J uly 8, 2014

Economic Development Strategy Evaluation

for Bexar County
Executive Summary
The Commissioners Court has requested an evaluation of the effectiveness of the economic
development department and economic development strategy for the county. For the purposes of
continuous improvement they also sought recommendations in the areas of business retention
and recruitment.

The work scope outlined nine specific questions to be addressed. This executive summary will
address each question, summarize the findings, and list the recommendations. A full report with
background information, comparable research of other county economic development
approaches, feedback from interviews and surveys, and reference materials will be provided as
the basis for these recommendations.

1. Evaluate and make recommendations regarding the Bexar County economic
development department's program and its role in the community's economic development
effort.
Findings:
The EDD was created during fiscal year 2003-2004 and has continuously evolved its role and
functions. Its primary mission has been to represent the county in business development,
negotiate incentives, and collaborate with economic development allies to expand jobs and the
property tax base for the county.

A peer comparison of major Texas counties, and select out-of-state counties, was conducted by
Griffith, Moseley, J ohnson, and Associates. Findings indicate most peer Counties take the


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minimalist approach for economic development, and rely on regional economic development
organizations to take the lead in business recruitment. Most counties are reactive with business
prospects brought to the negotiating table. They typically employ 1-3 staff, to evaluate projects
and propose property tax incentives from their county, getting approvals through their
commissioners court, and prepare incentive contracts with the county attorney's office. After
recruited companies establish operations, the same staff collect reports and monitor jobs and
investments performance versus goals. Any variances are reported to the county attorney and
Commissioners Court for corrective action. They typically also serve as representatives of their
county to collaborate and plan with the lead economic development organization in their
respective markets.

Some counties take on additional roles according to their local priorities. For example in Bexar
County, over time the department has assumed initiatives for small, women and minority
business supplier outreach, also tax increment financing districts, some housing finance
initiatives, Toyota supplier park development, locality development around the AT&T Center
and other county infrastructure investments, as well as advising smaller communities and
unincorporated areas within the county sharing their expertise on economic development matters.

In 2010, Bexar County formally joined the San Antonio Economic Development Foundation as a
major investor and partner at the level of $500,000 per year. The EDF is San Antonio's public
private partnership for economic development. Prior to this partnership, the county felt it was
often positioned as the last player at the table in negotiating incentives with recruited businesses.
This posture diluted negotiating power, and placed the county in a spoiler role if the incentive
requests were not accommodated.

Since joining EDF, the county now assumes a full participation and seat at the negotiating table
early in the process. The county also has a seat on the EDF executive board, to represent county
interests in governance, planning, coordination and accountability within the overall metro
economic development enterprise.

As an outgrowth of Toyota and their supplier park, the department has developed expertise in the


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automotive sector supply chain. Research and promotion for a Texas Mexico Automotive Super
Cluster has been a result of these efforts. Continued positioning for additional future production
lines by Toyota, and potential automotive cluster business recruitment remains a priority for the
county and department staff.

More recently in November 2013 director David Marquez presented a recommendation for a
more robust department approach to commissioners court. The intent was to be more proactive
as a county by engaging in direct business recruitment above and beyond the EDF collaboration,
building a staff of Subject Matter Experts (SME) for each target industry, and aggressively
pursue international recruitment prospects, which had already begun via foreign recruitment
missions and country consultants hired for J apan, China and Germany.

This robust economic development approach was partially implemented, and more recently put
on hold due to questions about international activities, and affordability to staff up fully for this
expanded mission.

Recommendations:
A more moderate approach for the county's economic development mission and scope is
recommended. We do not recommend returning to the prior minimalist approach where the
county simply processed incentive requests, and monitored performance. The county deserves to
have a seat at the negotiating table with recruited companies, and also a seat at the table
representing their interests within the EDF public-private partnership for economic development.

