Rooney

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Rooney/9″/mike1st/mark2nd

By CHRISTOPHER WOODARD

Staff Reporter

John J. Rooney, president of the Valley Economic Development Center, resigned last week and the agency’s vice president, Wilma Berglund, is expected to take over as acting president, members of the group’s board confirmed.

Rooney, who is credited with putting the Van Nuys-based business assistance center on the map as a clearinghouse for federal aid following the Northridge earthquake, came under fire after some members of the board questioned his stewardship.

In particular, David Honda, a general contractor who served as the organization’s unpaid chairman and chief executive, had been critical of Rooney’s management.

Honda asked for Rooney’s resignation in May, but five members of the board rallied in support of Rooney, asking at a July 19 meeting at one of the member’s homes that Honda resign instead. They accused Honda of micromanaging the organization, board sources said.

Honda obliged, but the decision by some board members to force him out angered other board members, many of whom had not been invited to the special meeting. Seven board members have resigned since Honda’s ouster, bringing to 10 the number who have left the 17-person board in recent months.

The VEDC operates several small-business development programs out of 10 offices throughout the region. Its largest source of funding is the U.S. Department of Commerce, which provides a $6 million revolving loan fund for quake-damaged businesses. It also receives grant money from the U.S. Department of Commerce to run the business assistance centers in Pacoima, Van Nuys, Reseda and Chatsworth.

But with its Commerce Department grant about to expire in September, and the organization running out of quake-damaged businesses to loan money to, Rooney has been under pressure to expand the group’s horizons and bring in additional revenues. That’s a goal Honda and other board members felt Rooney had failed to make progress on.

Ironically, it was Honda and Rooney who took an obscure business assistance organization with a budget of $2,300 in 1976 and building it into an enterprise with 40 paid staffers and an annual budget of $2.8 million, said Wayne Adelstein, a Valley newspaper publisher and member of the board.

“This organization is what it is because of two people John Rooney and David Honda,” said Adelstein. “Maybe it’s natural after so many years to have differences of opinion.”

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