Published: September 02, 2008 06:03 pm            

Hindman resigns as Economic Development Secretary

Will continue work as consulant for one year at same salary

FRANKFORT — The state’s chief economic development official resigned Tuesday and Gov. Steve Beshear appointed his cabinet secretary on an interim basis to the position.

John Hindman will continue to work in economic development on a consulting contract basis at the same salary of $250,000 for one year. He was also granted a $25,000 bonus. The board appointed Larry Hayes, Beshear’s cabinet secretary, to serve as interim secretary at no additional salary.

The Economic Development Partnership and the secretary’s position were designed to insulate economic development from political influence, but with Hayes’ appointment, that position will reside inside the governor’s office and inner circle until a permanent replacement is named. Hindman was appointed by Beshear’s predecessor, Gov. Ernie Fletcher, in June 2007.

Hindman said he wants to return to the private sector. Beshear said he has “no specific timeline for finding a permanent replacement at this point.”

After a 15-minute closed session of the executive committee of the Economic Development Board to discuss personnel, board member Luther Deaton, who was a key proponent of Hindman’s selection by Fletcher, made two motions, one to accept Hindman’s resignation and the second to appoint Hayes as interim secretary.

He said he regretted Hindman’s decision and he’d done a good job. Thomas Latta of Henderson, another board member, said, “John’s done a wonderful job.”

Beshear and Hindman both denied there was any political motivation for his resignation or any suggestion Hindman was pressured to resign.

“It was entirely his decision,” Beshear said after the meeting. “There was no dissatisfaction (with Hindman) on my part. I regret that was his decision, but I understand it – this is a demanding job.”

Hindman said political considerations were not a factor in his resignation.

But Hindman conceded he was criticized from time to time by local officials who thought he did not show enough deference to their individual county or city in trying to recruit employers.

“Any judge-executive is going to clamor for their county,” Hindman said. “So there’s always going to be some friction between somebody in this position and the local county judges who want to make something happen in their community.”

That happened recently when the ZAP electric automobile facility was snared by Simpson County. At a press conference to announce the company would build a facility there, Beshear said Steve Newberry, a Democratic candidate for the state Senate who has been active in economic recruitment in Barren County, had worked on the project. Newberry said his role was to share with Beshear – at the request of officials from the city of Franklin and Simpson County – how important the project was to that region and how close the company might be to choosing a site in Indiana.

But Hindman said Tuesday that project was in no way connected to his decision. He emphasized all the state incentives for ZAP are “performance-based,” meaning the state doesn’t ante up anything until the jobs are in place.

During his tenure, Hindman was vocal about the need to increase the educational attainment of Kentucky’s workforce, another key factor in companies’ decisions about where to locate and one in which Kentucky lags the nation and some rural Kentucky counties lag behind more populous areas of the state. Hindman said Tuesday he has tried to guarantee rural counties “a place at the table,” but ultimately companies – not he – decide where they’ll locate and education and proximity to transportation often put rural areas at a disadvantage.

“I came in trying to make clear that education is the foundation for economic development,” Hindman said. “The more we focus on an educated workforce pool to draw from, the better off the state is going to be.” He said the state needs to “embrace doing things in different ways. If you keep doing things the same way you’re going to get the same results.”

Beshear echoed that sentiment, telling the executive committee the transition will be used to evaluate how economic development can be improved in Kentucky. He commended Hayes, citing his role while he served as cabinet secretary for Gov. Martha Layne Collins in recruiting Toyota to Kentucky. That effort was led by Collins, her Commerce Secretary Carroll Knicely, and Hayes.

Hindman said he will continue to work on existing economic development projects while Hayes will handle administrative duties. That, he said, will give him more free time while allowing him to concentrate on job development.

“I will continue to pursue some of the projects that we have in the works – as much as the governor wants me to,” Hindman said.

RONNIE ELLIS writes for CNHI News Service and is based in Frankfort. He can be reached by e-mail at rellis@cnhi.com.

        

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