Commerce slows transition to public-private partnership
Posted January 28, 2014
Raleigh, N.C. — The Commerce Department is delaying its plans to transfer some of its functions to a private nonprofit.
In a letter to Budget Director Art Pope dated Jan. 24 that was distributed to lawmakers Tuesday, Commerce Department General Counsel John Hoomani says the state is slowing down the transfer to ensure a "seamless transition."
In prior drafts of the plan, some Commerce Department staffers would have begun moving to the private nonprofit side as early as February. The plan has twice been revised, and in its current version, none of the five Commerce Department divisions slated for transfer to the nonprofit arm would begin the move until the fall.
"The reason we're slowing down has to do with people," said Richard Lindenmuth, who will head the private side of the operation.
Lindenmuth told lawmakers Tuesday that the speedy transition would have been disruptive to long-time staffers and that the state wanted to ensure the transition was done correctly, even if it wasn't done quickly.
A public-private partnership has long been a part of Gov. Pat McCrory's economic development strategy. His transition team recommended the move even before he took office in early 2013.
McCrory, Commerce Secretary Sharon Decker and other top administration officials say a private company would be able to respond more quickly to businesses interested in moving to the state. The change, they have said, would also give prospective businesses a single point of contact.
The functions slated for transfer mostly deal with marketing functions, such as tourism, as well as business recruitment.
Lawmakers had drafted a stand-alone bill to guide the transition. But the bill never passed the General Assembly. Instead, a brief budget provision gave the Commerce Department authority to establish the partnership nonprofit and begin the transition. However, grumbling from lawmakers that they did not mean to give the department a blank check combined with other factors to slow down the transition.
Commerce officials have pointed to the U.S. Open in Pinehurst in June as a major marketing opportunity this summer and, in prior interviews, have suggested it would be a bad time to be in the midst of a transition.
Between now and then, Lindenmuth and Decker said they will be working with a transition team to set up the organizational structure of the partnership. The extra time will also give lawmakers time to officially pass the transition legislation and give the department and nonprofit more guidance as to how the General Assembly would like to see it operate.