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HomeMy WebLinkAbout2020/04/20 - ADMIN - Minutes - Economic Development Authority - Regular Official minutes EDA meeting St. Louis Park, Minnesota April 20, 2020 1. Call to order President Harris called the meeting to order at 6:00 p.m. Commissioners present: President Harris, Tim Brausen, Larry Kraft, Anne Mavity, Nadia Mohamed, Margaret Rog, and Jake Spano. Commissioners absent: None. Staff present: Executive Director (Mr. Harmening), Economic Development Coordinator (Mr. Hunt), Community Development Director (Ms. Barton), City Attorney (Mr. Mattick), Communications Manager (Ms. Smith), Senior Planner (Mr. Walther), Planner (Ms. Monson), CIO (Mr. Pires), and Recording Secretary (Ms. Pappas). 2. Roll call 3. Approval of minutes 3a. EDA meeting minutes of April 6, 2020 It was moved by Commissioner Rog, seconded by Commissioner Kraft, to approve the April 6, 2020 EDA meeting minutes as presented. The motion passed 7-0. 4. Approval of agenda and items on EDA consent calendar 4a. Adopt EDA Resolution No. 20-05 approving the sixth amendment to purchase and redevelopment contract – PLACE E-Generation One, LLC 4b. Adopt EDA Resolution No. 20-06 authorizing EDA submission of a grant application to the Department of Employment and Economic Development (DEED) contamination clean-up grant program on behalf of Robinson Zamorano for the Luxe residential project. Adopt EDA Resolution No. 20-07 authorizing EDA submission of a grant application to the Metropolitan Council tax base revitalization grant program on behalf of Robinson Zamorano for the Luxe residential project. It was moved by Commissioner Brausen, seconded by Commissioner Mavity, to approve the EDA agenda as presented and the items on the consent calendar. The motion passed 7-0. DocuSign Envelope ID: 4D569023-15B1-4B77-AA0F-8E8B8CCD85E0 Economic Development Authority -2- April 20, 2020 5. Reports - none 6. Old business - none 7. New business 7a. Small business emergency assistance program. EDA Resolution No. 20-08. Ms. Barton presented the staff report. Ms. Barton stated there are over 9,000 small businesses in St. Louis Park and staff has been contacting these businesses to inquire how the city can help them at this time. She noted some businesses are doing fine and managing, while others are in a dire situation. Many have applied for state and federal assistance, but there is a need for immediate funding to assist them with operating expenses. Ms. Barton stated in response to this, staff is proposing a small business grant program utilizing $200,000 from the EDA’s revolving loan fund to provide grants of up to $5,000 to approximately 40 businesses to help keep them afloat for the next 1-3 months. She noted this will be done on a first come, first served basis and the businesses must meet the city’s minimum requirements. Ms. Barton stated assuming the EDA approves the program this evening, the grant application will be on the city’s website tomorrow, and a media push will begin with emails, press releases, social media, staff calls, and the chamber of commerce helping to inform businesses as well. She noted staff also has a list of POCI businesses from the state and will use this to contact businesses and help them with the application process. Commissioner Kraft asked if the city is focusing on a certain class of small business and if they are businesses owned by people of color. He asked what the policy objective is. Ms. Barton stated the objective is to distribute the funds to businesses with 3-25 employees and to also make sure they are viable and were operating at a viable level before COVID. She added it is not being targeted to any specific demographic. She added as applications come in – they will be date and time stamped. Commissioner Mohamed asked how many businesses will be assisted, and what the goal is. Ms. Barton stated the city has $200,000 which will be allocated, that is $5 ,000 each for 40 businesses which could be served through this grant program. Commissioner Rog thanked staff for getting this program developed so quickly. She clarified that she was not suggesting a 2-3-week window, but a 2-3-day window instead of the first come first serve approach suggested by staff. She proposed a 2-3 sentence description in the application which would be more doable. DocuSign Envelope ID: 4D569023-15B1-4B77-AA0F-8E8B8CCD85E0 Economic Development Authority -3- April 20, 2020 Commissioner Rog asked if staff is asking for the number of employees the business had before their shutdown. Ms. Barton stated yes. Commissioner Rog stated the list of businesses shared with council is out of date. Ms. Barton noted staff is working from multiple lists and updating them to make sure they are accurate. Commissioner Mavity asked how the $5,000 level was arrived at. She asked of the 9,000 small businesses in St. Louis Park, what is the estimate of women- or minority-owned businesses. Ms. Barton stated staff considered the amount of money which could make a difference in helping to pay rent or utilities, payroll or supplies, yet keeping this amount low enough in order to help as many businesses as possible. Mr. Hunt stated the POCI list from the state includes city businesses that are female, veteran, and immigrant owned, which is about 700 businesses. He added there are about 50 businesses in St. Louis Park that self-identify as being owned by immigrants or people of color. Commissioner Mavity asked if it is possible to have the application process first come first served, but also with additional points for businesses that are POCI-owned. Ms. Barton stated yes, that is the intention. Commissioner Mavity stated if the goal is to sustain as many city businesses as possible, the $5,000 seems very low. She also asked if there are additional funds available in case more is needed later. She stated she is worried that $5,000 is not enough to sustain a business. Ms. Barton stated the city is not looking at this grant to be a sole source of funding for businesses, adding staff is encouraging businesses to apply to DEED and the federal