The Delta Grassroots Caucus (DGC) is a broad coalition of grassroots leaders in the eight-state Delta region. DGC is also a founding partner of the Economic Equality Caucus,
which advocates for economic equality across the USA.

Time for a Change in DRA Federal Co-Chair Post, & Recommendations to Prevent Recent Issues from Recurring

Posted on January 25, 2017 at 12:09 PM

As we enter a new administration and new Congress, the Delta Caucus strongly endorses continued growth for the Delta Regional Authority, a small but good agency for which we believe Rep. Rick Crawford, Sen. John Boozman and most Members of Congress as well as Gov. Asa Hutchinson and the region’s governors are doing a great job.

However, the current DRA Federal Co-Chair is an Obama administration appointee who is trying to hang on into the Trump administration, has engaged in ill-advised partisan actions, grossly exaggerated the impact of this small but good agency’s impact, supported sending of substantial parts of the DRA’s limited budget outside of the Delta, and supported the bad practice of adding on a tiny DRA contribution to a massive private sector contribution to add the total amount to their totals in news releases. For all of these reasons, it’s time for a change in the post of DRA Federal Co-Chair.

“Despite the Caucus’ longstanding support for the agency, we don’t rubber-stamp all actions of every DRA political appointee. We have serious policy disagreements with the current DRA Federal Co-Chair, Mr. Chris Masingill, and present four recommendations to prevent recent mistakes from being repeated by future Presidential appointees,” said Kevin Smith of Helena-West Helena, Caucus senior adviser.

“But beyond the fact that we thought he made and continues to make many mistakes in his role at the DRA, it’s a basic reality that each administration needs their own staff in appointed executive branch positions. Someone who opposed the current President’s candidacy in the 2016 election cannot appropriately serve during the Trump administration. It’s time for a change in the DRA post,” Smith said.

The current DRA Co-Chair has made inappropriate partisan statements, such as endorsing Hillary Clinton at the Democratic National Convention in 2016 in comments in Arkansas’ largest newspaper (Democrat-Gazette) while being identified in his post at the DRA. “He cannot appropriately serve in the Trump administration after having publicly opposed Trump in the election. Many Delta Caucus partners supported Hillary while some supported Mr. Trump, so our point is not that he endorsed Hillary, but that he should not have made any endorsement of any candidate or party. The DRA should be strictly nonpartisan.” said Caucus director Lee Powell.

While it is too early to tell what policies the Trump administration will take regarding economically distressed populations like the Delta and we hope to work with them in a positive way, there are concerns about some of the Cabinet appointees’ right-wing positions on such issues as minimum wages and above all repeal and replacement of the Affordable Care Act, which has been beneficial to many people in the Delta.

Such positions as repeal of the ACA clearly contradict the positions of both former President Obama and Secretary Hillary Clinton, and as an avowed supporter of those two leaders, it is surprising and illogical that the current DRA Federal Co-Chair would desire to continue working for a President who advocates policies that are so opposed to those of Obama and Clinton. The vast majority of Obama appointees immediately resigned when Trump was inaugurated, and that is what the current DRA Federal Co-Chair should do.

Smith said “Lee Powell and I and most of the other Delta Caucus partners were strongly pro-Hillary Clinton as is our right as private sector citizens in the election, but a government official at the DRA should stay out of partisan politics. So our question is: Why does Mr. Masingill want to continue serving in the Trump administration when he publicly opposed Trump in the campaign? How can he work effectively with Trump administration officials and Republicans in Congress and governors? Has he set a date to leave so as to hasten the Trump administration installing their own appointee? He should have left already like most of the previous administration appointees did, and he should resign now.”

“We need a DRA leader to help urge President Trump to make major investments in the Delta for transportation and other infrastructure as he pledged in his campaign, but we need a true Trump appointee in there to do so,” Smith said.

Key recommendations: In addition to the call for DRA staff to avoid partisan statements, substantial parts of the DRA’s small budget should not be sent outside the heart of the east Arkansas Delta as has happened the last two years; there should be an end to gross exaggerations of this good but small agency’s impact; and the agency should not add on a tiny DRA contribution to massive projects funded by other sources that would have happened without any DRA involvement.

