The board of the Haines Economic Development Corporation (HEDC) has voted to dissolve the nonprofit due to funding uncertainty, board and staff members said. Paperwork to officially dissolve the organization is planned to be filed at the end of next month.
The organization was established in 2016 to study the local economy and assist local entrepreneurs and non-profit groups, founder Debra Schnabel said. Schnabel, who was director of the Haines Chamber of Commerce at the time, said she built the organization “in reaction to what (she) saw as the failure of the borough to do economic development.”
In recent years, the organization released a number of research studies, including on housing, childcare, and workforce development in the Chilkat Valley. Those reports were successful in providing the basis for other organizations and governments in the valley applying for grant money, board co-chair Darsie Culbeck said this week.
The organization’s economic indicators reports provided a range of statistics on the local economy, including unemployment rates and earnings by industry.
But despite what he said was successful work, Culbeck said HEDC wasn’t bringing in enough funding.
“We just realized we weren’t really sustainable in the current federal grant environment, as well as with the borough finances,” Culbeck said. “It was really hard to have staffing stability, for staff to know they would have a job and be able to pay rent six months from now.”
HEDC has received an inconsistent amount of funding from the borough in recent years. In 2018 and 2019, the borough gave the organization between $95,000, funded by a portion of the borough sales tax dedicated to tourism and economic development spending. But In 2020, the assembly voted to cut the organization entirely out of the budget, leaving HEDC reliant on outside grant funding.
Borough funding for the organization bounced back to its highest-ever level, $125,000, for the 2023 fiscal year. But the following year, the organization declined borough funding altogether, preferring to operate off of the remainder of the $125,000. HEDC executive director Cindy Zuluaga-Jimenez said the organization declined the funding because they were “unsure of what [they] were being asked to do.”
Using the previous year’s funding, the organization worked on a recreational economy report, an economic indicator report, and a childcare survey.
HEDC has also operated off outside grants, which have contributed to funding operations amid the up and down borough funding. But those funding opportunities from state and federal agencies have dried up since the start of this year, Zuluaga-Jimenez said.
The grants the organization typically applies for, she said, have been either frozen or discontinued altogether, including grants from the federal Environmental Protection Agency.
The organization did receive $12,500 this year from the borough to produce a study on childcare in the valley. That report will be completed at the end of this month, and should be available for public review at the end of November, Zuluaga-Jimenez said.
Culbeck said that while he saw shuttering HEDC as a loss for the community, some of the organization’s services could be found elsewhere.
“There are certainly grant writers at the borough that could do some of the work, and the board has suggested to the borough that for things such as economic indicator reports, which are super valuable to other nonprofits in the valley, they can go to Cindy Zuluaga Jimenez,” Culbeck said.
The HEDC board has suggested establishing an advisory committee, similar to the current Tourism Advisory Board, that would continue to provide input on economic development to elected officials.