We also do not recommend the aggressive scenario, with a robust scope of county business
recruitment initiatives on a domestic and global scale. Concerns about duplication of effort, and
affordability preclude this as a sustainable option.

Presented below is a table of economic development scenarios. This identifies a broad range of
roles and functions that may be found in economic development organizations. We recommend a
moderate scenario for Bexar County economic development which encompasses the basics, plus
additional roles particular to the priorities and capabilities of the county.


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This matrix will help guide the Commissioners Court to redefine their economic development
mission, goals, operations, staffing structure, and role within the broader SA Metro development
infrastructure.
Economic Development Scenarios
Conservative Moderate Aggressive
Business Expansion & Retention Program X X X
Community Development X X X
Incentives X X X
Infrastructure Improvements X X X
Quality of Life X X X
Small, Minority & Women Owned Business Enterprise X X X
Workforce Collaboration X X X
Domestic Focus X X
Eagle Ford Shale X X
Economic Development Corporation X X
Locality Development X X
Outsourcing with strategic partner X X
Automotive Super Cluster X X
Trade Show Participation X X
Online Presence X X
Customer Relationship Management X X
International Focus X
Lead Generation X
Marketing and Outreach Campaign X
Prospecting X
Subject Matter Experts X
Sources: Derived from authors research; Development Counsellors International (2011); Leigh and
Blakely (2013); Nourick, S., Anderson, L., Ghosh, S., & Thorstensen, E. (2011; 2012); Reese (1994).


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We also offer a set of principles to guide determination of the department's programs, and
relationships with stakeholders.
A) Promotional and recruiting activities should be coordinated on the Metro level through a
public private partnership such as EDF, not conducted independently.

B) Targeted business and industry sectors in which the San Antonio Metro can be
competitive and offer the highest potential economic growth should drive all recruitment
activity, both domestic and international. The County, SA2020, and EDF targeted sectors
generally align. Incentive policies should provide greater rewards for targeted industries,
higher skilled and compensated jobs, and priority locations for each jurisdiction.

C) The strategic plan for economic development presented by Deloitte Consulting in 2013
should be the general framework to prioritize goals and assignments among local
stakeholders, including Bexar County.

D) For international recruitment, any missions should be coordinated through EDF, and
determined by solid target companies first, and countries second. Foreign market
consultants should only be engaged for the highest priority prospects, such as Toyota.
Even then the costs and support services should be shared among local stakeholders.

E) Messaging which promotes the Metro area for business recruitment must be consistently
aligned and branded, not fragmented.

F) Recruitment prospects require one single point of contact for customer relationship
management. This avoids confusion and presents a united front as a community. The
predominance of prospects should be managed by EDF. In some cases, it makes sense for
one stakeholder to take the lead, for example CPS with TESLA, yet still in close
coordination with the team.

G) Coordinated deal negotiating and incentives packaging is essential. When suspects turn
into prospects, EDF effectively convenes all partners early to give the project parameters.


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These negotiations also respect the distinct filters of each contributor to offer incentives,
including Bexar County, the City, CPS, SAWS, ISDs, Alamo Worksource, Texas
Enterprise Fund, etc.

H) Successes are shared and celebrated communitywide. Each deal has a different mix of
contributors, however everyone gains.

I) Elected officials must be engaged judiciously. Calls to companies get answered when a
Mayor or J udge take point. And internationally, government officials open doors to
access industry leaders at the top who are typically inaccessible to staff. Sufficient
preparatory work and coordination by EDF and City/County staff will determine highest
and best use of our top salespersons.

J ) Metrics, monitoring and evaluation are essential for continuous improvement and public
accountability. Outputs, outcomes, and return on investment should be transparently
reported at the partnership level of EDF, and also at the departmental level of the county,
city, and other stakeholders.

K) Limited local resources must be leveraged to support a collaborative approach to
economic development, in particular through a public-private partnership such as the
EDF.

