a decision is made.  But once a company has made a decision, than the entity should give an accounting of how the money was spent.  The same goes for vendors involved with the quasi-private organization.  If public dollars are involved in paying a vendor, then there should be a request for proposal process.  As consultants we really don’t like RFP’s.  In fact, we rarely respond anymore because many of them are already pre-determined.  But at least the process was completed.

Now as to the overall organization, again, I don’t think it matters if it is public or private.  Either will succeed if they have a clear vision, mission, goals and objectives.  Most of these quasi state organizations become like Christmas trees.  Everyone wants to hang an ornament on the tree!  They need to be like a straight pine tree.  The mission is to grow tall and live.  No one hangs anything on the tree.  Of course this is easier said than done.  Whenever you start using public funds, a lot of people start pulling different directions.  If I were to set up a quasi public entity I would ask the legislators to write short clear rules as to how the money can be used in the organization.  These rules would need to relate to the vision of the organization, just like any private money collected.  The main argument I see in the Good Jobs Now report is that these organizations are all just “make the Governor look good” organizations.  That really should not be the vision or mission.  But a smart Governor, will know that if this organization succeeds it will just naturally make them look good.  I think most Governors do understand that. Next:  Have you talked to your local businesses lately?

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