Louisiana official named new CEO of Virginia Economic Development Partnership
Editor’s note: This story has been updated
The board of directors of the Virginia Economic Development Partnership (VEDP) on Monday voted 15-to-1 to hire Stephen Moret, an economic development executive from Louisiana, as its next CEO and president.
Moret was named head of the state’s primary economic development marketing organization during a special board meeting in Richmond with only one board member, David Hudgins, dissenting. Hudgins nonetheless said Moret, who served as secretary of the Louisiana Department of Economic Development from 2008 until 2015, was eminently qualified.
“Right guy, wrong time,” Hudgins said, referring to a scathing report on VEDP released two weeks ago by the state’s oversight agency.
“With the JLARC [Joint Legislative Audit and Review Commission] report and possible changes coming from the General Assembly on restructuring and the upcoming governor’s election, there are just too many moving pieces,” Hudgins told Virginia Business.
The other 15 members, which formed a quorum of VEDP’s 24-member board, joined Board Chairman Dan Clemente and VEDP’s Search Committee Chairman Chris Lumsden in endorsing Moret’s selection. After an eight-month national search, he was chosen from a finalist field of six finalists. Lumsden said candidates came from both in and out-of-state. He said an eight-member search committee performed what he described as an “exhaustive” review with the help of a consultant.
Gov. Terry McAuliffe endorsed the board’s decision. “Having met with Stephen, I agree with the board that his executive management experience in both public and private sector economic development roles make him the right choice to lead VEDP at this critical time for the organization,” the governor said in a statement.
Moret, now president and CEO of the Louisiana State University Foundation in Baton Rouge, will take over from interim CEO Dan Gundersen on Jan. 1. He will be paid an annual salary of $340,000, plus benefits. He also will be eligible for an annual incentive performance bonus of up to 15 percent that's tied to performance review. Ninety-eight percent of VEDP's annual $27 million a year budget comes from state funds.
Gundersen, who presided over a controversial restructuring at VEDP, will stay on as chief operating officer. The board made Gundersen the acting head of the 100-person state authority after the March resignation of former CEO Martin Briley.
Some legislators, including Del. Chris Jones, R-Suffolk, chairman of the House Appropriations Committee, have said that now is not the time to bring on a new CEO. JLARC’s report described the VEDP as dysfunctional, lacking vision or a clear marketing plan. Another criticism is that an inconsistent and unstructured approach to state incentive grants “leaves the state vulnerable to fraud …”
In an interview on Monday, Clemente said that hiring a new, highly qualified leader will help shepherd through changes resulting from JLARC’s review. Saying that he had consulted with legislative leaders before calling Monday’s meeting, Clemente noted that Moret was hired to head up Louisiana’s economic development efforts in 2009 under conditions similar to those facing VEDP today. “He came in and straightened that out and brought in billions in new capital investment, “ Clemente said.
What really impressed him, Clemente added, is that Moret traveled to Georgia to study its workforce development initiative, developing a similar model in Louisiana called FastStart. “He hired the No. 2 guy in Georgia and brought him to Louisiana to make the program work,” Clemente said. “He’s good at executing ideas.”
Clemente said Moret —who was not present at Monday’s meeting — has read JLARC’s 132-page report. “He looked at it and said, ‘Dan, this is all administrative. I can take care of it. ’” Clemente said Moret wanted to come to Virginia because “ ‘your location draws Fortune 500 companies, and that creates a lot of opportunities for me.’ ”
In a statement released by VEDP, Moret said. “I look forward to addressing the important JLARC findings, partnering with and serving every region of Virginia, and making VEDP the best state economic development agency in the nation. I’m also delighted that our move to Virginia will enable my wife, our four young children, and me to be close to family, as my mother lives in Richmond and my in-laws are planning to live there for much of each year going forward.”
According to VEDP, Moret directed business development efforts in Louisiana that helped secure more than $62 billion in private-sector capital investment commitments. Those projects, in both rural and urban areas, included information technology centers, food and agricultural processing facilities and some of the largest foreign direct-investment manufacturing projects in U.S.
Under Moret's leadership, Site Selection magazine and Pollina Corporate Real Estate recognized Louisiana as one of the top-performing state economic development agencies in the U.S
Moret established LED FastStart, a customized workforce development program that The Economist called “probably the most notable statewide workforce-development initiative [in America].” Business Facilities, a business publication for corporate site selection and economic development, ranked FastStart as the best state workforce training program in the U.S. every year from 2009 through 2015.
In 2012, the Pew Center on the States praised Louisiana as one of 13 states “leading the way” in the evaluation of business incentives, based on LED’s work under Moret’s leadership to assess the effectiveness of statutory incentive programs.
“Working collaboratively with local, regional, and state officials, Stephen and his team were able to attract a wide variety of high-quality economic development projects, many of which would have seemed like remote possibilities only a few years before,” former Louisiana Gov. Bobby Jindal said in a statement. He said that Moret “built one of the finest workforce development programs in the nation; and, by the end of his tenure, all of Louisiana's business climate rankings were higher than they ever were prior to his appointment. I am very proud of the great job he did for Louisiana as a member of my cabinet, and I'm sure he will do great work for Virginia, as well.”
Moret previously served as president and CEO of the Baton Rouge Area Chamber of Commerce, a regional economic development organization, and as a management consultant with McKinsey & Co. At the LSU Foundation, Moret led the development of a multiyear blueprint for transforming academic philanthropy at the university and launching the largest capital campaign in the history of Louisiana. He holds a bachelor’s degree in mechanical engineering from LSU, a master’s in business administration from Harvard Business School and a doctorate in higher education management from the University of Pennsylvania.
Barry Duval, president and CEO of the Virginia Chamber of Commerce Barry, commended the VEDP board’s action. “Stephen Moret has a stellar reputation for getting results in economic development in Louisiana. The business community looks forward to working with him to apply fresh ideas and reform VEDP to more effectively attract new business and foster economic growth in Virginia.” The chamber lobbied the General Assembly during its session this year in support of spinning out VEDP's international trade unit into a separate entity. JLARC recommends leaving that unit in-house for now.