“While most Delta Caucus partners were Hillary supporters, we also have some Trump supporters in our network, and we have had good discussions with them about the need to get a Trump appointee to fill this post. We have confidence that Rep. Rick Crawford and Sen. John Boozman (R-AR) always stay on top of DRA issues, and we feel sure they are working to get a well-qualified appointee approved by the Trump administration in that job as soon as possible,” Powell said.

The DRA is a small agency that does some good projects each year; however, the vastly larger federal departments like USDA, HHS, US DOT, Commerce, etc., have programs of greatest impact on the Delta. The DRA can be a useful supplement to these large-scale programs. By far the most beneficial initiative for the Delta in recent years is the Affordable Care Act, which provided insurance to thousands in the Delta who never had it before. We just need to remember that the DRA is quite small.

Key recommendations to prevent recent mistakes from happening in the future:

• Avoiding partisanship: “All DRA officials should be careful to refrain from any partisan activities or comments, such as an ill-advised comment by Mr. Masingill while being identified in his government job praising Hillary Clinton at the Democratic National Convention in 2016, as well as other partisan actions. Delta Caucus partners happen to include many supporters of Hillary Clinton, but it is just not the DRA chair’s role as a government official to make any partisan comments for any party or any candidate,” Smith said.

• “DRA officials should avoid gross exaggerations of this small but good agency’s impact on the still economically distressed Delta, and not try to make inflated claims that it makes a major impact on the regional and the entire state’s economy. The DRA news releases have frequently made these claims when in fact poverty is still quite serious in much of the Delta.

The DRA does some good projects each year, but there’s no point in exaggerating it. These inaccurate claims weaken our ability to advocate for the DRA budget, defend it against cuts, and expand it to the much larger levels of our sister agency, the Appalachian Regional Commission, because some powers that be in Congress say we don’t need more funding if there is already such a major impact,” Powell said.

• The DRA should stop the ill-advised practice of tacking on a relatively tiny DRA contribution in some projects to a massive private sector investment—for example adding $150,000 to a project whose entire cost was $62 million for the North Little Rock Electric Dept., which would have happened without any DRA involvement. The claims that their small budget has caused “more than $2.9 billion” to be invested in the region is erroneous. Economics Professor Emeritus of ASU Garyl Latanich stresses that when the DRA contribution is so small, these projects “would have gone on without any DRA involvement.”

• The DRA should focus its funding in the impoverished east Arkansas Delta rather than scattering them across the state, in some cases in areas that are not located in the Delta: “Last year over half the funding oddly went to Little Rock, two projects in North Little Rock, Yellville in northwest AR hill country; Fairfield Bay; and this year at least $900,000 went to Bull Shoals, Stone County in the northern AR hill country, and to El Dorado, a relatively prosperous community southwest of Little Rock. These communities are just not located in the Delta and it was not the original intent when this agency was created for substantial parts of the funding to go outside the Delta,” said Harvey Joe Sanner.

DRA’s mission is to focus on the east AR Delta:The DRA statutory boundary lines were drawn expansively so that the region would not appear too small, yet the great majority of the 42 AR counties are in east AR; the requirement that 75% of the funding must go to economically distressed counties was intended to steer funding to east AR, and the clear legislative history and intent were that the DRA was created to aid the impoverished heartland of the east Arkansas Delta.

The Delta Caucus partners give high marks to Members of Congress such as Sen. John Boozman, Rep. Rick Crawford, and others in the Arkansas and Delta regional delegation for supporting the DRA budget, defeating attempts to slash its funding or even abolish it. The budget has now been increased to $28 million (of which Arkansas’ share is $3.2 million), which is small but better than the $6 million of the early 2000s or the $12 to $14 million range in recent years.

DRA budget dwarfed by vastly larger ARC: The DRA budget is dwarfed by our sister regional agency, the Appalachian Regional Commission, whose basic economic development budget is 5 times larger at $146 million. Beyond that, for many decades the ARC had $400 million or more each year for the Appalachian Highway Development System. The ARC no longer controls that funding, but the ARC-created highway corridors still gain funds from the Surface Transportation Program. By contrast the DRA has never held a separate highway development major source of funding.