L) Shared governance, policy and strategic direction for economic development should
occur at the Metro level through the EDF executive board. Bexar County should be
strongly represented along with other stakeholders to assert county interests in this
process.

2. Assess and make recommendations regarding the county's economic development
mission, programs and initiatives to ensure they are effective and properly focused.
When asked to express What is the mission for Bexar County economic development? the
most common general response of interviewees was "jobs and investment." When pressed for


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more specific description of mission components, strategies and programs to generate jobs and
investments, there was little consensus or alignment as to how to accomplish these goals.
On the commissioners level, their role is mostly reactive when specific business recruitment
incentive proposals are presented to the court. If a project is in their precinct, they are engaged
earlier in the process of pitching to the prospect, and consulted to some degree by staff in
structuring incentives. Commissioner Kevin Wolff is the court liaison to the economic
development department. J udge Nelson Wolff is commonly involved reviewing active prospects
countywide, and engages proactively with the most solid prospects by making calls,
presentations, and receiving inbound delegations.
On the staff level, director Marquez and assistant director Decamps maintain a running log of
active projects, prospects, and events which drives most staff activity. Analyst Mauerer
maintains a database of active incentive contracts, and refers any job shortfall variances to
director Marquez for corrective actions. These cases are also added to the work log for
resolution.
Staff below the director and assistant director in general are unaware of the department's specific
goals, metrics, annual work plans to achieve them, or the specific expectations for their positions.
Work assignments are largely reactive, constantly shifting to cover weekly urgencies. Position
descriptions have not been updated to define current staff roles and responsibilities. Individual
annual performance appraisals have not been conducted. Administrative workflow for office and
budget management is also more reactive than planned.
The only departmental metrics are after-the-sale monitoring of company performance on booked
incentive contracts. Company jobs reported versus goals, and financial forecasts for the property
tax effects through the abatement periods, and resultant increases to the county's property tax
base are monitored between the department and the budget office.
Although county staff participate in visits to the county's largest employers through the Business
Retention and Expansion program of the EDF, they have little to no influence on after-the-sale
company performance. Yet this is the main metric for their evaluation.


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Most departmental activities are described as working to bring in new jobs and investment.
Effectiveness bringing in new business is not measured for the department. No specific goals are
set for either business recruitment efforts, or results. No annual reports either internal or external
are routinely produced for accountability. This is a lost opportunity, since clearly many business
recruitments have been accomplished with important county contributions and economic
impacts.
The main presentation of economic development programs and initiatives is contained in the
annual budget submission process. This is a summary document for general budget request
justification. It is not apparently used as an annual work plan.
In November 2013, director Marquez presented an expanded vision for the department to
Commissioners Court. This advocated a more robust county capability to directly market and
recruit business prospects across targeted industries. Shifting and adding staff assigned to each
target industry would create Subject Matter Experts. These positions would act similarly to the
recruitment VPs at the EDF. They would be assigned to research their target industry sectors,
identify leads, and conduct direct recruitment outreach activities. It was intended for them to be
assigned goals and evaluated on new businesses, jobs and investment successfully recruited. And
expansion of international business recruitment was also advocated, through consultant
representatives in J apan, China and Germany. This expanded capability was never fully
implemented, with some staff assignments shuffled to cover target industries. Two additional
proposed positions remain unfilled. And public questions regarding international recruitment
efficacy have largely curtailed those activities.
On the community stakeholder level, the department is recognized as an important partner and
contributor to collaboratively promote the Metro area to business prospects. The county's main
tool to help attract business is property tax abatement. All stakeholders indicate the county's
participation early in the process of negotiating and structuring deals has been very positive.
Also the engagement of director Marquez, J udge Wolff and commissioners to receive inbound
delegations and sell San Antonio as part of the team effort has been very effective.


