To promote jobs, Lodi needs an economic development chief

Recently on this page, there was a column about the need for our city council to have the political will to make decisions that would be good for business and for creating jobs in Lodi. I couldn't agree more.

I believe that a city can use tools to attract business and to promote business growth. (Yes, this can happen without a Wal-Mart Supercenter.) Lodi, unfortunately, just doesn't have a lot of tools in the toolbox, and one of its biggest tools, the electric utility, isn't being used properly.

One item that Lodi sorely needs is an economic development director. This person does just what the title says: promotes economic development and, as has been explained in another column on this page, assists new and current businesses with what needs to be done at city hall to get from an idea to an open business.

Unfortunately, our city council has placed things in front of this very important position by not funding it. Best of all, our city council didn't even need to think of the way to get the job funded.

Before Lodi's last budget was passed, the Lodi Budget and Finance Committee recommended that the economic development director be funded with $72,500, and the committee showed the council where to get the money — eliminate the contributions to the San Joaquin County Partnership, $35,000; the Downtown Lodi Business Partnership, $35,000; and the Parade of Lights, $2,500.

Of course, the council ignored this idea, so the $72,500 will be spent and Lodi still won't have an economic development director.

The one tool that Lodi has that most other communities do not is the electric utility. I mean, we own the thing. We set the rates and we make the rules. It is ours and we should use it like a big magnet that attracts businesses. Lodi should be able to show businesses, particularly large users of electricity, that if they come to Lodi, they will not only have low rates, but they will have stable rates. Unfortunately, we don't and can't do any of that.

As I have indicated before, Lodi has some of the highest electric rates in California. So, why would you move your business to Lodi if your costs will go up? We can all list quality of life reasons, but I'm talking about money and giving people a reason to move. Giving a business owner that is looking for a new location a higher electric bill just doesn't put a mark in the plus column.

What about rate stability? Surely we can give a large power user a stable rate because we make the rules. You know, a rate that doesn't vary wildly from month to month, so the business can plan and budget properly. That must be a plus for Lodi. Not a chance. Because of the energy cost adjustment (I'll write about it in the future), our largest power users really have no idea what rate they will pay for power from month to month.

As an example, the monthly percentage change in the kilowatt rate for Lodi's largest power user since August 2007 ranged from a decrease of about 13 percent to an increase of nearly 30 percent from what they budget. By the way, there was only one month in which the rate declined. Swings like this are not good for business and just cannot be used to promote Lodi. At a minimum, we should be able to set rates for our largest users, and for residents, for six months.

If you have the chance to see a city council candidate, ask them what they are doing to promote business development in Lodi. Will they fund the economic development director? Will they use the electric utility to attract businesses, or just as a way to move money to the general fund? When they give you an answer, make sure they give you some specifics.

John Johnson, CFA is a Lodi-based business appraiser. You can reach him at john@johnejohnson.com or at (209) 369-1451.

Reader Feedback

TandC wrote on Sep 13, 2008 9:47 PM:

" Former Lodian, last count a council meetings, we have three, that's 3, rate raises scheduled to take place before 2010. Gotta pay for the new pollution belching power plant at White Slough for the Northern Cal. Power Association and councilmeego Hnasen, The new power lead from the other side of town for the NCPA and councilmeego Hansen, and the new power transmission lines for the NCPA and councilmeego Hansen. I'm sure glad our director of the utility, Mr. Morrow, didn't have a say in his own department and line of expertise. If others think they're capable of making Mr. Morrow's decisions, let them step up and say so instead of hiding in the shadows and making those decisions and then blaming others for those bad choices, as was Alan Vallow tried to be lynched for a decision made by our favorite politician that bankrupted Lodi's electric utility and started the city of Lodi towards its current $250,000,000 in debt. Why have two directors of utility? Why isn't Mr. Morrow speaking and accounting for LEUD instead of Mr. Hansen? "

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