Gov. Mike Pence, who campaigned on providing more transparency in Indiana’s economic development deals, put his imprint Tuesday on the agency that oversees such deals.
During a meeting of the Indiana Economic Development Corporation yesterday, Pence appointed three new board members to replace four who are resigning and signed a bill aimed at creating more transparency at the quasi-government agency.
A new conflict of interest policy for a venture capital fund associated with the agency was also discussed and the IEDC board approved an incentive package for a company with ties to a state lawmaker after giving it a second look.
“We operate above the appearance of impropriety,” Pence said.
The focus on ethics comes after several high-profile controversies under the previous administration of Gov. Mitch Daniels.
An Indianapolis Star investigation in December raised questions about the IEDC’s handling of a contractor, Monica Liang, who was accused of fraud and extortion in China. Star investigations have also revealed financial and other problems at two state-touted startups: Litebox, which promised to create 1,100 jobs in Indianapolis, and Global Energy Solutions, which pledged 200 jobs in the small southeastern Indiana city of Madison. Neither of those projects got off the ground.
Before Tuesday’s meeting, Pence appointed three new IEDC board members, including a former CEO at WellPoint who resigned last year amid investor unhappiness and a former Democratic contender for governor.
Insurance executive Angela Braly, architect Jim Schellinger and investor Rick Johnson were appointed to replace four board members who are stepping down: Tom Linebarger, CEO of Cummins Inc.; Cathy Langham, CEO of Langham Logistics; Sally Byrn, former CEO of SSCI Inc; and Kevin Bramer, CEO of MedVenture Technology Corp. A fourth new member to round out the 12-member board will be named later, the IEDC said.
Braly was president, chairwoman and chief executive of health insurer WellPoint, Indiana’s largest publicly traded company, until August 2012, when she resigned under pressure from investors who were unsatisfied with the company’s performance under her tenure. She led several major WellPoint acquisitions, including contact retailer 1-800-CONTACTS and Medicaid managed care provider Amerigroup. In 2008, Forbes named her one of the world’s most powerful women.
But the company also failed to meet Wall Street’s earning expectations several times, and Braly became embroiled in a high-profile dispute with President Barack Obama when the company hiked rates in California during Obama’s push for health care reform. WellPoint operates Blue Cross and Blue Shield plans in 14 states.
“An expert in her field, Angela Braly brings to the table an extensive background in the health insurance industry,” Pence said in a statement. “Her corporate leadership and national reputation will help us tell Indiana’s story both nationally and internationally in the coming years.”
Schellinger is chairman and CEO of Indianapolis-based CSO Architects. In 2008, he ran an unsuccessful campaign for governor in the Democratic primary, losing to Jill Long Thompson. As an architect, he was involved with projects at the Indianapolis International Airport, the JW Marriott hotel, and many others.
“A widely respected business leader, Jim Schellinger has a proven record of leadership and a broad range of skills to further Indiana’s economic development successes,” Pence said.
Johnson, a native of Columbus, is the president and CEO of Johnson Ventures Inc., an investment company whose holdings include Lenny’s Sub Shop, Indiana Limestone Co., Author House, and Bigfoot Food Stores. He also has served on the boards of the Indianapolis Museum of Art and Indiana University’s Kelly School of Business.
“Rick Johnson is a homegrown Hoosier whose expertise as both a business and community leader, coupled with his energy and entrepreneurial spirit, will serve Indiana and Hoosiers well in the years ahead,” Pence said.
The governor also signed a bill that would require the IEDC to provide more information about the incentives it provides to companies and the number of jobs those companies create.
Sen. Mike Delph, a Carmel Republican who initially proposed a stronger version of the bill, called it “a positive step in the right direction.”
After the bill signing, the IEDC heard information about a conflict-of-interest policy for Elevate Ventures, a nonprofit venture capital organization that awards state money to start-up companies. The policy says board members can’t vote on funding for their own companies.
The board also gave the go-ahead to $345,000 in state aid for Mainstreet Property Group, a company with ties to State Rep. Eric Turner, R-Cicero.
Pence had asked the IEDC board to review the deal amid concerns about conflicts of interest.
IEDC board member John Mutz said the deal met all qualifications and that there “was no undue pressure” by Turner, whose son now runs the company.
Date: May 7, 2013