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When economic development partner agencies are asked about the mission, programs and
initiatives of Bexar County economic development, they most often cite representation of the
county's interest within EDF governance, collaborating on presentations to recruitment
prospects, involving the judge and commissioners for top prospects, effectively negotiating and
structuring incentives from the county's perspective, also strategic planning as part of the
Deloitte implementation team. Smaller communities within the county specifically cite the
support and expertise provided by the department to help with locality development projects.
Community stakeholder agencies also expressed confusion about the county's independent
international outreach and prospecting. Most were unaware of departmental goals and staff
assignments. None of the partner agencies were aware of the expanded vision and scope
presented in November.
It is obvious that communication and alignment of the department's role is not sufficiently
focused and can be improved. This applies on the policy level with Commissioner's Court, also
on the operational level with staff and interdepartmental relations at the county. And it applies at
the community level for the county to contribute their important economic development role on a
collaborative basis.
Recommendations:
A. Basic management functions of the department need reinforcement. A clearer vision,
mission, focused work plans, goals, metrics, position descriptions, reports of
accomplishments versus goals, and performance evaluations for individuals and the
department as a whole all need attention.

B. To strengthen basic departmental management it is recommended that director Marquez
report administratively to County Manager Smith, as do all other departments of Bexar
County. Administrative routine oversight will ensure basic management functions are
maintained. Commissioners do not have sufficient bandwidth to supervise day-to-day
operations, which is not the highest and best use of their time as policy leadership.
The economic development director position was originally structured as a direct report
to the Court, to make clear this position is the principal negotiator of incentive deals


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without another layer of appeal. To maintain a direct line for this aspect of the job, we
recommend a specific delegation of authority to negotiate and recommend incentive
packages directly to the Court for their final review and approvals. Routine coordination
meetings on business prospects directly with liaison Kevin Wolff, J udge Wolff and David
Smith should continue. Routine supervisory review and approvals on expenditures,
travel, human resources, interdepartmental matters, etc. will be more efficiently managed
through the County Manager.

C. Also consider assignment of a department staff member to focus on internal management.
This would complement the director's primary role as an external representative and
promoter with business prospects.

D. The next generation of departmental management plans should reflect a moderate
scenario for the Bexar County economic development scope, as outlined above in
Question 1. Specific functions and program elements, staff and budget to carry them out,
can be tailored per the priorities of the county, affordability, and adherence to the
principles of collaborative economic development on the Metro level.

E. To strengthen planning, oversight, and accountability we recommend Bexar County
establish an economic development advisory body. This group should be representative
of County economic development stakeholders, include experts in the field and key
partner organizations. It should not duplicate Metro level coordination which occurs at
the EDF executive board, but rather help to focus Bexar County economic development
by advising the director and the court, who retain final decision-making authority

3. Determine if the department is adding sufficient and proper value to the larger, overall
economic development effort and make recommendations for improvement, if applicable.
Findings:
From the commissioners' perspective most concur that Bexar County has a vested interest in
economic development, and should play an active role in the overall metro economic


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development efforts. Some question the balance of investing in economic growth with pressing
community development needs. Especially in unincorporated areas of the County where
infrastructure deficiencies exist and the growth only adds stress to roads, schools, utilities,
abatements are sought which then limit revenues to service the increased demands. Consensus
generally exists for a collaborative approach through a public private partnership such as the
EDF. The county's high dependence on property tax revenues to fund its overall mission, with
ever increasing demands for services, requires stimulation of business and job growth.
Staff and stakeholder interviews echo this important role for the county also. The primary added
value is collaboration by the county in promoting and recruiting business prospects, and
contributing its property tax incentives where the return on investment with economic impacts
makes sense.
Recommendations:
Bexar County should continue in a proactive role in economic development, revised within the
moderate scenario, to avoid duplication and maintain affordability.
Specific departmental goals for outputs, outcomes, and ROI should be established. Reporting
mechanisms to evaluate performance versus these goals on a long-term basis should become
routine. These basic management tools will guide continuous improvements for the counties
economic development efforts.

