Former DEDO director sees shortcomings with economic development partnership

Former Delaware Economic Development Office Director Director Alan Levin questions whether relying on a public-private partnership is sustainable when the economy tanks.

Gov. John Carney plans to scrap the Delaware Economic Development Office in lieu of a public-private partnership.

“It’s his prerogative,” Levin said of Carney opting to abolish the agency, which is not mentioned in the state’s Constitution. However, he said making the move to save a tiny part of the state budget might provide to be unwise over the long haul.

The public/private partnership has often been sold to the business community as a way to add resources to economic development efforts as Delaware competes with larger states like New Jersey and Pennsylvania.

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Levin, the former owner of the Happy Harry’s drug store chain, points to the steep downturn in the Delaware economy in 2008 and 2009 at the time he was selected by Gov. Jack Markell to lead the cabinet agency.

Carney rolls out partnership plan that would scrap Delaware Economic Development Office

Levin said he wonders whether the partnership model by itself would have worked at that time, noting that private dollars that fund the agency could have been sharply reduced in a time of crisis.

According to a release, state funding of the partnership would be contingent on the private contribution.

“People point to Fisker,” Levin said, referring to the $20 million financial package to the car maker that the state lost when Fisker went into bankruptcy proceedings.

Levin went on to cite success stories that included saving the Delaware City refinery after it was on the verge of demolition, the purchase of troubled poultry processor Allen by Korea-based Harim and commitments by financial services companies to maintain or add jobs at a time when operations were being shut down elsewhere.

While efforts focused on attracting and retaining big employers, DEDO also established small business programs like the LIFT loan program, Main Street and others.

Levin noted that another success story was the growth of the tourism industry since 2009, with its economic impact more than doubling over that period of time.

He said he is afraid that tourism and economic development will not as high a priority from the Department of State, a collection of state agencies with various missions that include incorporations, a key source of state revenue.

Levin credits Gov. Jack Markell for putting an intense focus on economic development during his eight years as governor.

“We talked every day,” Levin said.

Levin would not comment on whether he clashed with Markell on some issues. Levin, a moderate Republican, ruled out a bid for governor in the 2008 election that brought Markell, a Democrat, into office. Earlier in 2008, Markell scored a primary upset over Carney, who was serving as lieutenant governor.

Carney went on to serve in Congress.

Levin also expressed regret that staffers of DEDO would be let go as part of the plan. He said many employees worked long hours with no pay increases in working to build the state’s economy. – Doug Rainey

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Delaware Business Now is a five-day-a-week newsletter and associated website operated by Bird Street Media LLC. Chief Content Officer is Doug Rainey, a 30-year veteran of business journalism in the state of Delaware.

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