Memorandum

City of Lawrence

City Manager’s Office

TO:	Dave Corliss, City Manager
FROM:	Cynthia Boecker, Assistant City Manager
CC:	Diane Stoddard, Assistant City Manager
DATE:	December 4, 2008
RE:	KU Small Business Development Center Payments

Please include the following item on the City Commission agenda for consideration at the December 9, 2008 meeting.  A similar action was approved by the Douglas County Commission at their December 1 meeting.

Payment to the KU Kansas Small Business Development Center (KU KSBDC)

The City of Lawrence and Douglas County have both, for a number of years, provided support to the KU Kansas Small Business Development Center through the annual budget for the Chamber of Commerce.  KU KSBDC is operated by the University of Kansas and the University also contributes to the funding of this office. 

As noted, the local government payments have historically been funneled through the Chamber based upon invoices from the Chamber.  Beginning in 2004, the Chamber stopped invoicing the two entities for these payments and stopped making payments to KU for this purpose.  Because invoices were not received, neither the City nor the County made the payments.  However, the Chamber continued to include these payments in their budget requests to the City and County and the allocation was approved by both governing bodies. 

Earlier this year, KU discovered that they had not received the agreed upon funding from the Chamber since 2003, and the Chamber subsequently discovered that they had not billed the local governments for their commitments, received the committed funds, or paid KU as agreed.  At that point, the City and County were contacted to resolve the situation.  Because the books were not yet closed on fiscal years 2006, 2007 and 2008, the City Manager and County Administrator approved the committed payments for these years. 

Mayor Dever and County Commissioner Johnson met with Dean William Fuerst to discuss the unpaid 2004 and 2005 commitments.  As a result of these meetings, it was agreed that since the City, County and University each share some responsibility for the situation the three entities should share equally in the responsibility for resolution of the issue.  The following details these discussions and the agreed upon payments.

Total amount budgeted by the City for 2004 and 2005:              $35,000

Total amount budgeted by the County for 2004 and 2005:                   $35,000

Total amount budgeted but unpaid:                                        $70,000

$70,000 divided three ways is $23,333.

Thus, the City and County would each pay $23,333 and the University would write off the remaining $23,333.

The County Commission at their December 1, 2008 meeting approved payment of $23,333 to KU KSBDC.

Action Request

Authorize payment to the KU Kansas Small Business Development Center in the amount of $23,333 from the 2008 budget.