The resignation of a key liaison between Gilroy and businesses
has many saying he was handcuffed by a lack of funds, which has
kept new enterprises well at bay.
The resignation of a key liaison between Gilroy and businesses has many saying he was handcuffed by a lack of funds, which has kept new enterprises well at bay.
Richard Spitler, who steps down as president and chief executive officer of the Gilroy Economic Development Corporation after eight months on the job, leaves as Gilroy is struggling to attract businesses, development and downtown vibrancy.
Since its formation by the Chamber of Commerce in 1996, the EDC has been a liaison between developers and the city. As the recent recession took a toll on Gilroy’s development, the EDC was planning to shift its focus toward retention of downtown businesses, Spitler said.
A bare-boned EDC has meant Spitler, who impressed city officials and the business community alike, was limited by lack of money and staff.
“The city government has policies and procedures,” Spitler said. “The hook is set deep and it’s hard for staff to change their way of doing things, so what you saw is me deliberately trying to get the Council to understand that the rules of the game that applied in 2005 don’t apply anymore. If you step out of City Hall to the business sector, everyone is trying to survive.”
Mayor Al Pinheiro said a starved EDC has a direct effect on the lack of businesses coming to Gilroy and said the bad economy has been to blame.
“Their loss of funding makes their job much tougher to do,” Pinheiro said. “The more money they (the EDC) have, they can do campaigning and the more apt they are to deliver. There’s obviously a correlation with lack of funding. It made it harder for us to attract businesses.”
Councilwoman Cat Tucker acknowledges funding for the EDC has been an ongoing preoccupation in the Council, but a decrease in funding to the EDC was a part of necessary citywide service cuts.
“Do we need all these services, yes, so which ones do we reinstate?” she said. “Public safety and then job growth. Certainly economy is on top of the list for me.”
Spitler said he was motivated by the City Council’s move to change the retrofitting requirements for the unreinforced masonry buildings. Currently, the safety requirements have led to vacancies in Downtown Gilroy. Spitler said the new requirements would help bring businesses to the area.
“When you step back and look at Gilroy, the most underused area is the downtown,” Spitler said. “I don’t think people had realized the potential. The economy has changed, the private sector has had to reduce costs and progress is slower than I would have liked.”
Tucker said the issue will be taken on in January during a policy summit retreat, where city leaders shape ideas that guide the local economy.
“I know that (Spitler) was concerned with funding,” Tucker said. “We were able to give him some one-time funding for marketing surveying. I personally think that we need to do as much as we possibly can to attract professional people, because people look for a job when they’re unhappy. It could be the frustration of working with little funding, but it could be that his new job is in his hometown.”
Spitler will become the City of Calistoga’s city manager in December. A Calistoga resident, he said his decision to move is motivated by family. He had been trying to relocate his wife, a first grade teacher, from Calistoga to Gilroy but the down economy has made job searching difficult for her.
“I like this town and the people,” he said of Gilroy. “I walk downtown and they say ‘good morning,’ but if they have a problem they just look you in the eye and then it’s done. It’s difficult to take sometimes, but it’s an honest community and I like that kind of town.”
Still, after eight months of representing the business and development community, he leaves Gilroy with a sense of frustration.
City budget cuts have affected the EDC, which receives funding from the City of Gilroy, the Gilroy Chamber of Commerce and from the corporation’s 23 business partners. Prior to the 2009 cuts, the EDC had a city-allotted $120,000 budget.
The two-person staff EDC is the only city-paid positions to form the liaison between businesses and the city. Spitler acknowledges funds were lacking.
According to Gilroy Financial Director Christina Turner, city funding for the EDC for fiscal year 2011 is $96,000, plus an additional $45,000 for a marketing plan to be administered by the EDC. Spitler’s annual salary was $90,000 plus benefits.
Jane Howard, Gilroy Visitors Bureau executive director and former interim EDC president, said attracting businesses to Gilroy may include funneling more money into the EDC.
“(The EDC) will be needing more funds to do what they need to do. It’s what I would call an investment,” Howard said.
