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Push on to revamp NM economic development

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Eric Lopez, site operations manager of NORC, photographed on Thursday June 9, 2016. (Dean Hanson/Albuquerque Journal)

There’s not enough money, there’s not enough staffing and “it’s not sexy.”

Talk to people in charge of bringing jobs to the state and those are just some of the problems they say they face.

Their success, they say, is a key part of pushing New Mexico’s bottom-of-the-list economy into the recovery that other parts of the country started seeing several years ago, advocates say.

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“Most people thought that, after the recession, we would recover,” said Mark

LAUTMAN

LAUTMAN

Lautman, lead consultant for the New Mexico Jobs Council. “But the tide isn’t going in our direction. You can point to civic endeavors that have been important but, overall, we’re not going in the right direction in the rankings.”

A group of experts recently came up with a list of recommendations for revamping how the state pursues economic development. The ideas emerged as part of the recent New Mexico First town hall on the economy.

The group’s recommendations and a host of others that got consensus at the town hall will be published and circulated, after which leaders will decide which ones to pursue, whether through the Legislature or other levels of government, or in the private sector.

One key proposal envisions a restructuring of the New Mexico Partnership, the 13-year-old nonprofit, public-private group that works for the state on attracting new business. The proposal also foresees a stronger network of local and regional groups to work with the Partnership and the state, and it calls for increased and more stable funding.

Challenging proposition

It’s an ambitious undertaking.

In a state with one of the highest poverty rates in the country and a poor economy, job-attracting efforts are not a priority, said Tom Taylor, interim COO of the nonprofit Four Corners Economic Development who is a former state legislator and former mayor of Farmington.

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“It’s a big challenge, trying to grow economically,” Taylor said. “It’s not sexy. Many people look on it as corporate welfare.” The Partnership has a budget of about $1.4 million, the bulk of which is public money, and five staffers. The state Economic Development Department’s budget is about $6 million with 55 employees who oversee other functions like the state film office. Working at the local and regional levels are about 30 government and nonprofit entities, although a few of them are nothing more than a contact within a county government.

T. TAYLOR

T. TAYLOR

“For whatever reason, the state has never chosen to focus on economic development,” Taylor said. “We like to say that we do, but New Mexico spends less than a lot of cities in the United States.

“… It’s not a matter of doubling the funding, it’s a matter of moving the decimal point to be competitive.”

He said he does not think there are too many organizations working on attracting jobs because “we have so many different situations in the state.”

GRINDATTO

GRINDATTO

However, the efforts must become more efficient, avoiding duplication and competition, said Jami Grindatto, president and CEO of Sandoval Economic Alliance.

The proposed revamping is based on the belief that the Partnership should do only marketing – promoting the state and seeking out businesses that might be willing to move to New Mexico or expand their current operations here, Lautman said. The Partnership would then turn prospects over to local groups to do the selling and to “close the deal” with the help of the state Economic Development Department.

Lautman said the problem with having a single entity do both of those jobs is that they require different skills. And the usual practice is that, once a prospect is found, staffers must spend so much time and effort closing the deal that marketing efforts take a back seat, he said.

State Economic Development Secretary Jon Barela said the New Mexico First recommendation is “pretty much being done now,” although he said he agrees “the Partnership should … refocus its energies and improve efficiency.”

He said that, once a new director is named, the Partnership should focus on recruiting in states where businesses are looking to leave. Steve Vierck, the previous head, left in February to become president and CEO of the Economic Development Corp. of Lea County.

Barela, who was among a recruiting contingent in Chicago last week, said Illinois and California are among the places that could be ripe picking for New Mexico.

He said he also wants the Partnership to focus on marketing the business sectors in which New Mexico could be best competitive. Among those are aerospace and defense, advanced manufacturing, film and digital media, and “back office and technical support” operations, such as call centers.

Barela said local economic development organizations have been cooperating with each other and the state “very well” since he’s been in office, adding that, “I will say that’s not always been the case.”

The future is in regional efforts where counties join forces, including those in neighboring states, Taylor said. For example, the economic region in the Four Corners includes four states, 17 counties and 26 communities that have more in common with the Farmington area than other areas of New Mexico have with it, he said.

Not on board with the proposed Partnership restructuring is Vierck, who called it a “throwback process” that was popular decades ago. He said marketers are the ones who establish a relationship with a business prospect so they should remain involved, rather than handing off the deal to others.

NORC sets the example

Look to NORC for an example of how to do economic development correctly, Grindatto said.

NORC at the University of Chicago – its full name – opened a survey research center in Albuquerque earlier this year and now employs more than 300 people, with plans to add more. The operation conducts surveys for clients that include governments, corporations and nonprofits.

It’s housed at Copper Pointe near Eubank and Interstate 40, but the company started out with an interest in Sandoval County, Grindatto said. The initial tip came from a real estate broker who told the Sandoval Economic Alliance the company was looking at a few buildings in the county.

Once discussions were underway, though, NORC wanted to see other sites in the area, so the Sandoval group contacted Albuquerque Economic Development. Those two entities joined forces to find NORC the best available site – regardless of where it was located.

AED head Gary Tonjes could not be reached for comment.

“In the past, it used to be very competitive,” Grindatto said. “We need to get past that. We don’t have enough to compete for. Now, who we’re competing with are all 49 states and the world.”

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