Glendale explores new nonprofit economic development agency

Glendale City Council is looking to push the local economy forward with a new agency that will assume some, but not all, of the objectives of the city’s defunct redevelopment agency.

At a joint meeting of the City Council and the Successor Agency on Tuesday, the Council voted unanimously to have city staff prepare the documents necessary to form an economic development corporation and bring them back to the Council for consideration.

Phil Lanzafame, the city’s director of economic development, said that compared to prior redevelopment efforts, the new corporation would be less focused on subsidizing or assisting with construction or other physical development.

Instead, it would strive to attract new businesses to the city and promote business-specific programs.

“It’s a statement by the city that economic development is important and we have created an agency specifically for that,” Lanzafame said. “More so, it allows you again a vehicle to generate revenue either through business propositions or grants, contributions, what have you.”

City Manager Scott Ochoa said the formation of a nonprofit economic development corporation won’t replace the direct investment performed by the city’s redevelopment agency, which was dissolved last year in the shuttering of nearly 400 redevelopment agencies throughout the state.

“It’s less to take the place of the now defunct and dissolved redevelopment agencies and more as an effort to represent the evolution of our economic development program,” Ochoa said. “We are much more in the business of facilitating business investment and attraction these days than we are underwriting it.”

Seed money for the new corporation would come from funds already allocated for economic development in the General Fund as well as any non-committed leftover money from the redevelopment agency, Lanzafame said.

“In the future, I think this has the ability to become a robust program generating its own revenue,” Lanzafame said.

He added that staff would spend no more than $15,000 to complete the paperwork for incorporation and address any legal issues.

The corporation would be a separate entity from the city, incorporated as a nonprofit with a board of directors likely composed of the City Council members initially.

City Attorney Michael Garcia said the City Council’s involvement would not violate any conflict-of-interest laws as long as council members are not compensated for serving on the corporation’s board.

However, council members Ara Najarian and Zareh Sinanyan voiced skepticism about potential conflicts. Najarian said that even though he was supporting the action now, he wouldn’t necessarily approve the final product.

“I do reserve my right to change my mind. Don’t say ‘You voted for this, Najarian, and now we’ve come down too far, don’t change your mind on me or double-cross,’” Najarian said. “And I do change my mind.”

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