City of Greensboro considers dropping Downtown Greensboro, Inc.

YES! Weekly | February 27, 2013
Taking some by surprise, a seemingly spontaneous discussion about seeking alternatives to Downtown Greensboro Inc. ended in a 9-0 vote last week at the Greensboro City Council meeting. Consensus may be a hallmark of the Winston-Salem City Council, but it is rare that Greensboro’s governing body comes to a unanimous agreement.

At-large Councilwoman Nancy Vaughan brought forward a motion directing city staff to explore alternatives to contracting with Downtown Greensboro Inc., a 501(c)6 that serves as a booster for the center city’s marketing and economic development efforts. Vaughan and other council members said frustration with DGI has been building and communicated the concern with the organization previously, but DGI President Ed Wolverton and recent board chair Susan Schwartz said the move surprised them.

“I was surprised that [Schwartz] was surprised,” Vaughan said, adding that council has been upfront about its dissatisfaction and that there have been meetings between council members, city staff and DGI since November.

“My frustration over the last year or so has been… that we are looking for DGI to be visionaries,” Vaughan said. “The feeling has been that downtown is getting stale. We want somebody who’s going to bring us initiative.”

Wolverton began his position with DGI towards the end of 2007 after serving as the president of the Wichita Downtown Development Corp. for about six years. According to the Wichita Business Journal, many of the ideas Wolverton’s old outfit pursued were similar to those DGI has discussed recently.

“Wolverton said the task force identified the Top 5 projects, which included supporting development of the east bank of the Arkansas River downtown: recruiting a grocery store, developing a new vision plan, creating a permitting program to allow street musicians and creating more ‘people places’ such as parks and plazas,” the March 2003 article reported.

All of those projects, with the exception of development along the Arkansas River, are primary development ideas DGI has been working on in the last year. Action Greensboro, DGI and the city are working on “pop up plazas” to close down a block and encourage pedestrian traffic, busking and other cultural elements in the spring.

Vaughan said DGI was involved in busking and food trucks but that the ideas were originated organically and were taken on by council because council saw what people wanted. The visionary ideas didn’t have to be brand new, Vaughan said, just transformative, big-picture ideas.

“You don’t have to reinvent the wheel,” she said. “You can look at other communities and what they’re successful at and we can emulate those ideas.”

The Business Journal article also said that one downtown “dreamer” idea was attracting Wichita State University to increase its downtown presence, something DGI and other interest groups have recently been trying to nurture in Greensboro with area colleges.

Downtown Greensboro. Inc. is also working on several other downtown ideas, including a bike-share program, rooftop vegetation and a decrease in the number of boarded-up storefronts, as well as other more gruesome projects like poisoning rats. Part of the organization’s role is to inform and represent downtown residents and businesses. The staff has surveyed people about food trucks, held informational meetings about the noise ordinance, carried residents’ complaints about parking and trash to city government, celebrated the police department’s Center City Resource Team and explained code violations to business owners.

As DGI e-mails show, many of the primary things the organization is working on and promoting — from First Fridays to the proposed performing arts center — did not originate with them but are projects to which they are connected. The organization wears many hats, which may be fitting for a group with three different legal statuses, but council feels it hasn’t amounted to enough.

Like Vaughan, Mayor Robbie Perkins called for visionary ideas and action, adding that it was time for council to move decisively.

“I am tired of talking about it behind closed doors,” Perkins said. “This isn’t the first time I’ve said this as mayor. I don’t think we’re competing effectively with other cities our size. I think downtown’s suffering from some indecisive leadership at this point. Drive to downtown Winston — there’s energy there. Drive to downtown Durham — there’s energy there.”

Perkins, Vaughan and the city manager attended a DGI board meeting last week to explain the city’s stance.

Downtown Greensboro, Inc. was established in 1997 and later followed by parallel organizations, Downtown Greensboro Foundation and Downtown Greensboro Improvement Corp., with different legal statuses but similar agendas. Wolverton is the president of DGIC, a 501(c)4, and DGI, and the two share a board of directors. The city contracts with DGI and DGIC for different services, but Vaughan said she isn’t clear on the distinctions between the organizations.

“I have to think that they are intertwined and I am trying to get some guidance right now between the two and where the overlap is,” she said. “Basically it’s shadow organizations. It’s the same leadership. It’s the same board.”

Council’s instructions to explore alternatives are currently limited to two aspects of DGI’s contracts, but the city’s relationship to the intertwined organizations runs deeper.

