A new group is about to steer Louisville economic development. Everything we know

City officials unveiled new details Friday about a public-private entity that will soon become Louisville’s lead economic development organization.

The nonprofit Louisville Economic Development Alliance, or LEDA, will include a board of approximately 30 people from businesses, nonprofits, organized labor, higher education and local government.

The public-private partnership is a key recommendation from the city's Growing Louisville Together plan, released in December 2023. And it has already drawn some controversy as the subject of a new ethics complaint filed against Mayor Craig Greenberg, along with two members of his administration.

LEDA is expected to have its first meeting, open to the public, in July.

Here’s what we know about the organization.

What is the Louisville Economic Development Alliance?

LEDA aims to address many aspects of economic development, including increasing access to capital, helping grow small businesses, spurring job growth and developing talent, city officials say.

The alliance is a 501(c)(6), a type of nonprofit that’s also referred to as a “business league,” or a group of individuals with common business interest. Common examples include chambers of commerce and real estate boards.

Paperwork to establish the nonprofit is expected to be filed the first week of July.

A private-public partnership was a key recommendation from the Growing Louisville Together plan, which details over 100 recommendations on topics ranging from land development to talent attraction to job growth.

Greenberg convened a group of about 80 stakeholders for a series of meetings last summer and fall to develop that plan. LEDA will be tasked with helping implement its recommendations.

Who will be on the board?

A complete list of official board members is still being finalized, according to a statement from the Mayor’s Office. However, the city has revealed the four “incorporators” who will be responsible for filing forms to officially create LEDA. They are:

• Jim Allen, vice chairman of Baird
• Condrad Daniels, president of HJI Supply Chain Solutions
• Kim Halbauer, regional president of Fifth Third Bank Kentucky
• Bill Moore, president of UPS Airlines.

University of Louisville President Kim Schatzel and University of Kentucky President Eli Capilouto are also interested in being on the board, Deputy Mayor Pat Mulloy said at a Friday news conference.

Mulloy declined to share the names of other confirmed members, saying a full list will be announced in July. The Mayor’s Office and the city’s Cabinet for Economic Development are still in the process of selecting, reaching out to and confirming board members.

A national search for a CEO for LEDA is expected to begin shortly with a goal of having that leader in place by year’s end, Greenberg said.

How are city employees involved with LEDA?

A yet-unknown number of Louisville Metro Government employees are expected to be contracted to LEDA. This group will include a “core team” of personnel, including project managers, policy and research experts, as well as lending and small business staff, according to the city.

The government will still pay for their salaries, Louisville Metro Cabinet for Economic Development spokeswoman Caitlin Bowling said.

What is LEDA’s budget?

The alliance is aiming for a $6 million budget, though exactly what that money will be spent on is unclear.

The alliance was recently awarded $1.5 million in start-up funding from the Louisville Metro Council in its annual budget after being recommended for funding by Greenberg.

Member dues are expected to provide an approximate $2 million to the group. The city-funded salaries of contracted Louisville Metro employees would also count toward the $6 million budget, Bowling said.

Through member donations, a funding pool will go toward “key strategies and initiatives” and possible “new funding tools for businesses,” according to information from Greenberg spokesperson Kevin Trager.

Is LEDA controversial?

LEDA is central to an ethics complaint filed by a former Louisville Metro Government employee against Greenberg, Mulloy and Jeff O'Brien, the executive director for the city's economic development cabinet.

The former employee, Terri Hathaway, alleges a “pattern” of entities being able to gain “influence and publicly-funded incentives,” which has “culminated in the creation” of LEDA.

“The private interests of Mayor Greenberg and Deputy Mayor Mulloy — as well as the private interests of those who are personally and/or professionally close to them outside of their service as public officials — are positioned to benefit in perpetuity from the intentional design of the Louisville Economic Development Alliance,” she wrote in the complaint, which was obtained by The Courier Journal.

Greenberg, however, said these claims are without merit.

“We totally will continue to partner with Metro Council,” he said. “Our administration has to play a big role. But all of those decisions will still be held by government. And with respect to the ethics commission complaint that was filed, that has no merit. Our attorneys are going to handle that.”

City leaders also emphasized the LEDA model as a “national best practice,” pointing to cities that have established similar entities, such as Cincinnati and Philadelphia.

“Our focus is on bringing people together and doing big, bold things for the city,” Greenberg said. “This is not where companies are going to be lobbying for incentives for their own company.”

Does LEDA take powers away from existing decision-makers?

Exactly what powers the new entity will have remain to be spelled out by city leaders, though Mulloy and the mayor said LEDA will not take away existing checks and balances.

“All the decisions for how city dollars are allocated will be made by Metro Council,” Greenberg said. “They'll be made by the executive branch.”

Mulloy said the question of whether LEDA is privatizing economic development is an important one and that the answer is “unequivocally, no.”

“There's nothing in this that changes any statute, any ordinance,” he said. “(Tax increment financing), tax incentives, all must still follow the same process, which is go through the legislative process.”

Why is Louisville pursuing a private-public entity to handle economic development?

Greenberg said Friday the city’s economic development strategy of the last decade hasn’t led to the results he's looking for.

When comparing Louisville's growth to other cities, he said, "the results in Louisville have been unacceptable. We need to do something new. We need to do something bold. We need to do something that creates partnerships with the public, private, educational, labor, nonprofit communities, all working together. That's what this does.”

City officials say the new nonprofit will allow for a more nimble approach to business attraction and expansion projects and convene parties at one table to focus on a slew of economic development issues.

They've also stressed the benefit of an entity outside of government that can provide continuity across administrations, while its public components can "pool and steer private sector investment towards projects resulting in larger community benefits."

Reach reporter Eleanor McCrary at EMcCrary@courier-journal.com or at @ellie_mccrary on X, formerly known as Twitter.