Economic development services for North Little Rock will be advertised and bid under legislation approved Monday by the City Council, answering a judge's ruling earlier this year that budgeting payments for such services is illegal.
The ordinance defines "economic development consultant" as a professional service for functions including developing strategies, communicating with prospective businesses and managing city properties marketed for economic development.
Such services will join other categories such as legal, financial and engineering previously defined by the city as a professional service.
"Economic development is important to our community, and we need it," City Attorney Jason Carter told the City Council. "We're going to do it within the law."
The City Council approved the legislation 6-0, with Aldermen Linda Robinson, Steve Baxter and Murry Witcher absent. Because state law requires a two-thirds vote of the City Council to procure professional services or add to its list of authorized services, Mayor Joe Smith's vote was the necessary sixth vote for approval Monday, Carter said.
The city will forward the legislation to Pulaski County Circuit Judge Mackie Pierce for approval, Smith said. Pierce formally ruled in June that city payments by both Little Rock and North Little Rock for city contracts or financial arrangements to local chambers of commerce and other economic development promoters -- the North Little Rock Economic Development Corp. and the Metro Little Rock Alliance -- violate Article 12 of the state constitution.
Pierce ruled that previous financial relationships with the chambers of commerce and development groups are illegal because municipalities don't receive anything solid in return and largely cannot account for how the money is spent. Pierce's ruling was in response to a lawsuit filed in 2013 by community activists in Little Rock that disputed the legality of the cities' financial relationship with their chambers.
"Once this is done, we'll go back to the court and ask 'Your Honor, is this what you want?'" Smith told the council. "We're trying to make the judge happy."
Carter confirmed that process, adding that "We won't make any final decision until we can run this in front of the judge."
The ordinance requires that the city seek economic development services by advertising for requests for qualifications and that the hiring not be based on price for such a service. Applicants are to be reviewed and ranked, with the city only then to negotiate a contract, including the price. If an agreement with the first choice isn't successful, negotiations move to the second, then third choices, Carter said.
"We want to be sure that we receive a good value for the money we are going to spend," Carter said.
North Little Rock has withheld since January -- under the court's order -- $275,000 budgeted this year for the North Little Rock Economic Development Corp., Carter said. Todd Larson is director of the North Little Rock Economic Development Corp.
Because of the hold on economic development funds, Smith said the city has "cut back some" on what it has tried to propose to developers or businesses wanting to locate in North Little Rock.
"Anything for the future, we've not been able to promise anybody," because of the litigation. Smith said. "One reason is we didn't have it. Economic Development [Corp.] has had to run off of its savings account. It's had to go into [certificates of deposit] to pay the rent and Todd's salary."
Metro on 08/11/2015