According to Wolverton, the city has an annual $103,500 contract for economic development and $100,000 for “enhanced projects” with DGI out of the Greensboro’s general fund. The city turns over $523,000 to DGIC each year from tax revenue created by the business improvement district, or BID, to improve downtown.

The tax funds primarily go towards the organization’s “clean and green services,” Wolverton said.

Downtown Greensboro, Inc. reported $38,808 in unspent funds from the $100,000 enhanced projects contract for fiscal year 2010/2011 and $18,203 in unspent funds from fiscal year 2011/2012. According to its budget allocation report for the current fiscal year, DGI takes $20,000 out of the $100,000 for enhanced projects for management fees. Similarly, $134,000 of the $523,000 in BID funds goes to DGIC in program management fees.

Downtown Greensboro, Inc. is subcontracted by Action Greensboro to maintain Center City Park, receiving $199,445 a year, according to the January 2012 contract between the two entities. The city pays Action Greensboro $200,000 for expenses —the normal amount for a city park — and $150,000 for “extraordinary expenses” such as operating the park’s fountain and water features annually.

After a 10-minute DGIC Board of Directors meeting on Feb. 21, Wolverton instructed reporters to leave as the DGI board meeting began. Not 10 minutes later, Wolverton and DGI’s staff were also asked to leave the meeting as the board went into executive session to discuss city council’s unanimous vote. Vaughan, Perkins and the city manager were also present at the meeting. Schwartz, the past board chair, said the meeting allowed the board and council to better understand each other but that no concrete decisions were reached.

Wolverton waited for almost 90 minutes in the hallway outside the meeting. As the meeting finished, downtown property owner and board member Milton Kern approached Wolverton outside.

“We’re behind you, Ed,” he said. Wolverton confirmed that city council had asked for a copy of his contract but said the board wasn’t required to release it.

“Ed is thought very highly of by the board,” Vaughan said. “They admire his meticulousness, his research and his numbers. I think we are trying to get the point across that we are looking for a visionary.”

The second item listed under DGI’s scope of services related to its economic development work with the city is to “develop conceptual ideas and plans” for downtown. An item further down the list tasks the organization with providing “long-term vision development and planning recommendations.”

In addition to looking at other options for the economic development contract, council also wants to examine the marketing for downtown. A new marketing campaign launched by DGI entitled “See. Do. Share.” with a website by the same name provides minimal information on downtown and directs back to DGI’s regular website. It also promotes downtown through the Twitter hashtag #DGSO, which is used by several downtown businesses, patrons and arts and cultural spaces.

In September 2012, DGI released its strategic work plan entitled “Leading the Way,” and characterized its work quite differently than its critics.

“DGI has grown from humble beginnings 15 years ago to lead the local renaissance,” the beginning of the report claims. “DGI’s visionary and thoughtful approach, ability to forge key alliances and collaborations and responsive-ness to stakeholder needs have all contributed to the explosion of growth, jobs, investment and activity since DGI’s inception.”

The first objective listed in the work plan is the proposed downtown performing arts center, despite the fact that the city created a specific, separate task force to research and promote the idea. Other objectives included installing informational kiosks, attracting new investment primarily by continuing existing practices, increasing public safety and parking availability, adding more trees, centralizing newspaper boxes, advertising downtown including messages about buying local, adding public art installations and more special events.

The report said one way DGI would “foster communication” downtown was to “assist in creating and supporting a Downtown Residents Association,” though one had already been launched seven months earlier.

The strategic plan aligns with the Downtown Economic Development Strategy, which was generated by DGI, the city, the county, Action Greensboro and residents. The ideas: completing the downtown greenway — which is being spearheaded by Action Greensboro — implementing a “comprehensive streetscape program,” encouraging mixed-use development, utilizing historic buildings, building the performing arts center and trying to create a downtown university campus.

“DGI is taking an active role in these and other potential transformational projects,” the report says. “DGI is helping with community outreach, identifying best practices and facilitating coordination, communication and cooperation among all parties.”

YES! Weekly’s public-information request on DGI showed Wolverton did regularly attend meetings on items of interest to downtown, like performing arts center planning meetings, and is in regular communication with city staff. Numerous other ideas were a continuation of what DGI is already doing or outlines of generalized concepts for improving downtown — like examining funding opportunities — but it would be a stretch to call any of them “visionary” or grand, transformative proposals.

