Published in Economic Development

‘Money has run out’ for rural economic development agency

BY Wednesday, July 22, 2020 04:24pm

GREENVILLE — The COVID-19 pandemic struck at an unfortunate time for the Montcalm Economic Alliance, which is now struggling to raise funding for its economic development work.

The alliance has contracted with The Right Place Inc. for several years to help with company recruitment, expansion and retainment.

Travis Alden, director of business development with The Right Place COURTESY PHOTO

However, major funding commitments for the Montcalm Economic Alliance are now expiring. The alliance’s funding challenges were first reported this month by the Greenville Daily News.

“That money has run out,” said Montcalm Economic Alliance President Rob Spohr. “It’s basically going to be an issue of cash flow from this point forward. We are telling our investors: ‘Any help you can give would be good.’”

The problem, however, is that the alliance’s main funders include schools, health systems and the local community college — each also facing revenue shortages due to COVID-19.

“Most of our investors are in a rough place, we understand that,” Spohr said.

The alliance had a roughly $140,000 yearly contract with The Right Place, which is now month-to-month at $11,250, Spohr said. He added that it’s “too soon to tell” how long the current arrangement may last.

“We wanted to just ensure maximum flexibility as possible,” said Travis Alden, director of business development with The Right Place. “Now is not the time to pump the breaks on economic development services.”

The Right Place has unique contracts with several rural West Michigan counties, and it’s up to counties to determine fundraising strategies, Alden said.

Among those contracts, Montcalm’s is “really the only contract at risk.”

“This is kind of an unprecedented time for all of us, and I don’t think any organization has gone unscathed through the crisis,” Alden said. “Rural communities are facing fundraising challenges. We’re trying to be as flexible and innovative as possible to make sure we can support and strengthen the partnership with them.”

Spohr agreed: “This isn’t just a Montcalm issue. It’s going to be an issue for a lot of other places, I’m sure.”

Alden said economic development work “becomes critical” during challenging and recessionary periods.

“When times are good, it’s fun and exciting when talking about projects,” he said. “But when it’s more about resiliency and recovery, it becomes critical to have (economic development) services. If you don’t have that in the community, things could get kind of dicey.”

According to The Right Place, its direct business assists — such as working directly with companies on finding financial assistance or navigating loan programs — is 320 percent above what its been during typical periods of the year.

“That’s where having this relationship between a local entity like MEA and The Right Place is even more critical,” Alden said.

Spohr added that without The Right Place’s support, economic development would eventually fall upon the area municipalities.

“The reason we (contracted with The Right Place) was to get on the radar” of prospective companies, Spohr said. “At times we’ll be off the radar is what this means.”

Read 3172 times Last modified on Wednesday, 22 July 2020 16:37