New JLDC Bylaws Shift, Consolidate Board Appointment Power to Mayor

UPDATE: Liuzzo Criticizes, Dolce Clarifies Process for Changing JLDC Bylaws [Jan. 30, 2018]

JAMESTOWN (Jan. 26, 2018) – The mayor of Jamestown now has more power when it comes to making appointments to the Jamestown Local Development Corporation’s (JLDC) board of directors.

The JLDC was established in 1981 to serve as the not-for-profit lending agency of the city, in order to provide low interest loans to help spur economic development. The JLDC was originally set up to include a board of directors, that would authorize loans while also providing oversight of the organization. As part of its establishment, the JLDC was required to follow a set of bylaws to serve as a guide for governance and regulation of its affairs.

In 2016 and 2017 the Jamestown City Council approved three separate resolutions related to updating the JLDC bylaws. Action was taken during the June 2016 council voting session, the April 2017 council voting session, and the August 2017 council voting session. In all three instances the council voted unanimously in support of the resolutions.

• Original 1981 JLDC Bylaws [PDF]
• Updated 2017 JLDC Bylaws [PDF]

At the time of each vote, the action received little to no attention by the media or public in general. The proposed updates were also not discussed in any council committee meeting or work session prior to action. In fact, during each respective voting session the resolutions were introduced as “new business,” meaning there was no advanced public notice that they were going to come before the council. Also, when it finally came time for the council to vote on the updates, they were mainly described as a “procedural update” that involved “minor revisions” or “clean up language.”

Jamestown Mayor Sam Teresi did discuss the proposed changes during a 2016 JLDC meeting, saying that the proposed updates were the result of recommendations from legal counsel.

“Several months ago it was advised by Corporation Council and City Bond Council that the by-laws and certificate of incorporation be reviewed. Everything is in good order, but there was recommendation that some of the language be updated,” The minutes report the mayor saying during the JLDC’s October 2016 meeting. “City Council authorized submission of updates to the Department of State. When received back, the Board will be updated and provided with copies of updated by-laws and certificate of incorporation.”

However, earlier this month the revised JLDC bylaws were posted on the city website and they show the changes involved more than just minor revisions and clean up language.  Not only do the changes account for the possession of assets (likely in anticipation of a proposal to have the JLDC purchase the city Wastewater Treatment Plant), but some also involve transferring the power of appointment for three of the nine JLDC board seats.

MAST, Jamestown Chamber, JRC Presidents Can No Longer Appoint Their Own Representatives

Under both the original and revised JLDC bylaws, three JLDC board seats are to be filled by the presidents of the Jamestown Chamber of Commerce, Manufacturer’s Association of the Jamestown Area (today the Manufacturers Association of the Southern Tier, or MAST), and Downtown Jamestown Business Association (today the Jamestown Renaissance Corporation, or JRC).

The original bylaws also stated that if the president for each of those respective organization was unable to serve on the board (because they are not a resident of the city, for example), he/she would then have to appoint a qualified member from his/her organization to serve. But under the recently revised bylaws, that appointment power was removed from each of the three respective presidents and given to the mayor:

(Editors Note: WORDS CROSSED OUT are removed text from the original 1981 by-laws. WORDS IN RED are added text from the revised 2017 by-laws)

“Every Each Director shall be a resident of the City of Jamestown. In the event a Director, to be seated by virtue of office or title, is not a resident of the City of Jamestown, he shall appoint a member from his organization to serve on the Board of Directors, said appointee shall reside in the city of Jamestown or chooses not to serve on said Board, the Mayor of the City of Jamestown shall appoint an official from said organization, who resides in the City of Jamestown to serve on the Board of Directors.”

Another change in appointment power deals with how vacancies will be filled, giving that power solely to the mayor.  The original bylaws stated:

“Any vacancy on the Board of Directors arising at any time and from any cause, including an increase in the number of Directors by amendment of the Certificate of Incorporation or the By-Laws, may be filled within ninety days at any meeting of the Board of Directors by a majority of remaining Directors or the Directors then in office, as the case may be, or thereafter, by members at a special meeting of members called for the purpose.”

The revised bylaws state:

“Any vacancy on the Board of Directors arising at any time and from any cause, including an increase in the number of Directors by amendment of the Certificate of Incorporation and the By-Laws, may be filled within ninety days by the Mayor of the City of Jamestown.”

Yet another change was the addition that tthe city council president would serve as Vice President of the JLDC board.

• REVIEW ALL REVISIONS TO JLDC BYLAWS [PDF]

MAST President Disappointed with Changes to the Bylaws

Chautauqua County Chamber of Commerce and Manufacturers’ Association president Todd Tranum

Among those critical in the changes to the bylaws is Todd Tranum, president of MAST.

Tranum is precluded from serving on the JLDC Board because he is not a resident of Jamestown. Under the original JLDC bylaws, he would have the ability to select who serves in his place.

When the MAST seat on the JLDC board was vacated by Justin Hanft in mid 2017 because he moved out of the city, Tranum wanted to appoint former BPU chair John Zabrodsky to the seat and he tells WRFA he informed the Department of Development of his decision in May 2017.  However, that appointment wasn’t acted on when the JLDC held its next meeting in December 2017. Instead, according to the Post-Journal, the JLDC acted on accepting the new bylaws.

The revised JLDC bylaws were finally reviewed and authorized by the state at the end of 2017. As a result, Mayor Sam Teresi – using his new power of appointment for that seat – appointed JCC development director Tim Smeal to the board as part of his slate of 2018 appointments. Those appointments were all approved by the city council, 8 to 1, during its Inaugural Meeting on Jan. 8.

“This is a continuation of Mayor Teresi’s and (Department of Development) Director Vince DeJoy’s attempts to limit the voice and input of the business community,” Tranum said in an email to The Post-Journal in December following the JLDC meeting, and also reiterated to WRFA. “The mayor and the director of development’s methods are not business friendly, inspire distrust and undermine efforts to improve the local economy. The business community will not be silenced.”

When WRFA spoke with Mayor Teresi about the bylaw changes, he said they were done to reflect what had already been taking place in practice and pointed out they were the culmination of a year-and-a-half long process. While it’s evident the bylaw updates were approved by the council in three separate public votes, it’s also worth noting there appears to be no actual public discussion or detailed explanation of what specifically was being changed before voting actually took place.

EDITORS NOTE [Jan. 28, 2018]: A previous version of this story erroneously reported the original JLDC bylaws had no language in place regarding who would serve as president. This is incorrect. The language regarding the Mayor being elected as President of the JLDC board, was listed in another area of the 1981 bylaws (Article IV).

TIMELINE OF JLDC BYLAW CHANGES

As noted above, it appears that none of the changes in the bylaws were publicly reviewed and discussed by the city council prior to their action. A timeline of the related action, along with comments from city officials, is outlined as follows:

June 2016 – City Council Voting Session