Independence requires bold action.
And Kentucky Capital Development Corp. (KCDC) could be looking at bold moves.
After an unsuccessful effort to get an industry representative on the municipal utility’s board and emails circulating about funding cuts as a result of those efforts, KCDC board members discussed diversifying their funding sources at their most recent meeting in order to stand more firm in future scuffles with city and county officials.
“We’re 100 percent dependent on public money, and that dependence gives us a glass jaw,” said KCDC board member Zachary Horn, a Frankfort attorney. “You’re not able to be loud or controversial, and that’s the reality of it.”
Horn introduced the topic at the most recent KCDC meeting. He said that as an industry-advocating board, KCDC has a duty to represent the interests of business and industry to public officials. However, with all of their funding – a total of $230,500, split evenly by Frankfort and Franklin County – KCDC is sometimes put in a position where it can’t be as tenacious as some in the business community would like.
“So we’re in a tenuous situation, and we’re often tasked with conveying a message people don’t want to hear,” Horn said. “And those are the people who ultimately fund us.”
The friction was demonstrated in the latest appointment to the Frankfort Plant Board. KCDC members had requested an industry representative occupy the vacant seat on the municipal utility board seat since industry consumes about 53 percent of FPB utility services.
“Not having representation from the largest users who have the most invested and create the most jobs in our community is a detriment to the city of Frankfort and the FPB,” Terri Bradshaw, president of KDCD, told the city commission at the time. “We strongly recommend that you appoint a representative of the manufacturing industry to the vacant FPB position.”
City commissioners ultimately ignored KCDC’s request and approved Jeff Bradshaw, technical director of geospatial technology company GeoMechanique, for the FPB seat by a margin of 3-2. The dissenting commissioners partly agreed that an industrial representative ought to hold the seat.
Horn said that was the right of the elected officials to reject their request. However, shortly after KCDC’s push for an industry representative on the FPB, he began circulating an email to the other board members that an unidentified city commissioner was threatening funding cuts.
Horn proposed lessening the amount that KCDC is beholden to elected officials by diversifying funding with contributions from private industry. KCDC had at one time been funded in that way, he said, but along the way became purely taxpayer-funded.
Chairman Danny Willis said he was skeptical that having a private funding source would affect the way the board acts.
“I’m not sure that is going to generate the effect that you’re looking for,” he said.
And Terri Bradshaw said she is not sure KCDC could proceed on that path without first having the city’s and county’s approval to modify the ordinance, which would effectively diminish their power over KCDC.
“I don’t know what this would look like or what route this will take us on as we go forward,” she said.
Franklin County Judge-Executive Huston Wells was mayor at the time KCDC was created and said, ironically, it was intended “to make the community work together” in creating work outside of state jobs. He said that he’s seen the successes of KCDC in industry, small businesses and tourism in Frankfort. Wells feared that defunding the quasi-governmental agency would lead down a path of privatization for KCDC.
“I think it would be a tragic mistake,” Wells said. “It’s a better deal for all of us to cooperate. KCDC is working. It would be a shame to change that.”
Mayor Bill May was a commissioner at the time of KCDC’s conception. He said it was created to encourage development in the industrial sectors of the city and the city has made substantial headway in the area since. He said it was worth looking at whether KCDC has fulfilled its duty.
“I want to talk to more people to decide what direction we need to go in that is the best for our community, our businesses and our industries,” May said.
The KCDC board directed Bradshaw to look at the organization’s bylaws and determine whether it can accept private funds, whether it would need to restructure its strategic plan and whether the change would modify the structure of the board to accommodate a private business representative. Bradshaw said she is attempting to convene a special meeting of the executive committee to discuss proceeding.
The question among KCDC board members lingered at the end of the meeting of whether the city and county would look at cutting the organization’s funding because it is looking for outside funding.
“We have inherent limitation on what we can do now,” Horn said. “We can only do as much as the revenue they give us allows, but if we had other sources of revenue we could do more, and we would have autonomy to take on hard issues when we have to.”