the economy:

Major changes in economic development efforts under way in Nevada

The Governor’s Office of Economic Development took another step toward the makeover of how the state attracts, expands and retains companies Tuesday when state officials opened requests for proposals to form newly minted regional development authorities.

The new iteration of a development authority includes a proposal from a superstar team of key Southern Nevada business stakeholders with interests in diversifying the economy through the recruitment of businesses, assisting existing businesses with their expansion plans and preventing companies from being lured to other states.

It’s a much more expansive approach than strategies that have been used for years by one of Las Vegas’ primary drivers of economic development — the Nevada Development Authority — and its lead executive, President and CEO Somer Hollingsworth.

As a result, Hollingsworth’s role is expected to be greatly diminished. And in the NDA’s place will be a new group comprising economic development leaders from Southern Nevada’s municipalities, chambers of commerce and the education community as well as the NDA.

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Somer Hollingsworth

The new group already has begun the process of finding a new chief executive.

Hollingsworth did not immediately respond to calls requesting comment on the change in the NDA’s role and how it could affect him professionally. Some are hoping he would work in some capacity with the organization’s new CEO because of his long tenure with the organization and his vast institutional knowledge.

For now, the new group is calling itself the Las Vegas Regional Economic Development Council, but that could change.

The Governor’s Office of Economic Development received 11 proposals by Tuesday’s deadline, with the one from the Las Vegas group the only one representative of Clark County’s interests — an indication that the area’s key players appear to be working together.

Other development authority proposals came from a collaborative group representing interests in Northern Nevada. The other nine were from groups in different rural counties.

Mike Skaggs, deputy director of the Governor’s Office of Economic Development who oversaw opening the requests, said some of the proposals appear to be filled with elaborate detail, giving him hope that the state is on course to begin a new chapter in growing the state’s economy.

The state office will now take until the end of May to evaluate the requests and determine which organizations will be qualified as regional development authorities, which will make them eligible for state funding to assist in their efforts. There’s no limit to the number of authorities that could be qualified from the 11 submissions.

In the meantime, the process is a sea change for the NDA that includes sharing responsibilities with leaders of other organizations.

“It’s a lot broader mission than what we had done before at the NDA,” said Glenn Christenson, chairman of the NDA’s board of directors. “The new group felt it was appropriate to find a new leader who has done this kind of thing before.”

The Las Vegas Regional Economic Development Council has contracted with Jorgenson Consulting, a Greensboro, N.C.-based executive search company that specializes in community economic development recruitment, to find a CEO for the new development authority.

Christenson said the group hoped to have its CEO in place by July 1.

The new group’s stakeholders have a big challenge ahead of them. Organizations that have been friendly and not-so-friendly rivals must now work as one team. Christenson said economic development leaders from Clark County and the cities of Las Vegas, North Las Vegas and Henderson were among participants. So are the Las Vegas and Henderson chambers of commerce. Other stakeholders include industry leaders in gaming, health care, real estate, manufacturing, tourism, banking and utilities.

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Glenn Christenson, head of the Nevada Development Authority board, says hard times make it necessary to share resources, such as the new booth at the Las Vegas Convention Center.

Christenson said the group was being represented by education leaders so that K-12 and higher education could develop programs to help build a home-grown workforce.

Representation also is being sought from industry groups the state is seeking to attract — including technology, health and medical care, aerospace and defense, logistics, distribution and transportation, and renewable energy. Christenson said a conscientious effort was being made to recruit young executives as well as senior members to maintain a greater level of experience in the future.

To keep the size of the group from getting too unwieldy, Christenson said representatives wearing multiple hats were being sought — for example, a banking industry representative also on NDA’s board or a health care industry leader with a key role on a chamber of commerce.

A steering committee formed in January that has led the effort to form the new development authority includes Christenson and is chaired by Las Vegas City Manager Betsy Fretwell. Other members include Las Vegas Chamber of Commerce President and CEO Kristin McMillan, Las Vegas Chamber of Commerce Chairman Kevin Orrock, Clark County Commissioner Susan Brager, Clark County Manager Don Burnette, Henderson Councilwoman Debra March, North Las Vegas Mayor Shari Buck, North Las Vegas City Manager Tim Hacker, UNLV President Neal Smatresk and College of Southern Nevada President Mike Richards.

The steering committee also is the core of the search committee that is hiring the organization’s new CEO. Other search committee members include Virginia Valentine of the Nevada Resort Association; Missy Young; of Switch Communications; Chris Nielson of Zappos.com; longtime Southern Nevada executive Punam Mather of Mather & Associates; and Frank Woodbeck of the Nevada Department of Employment, Training and Rehabilitation.

Big money is at stake for successfully being selected as one of the state’s regional development authorities.

Based on the Southern Nevada group receiving about 70 percent of available state funding — local leaders are making that assumption based on Southern Nevada generating 70 percent of the economy and being home to 70 percent of the state’s residents — it could get an estimated $1.7 million. The NDA’s own dues and fundraising efforts generate about $1 million a year, and the state currently provides about $1.1 million to NDA efforts.

Within three years, the organization hopes to be able to leverage its efforts to generate $1.3 million a year and add that to a state contribution of $4.7 million for an annual budget of $6 million.

Christenson said that level of funding was necessary to compete with other states’ efforts to recruit companies. The reason: The new development authority will have an expanded role.

In the past, the NDA focused primarily on guiding executives of prospective new companies to the state through the Nevada Commission on Economic Development’s tax abatement and deferral incentives; connecting companies with local real estate professionals and government officials; and marketing and advertising the state, particularly in California, on its lower tax rates and utility costs.

But the state will expect much more from its development authorities and has established new strategies to attract and retain companies. The new organization plans to have committees devoted to marketing, branding and recruitment; business retention and expansion; higher education and work force development; international business; redevelopment; and government affairs.

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  1. The NDA has not been effective. Hollingsworth liked to pick fights with California and appeared to be little more than a used car salesman. How the organization was able to get state funding for so long without opening its books to the public is incredible. We've (Las Vegas and the state) have gotten several new companies here over the past year or so, with, if my count is correct, nearly 1000 new jobs; not one a direct result of the NDA, though the organization did like to take credit.

  2. Until Nevada fixes it's Education System it will be the Land of Warehouses, Call Centers and Service Jobs for an Uneducated Population. Regardless of what anyone says and does it will all be for naught until this One Crisis Problem is fixed. Now, How will Educators be Held Accountable, Students be Held Accountable, Adequate Resources Become Available and a Fair Business, Casino and Mining Tax be Implemented.
    With Our Politicians and Residents unwilling to hold them accountable - It's NEVER going to happen. So get those Fast Food Applications Ready.

  3. JeffromVegas: I don't think it was a "palace coup." I've followed NDA and Hollingsworth for some time and it's simply an ineffectual organization. Other states, and I don't recall them at the moment, have state run organizations that are quite effective. Hollingsworth's ridiculous tactic of picking a fight with California cost the organization (and you and me, as there is state funding) quite a bit of credibility. And, they never did open their books...though I think there was a story on their financials a while; some enterprising reporter did it.

    newnvres: Absolutely, the education system has to be fixed. However, I see nothing wrong with call and fullfillment centers: Arizona has done quite well by them and think about Young America, MN, the capitol of fullfillment. It's a prosperous industry, provides jobs, albeit low-paying, but jobs nonetheless and state revenues.

    Proofus: Nice. I could use you from time to time.