James Suner of the James Group, an EDC partner, said the job of being an EDC president is difficult, regardless of the salary.
“Our EDC presidents are being given a lot to do with a limited number of resources so we can’t obtain the best and the brightest and then keep them,” he said. “I certainly couldn’t do it.”
According to Spitler’s contract with Calistoga, which is set to be approved at Tuesday’s Calistoga City Council meeting, he will make $140,000 a year with benefits.
AN EARLY EXIT
Spitler’s resignation last week caught many by surprise.
“Too bad to hear, I had no idea,” said Steve Peat, owner of three Gilroy McDonald’s and an EDC partner. “You always hate to see somebody who just joined us, leaving.”
Kurt Michielssen, the EDC chair, said he was surprised when Spitler announced his resignation last week, but said he understood his motivation.
“I am very, very sorry to see Richard leave,” he said. “In the short period that he’s been with the EDC, he’s done a good job of bringing funds in and re-establishing partnerships, and bringing a good deal of order to policies and practices.”
Michielssen said Spitler had discussed moving permanently to Gilroy but did not commit to it, and added he did not remember whether the hiring committee had deemed it necessary for the EDC president to live permanently in Gilroy.
Councilman Perry Woodward said he found out about the resignation through GilroyDispatch.com and said he was surprised Spitler was taking a position as a city official after defending business and development here.
“There’s always a tension between business and government, and Richard was doing a good job with bridging that gap and we were just starting to see the results,” he said.
Spitler, whose job sometimes involved speaking to the City Council on behalf of developers, said he had difficulty convincing the city that the recession has merited some attention from the city toward the business community, and also struggled to get property owners to open up to the idea of new businesses.
“There’s a lack of imagination and risk takers that are willing to make something happen,” he said. “Property owners need to wake up and do what’s best for Gilroy. Every building has its own story. When it comes to city policy, the downtown needs to coalesce better, work with everyone and say ‘city here is where you come in.’ ”
Spitler accomplished many things in his short time as president of the EDC, Michielssen said.
“He was in the center of bringing Monterey Pasta, which will be hiring 250 people and was also extremely helpful and supportive to Mi Pueblo,” he said.
Monterey Pasta, a Salinas-based company, will be moving to 5755 Rossi Lane in southeast Gilroy in the spring. Mi Pueblo, which held its grand opening celebration Nov. 6 at its First Street location, has hired 150 people from the area.
Spitler was the first president to be hired for a permanent position since Larry Cope resigned in April 2009. Richard Zahner was heading the EDC as interim president for a year and trained Spitler for his position.
AN EMPTY EDC SEAT
Suner said he is not nervous about the prospect of having an empty seat at the EDC because limited funding does not allow them to do as much as they’d like to, he said. But this time the board of directors should take a different approach when looking at who to hire.
“What we need is some young talent,” he said. “We keep getting guys at the end of their careers. In this economy with this budget you hire someone that has a degree, but they have to prove their value. Give me poor, smart and hungry.”
Michielssen said the board of directors of the EDC met Wednesday to discuss Spitler’s resignation, plans for succession and hiring process, but no possible candidates were discussed. He said the search for a replacement hasn’t begun yet.
“We did have a committee last year – myself, Richard Zahner from a logistical standpoint and two other directors,” said Michielssen. “We interviewed applicants and narrowed down the list and then we had our finalists interview with the committee directors of EDC and some of our partners. I thought that worked well.”
Spitler was one of more than 35 applicants for the CEO position from across the United States, said Michielssen. The EDC began looking for applicants in November and made the final decision in February. Spitler was the Healdsburg redevelopment director before coming to Gilroy.
According to a Calistoga City Council agenda item, a subcommittee to recruit a new city manager was formed Sept. 21. The city’s local newspaper, The Weekly Calistogan, reported the city received almost 100 applications for the job.
Spitler, on the other hand, hopes that his experience in Gilroy will help him as Calistoga City Manager.
“These past months in Gilroy have really opened my eyes to the way people see government and sometimes employees don’t notice that they’re kind of in their own world. But what they do will affect people. Hopefully, I won’t forget that and carry it to my next job.”