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Proposed public-private group would steer Louisville development. What is it?

The downtown Louisville skyline.
Ryan Van Velzer
Louisville Mayor Craig Greenberg’s administration is seeking $1.5 million in the city budget to help launch a public-private partnership focused on economic development.

Louisville’s upcoming budget includes $1.5 million to fund a public-private partnership to steer the city’s economic direction. It’s led to concerns about the influence for-profit businesses could have under the plan.

Late last year, Louisville Metro Government released an economic development plan. It sets broad and specific goals for the city under four main themes including education and training improvements and business growth.

“Growing Louisville Together” tallies more than 90 pages of plans and strategies the administration has to improve Louisville’s economic outlook. It also outlines the group that will be tasked to help make the vision a reality. It’s called the Louisville Economic Development Alliance (LEDA).

On Thursday, Louisville Metro Council is expected to vote on the city’s upcoming budget, which includes a $1.5 million ask from Mayor Craig Greenberg’s administration to help fund the public-private partnership. But it’s also attracted criticism from a former city employee who raised concerns to council members.

A powerful new group

According to a document shared by the mayor’s office, LEDA would have a roughly 30-person board of directors consisting of small and big business leaders, government officials and labor and education representatives. It would operate as a 501(c)(6) not-for-profit, a designation often used by business leagues and chambers of commerce.

LEDA would take in the city’s Department of Economic Development, moving it from the city’s Cabinet of Economic Development. It would also receive a team of government employees to work for the public-private entity.

Caitlin Bowling, a spokesperson for the Cabinet of Economic Development, declined a request for an interview, directing questions to the mayor’s office.

Deputy Mayor for Economic Development Pat Mulloy, however, advocated for the spending to Metro Council at a city budget hearing last month.

Mulloy said he and Greenberg have begun contacting local leaders who helped create “Growing Louisville Together” to recruit them to the proposed group’s board of directors. He said, ideally, private business representatives would hold a majority of seats on that board.

“There will be a dues structure there, and that will bring in $1.5 to $2 million dollars of revenue to help fund this,” Mulloy said.

Mulloy said he expected the partnership to become self-sustaining, therefore no longer needing city budget support, but said he doesn’t know how many years that would take.

The document Greenberg’s office shared with LPM News highlights what it sees as a need for great urgency and flexibility to solve what ails Louisville’s economy. It said leaders who worked on the “Growing Louisville Together” plan often described the city’s economic development efforts as “disjointed.”

It argues that the LEDA board’s non-government leadership could help achieve long-term goals, and its public seats could “steer private sector” spending to benefit residents.

It also gives examples of what the partnership would do, like attracting new businesses and keeping current ones in Louisville, creating and marketing a city brand and guiding investments.

At the May 14 budget hearing, Mulloy said the partnership would offer economic guidance to the city. But in response to some council members’ concerns, he said it would not take over their responsibilities, like approving spending, or stretch too wide.

“All the other functions that your government does, will remain with the government. But we would move the economic development with a real focus to this public-private partnership,” Mulloy said.

He also told council members that Greenberg is interested in serving as board president during the partnership’s early stages. Kevin Trager, a spokesperson for the mayor’s office, said in an email that the city was still considering who would serve on the board and did not confirm if Greenberg was seeking the role.

Contention over the plan

The plan surrounding LEDA prompted a former city employee to share concerns with Metro Council members.

Terri Hathaway told LPM News she was terminated from her job with the city as Metropolitan Business Development Corporation (METCO) manager earlier this month, having worked with the small business loan program since 2020. She said she is appealing that termination.

She also filed an ethics complaint against Greenberg, Mulloy and Jeff O’Brien, who directs Louisville’s Economic Development Cabinet. Trager told the Courier Journal that the complaint was without merit.

Hathaway said she wants to see development streamlined in Louisville, but that she has concerns with current plans.

“What I envision as a solution for a development finance corporation in this community is not what LEDA is,” Hathaway said.

In an email sent last week to all 26 council members, she said that, according to documents she had seen, more than 80% of LEDA’s board was expected to be filled by for-profit corporate representatives, like developers and bankers. She also said more than a dozen city employees would work for the group.

Hathaway also claimed LEDA’s structure would not prioritize small businesses and neighborhood development, and said the group would decide which incentives and projects appear before Metro Council for approval. She recommended council members hold off on approving the funding.

Hathaway said she sent the email to Metro Council because she felt the city was misrepresenting LEDA to Metro Council and the community, and that the alliance is being shaped against the public interest.

“What I'm really seeing is the privatization of the decision-making and of the oversight … of Louisville’s economic development trajectory,” Hathaway said. “At the same time, it’s being subsidized with public dollars.”

During a committee meeting Monday, Metro Council members made final revisions to the city’s proposed budget for the upcoming fiscal year. They did not discuss or attempt to alter the $1.5 million request for LEDA funding, meaning it’s expected to be voted on alongside the rest of the budget at Thursday’s council meeting.

The mayor’s office did not respond to an interview request by deadline. However, Trager provided an emailed statement responding to concerns raised about LEDA.

He said that Metro Council would have control over approving any tax incentives, and added that loans made through METCO would still be voted on through the METCO board. Mulloy had previously told council members that the city was considering moving METCO into LEDA’s structure.

Trager also pointed to cities like Columbus, Cincinnati and Philadelphia as examples where private-public partnerships are successful when steering economic development.

“By including private business, nonprofit, labor, higher education, and local government representation in the new entity, they become even more invested in the growth of our city and creation of new good-paying jobs,” Trager said.

The “Growing Louisville Together” plan cites the Cincinnati Center Development Corporation, created in 2003, as an inspiration for LEDA. However, according to its website, that organization focuses specifically on Cincinnati’s downtown and Over-the-Rhine neighborhoods, while Louisville’s plan has a city-wide focus.

Jacob is LPM's Business and Development Reporter. Email Jacob at jmunoz@lpm.org.

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