A review of the draft budget for 2014 shows the Koochiching Economic Development Authority expects another successful year.
The budget, which was reviewed Wednesday by the KEDA Board, was broken down into two parts – KEDA’s operating budget and a cold weather testing budget – and is expected to be discussed and adopted when the board meets in September.
“We expect a carry-over starting balance to be about $113,958,” said Paul Nevanen, KEDA director.
The draft included information that the Iron Range Resources & Rehabilitation Board is one of the primary funding sources to the organization.
“We are self-funded with the exception of IRRRB funding,” Nevanen said.
The IRRRB Board seeks to promote and invest in business, community and workforce development for the betterment of northeastern Minnesota. The contribution is based on a formula from taconite production. Significant increases in taconite production has been reflected in the KEDA’s allocation of funds, Nevanen explained.
This year, Nevanen reports KEDA received $86,127 from the IRRRB, which is expected to be received in September or October. Next year, a signed formal agreement says the organization’s portion will increase to $93,442.
“It’s good news,” Nevanen said.
In further review of next year’s budget, the board agreed to opt out of a program and put $25,000 back into KEDA’s operating budget.
In 2005, KEDA joined the Minnesota Community Capital Fund program. The nonprofit corporation provides local communities and economic development agencies throughout Minnesota with the opportunity to participate in a development financing organization as a means of helping small businesses and nonprofits secure the capital they need to grow and prosper when they need it.
“It is a gap finance program created in conjunction with community reinvestment,” Nevanen said. “While the fund saw early success, in 2007 more restrictive guidelines made it difficult to sell loans into the secondary market...It really became less competitive.”
The board agreed that by opting out of a dissolving fund and putting the money back into KEDA’s operating budget, the money would be put to better use.
In related budget business, the board agreed to give a $1 per hour raise to the KEDA’s administrative assistant, Kyra Briggs.
KEDA’s biggest expense is employee wages and while Nevanen said the wages of himself and Herman “could hold at the current level,” he recommended the raise for Briggs based on the results of an annual performance review.
Board treasurer and Koochiching County Commissioner Rob Ecklund said he appreciates the help Briggs offers and noted she is deserving of the raise.
In other business Wednesday, Jenny Herman, business consultant for the Small Business Development Center, gave a quarterly update that included she has worked with 13 new clients since Jan. 1.
“Most often it’s business planning and business accounting,” she said of the services new clients are seeking. “We service satisfied clients.”
She added that she assists 33 long-term clients who have utilized SBDC services for more than five hours.
Herman also said SBDC serves as a satellite office of the University of Minnesota Center of Economic Development to provide services to existing businesses and entrepreneurs.
“There are nine other consultants in our region...we all work really well together,” Herman said. “We purposely make sure we’re not working against each other...Just because someone is in Koochiching County doesn’t mean they can’t use SBDC services from someone in Hibbing or Duluth.”
She continued that Duluth is “very supportive” of International Falls and the surrounding communities in the county.
Herman plans to once again bring the junior achievement program into classrooms. Last year, the program that stresses the importance of staying in school reached 680 Koochiching County students in 27 classrooms.
“We had really good feedback on the program from volunteers, teachers and students,” Herman said.
This year, Herman plans to expand the program to more classrooms to reach even more students.
Also Wednesday, Debbie Bowman, who serves as an alternate board member, presented the board with a few questions and concerns regarding new ideas flowing through the organization.
“I’m concerned about the agenda,” she said. “I think the agenda very seldom changes and I think there is so much work to do and there are so many things to do here...We keep working on the same things over and over again.”
“We welcome new ideas,” KEDA Board Chairman Allen Rasmussen said, “as long as they’re somewhat realistic.”
Board member and Koochiching County Commissioner Wayne Skoe said that while not all ideas and efforts make it to the board’s agenda, KEDA and other businesses and organizations are constantly working on economic development.
He said some projects, however, aren’t ready to go public and therefore, aren’t on the agendas of public meetings.
Bowman also said following Boise Inc.’s announcement to eliminate 265 jobs at the local paper mill, that “perhaps I would like to see KEDA play a bigger role in working with the people who are here.”
Rasmussen said that one of the main components of economic development is making local people successful and “Jenny does a great job doing that.”
“We do put efforts into that,” he said.
Nevanen said Herman and the organization work with other committees and organizations and caring for the local business community is a priority of KEDA and its ongoing efforts.