The Delta Caucus appreciates Gov. Asa Hutchinson’s support for the DRA; he serves with the governors of the 8 Delta states on the DRA board. As a statewide official, we know the governor would be pleased when any AR community gets federal funding. However, the DRA Federal Co-Chair has a very different role: he is supposed to make sure the agency remains true to the DRA’s original mission and intent, which was to aid the heart of the east Arkansas impoverished Delta.

Therefore, we place the primary responsibility upon DRA Federal Co-Chair, Mr. Masingill, for what we regard as funding allocations going to places outside the Delta. The Co-Chair not only supported these projects outside the Delta but made public communications touting the agency as helping over this huge area of the state—this is far beyond the scope of this good but small agency. Stretching its small budget that far greatly dilutes its impact on the areas where it is most needed.

DRA Alternate Federal Co-Chair Mike Marshall did a very good job, as did former DRA official Rex Nelson for President Bush. We say this to stress that most Presidential appointees in the DRA’s history have performed their duties admirably.

Delta Caucus partners include Clinton administration appointees Lee Powell and Wilson Golden who were involved in the DRA’s creation. The Caucus later fought for the agency through the lean years when the Bush administration slashed its funding, the arduous battle to get funding closer to the original $30 million (now $28 million) envisaged when President Clinton signed the bill creating the agency into law in late 2000. The key long-term goal is to gain equality with the ARC.

The DRA Arkansas announcements in 2016 included $3.2 million for projects that had a total of $26 million. The DRA release stated that the funding was “primarily” from the DRA SEDAP program. Again, it is good that the DRA contributed to these projects, but they were one of many contributors and gave only about 13% of the total.

APPENDIX Part A: Some Key Facts and Figures from the DRA

  1. Quotation from statement by DRA Federal Co-Chair Chris Masingill in the Arkansas Democrat-Gazette, July 28, 2016:

“Bill Clinton Touches Home Base; Former President, Arkansans Catch up in Philadelphia,” article in the Arkansas Democrat-Gazette, July 28, 2016 Quote from DRA Federal Co-Chair Chris Masingill:

“Delta Regional Authority federal co-Chairman Chris Masingill of Little Rock said Clinton’s speech was ‘amazing. It just once again reinforces why the case is so strong for Hillary Clinton. … This is about our children, this is about the future of the country and this is about inclusion. It’s not about fear.’”

  1. Facts about the DRA and need for GAO or other objective entity to do updated research on its effectiveness:

Note: The DRA statute—for the reasons explained above—expansively defines the Greater Delta Region as including 252 counties and parishes in Louisiana, Mississippi, Arkansas, Missouri, Illinois, Kentucky, Tennessee, and Alabama, covering a population of about 10 million people.

It is not possible to give an accurate estimate of the DRA impact on the economy of the region, due to the small size of the budget. The DRA gives self-reported information frequently, but these count all the funding for any project that the DRA gave any small contribution to; as Professor Gary Latanich and many others have explained, the claims for leveraging are inaccurate. However, for those projects that the DRA provided either all the funding, most or a significant part of the amount, it is safe to say that the agency can claim at least part of the results, depending on how large their contribution was. Moreover, the DRA has a special statutory authority to use its federal funding to count as the local matching grant to obtain other government funding. Please note that this statutory provision does not apply to private sector. The total funding counted by the DRA in its allegation of “leveraging” includes a very large amount of private sector funding. Other federal and state government agencies have also contributed to these projects.

The practice of pooling resources from a large variety of resources is indeed useful. This creates a diversified base of funding for each project. We would recommend, however, that the DRA should refrain from contributing tiny donations to massive projects—in some cases their share has been less than 1%, 2%, or 3 to 5%. There is no hard and fast rule, but generally economic development professionals, nonprofit executives, economists, and those with experience on Congressional staffs, to governors, or Presidential appointees of national administrations agree that a tiny contribution of 1 to 3% is an inefficient use of taxpayers’ dollars, and it is wiser to invest in smaller-scale projects where the DRA funding makes a real and significant difference.

As Professor Latanich has stated, for a government entity like the DRA to add on $150,000 to a $62 million project or $150,000 to a $6.6 million is just not true “leveraging,” because these projects would have happened without any DRA involvement. The USDA Economic Research Service did a report on the DRA, but that was in 2012. Furthermore, USDA provides part of the DRA budget—about $3 million annually—so they cannot be completely objective about a separate agency that they help to fund. Naturally they would want to place the agency in a favorable light.