4. Examine Bexar County's role in international recruitment activities. Determine if
international recruitment efforts are appropriate for Bexar County. If so, provide
recommendations regarding oversight measures needed in the area of international
recruitment, and examine whether these activities should be outsourced to another
organization, such as the San Antonio Free-Trade Alliance.
Findings:
Feedback from commissioners, staff and community stakeholders question the role of Bexar
County acting independently to promote and recruit international business investments.


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Sensitivity to such trips led to a new policy requiring specific court approval of any international
outreach missions. This new policy was invoked quickly and has been well received as a
standard check and balance protocol.
At the same time, there is broad support for community-wide efforts for international outreach
and business recruitment. Toyotas manufacturing plant with 2,000 assembly jobs plus over
2,000 supplier jobs, positioning for a future potential production line expansion, and
opportunities to build the automotive cluster with additional recruitments, are valid and priority
targets.
In the economic development field, the proportion of domestic versus international prospects is
shifting. The Brookings Institution's Global Cities Initiative recently selected San Antonio as a
pilot to promote foreign direct investments. International outreach is not new for San Antonio,
ever since HemisFair, then with NAFTA, Toyota and even Eagle Ford Shale with significant
foreign investments. It is clearly an appropriate role for the San Antonio Metro area to recruit
international businesses and investment. However this should be done on a coordinated basis
with other economic development allies, not solely by Bexar County.
An analysis by Brookings Metropolitan Policy Program indicates that 83% of global economic
growth is occurring outside of the U.S. As a result, current economic development approaches
that focus on U.S. targets are outdated. In order to compete effectively, metropolitan areas will
need to shift economic growth policy by becoming more globally focused.
Brookings points toward growing global recruitment, but does not prescribe how. In recent years
San Antonio organizations promoting internationally have been in flux. The San Antonio Free
Trade Alliance suffered poor staff leadership for a long time, then a transition period to reassess
their mission and roles, and recently staff leadership was re-established by hiring the former
Executive Director. Other organizations such as the Greater, Hispanic, Asian Chambers, City
International Affairs, and County Economic Development began to experiment and act
independently on outreach initiatives, with trips, engaging foreign representatives, and hosting
events such as Sister Cities International Conference.


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To fill the void for coordination City Councilwoman Elisa Chan began a China Advisory
Committee, which then morphed into the Global Advisory Committee (GAC) in 2012. The GAC
grew to 50-60 representatives across the community, as a forum to plan and coordinate
international outreach. Due to leadership changes and the GACs assignment to the Free Trade
Alliance, this lost momentum and was recently disbanded.
Free Trade Alliance operates under a new City contract as of 2014 to continue its historical roles
of advocating free trade policies, promoting trade for area businesses, and convening trade
stakeholder groups locally. A new element added to the FTASA work scope is to assist EDF
with international business recruitment, which is currently a work-in-progress. EDF contracts
call for 34 marketing trips annually overall, with a goal of only 2 of the 34 being international.
Given the importance of international recruitment, time is ripe to convene a stakeholder
conversation on how to best mobilize a collective effort and resources internationally. The
Brookings foreign direct investment initiative is a good place to start.
Recommendations:
International recruitment should be consolidated and coordinated by a single entity, presumably
with EDF and FTASA assistance. All international business recruitment travel with Bexar
County representatives should be coordinated with this lead entity, after review and approval by
the Court.
For international recruitment, any missions should be coordinated through EDF, and determined
by solid target companies first, and countries second. Target industries defined by the Deloitte
plan, Bexar County, SA2020 and EDF provide clear guidance on recruitment priorities.
J udicious use of elected leadership to assist foreign recruitment is important. Government
officials can open doors to access industry leaders at the top who are typically inaccessible to
staff. Most of their involvement will be receiving inbound delegations, however selective
outbound missions with prime targets merit their involvement too. Sufficient preparatory work
and coordination by EDF and City/County staff will determine highest and best use of our top
salespersons.


