Direction of Lee’s Summit economic development debated

rpulley@lsjournal.comFebruary 28, 2014 

While Lee’s Summit recovers from the “Great Recession,” one local debate raging is the direction of the Lee’s Summit Economic Development Council.

The skirmish, underpinned by politics and a tight city budget, is fueled by what some see as lackluster growth in commercial development.

Some Lee’s Summit City Council members are demanding changes in how the city spends its money on economic development, including funds it allocates to the LSEDC, the Lee’s Summit Chamber of Commerce and Downtown Lee’s Summit Main Street Inc.

Because the LSEDC gets a large share of city money, (about $250,000 of its $500,000 budget) a lot of the heat falls there.

Council members Bob Johnson and Derek Holland suggest possible cuts, or spending more money for economic development under direct control of City Hall. But they don’t say specifically say what they’d do with that money.

Holland recently proposed asking the city increase its spending on economic development from about $330,000 annually to $530,000. The $330,000 is generally allocated to the LSEDC, Chamber and DLSMS for programs they run on behalf of the city, whether its recruitment, marketing or advertising for tourism.

Holland said the community needs to be work with brokers and developers to get Lee’s Summit to the table.

“Simply, the resources haven’t been there to build the staff and talent to do that,” Holland said. “I’m trying to rattle the cages to get it moving in a direction to expand our economic development.”

Johnson said he’s doubtful the full council will make any dramatic moves.

“I keep talking about it, and it falls on deaf ears,” Johnson said. “Deliver something for a change.”

Such critics say that Lee’s Summit’s economic growth has been stagnant, with the ratio of commercial compared to residential property hovering at 17 to 19 percent. They neglect to acknowledge that during those high-growth years when Lee’s Summit added 700 to 800 houses annually, so had it not been growing commercially the sector would have shrunk, not remained flat.

Others, like Mayor Randy Rhoads and the LSEDC’s volunteer board chairman Brad Cox believe the efforts are fruitful, even if there are continuing challenges.

Rhoads said that LSEDC does do marketing through the Kansas City Area Development Council, but Lee’s Summit doesn’t always meet criteria of businesses looking for locations through that agency.

He said one particular challenge is the lack of vacant buildings 50,000 to 150,000 square feet to land manufacturing companies.

“I think there is a school of thought to equate money with an obvious return. I’m not sure that’s realistic,” Rhoads said. “So much of what our EDC does, it’s marketing, it’s not all they do, but a lot of the time you don’t see an immediate return.”

He said one particular challenge is the lack of vacant buildings 50,000 to 150,000 square feet to land manufacturing companies.

Rhoads said often the companies are searching anonymously and the descriptions are too generic for local officials to act on directly. Every city will have success and losses, he said.

“I don’t see any systemic problem with the EDC,” Rhoads said.

Cox said that after 30 years of fast growth, Lee’s Summit is a maturing community and nearly fully developed.

It needs to keep adjusting its strategy, not repeat the tactics used decades ago, he said.

“Does our city manage that shift and get our arms around it, or be like so many suburbs that have their glory and fall off the map?” Cox asked.

It will need to do more redevelopment and make creative use of tax incentives. He said Lee’s Summit’s sweet spot now is smaller companies and offices employing highly educated workers, Cox said.

It has an opportunity to become a hub for health care and services for older adults, taking advantage of demographic changes as the America’s Baby-Boomers age.

He cites 2,500 jobs created by gradual expansion of Saint Luke’s Hospital East, and 500 jobs that hospital has at a data center at Summit Technology campus.

He says St. Luke’s East Hospital, Lee’s Summit Medical Center and Truman Medical Center-Lakewood will result in many spin-off clinics, supporting businesses and jobs coming to the community.

Now businesses, which depends on the so-called “creative class” look for areas where they’ll find the educated employees they’ll need. Those knowledge-based workers are in fields of health care, architects, soft-ware and other engineers.

He said it’s better than trying to recruit specific companies, although not a visible.

“There isn’t a supermarket where you can go pick a company out,” Cox said. “I disagree with that approach.”

The LSEDC is working on a transition plan for President Jim Devine’s eventual retirement and replacement of Teresa Evans, vice president, Cox said.

It has been stepping up its efforts in recruitment as well, he said, reconnecting with the KCADC, with Bill Brown joining its Board of Directors. Brown, of Lee’s Summit, also is on the LSEDC’s executive board.

With the exception of Council member Rob Binney and the mayor, Cox said, the city council members rarely come to the LSEDC’s meetings to learn about what the organization has been doing.

“They don’t know what we’re doing, yet they say ‘We’re going to take your money,’” Cox said. “That’s frustrating.”

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