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New economic director has confidence in future

JANESVILLE — Janesville's new economic development director is confident jobs will come back to the area, and he wants the city to have more financial tools to aid the effort.

The city now relies heavily on TIF districts.

Vic Grassman will meet with council members Monday to ask for direction on his suggestions, which include forming a redevelopment authority and creating a small business revolving loan fund.

"If you've got a hammer, everything looks like a nail," Grassman said of the city's use of TIF districts. "But if you have a number of tools, you can be more specific. TIF will continue to be a major economic financial tool. It just won't be the only one."

Grassman, who started in October, is a Wisconsin native. Before joining Janesville city staff, he worked in the Denver office of economic development. He also was employed for 12 years by the Wisconsin Department of Commerce—Bureau of Business Development and by the UW-Whitewater Small Business Development Center.

"I firmly believe in the community," Grassman said. "Janesville has a great location and the workers are known for their productivity.

"Transitions are difficult. I see a really strong future for this area. We just need to create as many financing tools and other tools—such as 5.0—to respond to our customers, both existing as well as new businesses."

Rock County 5.0 is a five-year public/private initiative with a goal to

reposition and revitalize the economy. The group emphasizes such offerings as shovel-ready sites and a streamlined permit process to take economic development "to the next level," Grassman said.

For example, Rock County 5.0 is creating a database to show industries the cost of setting up shop here, including worker profiles and certified sites.

It also is focusing on regional marketing.

Perception is critical, Grassman said.

People around the country don't know much about Wisconsin except that it's cold and that it has the Green Bay Packers. In reality, the state has plenty of pluses that should be advertised, including a top-rated education system, roads and plentiful water.

Colorado, for example, is 48th in its support of primary education. While Wisconsin boasts a high percentage of students who graduate high school, Colorado has the lowest.

"Until I left Wisconsin, I took it all for granted, just like a lot of people," he said.

The Rock County 5.0 initiatives will show Rock County to be "extremely professional (in its) responses to both internal companies' needs as well as companies looking to locate here," Grassman said.

The group has $1 million with no overhead or salary costs. The Rock County Development Alliance, a small group of area economic development officials, never had a budget of more than $10,000.

The city is at a disadvantage with communities in other states because Wisconsin statutes do not allow it to make direct financial incentives available, Grassman said. The state's regulatory and taxation climate also is a challenge.

"We're not ranked very highly as a business-friendly state," Grassman said. "You talk to business people, and they just throw their hands up."

The Wisconsin Economic Development Association and Competitive Wisconsin have raised $300,000 for a non-partisan assessment of Wisconsin's business climate relative to other states, Grassman said.

The groups hope the study will be a debated topic during the governor's race.

For now, the city will do what is in its control, he said.

Businesses are looking at Janesville right now.

"We're going to be OK." Grassman said.

"It's not 'if', it's 'when.' We will be successful."

Suggested economic initiatives

The Janesville City Council will meet at 5 p.m. Monday in City Hall, 18 N. Jackson St., to consider adopting several economic development financing initiatives. Study sessions are televised on JATV.

The proposals include:

-- Redevelopment and housing authorities.

A redevelopment authority is a quasi-judicial agency with a focus on economic development in blighted areas. It can buy and sell land and issue bonds for debt, which does not impact the city's debt or property taxes. For instance, the authority could borrow money to buy and demolish dilapidated buildings and hold the land for a future development.

Janesville has a community development authority that deals with housing. A housing authority likely would replace the community development authority but operate in the same manner, said Vic Grassman, economic development director. According to statutes, a city must have a housing authority if it has a redevelopment authority.

"It's a common tool that hasn't been used here that I'm hopeful we can implement," Grassman said.

-- Public/private partnerships with banks for downtown redevelopment.

Grassman is working with local banks to create a fund that would close lending gaps. For example, a developer who could only secure a certain amount of money from a bank could turn to the fund for the remainder. The city would not get involved in the underwriting but would share in the risk.

"It's a great example of sharing the risk of working together and having a program that's focused on the downtown," Grassman said.

-- A small business-revolving loan fund using TIF funds and community reinvestment dollars from banks. The federal government already requires that banks give money to communities, Grassman said. The money could be used to create a pot of money to assist companies and job creation.

"It's the city partnership with the private sector that we're encouraging—TIF funds with other funds to create something more than we had in the past."

-- Closer city council scrutiny of TIFs, especially when issuing small loans where no financial need is indicated.

"I think the role of TIF in redevelopment is in game-changers, like the Sara Investment building. That changed the downtown," Grassman said.

Most communities use TIF as incentives for developer-related projects, he said.

"Janesville is somewhat unique in that its primarily use of TIF is for industrial development."