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Existing foreign representation contracts with J apan, China and Germany should either be
terminated or consolidated under the restructured international recruitment effort with EDF.
Foreign market consultants should only be engaged for the highest priority prospects, such as
Toyota. Even then the costs and support services should be shared among local stakeholders.
A consensus plan for the Metro areas international recruitment strategy does not currently exist,
and should be articulated and agreed upon by all key economic development stakeholders, in
order to focus resources on a short list of targeted foreign industries and countries.

5. Provide recommendations for performance measures that will clearly establish and
communicate desired outcomes in the area of economic development.
Inputs:
Success implementing strategic plan (i.e., how many goals were actually met)
New investment attracted /total capital provided
Incentives awarded / availability of different types of start-up capital for local business
(number and/or value)
Marketing campaigns
Amount of financing provided
Public-private partnerships, joint ventures, collaboration (number, size, and type)
Relationships established with other organizations, customers and stakeholders
Attendance of conferences, conventions and trade shows
Greater involvement and collaboration with strategic partners
Outputs:
Businesses attracted and created in the region (number , distribution across targeted
industries)
Number of jobs attracted and created (full time, part time, contract, seasonal)
Number of businesses and jobs expanded
Number of businesses and jobs retained
Wages / salaries of jobs attracted (average)


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Number of business leads that choose to locate in the community
Foreign direct investment attracted to the county

6. Conduct a review of the department's staffing, to include an analysis of the skill sets and
talents needed to implement desired economic development strategy.
Findings: The county staff descriptions are out of date. Furthermore, staff have been shifted to
other duties and roles. This review was conducted using staff rsums and information given
during interviews.

Executive Director: This position is responsible for the overall operation of the EDD. These
duties include planning, developing, and directing efforts pertaining to economic development.
Part of the responsibilities are to attract new businesses and economic development projects,
whether locally or globally, to the county. This is done by overseeing the process from
prospecting and recruiting to the execution and compliance of agreements. The role also involves
contract negotiations, and developing and supervising compliance of tax phase-in contracts.
Duties include making recommendations, goal setting, and overseeing funding and expenditure
data as well as the development of budget submissions. The executive director reports key issues,
trends and progress to the Commissioners Court. In addition to being the department
representative to the Court, the position also serves as a liaison to the business community,
intergovernmental partners and community based organizations on economic development
activities.

Deputy Director: This position reports to the executive director and acts on their behalf as
needed. Duties include facilitating annual work plans and overseeing the roles of SMEs.
Contingent plans would have the deputy director serve as the aerospace SME. Primary
responsibilities are prospecting and coordinating with various personnel and organizations on
economic development projects. Other duties include managing operational budget and
expenditures, and develops and facilitates regional partnerships.

ED Manager: The primary function had previously been tax abatement work. Prior to the
department reorganization, this position acted more as a sales representative for the county and


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worked to bring jobs and investments to communities. The ED manager also handled the
department budget, which has now been turned over to the deputy director and the office
supervisor. The current duties focus on workforce analysis and works specifically on the Toyota
project.

Senior Policy Advisor: This position clearly shows the mismatch of job titles and actual
responsibilities. The original hiring title was CIED Data Program Manager. Currently, duties
include serving as a data analyst and contingent plans will assign this role as the corporate SME.
Future work plans include working with the executive director, and deputy director in developing
a strategic plan designed to increase the rate of job growth in the county. This year duties will
include developing the departments budget and supervising abatement compliance and
monitoring with the analyst position.

Analyst: The primary functions of this role includes serving as a liaison between the department
and other county departments, working directly with the incentives process, from qualifying and
analyzing applications to drafting and monitoring agreements. An additional duty is conducting
site compliance visits and maintaining the departments compliance database.

