The Eastern New Mexico News - Serving Clovis, Portales and the Surrounding Communities

Q&A: New RCCDC director talks position, county

 

April 29, 2018



The Roosevelt County Community Development Corporation's new Executive Director William Hendrickson begins his new job on Monday.

Hendrickson, formerly of Las Vegas, New Mexico, was one of three finalists in a pool of around 15 candidates, according to RCCDC Board President Randy Knudson.

He said that RCCDC board members, along with Portales Mayor Ronald Jackson and Roosevelt County Manager Amber Hamilton, selected Hendrickson.

Hendrickson said his annual base salary is $52,000.

The News spoke to him on Friday about his new position:

Q: What is the primary purpose for an economic development tax?

A: It's more for reinvestment back into the community. For the most part, that's the way the money will be used: To create jobs. Oftentimes, if you're going to help a business to expand, it's gonna be attached to how many jobs you're gonna create with that. It wouldn't be to invest in a mom and pop restaurant or things like that. It's usually something like manufacturing, or you can help put in a new hotel or something like that, because that's going to create jobs as well. The end result, all the time, is jobs.

Q: How much revenue goes to the Roosevelt County EDC annually? Is it enough? Too much? How do you know?

A: Not specifically. I think it's around $60,000 total, I think, from the city. Part of that's through the LOGRT, which is that 1/8th, local gross receipts tax, and some of it comes out of the general revenue. I'm not exactly sure of the ratio.

For the size of the community, I think that's more than some other communities provide. In some other communities, it's less. I really think it just depends on budgets and ability to do things. In Las Vegas, it was less - way less - but in other communities that have the gross receipts tax ability, it's about right. It gives the ability to do the economic development job that's required.

Q: What is your first priority as you step into this job?

A: What I have to do is I'm gonna have to learn about the community, and so I'm gonna be talking to business people and talking to the board and just finding out what the community's priorities are. The little bit that I've learned so far is that there's a lot of interest in driving retail, more so than maybe manufacturing and trying to bring in a big company. Bringing in big businesses is a little tough for small communities. We have a lot of agricultural-based large companies; we have dairy and the peanuts and so-forth. There's quite a bit of activity already, and so that could be enticing to bring more.

I think a lot of folks, from what I've heard, are interested in trying to build on the retail trades and bringing in more businesses like the brewery and stuff like that. It's probably just a mix.

Q: Do you have goals spelled out? If so, what are they?

A: I want to take a look at the industrial park and get a good feel for what its potential is. I think that's an attribute for a community, and we've got the rail coming through, so there's probably some way to tie those two together. Again, I'm just gonna start learning what assets are in the area, but besides that industrial park, it's pretty impressive. When we talk to sites - these are the folks that go around looking for locations for businesses - things like industrial parks are very important. That has the potential for bringing in a lot of jobs.

But I think, overall, my focus is gonna be on small businesses. Expanding local businesses is the high priority for me.

Q: Talk about the process for deciding which businesses receive funding and how much.

A: Again, the "how much" is always related to the number of jobs that's gonna be created. The businesses themselves: Again, retail is a little bit tougher to do, even if you're working with the state to get funding. The state doesn't really work with retail too much, but they do consider things like breweries and wineries and things like that as manufacturing. Those are often easy targets to help expand or help create them.

I know we got a brewery in town, and I talked to Justin Cole yesterday, and they're interested in doing some stuff in the near future, so just kind of learning about that.

And then I need to find out what the other business is. It's mostly agriculture, I would guess, but again, it's really tied to the number of jobs that are going to be created, and that's really the drive behind whether you're doing it locally or working with the state. The state's a little more restrictive.

The other thing you want to think about is what is the other economic impact on the community? If you've got a business that wants to expand, and they want to maybe renovate a building that's not being used, that's a benefit to the community through taxes, and if they're expanding their business, they can repay through gross receipts tax and jobs. All of that has to be looked at on a case-by-case basis. What is the impact of whatever you're providing, the assistance, whether it be financial, taxes, and any other assistance - any of those types of things that are going into the project. What is the project actually giving back to the community?

There's got to be a balance there, because you can't use public monies to give profit to the business. The business actually has to pay that back in some fashion, and so all that has to be weighed as to what those impacts are. We don't want to be in a situation where the municipality is throwing all this money at a business: That's what happens when you're giving money to a friend, let's say, and it's kind of an under-the-table type thing. You're using public monies for a for-profit industry and you're not getting anything back out of it, so you need to really, from an accounting standpoint, say, "Hey, we're giving you X number of dollars and we're actually getting either that back or more, and we're creating jobs."

Q: What can be done to ensure EDC-funded businesses do not have an unfair advantage over other local businesses?

A: Again, I think that's where it comes down to: What is the impact on the community? We would be using and working with the city or the county - we'll be working with their funding and stuff, and using public monies. We have to justify what the return is. If we can't justify that, it's just not a go. From my past experience, that is the number one thing that you have to do, and if you've got the state involved, it's a no-brainer. They will not fund anything that doesn't perform that way.

Q: How do you measure success when supplementing for-profit businesses with taxpayer dollars?

A: For instance, let's say that you provided $50,000 for whatever the project was, and there's gonna be certain requirements for that $50,000 - X number of jobs or X period of time, gross receipts tax - basically, it's like a collateral type thing. If you don't perform, then there's a clawback provision. That's one of the reasons why a lot of these agreements, the state won't invest in equipment, because equipment depreciates and so you can't tie things into equipment. It's always going to be tied into a dollar value. It could be tied into you putting a building at risk as collateral. Somebody's gonna get something back. There's always that aspect of the agreement, to make sure that the monies are spent the proper way and the expectations on the returns are there as well.

-Compiled by Staff Writer Eamon Scarbrough

 

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