We call upon the GAO or national nonprofit organizations like the Brookings Institution to take an objective, thorough analysis of the DRA’s impact in the region over the course of its history. We are confident that if they do conduct such an analysis, it will reveal that the DRA had a positive, though not large, impact across the region.

The DRA’s self-reporting and claims for its own impact of course is not objective and the claims are obviously exaggerated.

  1. FUNDING ALLOCATIONS ANNOUNCED IN NOVEMBER 2016–DRA CONTRIBUTION AS A PERCENTAGE OF THE TOTAL AMOUNT

Projects where the majority of funding was invested by DRA and many other investors, again based on the DRA’s own release:

• for the Bull Shoals project, DRA funding was $500,000 out of a total of $8.4 million;

• for the Pine Bluff project, DRA was $150,000 out of a total of $6.6 million;

• for the Stone County project, DRA portion was $200,467 out of a total of $1.1 million;

• for for the El Dorado project, DRA funding was $200,000 out of a total of $1.8 million;

• for the Restore Hope Delta project, DRA funding was $119,000 out of a total of $1.1 million;

• for the Monticello project, DRA funding was only $200,000 out of $3.95 million;

These make up most of the funding–almost $24 million out of the total of $26 million, and in five of these six projects the DRA share ranged in five of the six projects from 2.5% to 5% to about or slightly over 10%. The largest DRA share was about 20% for the Stone County project, which is good although still much less than half. But most of the other percentages were far smaller.

In addition, there were a number of smaller-scale projects where the DRA share was larger, and that is positive. But again, for for $23.95 million out of the total of $26 million, the DRA percentage of funding was quite small.

There was one project that was an exception to the rule–$855,000 for a public sewer project in Marvell where according to the release the DRA provided all the funding. This is commendable and all projects should involve at least some reasonable percentage of the total from the DRA; if the percentage is so small, they should be candid enough to acknowledge as much and be accurate.

If all the projects were like the Marvell project or at least involved a significant DRA percentage of the total, there would not be any problem.

  1. PROJECTS IN 2015 WHERE DRA PERCENTAGE WAS A TINY AMOUNT OF THE TOTAL, & LARGE AMOUNTS WENT TO Northwest and Central AR:

The funding in 2015 was actually much more skewed to areas outside the true east Arkansas Delta than it was in 2016, so if this is evidence of a trend toward more of the funding going where it is most needed consistent with what the agency was created for, then we would welcome such a trend.

In 2015 the DRA announcement alleged that the DRA funding of only $1.3 million in Arkansas was leveraged into a total of about $108 million from all private sector, governmental and other sources. The lion’s share at about $99 million came from the private sector.

For most of its history, the great majority of the funding did go to the heart of the Delta, and there were no exaggerated claims about its impact. For example, in 2012, all of the projects went to east Arkansas. The DRA investment for the projects was about $1.4 million out of a total investment from all sources of about $4 million, so this was a reasonable contribution and a significant part of the total funding.

These problems of questionable use of the funding and gross exaggerations were much more serious in 2015 and 2016.

The DRA statement alleges that the DRA funding of $1.3 million in Arkansas was “leveraged” into a total of about $108 million from all private sector, governmental and other sources. The DRA investment was less than 2% of the total.

·In Arkansas in 2015, five of the nine DRA funded projects went to central, northern and northwest Arkansas: Little Rock, two in North Little Rock, Fairfield Bay, and Yellville in northwest Arkansas, and one went to a statewide project across all four Congressional districts, when of course the Delta is mostly the First Congressional District as well as a number of counties in the Fourth District.

The 2nd and 3rd districts have very little or none of the heart of the “Delta,” by any reasonable definition of that region. So only three projects went to east Arkansas in the 2015 announcements. One was in Independence County in northeast central Arkansas, and only two went to the true heart of the Delta in Chicot and Phillips counties. A large chunk of the funding simply did not go to the heart of the impoverished Delta. · In some cases the DRA percentage of the contribution was minimal: North Little Rock electric dept. project had a $150,000 DRA contribution out of a more than $62 million total.

