FSEDI agrees to funding cuts

Published 8:22 am Wednesday, May 5, 2010

FRANKLIN—Franklin-Southampton Economic Development Inc. has agreed to smaller contributions from Southampton County and the City of Franklin next fiscal year.

John Smolak, president and CEO for FSEDI, said his organization’s board had endorsed taking cuts of $50,000, or 33 percent, from the county and city to help both localities deal with major budget shortfalls. Smolak discussed the cuts with County Administrator Mike Johnson and City Manager June Fleming.

“It is certainly our intent to work with Southampton County to offer our fair budget reduction, as other county departments have done, to help their current budgeting issues,” Smolak said Monday. “FSEDI has offered to the City of Franklin the same budget reduction for the 2010-11 fiscal year to assist with their budgeting issues as well.”

Southampton and Franklin have each contributed $150,000 a year to FSEDI since it was founded in August 2005. The Camp Foundations and Franklin-Southampton Charities have given a combined $400,000 per year.

“There’s nothing political about it all,” Fleming said Tuesday of the funding reduction. “FSEDI just wanted it to be the same for both, for Franklin and Southampton. The draft budget will contain that $50,000 reduction.”

Fleming said she hoped to have the city’s draft budget completed and printed today. She is scheduled to present it to the City Council during a 5:30 p.m. work session on Monday, May 10.

Meanwhile, Southampton County supervisors finalized their draft budget totaling more than $53 million last Wednesday and will hold a public hearing at 7 p.m. Monday, May 17, at the Southampton High School auditorium.

An additional work session may be held at 6:30 p.m. on Wednesday, May 19 to consider suggestions from the public hearing.

“The FSEDI budget cycle for 2010-2011 will be reviewed closely to insure that we maximize our financial resources as we have done from day one,” Smolak said, adding that the organization “will need to use a part of their reserve fund (for operations) in fiscal year 2010-2011.”

FSEDI, a public-private entity charged with creating and preserving jobs in the two localities, is believed to have reserve funds of more than $1 million, a large portion of which is from funding it received but did not spend in recent years.

Smolak said he didn’t know about the private foundations’ funding intentions for coming years.

‘The private foundation sources have not committed to any further funding at this point in time, but they haven’t been approached at this point,” he said in an e-mail.

Southampton County Jerusalem District Supervisor Anita Felts said Friday that Southampton supervisors “had to make cuts throughout the budget, and that just happened to be one of them. There was no particular reason. We just cut every department.”

Felts said the cut is not performance-related.

“I think they’re doing very well,” she said of FSEDI. “I’m very pleased with the progress that they’re doing. Maybe they’re not bringing in businesses by leaps and bounds, but a lot of other places aren’t either.”

Berlin-Ivor District Supervisor Ronald West said Friday that FSEDI “wasn’t cut for any particular reason except that everything had to be cut this year. But it’s a more extreme amount than I had anticipated.”

West said he believes the $50,000 cut in the draft budget will remain in place.

“I would say it will be what we have already moved to — $100,000 — because we’re struggling to keep a budget that is reasonable,” West said. “Nobody is happy about this budget. I’m particularly not. We’re not going to be pleased presenting this as a budget. And entities like FSEDI are not going to be pleased either, and they shouldn’t be.

“We all have to hope that next year is a better turn.”