Port of Bellingham stepping up as economic driver: Officials hope to bridge gap between the state, private business

Rob Fix, the Port of Bellingham’s interim executive director, knows his agency’s economic hand reaches beyond city limits.

“We’re called the Port of Bellingham, but we should really be called the Port of Whatcom County,” Fix said.

In April, the port assumed a deeper role as an economic driver in the county: taking over management of its associate development organization, the primary authority for the region’s economic development and the county’s bridge between business and state government.

Washington commerce officials first began utilizing ADOs to coordinate economic expansion and data collection in 1990. There are now 34 ADOs serving 39 counties statewide.

The organizations receive tips from the state Department of Commerce when new businesses or industries seek to gain footholds within their regions.

They also receive state grant money to help fund development projects. The state requires ADOs to come up with matching funds in order to receive grants.

The port assumed the lead of Whatcom County’s ADO from the nonprofit Northwest Economic Council.

Most ADOs in the state are run by nonprofit organizations.

Peggy Zoro, NWEC’s executive director, said during increasingly volatile budgetary times, it’s much harder for nonprofit groups to raise matching funds for economic development programs.

Since the port has capital available, and it already plays a major economic role in the county, it’s likely to have an easier time managing the ADO system.

“This really will allow for better stewardship of the ADO model,” Zoro said. “The port has great capacity; it has deeper pockets.”

Fix said he wasn’t sure the port is necessarily better suited than the NWEC to take the lead on the ADO. The nonprofit, which works to develop regional economic strategies and bolster private sector interest and investment, had done a great job managing development in the county, he said.

However, the port’s capability of matching state grants without having to fundraise, along with the economic development activity it’s already accomplished, makes the government agency well-suited for the role.

“We already have these expenditures; we didn’t have to go raise the funds each year for a match, which in these tight budgetary times is very problematic for an agency like the NWEC,” Fix said.

Lydia Bennett, the port’s director of business development, agreed, saying the port’s management of the ADO will make it easier to match and receive state grants to fund development projects in the county.

As nonprofit groups struggle to raise funds, cuts to state grants have reduced the effectiveness of ADOs across the state to create and retain jobs.

Strong increases in state money – lawmakers increased ADO-grant funding by 162 percent in 2007 – halted with cuts as the economic downturn left the state struggling to plug holes in its budget.

In 2009, total funding was reduced from $7.8 million to $6.5 million.

Gov. Gregoire announced an across-the-board reduction of an extra 6.3 percent the next year.

At the same time funds have been cut, jobs created and retained by ADOs in the state decreased from 8,411 jobs in 2008 to 6,635 jobs in 2010, according to a report from the state commerce department.

Commerce officials say the economic downturn and rising unemployment across the state likely played a larger role in the loss of ADO-created jobs.

In Whatcom County, Fix said a major effort for the port moving forward is to meet with local business owners and find out what is standing in the way of expansion.

Port officials are already in the process of gathering feedback, he said, and they should have answers toward the end of 2012.

Fix predicted regulatory barriers would be a significant issue for business owners seeking to expand their operations, as well as barriers to securing financing for new projects and companies.

“In this current economic climate, the financing is probably going to top the list,” he said.

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