To better tell the story of the Lehigh Valley as a region, a major business development nonprofit is cutting administrative and overhead costs to boost its focus on marketing in 2013.
“We have a loan pool with $12 million each year,” said Don Cunningham, president and CEO of Lehigh Valley Economic Development Corp. of Bethlehem. “We want to get more aggressive about marketing that and getting companies capital.”
While some billboards could be used to deliver LVEDC’s marketing message, Cunningham said the delivery methods have not been finalized, though it would be mostly through electronic means.
He said a lot of companies in the Valley are contemplating growth and expansion but do not know about the opportunities available to them. An increase in marketing for loan and financing opportunities would also highlight the incentive programs available to businesses outside the Valley to encourage them to locate here.
These programs include the Neighborhood Improvement Zone (NIZ) in Allentown, Tax Increment Financing (TIF) which is being used for future business development in places such as Palmer Township near Route 33, and the Local Economic Revitalization Tax Assistance Act or LERTA.
“Over time, the organization has gone to doing little to none business development marketing of the Lehigh Valley,” said Cunningham.
Last year, the organization spent $170,000 on marketing. In 2013, the organization’s marketing budget will be $447,500, which is less than it was when the organization was created 17 years ago, said Cunningham.
The total 2013 budget is $2,072,900.
To shift more money to its marketing budget, the organization reduced overhead costs by eliminating the vice president positions for fund development and business relations, and entrepreneurial development. The title of chief operating officer has also been eliminated.
“We are a bit top heavy on administrative costs,” said Cunningham.
While three positions are being cut, the organization will create three new ones, including director of business retention and expansion, director of finance in loan development, and director of research. With 13 full-time and two part-time employees, Cunningham said the number of employees will stay the same in 2013.
LVEDC will also shift some program dollars to the marketing budget by cutting in half its contribution to the Greater Lehigh Valley Chamber of Commerce Borough Business Revitalization Program which supports small retail storefronts and downtown businesses. The organization gave $50,000 to the chamber to support this program last year but will reduce that to $25,000 this year.
While LVEDC will continue to support the foundation, Cunningham said it will increase its focus on developing businesses that have 25 employees or more, particularly in the manufacturing and distribution sectors. The organization will also reduce its contribution to a state startup grant program from $50,000 to $25,000.
“The key is to coordinate among ourselves and make our dollars go farther,” said Cunningham. “I think that’s reflective in this budget. We still have a ways to go to very effectively deliver the message of the Lehigh Valley.”