S.J. Economic Development District / Weakness now clear - pressofAtlanticCity.com: Press Editorials

S.J. Economic Development District / Weakness now clear - pressofAtlanticCity.com: Press Editorials

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S.J. Economic Development District / Weakness now clear

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Posted: Monday, January 21, 2013 12:01 am

Structure is everything - in organizations as well as buildings. If something is not constructed properly, it cannot last.

And, if you ask us, the structure of the South Jersey Economic Development District was the reason for its current troubles.

The latest audit of the troubled agency found that fired Executive Director Gordon Dahl sometimes submitted the same bill to multiple granting agencies, possibly allowing the SJEDD to paid twice for the same work. The audit found problems so significant that the auditors, Ford-Scott & Associates, wouldn't even venture an opinion on the SJEDD's overall health.

Of course, the SJEDD's problems are well-known at this point.

The agency is $1 million in debt after overseeing the installation of infrastructure at the now-stalled NextGen Aviation Research and Technology Park in Egg Harbor Township. Atlantic County, one of four counties that make up the regional district, recently agreed to provide $474,000 owed to NextGen contractors.

Dahl was fired in April 2012 after the financial problems became clear. The district lacked a formal budget process, and Dahl continued to get annual raises even as salaries and benefits exceeded revenues.

How could this happen? Easy, when you consider the structure of the SJEDD.

Regional economic development districts such as the SJEDD are creations of the U.S. Economic Development Authority. Their mission is to funnel federal grant money into regional projects. In addition to the federal money, member counties - Atlantic, Cape May, Cumberland and Salem in the case of the SJEDD - pay membership fees.

When the SJEDD was created in 1979, its small staff and its relative autonomy were seen as a plus. But in essence, no one was watching the store.

The SJEDD is, theoretically, overseen by the EDA's regional office in Philadelphia - but that office never noticed that the SJEDD didn't perform required audits two years in a row.

There's also a board made up of several representatives from each of the four counties - a revolving board that met all of four times a year during Dahl's tenure and pretty much failed to exert any kind of effective oversight. "Being on this board is not a day-to-day, right-on-top-of-it micromanagement of this little district," Chairman Leonard Desiderio said a year ago when the agency's problems were first revealed by Press staff writer Jennifer Bogdan.

At this point, it is painfully clear that this loose structure was a key component of the SJEDD's problems. Interim Executive Director Steve O'Connor has taken some steps to address these structural issues - the board now meets monthly, for example. But it's a pity these issues were not addressed years ago.

Talks are apparently under way to somehow merge the SJEDD with the South Jersey Transportation Planning Organization. Maybe that's the answer, maybe it isn't. But clearly, the structure of the SJEDD was flawed from the start.

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