I think that DGI has done a very good job with marketing downtown and keeping it clean. It just seems to me that we’re continuing to flourish. I think that’s a lot, considering that we as a community don’t have a lot to put into development.”’

Susan Schwartz

Vaughan said she didn’t want to limit the alternative options to DGI by discussing it prematurely, but said the city taking over the responsibilities was a possibility. Vaughan added that it was possible the council would support staying with DGI if there were significant changes.

Wolverton directed most questions to Schwartz, who said the board is pleased with the staff.

“The board really stands behind our performance based on the contracts we have,” Schwartz said. “We think they’ve done everything that they’ve been asked to do.”

Downtown business owner Eric Robert, who has been one of DGI’s most vocal critics, said the issue extends to the organizations and the board, not just one person.

“Wolverton shouldn’t be the fall guy,” Robert said. “I would like to see everything at the end of the fiscal year to go in house to the city. DGI controls all the funds and people are afraid to go against them. They have operated without any kind of consequences.”

Robert said he objected to paying taxes, through the BID, to an organization that wasn’t representative of the city and took so much in management fees. The organization’s strategic plan says otherwise, calling its board “diverse.”

Robert also opposes so much of the BID money being spent on downtown cleaning, decrying the $323,500 for “clean and green” services, saying it’s far too much to spend on “getting gum off of the sidewalk.” Robert said he would rather his portion of the BID funds go towards a more worthwhile downtown project like the Interactive Resource Center.

Robert has crusaded against DGI, taking his concerns to city council and also filing public-information requests to try and learn more about the organization’s finances and roles. He isn’t the only one who has contacted council to criticize the nonprofit; downtown property owner Jim Morrone e-mailed council in October 2012 when DGI requested its unspent funds be rolled over into the following year.

“From where I sit, it looks like mismanagement of money and priorities are taking place in DGI,” Morrone wrote.

“I am opposed to re-authorizing this money. Furthermore, I question that the money will actually be used for those two items. It seems like an afterthought, just to keep the money in their hands.”

Morrone’s e-mail was among several that turned up in a YES! Weekly public-information request on DGI, but he could not be reached for comment in time for the article. The organization expends funds on hanging flower baskets and trees to beautify downtown, and Morrone questions why the money hadn’t been spent on trees or downtown signs earlier.

Schwartz defended DGI’s work and said that rather than generating new, visionary ideas, downtown needed to implement plans that were suggested by consultant Cooper Cary including the downtown greenway. The organization is working on four major projects, she said, including the proposed performing arts center, the greenway, a downtown university district and the South Elm redevelopment project.

“I think that DGI has done a very good job with marketing downtown and keeping it clean,” she said. “It just seems to me that we’re continuing to flourish. I think that’s a lot, considering that we as a community don’t have a lot to put into development.”

Vaughan said DGI dragged its feet on implementing ideas that council had taken the initiative on, such as busking and food trucks, adding that the big ideas for downtown like those Schwartz listed came from elsewhere.

“None of those ideas were brought forward by DGI,” she said. “Council had to go to DGI and say: ‘Implement these ideas.’ Quite frankly, I don’t want to talk about flower baskets, busking and food trucks. I want to talk about bigger ideas.”

Schwartz said DGI and the city had agreed at the end of 2012 to work together to set 2013 priorities and hadn’t had a chance to prior to the council’s vote. The two bodies had agreed the city manager would designate a staff member to attend DGI board meetings but the designee, new Assistant City Manager David Parrish, attended his first meeting last week. Schwartz said. Council, staff and DGI planned to continue discussions on Feb. 26.

While Schwartz admitted DGI can’t take credit for all of the development that happens downtown, she said it is responsible for making the center city appealing and attractive to businesses. The growth rate for downtown — marked by more than $10 million in increased tax revenue — exceeds the city as a whole in recent years, she said.

“We need people with all kinds of ideas,” Schwartz said, adding that DGI is just part of the equation. “I’d say it’s almost thank heavens for downtown.”

Editor’s note: Just before press time on Tuesday evening, the city of Greensboro issued a press release saying, in part, “Representatives from the City of Greensboro and Downtown Greensboro Incorporated (DGI) have reached an agreement on continuing their partnership in promoting and improving the downtown area. As part of the agreement, a working group will be established to better define the partnership between the City and DGI.

The group will be a subset of representatives from the two groups. The team will spend the next three months reviewing how the partnership has worked in the past and will recommend changes and improvements for the future.”

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