State Newsmaker Q &A: Alan Levin

Q: In your previous career as a Delaware businessman, what did you think the state should be doing to help companies grow?

A: I think the biggest thing was trying to eliminate the red tape. When you’re developing a business the last thing you need to do is take time away from your business. You’re filing out applications galore, and I think that’s time that you should be involved with your business as opposed to with government issues.

Q: In the past Delaware’s economy relied heavily on the financial services industry; what industries do you see supporting the state’s economy in the future?

A: There are four main industries and we used to refer to them as the four Cs, you had chickens, chemicals, credit cards and cars. Financial services are not done, they’re still here and they’re still an important part of our economy. But the most important thing that we need to do is diversify if any of those four legs should fall apart for whatever reason. There’s a fifth leg, and that’s clean energy and green efforts. These are things we need to be looking at more so than we have in the past.

Q: What does DEDO do to entice businesses to locate here?

A: You first look at what the company needs and what they’re going to bring to the state. You look at it from the perspective of how many jobs are going to be created here and how much tax revenue is going to ultimately come into the state. When we make a loan, we base it on what tax revenue will be coming to the state over a period of time and we’ll basically front that money to the company. At the end of that period, if they have hit their number and far exceeded the personal income tax that we would have collected, it becomes a grant. If they don’t hit their number, then it becomes subject to what we call a call-back, which means they have to pay back some funds to us.

Q: Last month the administration announced it had succeeded in bringing electric car manufacturer Fisker Automotive to the Boxwood Road General Motors plant with a combination of state loans and tax incentives. Some might argue that the state has taken a big risk on Fisker. How does the administration determine what businesses receive substantial backing?

A: You look at the whole package. As part of our due diligence we obviously look at their financing, we look at the individuals involved. Buying the GM plant is the easy part, it’s how to run it, how to have a vision that’s important. We do this with all companies, whether they have three employees or whether they have 500. There’s no guarantee, but you hope this is the one that hits.

Q: How has your perspective toward economic development changed now that you’ve moved from the private sector to the government side?

A: I would have never thought to engage the state for help. We went to the bank, if the bank wouldn’t finance something we wanted to do, or they told us our balance sheet was screwed up, you got it in order and you came back six months later. I’m glad the state has the ability and the willingness to do this. I’m not sure we have the funds, but you end up spending money to create jobs.