In other cases: a $39 million project in Independence County had a very small DRA contribution of $150,000; a Lake Village project had a DRA contribution of $65,000 out of $4 million. These are all fine projects. We praise the private sector companies who provided most of this funding along with other governmental entities. Our concern is that when the DRA budget is so small, why are such relatively tiny percentages tacked on to huge projects? Is this the best use of the money?

· Was the funding to expand the inland maritime museum in North Little Rock a wise use of DRA funds? The DRA contribution was a large percentage in this case ($150,000) and we all support tourism, but what does a museum in North Little Rock have to do with economic development in the Delta? Why not use funds for a museum located in the Delta?

·Economic Research Service at USDA has raised questions about the accuracy of these reports, and let us emphasize here that ERS on the whole has been quite positive of the DRA on the whole. But in a 2012 report they said… “—it is difficult to know whether these other investments would have occurred without the DRA spending.”In further elaborating about the reliability of regional economic development programs’ self-reported claims, the ERS stated they are limited in accuracy because they are “largely based on self-reported employment figures and model-based results rather than on observed economic outcomes.”

· In the years since the ERS report raising questions about the accuracy of these self-reported claims of a huge leveraging impact, the claims have rapidly expanded. It was $1.4 billion according to the DRA in 2013, and that number has now grown to $2.86 billion. There is definitely some leveraging and that is very good; but the impact is nowhere near such a massive amount–more than doubling the total investment in about three years? We are still seeing disturbing poverty in the region and an impact of that size would have been felt very noticeably across the region, if these figures were accurate and if they are intended to mean that the DRA generated $2.86 billion that would not have been there otherwise.

· Fairfield Bay is relatively prosperous and is not located in the Delta, strictly as a matter of fact, yet it received some DRA funding, based on the DRA announcements for 2015.

· There was a statewide funded project of $250,000 for education about the value of technical jobs or all four Congressional districts that according to the DRA will educate 800,000 students, parents teachers and others in Arkansas. Is this really an accurate figure—800,000 people would be over one fourth of the entire population of Arkansas. This is a good project, but does the DRA really have the funding to do this? The agency was designed to aid the Delta and does not have the funding to help the entire state. This would seem to be more appropriate for either state government, the US Dept of Education or governmental entities with far larger budgets than the DRA.

The Delta in Arkansas is much of the First District and a substantial part of the Fourth District. That is where the lion’s share of the DRA funding should go, and not diluted across all four Congressional districts of the state.

The statute does include Pulaski County and even Marion County in northwest Arkansas. But placing such large percentages of the funding into central, northern and northwestern Arkansas than the Delta is just not what was envisaged by the agency’s creators and is not the best use of funding. Either the great majority, or preferably all of the funding should go to the heart of the economically distressed east Arkansas Delta.

  1. DRA Headlines in Newsletters and Website Postings that Exaggerate the Percentage of DRA funding

We would ask the media and the public to scrutinize the DRA communications in emails, news releases, and group newsletters, which often contain exaggerations in the headlines and first few paragraphs that are inconsistent with the detailed descriptions in the body of the document. It requires some scrutiny to read through these documents, which sometimes are four pages or so. We would suggest an end to the inaccurate headlines and lead sentences in these articles.

Here are a few recent examples:

  1. Headline of DRA release on Oct. 12, 2017: “Delta Regional Authority Invests nearly $100 million into west Tennessee’s economy”

The DRA actually invested almost $1.6 million out of the total that was very close to $100 million. Under the category of “Leveraged Funds” the amount listed is $97,986,852. As Professor Latanich and other have indicated, the $1.6 million did not leverage the vastly larger total of almost $99.9 million; most of that total would have happened without the DRA’s involvement. Note that this headline literally states that the DRA invested this entire amount.

  1. Headline of DRA release on Nov. 29, 2017: “Delta Regional Authoirty Invests $13 million to strengthen Kentucky’s economy”

The DRA’s portion was somewhat over $1.4 million out of the total of $13 million. The DRA covers only 21 counties in western Kentucky, a relatively small part of the state; so the statement that this will “strengthen Kentucky’s economy” is inaccurate.

  1. Headline of DRA release on Dec. 6, 2017: “Delta Regional Authority leverages over $4 million in Alabama investments”

The DRA portion of the $4 million was somewhat more than $1.4 million, so this is not as inaccurate as many of the other headlines. It stated that the DRA “leveraged” this amount, which is far less exaggerated than the other headlines simply stating that the DRA directly invested the entire amount.

