Pueblo ends economic development services contract with PEDCO after more than four decades

The City of Pueblo announced in a press release on Tuesday the termination of its contract with the local economic development agency known as PEDCO as of the end of the year. 

More than forty years ago businesses in Pueblo formed and funded the nonprofit Pueblo Economic Development Corporation, known as PEDCO. Since then the organization's mission has been to attract, retain and expand primary jobs in Pueblo County.

The canceled contract with the city provides some funding to help market the City of Pueblo to prospects from outside the area, as well as to help cover some expenses of the building that houses the organization, according to PEDCO president and CEO Jeff Shaw.

A few years after PEDCO formed, the city’s voters approved a half cent sales tax to support economic development efforts. Those tax revenues are administered by the city. PEDCO does its work with prospective businesses primarily using funding from its members, Shaw said.

Shaw said the sales tax fund is often a point of confusion. “PEDCO's not in control of those dollars," he said. "It's the city and we're not funded by those (tax revenues).”

If there's a project that needs incentive money, PEDCO presents a proposal to the city. If approved, there is a contract between the city and that company, and PEDCO is not a party to it, Shaw said, adding that the contract termination will not affect the nonprofit’s mission or efforts.

“We're open for business. PEDCO's going to remain open into 2026 and years in the future,” Shaw said. “The community has a lot to offer. We're hopeful that a public announcement like that doesn't create any concern in prospect's minds that things aren't moving forward. They certainly are. We're still very optimistic and it's not changing our operations at all.”
The announcement came a few weeks after city council passed a resolution on a 5 to 2 vote to issue a request for qualifications from “groups or individuals interested in providing economic development activities for the benefit of the city and its citizens.”

Councilor Regina Maestri brought forward the resolution during the September 8 regular meeting, saying they need to explore whether a different economic development partner could improve the city’s bottom line. Maestri said it was prompted by concerns she heard from some city residents.

“It ties to all the economic development that we've been doing,” she said. “We still don't have enough money to operate the city. We don't have enough tax revenue to operate the city.”

Councilors Denis Flores and Joe Latino voted against the resolution. Flores noted that there is a measure on the November ballot to extend the half-cent sales tax for five more years.

“If you want a prescription for losing the election in November, here it is right here, “ he said. “This says that we have no confidence in PEDCO and what they've done in keeping our community going for all these years.”

The mayor's office said in the announcement that the “termination is consistent” with the city council resolution to start a search for new economic development partners.

Council's vote was not needed to end the contract, according to an email from the mayor’s office, because there isn’t a financial obligation tied to this action after the end of the year. The request for qualifications is being finalized and it should be ready later this month. PEDCO can participate if the organization chooses to.

“The City is hopeful this move will cause an evolution of its economic strategy—one that encompasses a broader focus than just primary jobs and shows a commitment to the growth of Pueblo overall,” Mayor Heather Graham said in Tuesday’s press release.

According to reporting by the Pueblo Chieftain, earlier this month council denied a long discussed request from the mayor’s office that was supported by PEDCO to refer a ballot measure that if approved, would have allowed more flexibility in how 10 percent of the current half cent sales tax revenues could be used. That sales tax is what’s up for an extension in November.