Senior Analyst: Prior to the new role, this position served as the Strategic Initiatives Coordinator
for TMASC. Current duties include maintaining a focus on the automotive cluster and a focus on
the Eagle Ford Shale industry. This role oversees social media, and serves as the program
manager for the internship program. Additionally, duties are providing background research and
marketing materials for the department. This role involves coordination of various agendas and
meeting set ups between the department and various delegations as well as collaborating and
reporting to the Deputy Director.

Office Supervisor: This role reports directly to the executive director. Duties included
maintaining the executive directors and staff meetings. The primary functions are to supervise,
train and evaluate office clerical and administrative personnel. Responsibilities are
administrative and clerical support such as developing office administration procedures,
monitoring employees time and attendance, maintaining in-house budget expenditures, creating


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reports, and assisting with budget preparation. Other duties include managing the daily office
functions such as ordering supplies, and creating and reviewing requisitions and purchase orders,
and verifying and authorizing vendor payments.

7. Determine if the department has sufficient resources available to successfully achieve the
recommended economic development strategy.
Findings:
The aggressive approach to economic development is likely unsustainable and commissioners
agree that this strategy should be re-evaluated.

The use of SMEs (Subject Matter Experts) has the potential to add permanent fixed costs to EDD
operations, exceed resources available in the general fund (and thus relying on a diminishing
CIED fund) and at the same time, underutilize costly resource experts. SMEs should be sourced
on an as-needed basis and not be part of full-time EDD staff. If the CIED fund is used to support
fixed costs, then long term funding will be unsustainable.

Existing consulting contracts with China, and Germany should either be terminated or
consolidated under the restructured international recruitment entity. A formal international
strategy does not currently exist and should be articulated and agreed upon by all Bexar County
economic development stakeholders in order to focus resources on a short list of targeted
countries.

8. Provide recommendations regarding financial controls and management oversight for
economic development activities.
Findings:
Commissioners generally agree that a single point of contact with county staff will establish
necessary financial controls and management oversight for economic development activities.

To strengthen basic departmental management it is recommended that director Marquez report
administratively to County Manager Smith, as do all other departments of Bexar County.
Administrative routine oversight will ensure basic management functions are maintained.


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Commissioners do not have sufficient bandwidth to supervise day-to-day operations, which is
not the highest and best use of their time as policy leadership.

The economic development director position was originally structured as a direct report to the
Court, to make clear this position is the principal negotiator of incentive deals without another
layer of appeal. To maintain a direct line for this aspect of the job, we recommend a specific
delegation of authority to negotiate and recommend incentive packages directly to the Court for
their final review and approvals. Routine coordination meetings on business prospects directly
with liaison Kevin Wolff, J udge Wolff and David Smith should continue. Routine supervisory
review and approvals on expenditures, travel, human resources, interdepartmental matters, etc.
will be more efficiently managed through the County Manager.

Current Organizational Chart





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Recommended Organizational Chart
---For tax abatements and incentives, Executive Director can directly report to the Commissioners Court


9. Review of the county's agreement with the San Antonio Economic Development
Foundation and determine whether the county should be investing in this activity and if so,
at what level.
Findings:
From the commissioners perspectives, most agree the EDF agreement is an appropriate means
to participate in collaborative business recruitment for the region. Inclusion in the prospect
presentations, negotiations and deal structuring process at the front-end is an improvement over
their prior experience of being the last player at the table in negotiating incentives. Some
concerns are voiced about the representation of one seat on the EDF Board for the Countys


