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VOL. 125 | NO. 212 | Monday, November 1, 2010

Business Sense

Shelby County Mayor Mark Luttrell makes economic development top priority

By Andy Meek

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Photos: Lance Murphey

Mark Luttrell has a little more than eight weeks under his belt as Shelby County mayor, and he’s spent much of that time on things that shouldn’t come as a surprise.

Personnel shuffling, the inevitable appearances at Shelby County Commission meetings and relationship building with suburban mayors have all jockeyed for his attention.

Behind the scenes, however, Luttrell is also settling into a far more important role.

Like his counterpart at Memphis City Hall, the new county mayor quickly decided that now more than ever, with the U.S. economy still a wreck and the state and local picture not much better, he ought to get started on a special project.

He decided it should be the construction of a sign. It should read “Open for business,” and it should be set up at the Shelby County limits.

Luttrell developed the motivation for that mission while on the campaign trail. And he began to implement it weeks before he was sworn in.

One example came in August, when he joined the city’s business elite in a high-stakes presentation to Pinnacle Airlines Corp. board members. The presentation was part of a campaign – an ultimately successful one – to encourage Pinnacle to bring its corporate headquarters to Downtown’s One Commerce Square from an area near Memphis International Airport.

Luttrell, who had won his mayoral election only a few days earlier, had intended to be out of town at the time of the presentation, according to Memphis Mayor A C Wharton Jr. But Luttrell rearranged his schedule for the occasion, since both mayors thought it was important to send a unified message to Pinnacle executives.

Luttrell also contributed to that message high atop One Commerce that same night in a private meeting with Pinnacle board members. On the 29th floor of the tower, Luttrell’s contribution to the elaborate pitch was to assure Pinnacle’s leadership that Downtown would be a safe community where the company could grow and thrive.

Luttrell told them he’d been the county sheriff for eight years and could personally attest to Downtown’s safety from a statistical standpoint.

After having been in office for a few weeks, Luttrell still recalls – and remains driven by – comments he heard on the campaign trail, such as the contention that Shelby County was “not a real business-friendly community.”

“I’d start hearing these stories, and, OK, what does that mean?” Luttrell said. “I kept hearing time and time again about the impediments we have in place that slow down the growth of business and really impede the development of business. And it just became a recurring theme that I was hearing at all levels of government and in the community.”

He’s begun attacking those obstacles on two fronts – figuring out how to better meet the needs of businesses already here and jumpstarting efforts to bring new business to the area.

Luttrell was on the phone pursuing that latter goal only a few days after taking office.

“I kept hearing time and time again about the impediments we have in place that slow down the growth of business and really impede the development of business. And it just became a recurring theme that I was hearing at all levels of government and in the community.”

– Mark Luttrell, Shelby County Mayor

Wharton, who was involved in figuring out how to assemble a package of incentives for an unnamed company, said he’d “scraped the bottom of the barrel” in figuring out what assistance the city’s public works department could provide in the matter.

Wharton called Memphis Light, Gas and Water Division president and CEO Jerry Collins, and the story was the same there – “scraping the bottom of the barrel.”

Holding up his index finger and thumb, Wharton said the parties involved were still “this close” to getting to the finish line.

Then Wharton called Luttrell, who asked the city mayor how important the potential deal was. When Wharton let him know its significance, the county mayor wasted no time.

“Get with Jim Huntzicker,” Luttrell said, referring to the head of the county’s finance division.

It remains to be seen what the public outcome of those private negotiations will be. But at a minimum, that episode helps demonstrate the relationship between the two mayors has thus far proven to be seamless. And it’s already being relied on to grease the county’s wheels of commerce.

Along the way, Luttrell’s transition team has been fine-tuning recommendations for the mayor that touch on everything from intergovernmental relations to education to public safety.

One topic the group put a high priority on is economic development, and it’s easy to see why. Luttrell staffed the transition team with more than a dozen business and civic leaders, and he chose Stephen Reynolds, president and CEO of Baptist Memorial Health Care Corp., and Elaine Sanford, president and owner of Young-Sanford Marketing and Media Services, to co-chair the team.

The team had full cooperation – and plenty of attention – from Luttrell’s people. One of Reynolds’ morning habits is to check his iPhone for The New York Times e-mail he gets – his first e-mail of the day delivered during the early morning hours. But once Reynolds got involved with Luttrell’s transition, his new first e-mail of the day would frequently come instead from Kim Hackney, Luttrell’s senior policy adviser, who routinely sends out missives well before the sun comes up.

