Chamber to seek $4 million for Valley's downtowns

By Jeanne Bonner Of The Morning Call

October 9, 2007

The Greater Lehigh Valley Chamber of Commerce plans to raise at least $4 million for an urban revitalization initiative it announced earlier this year.

The fundraising target is more than double the initial estimate the Chamber made in March. The more ambitious figure emerged after a feasibility study this summer found strong support for a wider role for the Chamber in reducing storefront vacancies and boosting jobs in the downtowns of the Valley's cities and boroughs.

The group could begin disbursing funds to worthy projects as early as this month. The Chamber's foundation, which will spearhead the five-year initiative, received its first seed money last week when it sold the organization's longtime Bethlehem office for $415,000.

Later this month, a fundraising firm the Chamber hired will begin tapping donors, some of whom are expected to not only make sizable pledges but also recruit other companies and individuals to do the same.

''The people we interviewed…told us they were overwhelmingly convinced the Chamber needed to take on this initiative. Most businesses felt the urban cores were lacking in attention,'' said Tom Micelotta, a consultant with National Community Development Services of Atlanta who conducted the feasibility study and is leading the fundraising effort.

Tough tasks remain ahead for the Chamber. For example, many of the 60 leaders surveyed for the study expressed doubt the Chamber could raise millions of dollars, even over the projected period of five years. The Chamber also has its eye on public funds, but it's far from certain whether the state or Lehigh and Northampton counties will contribute.

Others expressed concern about staff turnover at the Chamber and questioned whether the organization has the leadership to take on this initiative.

There's also concern about duplicating efforts. In the confidential interviews Micelotta conducted, some Valley leaders said that if the foundation undertakes economic development in the area's cities and boroughs, it could interfere with the work of the Lehigh Valley Economic Development Corp.

According to the study, one respondent asked, ''How will this conflict with LVEDC's efforts?''

That's partly because under its previous president, Beth Gorin, LVEDC was exploring a larger role in urban development.

''When it comes to the downtowns and the cities, we are leaning toward letting the cities and the Chamber work with that,'' LVEDC spokesman Joe McDermott said Friday. ''The Chamber and the cities are in the best position to work on downtown issues, particularly as it pertains to retail and small businesses.''

People involved in the day-to-day struggles of the downtowns say the cities and the boroughs need all the help they can get, and it's essential that the business community gets behind revitalizing the urban cores once and for all.

Alan Jennings, executive director of the Community Action Committee of the Lehigh Valley, an anti-poverty agency, said it would not be a problem if the Chamber and LVEDC -- ''the two 800-pound gorillas in the business community'' -- competed to take the lead in revitalizing the area's cities and boroughs.

''That's progress,'' he said in an interview last week.

The Chamber's leaders see revitalization of the Valley's cities and boroughs as a moral and economic imperative. The Valley's population and economy have grown at a near-record pace this decade, but most of the expansion has occurred in suburban office parks and housing subdivisions.

Between 1998 and 2007, the collective tax base of the region's three main cities grew 4.2 percent. By contrast, the tax base of all of the Valley's townships grew 39 percent in that period, according to assessment data gathered by the Lehigh Valley Planning Commission.

The Chamber also sees it as a logical segue to the organization's push to become the regional voice of the business community. The organization, originally the Allentown Chamber of Commerce, spent the late 1990s and the early part of this decade merging with smaller chambers and other business groups. With 4,800 members, it's now the second-largest chamber in the state.

In 2003, the Chamber turned its focus to revitalizing the area's cities, with a pilot program in Allentown. The group has provided staff to work with downtown merchants on events such as musical performances on Fridays in the summer.

Two years ago, the Chamber helped Easton land a five-year state Main Street grant, which seeks to revitalize downtown commercial districts. The Chamber also helped orchestrate an ongoing $90,000 state grant to pay the salaries of downtown managers in nine boroughs.

There's been progress, but longtime residents, especially in the small boroughs, hunger for new businesses. Chamber officials say small programs and grants are not enough.

''What's always frustrated me is we have this leadership and this focus on downtowns, but we have no funding to impact change. It's all rhetoric and no dollars,'' Chamber President Tony Iannelli said in an interview last week. ''What I like about this is, we can put our money where our mouth is. Instead of cheerleading and building boards and organizations, we can raise money and make a change.''

Providing matching funds for state revitalization initiatives such as the Main Street program will probably be one of the foundation's goals. That's needed assistance because the state funding is minimal and because guidelines often require the municipalities in the program to find matching funds, Jennings said.

He also wants them to aggressively market the ''concept of downtowns'' through the Valley. The foundation is also exploring the possibility of creating a loan pool.

Northampton might be one of the first recipients of money from the foundation. The borough has approached the Chamber about buying and installing banners in the borough, officials said.

Bethlehem has asked for money for a transportation study. It also might tap the foundation for help with its Elm Street program, which seeks to revitalize older neighborhoods near downtowns, said Tony Hanna, the city's director of community and economic development.

Hanna said of the organizations involved in economic development, the Chamber is possibly the only group that has ties to small and large businesses, retailers and boroughs and cities.

''I think the foundation truly makes the Chamber relevant,'' Hanna said. ''It gives the Chamber a connection.''

At the end of this month, Micelotta will contact about 40 community leaders who were identified during the feasibility study as possible fundraising campaign coordinators.

Among those names is Hank Barnette, chairman emeritus of Bethlehem Steel. Barnette, who was interviewed as part of the feasibility study, said if asked, he would help with fundraising.

''If a group of well-intentioned civic leaders gives a problem such as this strategic thought and devises a tactical short-term implementation plan, and they are willing to address the problem, we should support that, and give them the benefit of our support,'' he said.

Others sounded more caution.

In a brief interview on Thursday, Mike Gausling, co-founder of OraSure Technologies in Bethlehem, said he was not aware of the Chamber's foundation and its urban revitalization initiative.

He said he does not know if he will give money to it or not, because he recently launched Originate Ventures, a venture capital firm. He's been refurbishing a former firehouse in south Bethlehem where the fund is based.

Similarly, Tim Holt of Air Products and Chemicals in Trexlertown, one of the region's largest employers, was named as a possible leader for the campaign. Holt, who sat for an interview for the feasibility study, was unavailable for comment last week.

Laurie Gostley-Hackett, the corporation's manager for community relations and philanthropy, said while the company is happy to be part of the foundation's development council, Air Products will take a wait-and-see approach.

''We don't know enough about the foundation yet, so it's too early to comment,'' she said in an e-mail. ''As we learn more about the foundation and the initiatives, we'll be in a better position to study each project on its merits and then make the decision on our involvement.''

Micelotta, who will be living in south Bethlehem for the next year while he works with the foundation, brushed away the doubts as a natural reaction to a brand-new campaign.

''I call it cautious optimism,'' Micelotta said.

jeanne.bonner@mcall.com