City Beat: Council considers merging two departments

At its June 10 meeting, Springfield City Council heard a proposal that officials say would streamline operations and cut expenses by combining its departments of Workforce Development and Economic Vitality.

The plan, to be voted on at the June 24 meeting, would create a Department of Economic Vitality & Workforce Development, whose single director would head three divisions: Community & Economic Development, Workforce Development and Grant Management.

Amanda Ohlensehlen, the city’s director of Economic Vitality, said the two departments work closely together and have several overlapping granting agencies.

Ohlensehlen, who is in line to head the combined department, said the merger offers a chance for creative solutions, cost savings and operational efficiencies while reducing administrative redundances.

She noted that the benefits to the city would be lasting.

“By combining these efforts, we will have a robust cost-saving framework over time for sustainable solutions for the city that ultimately will result in general fund cost savings as well as increased programmatic solutions,” she said.

Ohlensehlen said the combined department looks at how the labor market aligns with the city’s economic development goals.

“As we think about that intersection between workforce development and economic vitality, we want to make sure that we are understanding what the needs are of the community to know what type of training is needed,” she said. “As we increase jobs, we’re able to have individuals that are trained and educated and skilled in the diverse industry sectors that are represented throughout the region.”

Grant division
Ohlensehlen noted the combined department’s new grant division offers something new, as the city does not currently have a separate division for grant management.

She noted that the division would give the city a competitive advantage in grant-seeking.

“The more proactive we can be to learn about those opportunities and be in contact with our federal agency partners, the more likely we are to be competitive and make a strong appeal on our grant applications,” she said.

Ohlensehlen said that combined, the departments currently manage nearly $30 million in grants from various federal agencies, including the Department of Commerce, the Environmental Protection Agency, the Department of Labor and the Department of Housing and Urban Development.

New building
The combined department would be housed in a building council cleared the way for with approval of $4.4 million in bond funds to be used for its purchase and renovation and to be repaid through rental payments from the city’s workforce partners.

The building the city plans to purchase is located near City Government Plaza, but the address has not been announced. Cora Scott, the city’s director of public information and civic engagement, told Springfield Business Journal the closing on the purchase is anticipated June 26.

Communication issues regarding the planned purchase led to a fracture between the city and the seven-county Ozark Region Workforce Development Board that resulted in the city’s removal as the board’s fiscal agent in a June 7 vote.

Council approved the issuance of $22 million in special obligation improvement bonds at the meeting to fund improvements to the Springfield Art Museum, the renovation of the Historic City Hall and the acquisition and renovation of the workforce development operations building.

In a separate measure, council also reallocated $4.4 million in fiscal 2023 budget carryover from the Historic City Hall renovation to the workforce development building purchase and renovation. This was to address limitations in tax-exempt financing for housing some of the city’s workforce partners, capped by the Internal Revenue Service to 10% of the facility.

Councilmember Brandon Jenson raised a concern about whether the city would have any trouble with debt service payments on the new workforce building if partner agencies depart.

City Manager Jason Gage said the action taken on behalf of the Workforce Development Board applies only to the fiscal agent role. He noted lease payments associated with the Workforce Innovation Opportunities Act, administered by the Workforce Development Board, amount to $250,000-$270,000. If agencies were to depart shared building space, the city would have to seek other grants or be more aggressive in renting out additional space.

“As you might expect, we always have that in the back of our minds – the what-ifs and the future, always trying to make sure we have a plan in front of that,” Gage said.

Other action items

• Council passed a record $507 million budget for fiscal year 2025.
• The real and personal property tax levy for fiscal year 2025 was set at a level of $0.6091 per $100 of assessed valuation.
• A short-term rental was approved at 2960 E. Huron St. by a 7-2 vote, with Mayor Ken McClure and Craig Hosmer voting against it. There are 312 legal short-term rentals in the city and an unknown number of illegal ones, according to Planning Manager Bob Hosmer. Craig Hosmer called short-term rentals a long-term disservice to the city, saying about as many people operate illegally as operate legally in the city.
• Council accepted $600,000 in Surface Transportation Block Grant funds from the Missouri Highways and Transportation Commission. The funds will reimburse the city for a portion of the annual base salaries of seven city employees who operate the city’s Transportation Management Center, which coordinates traffic flow in the metropolitan area.
• Annual contracts with three entities – the Springfield Convention and Visitors Bureau Inc., the Greater Springfield Area Sports Commission and the Springfield Regional Arts Council Inc. – were given a public hearing. Under the agreements, the CVB is funded through 47% of the city’s hotel/motel tax receipts, or roughly $3.5 million, with the remainder of its $4.7 million budget coming from the private sector, the Missouri Division of Tourism and interest earnings. The sports commission and arts council each receive 4.5%, or an estimated $338,000 each, from the lodging tax. Council will vote on the contracts June 24.
• A public hearing was held on a contract with Branco Enterprises Inc. for the Jefferson Avenue Footbridge rehabilitation project. Branco was the only bidder, coming in at $10.8 million, higher than the engineer’s estimate of $8.9 million. The project would be funded through a direct appropriation from the state of Missouri, a combination of quarter-cent and eighth-cent city sales taxes, a Commercial Club contribution and special obligation improvement bonds, if approved. A vote on the contract is set for June 24.
• Improvements to the intersection of Division Street and National Avenue will cost $2.6 million, if the bid by Springfield-based Hartman and Co. Inc. is accepted at the June 24 council meeting. Two bids were received, the other from Radmacher Brothers Excavating Co. Inc., and both were over the $1.9 million estimate by the city’s engineering consultant.
• Three collective bargaining agreements were presented to council for first reading, with a vote to come June 24. The agreements are with the International Association of Fire Fighters Local 152 and two bargaining units within the International Brotherhood of Electrical Workers AFL-CIO No. 753, one for a crafts, trades and labor employee group and the other for a professional, administrative and technical employee group. A salary ordinance was also presented for non-bargaining-unit workers.
• Among a set of merit rules changes being considered by council is granting city employees an additional holiday on the day after Thanksgiving. Council will vote on this measure June 24.