For that reason – as well as more serious reasons that include the transition team’s work and the man it’s handing off the recommendations to – Reynolds said, “We all sense this is a new day for Shelby County.”

Members of the economic development subcommittee of Luttrell’s transition team were Jim Ethridge, CEO of Ethridge Enterprises; Robert Staub, small business success coach and founder of SmallBizMemphis.com; Gwyn Fisher, executive director of MPACT Memphis; and Roby Williams, president of the Black Business Association of Memphis.

Each of them understands the new mayor’s economic priority.

Members of Shelby County Mayor Mark Luttrell's transition team disperse after holding their final meeting in the mayor's office.

“It needs to be easier to do business with the government, and I believe he’s committed to that,” Staub said of Luttrell.

Fisher said the county “can’t afford to keep losing young talent and middle-class families.”

The economic development subcommittee came up with four recommendations. The first is liable to get the most immediate attention and focus, while some of the others encompass recurring and long-range goals.

The first recommendation: restructure the city-county Office of Economic Development.

The team determined the office as it is now is a component of the city-county Office of Planning and Development, and as such that it's “buried” within the OED by having no direct report to either the city or county mayor. The team also faulted the office for not being a first point of contact about businesses incentives, which companies generally learn about "after first talking with the chambers of commerce."

"This lack of resources (also) prevents the OED from providing the highest caliber of small business services necessary to build a strong county-wide economy," the transition team’s report reads.

Luttrell’s team noted the payment-in-lieu-of-taxes (PILOT) program – one of Memphis and Shelby County's most oft-used business incentive programs – needs to be tweaked. The transition team recommends the scoring matrix used to determine the length of tax freezes that companies are awarded should be revised to allow the city-county Industrial Development Board more flexibility.

Luttrell’s team also faults the requirement that PILOT participants convey their property to the IDB to get the benefit, which “often has a strong chilling effect on potential business recruits.”

The team’s report argues the current economic development organization is inefficient and cumbersome, with little genuine oversight. The proposed solution: create an "umbrella entity" to revitalize economic development in the county. As it's proposed, the organization would be similar to the Center City Commission, although its purview would be all of Shelby County.

It’s further recommended that the new umbrella entity be moved out of government and set up with a board that includes the city and county mayors or their representatives, a representative of the suburban mayors and business leaders. The new structure also would include a small-business component, with a point person giving guidance to small businesses wanting to do business in the city and county. It could even be a designated "Small Business Office" within the restructured OED or another part of government.

Beyond that, Luttrell's team also recommends building more cooperation among neighboring municipalities, counties and states "in mutual support of economic development." And the team suggests streamlining the approval required to correct deficiencies impacting zoning and land use so that they need only come from one entity – either the city or county – instead of both.

The economic development subcommittee also suggested creating a “Young Professionals Kitchen Cabinet.”

“Dissect this well,” Luttrell instructed his people during the transition team’s recent final meeting, indicating he intended to use the recommendations to fuel much of his administration.

Some of that attitude about the importance of economic development could be seen earlier this month, when Luttrell listened to county commissioners go back and forth during a lengthy discussion about tax breaks. Luttrell reached a new inter-local agreement with the county’s suburban towns and cities about the tax breaks they can offer. But legal opinions from the county attorney’s office sent the matter to the commission for approval, and the discussion there focused on how much oversight is too much.

“We have almost over-regulated ourselves into poverty around here,” Luttrell told commissioners. “I don’t think there’s a single commissioner on the board today that would say, ‘I’m trying to give Mississippi an advantage,’ but the reality is we’re giving everybody an advantage over Shelby County when we can’t agree on (things like) this.”

Later, Wharton and Luttrell were seated beside each other before the IDB in a joint pitch to the board endorsing Cargill Inc.’s request for a retention PILOT to renovate and expand its Presidents Island corn-milling facility.

Luttrell might have had that and other episodes in mind when he promised his transition team, “I’m going to do my best to see what we can do to reconstitute our economic development plan.

“I think oftentimes public servants forget how they got here. I don’t forget how I got here. And I know you’ve got an expectation for me to produce.”

PROPERTY SALES 101 603 9,602
MORTGAGES 92 538 10,616
BUILDING PERMITS 215 1,282 20,958
BANKRUPTCIES 51 408 6,108