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Parson reorganizes Economic Development, narrows focus

Parson reorganizes Economic Development, narrows focus

January 18th, 2019 by Bob Watson in Local News

With Zora Mulligan and Rob Dixon to his right, Gov. Mike Parson held a press conference Thursday in his Capitol office to announce the details of three executive orders signed earlier in the day.

Photo by Julie Smith /News Tribune.

Gov. Mike Parson on Thursday ordered a major reduction in the size of Missouri's Economic Development Department with a goal of streamlining Economic Development's operations to "make sure that our young men and women, our children, are going to be prepared for the workforce of tomorrow," the governor said.

As Economic Development Director Rob Dixon told reporters Wednesday, Parson noted Thursday the department currently has 865 employees.

"Any time you have 800-plus employees under your umbrella ... you've got to look after all of these moving parts — (Dixon) has to administer all of that, every day," Parson said during a news conference in his Capitol office. "Most of the states we're competing with every day have less than 200 employees in their economic development branches.

"And they are strictly focused on economic development — and that's what we've got to do."

Parson signed three executive orders Thursday, moving agencies from the Economic Development Department into other state government departments:

The Division of Energy to the Natural Resources Department.

The Division of Workforce Development and the Missouri Economic and Research Center to Higher Education.

The Public Service Commission and Office of Public Counsel to the Department of Insurance, Financial Institutions and Professional Registration.

The governor's orders also change the Insurance Department's name to the "Department of Commerce and Insurance." Officials were trying to determine if lawmakers also must approve that change.

The proposed changes are to take effect March 18 — 60 days after Parson issued the executive orders.

Dixon noted the changes followed a year-long study of "what's happening around the country and what the best-performing states in economic development are doing."

The main goal is reorganizing Economic Development.

"That's going to be where you're going to see significant changes in the way we do business," Dixon said, noting the changes will let him and his staff really focus "on the customers that we serve — the businesses, the communities (and) the citizens of the state."

The changes also will allow the department to target efforts in different areas of the state that are more specific to those areas, he said.

Higher Education Commissioner Zora Mulligan said: "This is a fundamental re-set in the way Missouri approaches economic development and workforce development.

"This is a strategic realignment of resources (that) allows us (in Higher Education) to focus a single agency's efforts on everything the state of Missouri does to help people get a job after high school."

She said adding Workforce Development and MERIC's research into labor statistics and needs will help with Higher Education's other work.

"Data is the most important tool we have to drive decision-making in state government," Mulligan said, "so being able to enhance our capabilities in the area of data will help us work with institutions to help then understand, more clearly, what skills are in need in the workforce."

Parson said: "Workforce development is going to be a priority of this administration.

"The Department of Economic Development (now) can truly focus on bringing jobs to this state and making sure we have a quality workforce, willing to meet the demands of the future of this state."

Dixon said tax credits and other incentives are among the last questions prospective businesses ask.

"The first things that they ask for are," he said, "will they have the workforce they need to help them grow, and do they have the infrastructure that's going to help them build their companies and their success. They're looking at broad business climate."

Voters in 1972 approved reorganizing state government into no more than 15 departments, plus the Office of Administration — and Missouri government is at that level.

Parson's orders don't change the constitutional list.

Lt. Gov. Mike Kehoe couldn't attend Thursday's news conference, but told the News Tribune in an email: "I want Missouri's Department of Economic Development to be laser-focused and the best in the Midwest. This reorganization will help make that happen."

With the changes, Economic Development will be left with 165 employees, the governor said.

Maggie Kost, Economic Development's Communications director, told the News Tribune Thursday the departments involved in Parson's new orders have been "working with the Office of Administration to find the best solutions for the physical locations of each division. We have not established a hard and fast timeline for this, in the interest of making this as smooth and seamless as possible for all involved.

"Our goal is to finalize any MOUs (memoranda of understanding) and transition details through the spring and summer."

Parson said his Cabinet members all have been involved in talking about ways to streamline government and their operations.

Mulligan said adding agencies to her department isn't an abandonment of Higher Education's traditional focus on college and university training.

"One of the things I like about the approach we're taking," Mulligan said, "is that it's a very broad expression of support for all different kinds of post-secondary options."

In addition to his executive orders, Parson noted Thursday that lawmakers have been asked to transfer the St. Louis-based Missouri Arts Council to the lieutenant governor's office from Economic Development.

"One of the things I've said all along — and, coming from the lieutenant governor's office — is I think there should be some more responsibilities in that office," Parson said.

Kehoe said: "I support the Arts Council, understand the importance of their work for Missouri, and look forward to helping them fulfill their unique and vital mission."