  1. Headline of DRA release on Dec. 13, 2016: “Delta Regional Authority invests more than $4 million to strengthen Illinois’ economy”

The DRA portion of the $4 million was in the range of $900,000. The DRA covers only 16 counties in the southernmost part of Illinois, so this is a very small part of the state. This will be helpful to some areas in southern Illinois, but to say this will strengthen “Illinois’ economy” is obviously inaccurate. Illinois is a very large state and the 16 southernmost counties make up a very small percentage of it.

  1. DRA news release of Sept. 23, 2016, announcing DRA funding for Arkansas contained the following quote near the top of the story: “The nine new investments, including a renovation and expansion to a training center and infrastructure improvements that support economic development, leverage $1.3 million in DRA resources into $7 million in total public investment and nearly $100 million in private investment for Arkansas’ Delta communities, their residents, and their economies.”

The statement that these projects “leverage $1.3 million in DRA resources into $7 million in total public investment and nearly $100 million in private investment” indicates how relatively tiny the DRA percentage was for the total funding in 2015: only $1.3 million out of a total of $108 million.

APPENDIX Part B: Statements from Delta Caucus senior partners

  1. Kevin Smith of Helena-West Helena, former aide to the late US Sen. Dale Bumpers, aide to then Governor Bill Clinton on the Lower Mississippi Delta Development Commission, former state senator, now Delta Caucus senior adviser

  2. Lee Powell, Delta Caucus executive director, Washington, DC area, Presidential appointee in the Clinton administration and one of four managers of the administration’s Mississippi Delta Regional Initiative (along with Wilson Golden, Harold Gist and Albert Eisenberg); former aide in the First Congressional District of east Arkansas, 1986-1990; originally from Arkansas who has lived and worked in four of the Delta states in his career (Arkansas, Tennessee, Louisiana, and Selma,Alabama);

  3. Wilson Golden, Delta Caucus senior adviser, Presidential appointee in the Clinton administration and one of the four managers of the Delta Regional Initiative, Mississippi native (now living in the Atlanta area), board member of the William Winter Institute for Racial Reconciliation at the University of Mississippi

  4. Harvey Joe Sanner, Delta Caucus senior partner from Des Arc, Arkansas, president, American Agriculture Movement of Arkansas, member of Arkansas Waterways Commission, veteran Delta regional advocate

  5. Gary Latanich, Economics Professor Emeritus, Arkansas State University, Jonesboro

  6. William McFarland, member, Alabama Republican Party Executive Committee (four of the other statements come from Democrats, so this comment from Republican is added to include both parties)

  7. STATEMENT of Kevin Smith, Caucus senior adviser, Helena-West Helena:

“I fully support the DRA as an institution, and I also understand that all Arkansas communities all across the state deserve funding–but this particular agency was created to fund projects in the heart of the east Arkansas Delta. It is terribly disappointing to me that the current DRA Federal Co-Chair has veered away from the original mandate of helping the most economically devastated counties of the Delta region in Arkansas. Furthermore, it dilutes both the funds intended for those communities as well as the credibility of the DRA itself to spread funding outside of the area originally agreed as the targeted core counties.

“It is long past time for new leadership at this agency. I hope the new administration’s choice of a Federal Co-chair of the DRA will return to the original vision and mission mandated by Congress to create jobs in the targeted core and hardest hit areas of the DRA region. The main programs that have an impact on the Delta of course are USDA, HHS, Labor, and the other major federal programs, in addition to the state government programs, but the DRA can be a good though not large-scale supplement to those efforts, if the funding is used appropriately. I look forward to a return to this original scope of its work; we appreciate the Congressional delegation’s support for the DRA and urge them to support this goal as well.”

  1. Statement of Lee Powell, Delta Caucus Executive Director and Clinton administration Presidential appointee:

“The great majority of the Members of Congress across the region, the governors of the eight Delta states, and many grassroots partners are strongly supportive of the DRA, and that is greatly appreciated.

Alternate Federal Co-Chair of the DRA Mike Marshall of Sikeston, Missouri did a great job for the agency. He recently left the DRA to take a job elsewhere before the Trump administration began.

