Picture 2Louisville’s main economic development organization took a major hit today.

Several sources tell Insider Louisville as many as 22 Greater Louisville Inc. staffers out of a total of 50 were dismissed during the course of the day. Other sources said 25 percent of the total, or 12 people, were cut.

Many of those who lost their jobs were senior staffers, many of whom had been with GLI since it was formed in 1998.

Sources confirm departing executives include GLI No. 2 Tracee Troutt, who had been the interim president and CEO before the arrival of new CEO Craig Richard from Houston.

GLI executives did not return repeated calls, nor did they reply to requests for interviews through third parties.

The notification of staffers began this morning, with employees summoned to the executive offices and dismissed into the afternoon, according to those with direct knowledge of events.

It was, in the words of once source, “a bloodbath.” But another insider said the cuts were necessary to “strengthen the core” of GLI.

GLI sent IL these statements from Kerry Stemler, Chairman of the Board, Greater Louisville Inc., and Craig Richard, president and CEO Greater Louisville Inc. regarding what GLI terms “a realignment.”

“There were two catalysts for organizational change at this time – the post-recession business dynamics and the new leadership agenda of our president and CEO Craig Richard. We’ve been able to identify efficiencies within the organization and create a structure with an increased focus on economic development and member services.” Kerry Stemler, Chairman of the Board, Greater Louisville Inc.

“Like most companies in the new economy, we’re learning to do more with fewer resources. I am confident that our organizational changes will result in a more focused, tighter operation with an increased capacity for long-term success.” Craig Richard, president and CEO Greater Louisville Inc.

The cuts come as GLI, which receives the majority of its budget from member companies and donations from large corporations, deals with what insiders describe as a financial crisis.

Top donors include Brown-Forman, PNC Bank, Humana, Chase and UPS, according to the GLI website.

Sources say much of the GLI budget went to six-figure salaries for top executives as membership fees declined rapidly. Before he left to take the CEO position at St. Louis Regional Chamber and Growth Association, former GLI CEO Joe Reagan was paid just over $369,000 per year, according to a Form 990, a financial statement required by the U.S. Internal Revenue Service of non-profits.

He also received a supplementary income of more than $100,000 from a group of businessmen led by Bill Samuels, retired president of Maker’s Mark.

Troutt was paid about $145,000, according to a 2011 Form 990.

However, under Reagan, GLI membership fell to about 2,000 companies from a height of about 3,200 members in 2005 when Reagan arrived as GLI CEO, according to data from insiders.

For more detail on the companies that dropped their GLI members, see this IL post from earlier today.

Terry Boyd
Terry Boyd has seven years experience as a business/finance journalist, and eight years a military reporter with European Stars and Stripes. As a banking and finance reporter at Business First, Boyd dealt directly with the most influential executives and financiers in Louisville.