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$500,000 contribution, and inattention to issues of community development when EDF brings
industry into parts of the County lacking infrastructure.
From the staff perspective, the operational collaboration with EDF when serious prospects are
qualified is very close and effective. Through the stages of promotion and site location proposals,
to packaging incentives across the City, County, ISDs, utilities, job training, Governors Office
Enterprise Fund, to approval of incentive contracts, and sharing successes there is reportedly
good coordination. Staff also actively participates in EDF governance via the Executive Board,
strategic planning and implementation with the Deloitte process. Staff negotiates the annual
agreement with EDF, in coordination with the City, however emphasizing the Countys
particular priorities and goals. The Countys original 3-year agreement with EDF lapsed last Fall,
and in the interim the collaboration was business as usual, and an extension was approved in
J une.
From the stakeholders perspective, Bexar Countys participation as an EDF partner is integral.
The City, the Chambers, the utilities and private sector members value and expect Bexar County
to be at the table and contribute to the recruiting process with talents, efforts, leadership
involvement and resources on a team basis. Many cited room for improvement, and issues to
address in future agreements, however are committed to proceeding with economic development
as a team activity through EDF.
From a best-practices perspective, Griffith, Moseley, J ohnson and Associates surveyed
comparable county economic development organizations and found the norm is to participate in
regional business recruitment organizations, as public-private partnerships. No counties in the
survey attempted aggressive business recruiting on their own.
From a contractual perspective, it is important to recognize the general performance of EDF has
consistently met or exceeded the goals and specifications reflected in both the County and City
contracts. The public sector buy-in occurred in 2010 after a task force recommended that the
County and City take formal roles in setting business recruitment policy and EDF governance,
influence the quality of businesses and jobs recruited and incentivized, maintain consistency in
marketing messages, establish a new Business Retention and Expansion program (partially in


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response to AT&Ts HQ departure), and conduct Metro-level economic development strategic
planning. Resources were redirected from City Economic Development by reducing non-core
functions and staffing from 47 to 27. The County has also maintained a limited staff of 7 for the
Economic Development Department, to enable the EDF investment.
From 2010 to 2014 represents the first generation of the public buy-in to EDF, the County with a
3-year contract plus the recent extension, and the City with a 5-year contract. Now is an
opportune time to learn from this first cycle, and address any course-corrections of concern by
the partners. Serious concerns were voiced by some key County & City stakeholders, and are
summarized below:
With the additional $1 million/year public buy-in to EDF, business recruitments and
expansions continue a similar trend averaging 25-30 companies and 3,000 4,000 new
jobs per year. Even though contractual goals are met, should the results be showing a
commensurate increase with funding to EDF?
With the City and County investing $500,000 each, is one Board slot representative for
this level of investment? In addition to the City & County executives, should broader
community interests be included?
Private enterprise membership and dues for EDFs mission should increase also
commensurate with the publics investments.
Concerns about industry targets and prospecting methods by EDF, with a mix of
recruited companies still perceived to be old-school vs. growth and innovation industries,
approaches relying too much on site-selection consultants.
Insufficient use of political leadership by EDF in recruiting, and often poor coordination
when they are used. From phone calls, to receiving key inbound prospects, making
pitches or trips, use of the communitys top spokespersons can be improved.


22

EDF leadership to implement the SA2020 economic growth component and Deloitte
Strategic Plan can be improved, to mobilize and align institutional efforts around that
common mission.
A more holistic approach and emphasis linking economic development to community
development is needed, although EDF tends to focus primarily on the business
recruitment and BRE parts of development.
Recommendation:
While voicing these concerns, at the same time a commitment to continue a team approach and
public-private partnership for economic development with EDF was also voiced. The
recommended governing body to address these concerns is the EDF Executive Board, and should
have this dialogue with participation of top County and City leadership in addition to staff. The
set of guiding principles outlined in Question 1 above provides a useful framework to determine
the next generation agreements among the County, City, EDF and other stakeholders. A meeting
of the minds to clarify the direction, roles and responsibilities of the San Antonio and Bexar
County economic development enterprise is needed.
It is recommended the County continue with extension of the EDF agreement to perform on the
established goals with the established budget, and make the necessary adjustments for the next
generation contract phase.
Summation
Timing for Bexar County is opportune to consider and implement these recommendations. The
2015 budget planning cycle is in progress for internal Economic Development adjustments, and
the next EDF agreement cycle is ready to proceed with negotiations.