Likewise, Alternate Fedetral Co-Chair Rex Nelson did an excellent job for the agency during the Bush administration.

Mr. Nelson and Mr. Marshall were bipartisan, did not exaggerate the impact of this good but small agency, and always tried to adhere to the true mission of the agency to the best of their ability. There is no reason for the bad judgment exhibited by the current DRA Federal Co-Chair..

Unfortunately we have disagreed with the current DRA Federal Co-Chair. There have been numerous instances of partisanship and the statement at the Democratic National Convention was only one of them. Republicans heartily disapproved of that statement, as did many Democrats who do not want four years from now to see a Republican Presidential appointee at the DRA go to the Republican National Convention and endorse the Republican nominee. The DRA Federal Co-Chair has to work with governors, Members of Congress and others from both parties and should refrain from any partisan activity whatsoever.

We have heard from Professor Latanich, Emeritus Professor of Economics at ASU, and many others about the erroneous nature of the claims of massive leveraging by this political appointee. The Delta region still has far too many impoverished areas and is just now coming out of the recession. We don’t need to paint a misleading rosy scenario of our region.

  1. Statement of Wilson Golden, former Clinton Presidential appointee and Mississippi native: “As a former Presidential appointee myself, I thought it was the most inappropriate comment imaginable for a Presidential appointee, while in office, to take sides in a political campaign setting for one candidate or the other, while being identified in his government job. Arkansas was not in play in the election so the comment had no impact, but the Delta grassroots partners emphasize that a DRA Federal Co-Chair should never take sides in any election campaign.”

  2. Harvey Joe Sanner, Caucus senior partner from Des Arc, said succinctly and rightly:

“Not one dime of DRA funding should go outside the Delta.”

  1. . Statement of Billy McFarland, a member of the Alabama Republican Party Executive Committee. Most of the other commentators come from Democratic backgrounds so we wanted to include comments from grassroots leaders of both parties.

“I am disappointed to learn of Chairman Masingill’s partisanship, as displayed by his recent activities at the Democratic National Convention in Philadelphia, especially at a time when we should all be working together and across the aisle to improve the quality of life for the millions of needy citizens in our 8-state Delta region.”

  1. PROFESSOR OF ECONOMICS EMERITUS GARY LATANICH, ARKANSAS STATE UNIVERSITY, JONESBORO

In looking at the Delta Regional Authority’s claims regarding the size of leverage their budget was able to obtain, there are three issues that need to be considered:

  1. Was the additional money devoted to Delta Regional Authority (DRA) projects new money or would the private investment “leveraged money” have happened anyway, if the latter, then the argument can be made that in fact the private investors have leveraged the DRA contribution.

  2. Leverage implies that private investors will put forward a majority of the capital, implying they have a very strong interest in investing. It should also be noted that the higher the leverage ratios the more likely the private sector would have funded the project without DRA involvement.

  3. In all forms of leverage where private investors put forward most of the capital, they will have the predominant influence in the design and implementation of the investment. Their goal is to make money, not to promote economic development, thus there will be tradeoffs between their profit maximization motives and the economic development objectives of the DRA. With this in mind let’s quickly review the 2015 DRA-funded projects

The DRA-funded nine projects in Arkansas, all in counties that are part of the DRA geographic mandate, on a budget of $1.27 million leveraging (public and private) an additional $106.65 million for a total investment of $107.93 million. But, $99 million in private leveraged investment dollars went to three projects, two for infrastructure improvement and one for equipment. For these three projects the DRA devoted $365 thousand, which is only .0036 percent of the total cost for all three. Clearly these three projects would have gone on without DRA involvement.

For these three projects the DRA devoted $365 thousand, which is only .0036 percent of the total cost for all three. Clearly these three projects would have gone on without DRA involvement.

It should be noted that the same concern about the size of the DRA’s contribution in terms of “leveraging” can again be found in some of the projects funded in 2016. For example, the DRA contributed $150,000 to a Pine Bluff project costing $6.6 million. In this case the DRAs contribution was only 2.2 percent of the total cost. This is again another example of a project that would have been undertaken even in the absence of DRA participation.

Professor Gary Latanich Emeritus Professor of Economics Arkansas State University