government, as well as Hennepin County for deferred loans. She added businesses are being encouraged to ask for deferred rent payments as well. Ms. Barton added that another $200,000 is available from the city, for a second round of funding later if needed. Commissioner Brausen supports doing this, but noted he worries about the efficacy of the grants, adding that funding might be better used later on, in order to help get businesses up and running again. He asked if a business is owned by a St. Louis Park resident, will they get a higher score. Ms. Barton stated currently there is no scoring for a resident-owned business in St. Louis Park. Commissioner Brausen pointed out that folks who work from home or live in St. Louis Park and also work here, help fossil fuels to decline when they have shorter commutes. He noted living and working in St. Louis Park could be an additional score for the DocuSign Envelope ID: 4D569023-15B1-4B77-AA0F-8E8B8CCD85E0 Economic Development Authority -4- April 20, 2020 application. Ms. Barton stated this is not something staff has included in the evaluation process, but staff will take a look at it. Commissioner Brausen asked why the grant was not a deferred loan program instead, allowing owners to pay back after two years. Ms. Barton stated staff did consider deferred loans but added many of these businesses do not want to apply for loans given the current circumstances, and if the business survives, the loan is forgiven and if the business doesn’t survive, the loan doesn’t get paid back anyway, so it makes sense to do a grant program. Commissioner Brausen noted Minnetonka has rolled out a grant program similar to this and one of their requirements is that the business was profitable last year. He asked if that will be part of St. Louis Park’s application criteria as well. Ms. Barton stated yes, the businesses will have to have been profitable for at least 6 months prior to COVID, as well as factoring in how long they have been in business. Commissioner Spano asked if there is a reporting requirement for businesses that receive grants. Ms. Barton stated yes. Mr. Hunt added the city will ask businesses to report two months of receipt of funds on a simple report form, documenting to staff what they spent the funds on. Businesses will be contacted for reporting within 6 months of receiving the loan. Commissioner Spano asked the city attorney about providing funds for businesses owned by persons of color or indigenous groups. Mr. Mattick replied that the funding is related to COVID, as it is affecting all business, and not related to the type of business or ownership status. Commissioner Spano asked if staff has bandwidth to contact business owners who are women, people of color, or indigenous groups first, adding he advocates the city doing that. President Harris asked about small business grants for businesses with 1-3 employees. Ms. Barton stated typically businesses with fewer than 3 employees are self-employed, have gig workers or 1099 status, and typically work from their home. She added there are other resources in place for these business types, including unemployment insurance along with the additional $600 weekly federal stimulus. President Harris asked if Twin West is aware of the program. Ms. Barton stated yes adding Twin West will help get the word out to business owners. President Harris asked about the timeframe and how quickly funds will be sent to business owners. Ms. Barton stated the goal is to process the funds immediately, as soon as the grant agreement is signed. Mr. Hunt added it can take a few days to 10 DocuSign Envelope ID: 4D569023-15B1-4B77-AA0F-8E8B8CCD85E0 Economic Development Authority -5- April 20, 2020 business days to receive the funds, depending on if the business owner elects direct deposit of the funds or requires a check. Commissioner Kraft also thanked staff for their work on the program. He shared the previous questions and concerns related to the grant amount ($5,000) but will defer to staff’s guidance. He stated the policy question should be more targeted towards the policy they want to fulfill. He suggested it should read, “The EDA should create a small business emergency assistance program to equitably help sustain local small businesses impacted by the COVID-19 pandemic, with a disproportionate representation of POCI owned business and businesses with owners and all employees in St. Louis Park.” He stated this would seem more in line with the stated goals of the program to prevent business closures and promote long-term economic vitality in the community. He added economic vitality would be better served if, when deciding between two applications, a business owned by a St. Louis Park resident that employs people from St. Louis Park was given preference. Commissioner Kraft noted he is concerned that the strict first come, first served basis precludes fulfilling the policy guidance because the scoring is not even looked at. He agreed with the idea of having a short application period. Commissioner Mavity stated she agrees with Commissioner Kraft’s recommendations for defining the policy. She stated another “whereas” comment should be added to the motion to state, “Whereas women and minority-owned businesses have historically lacked access to capital equity and are a priority for accomplishing the city’s race equity goal.” She explained this needs to be added in order to bring clarity that this is COVID - related, but also articulates a goal the city is trying to accomplish. Commissioner Rog agreed with the resident-owned criteria, and preferred the deadline be just 2-3 days after the applications are available. She stated she does not agree with the first come first served criteria as it is not equitable. Commissioner Mohamed stated while she understands the grants are open to all business owners, she pointed out that Chinese businesses are struggling as well. She agreed first come first served is not the most equitable, and she is concerned that people of color and women will be the last to he ar about the programs if they are not connected. She agreed the $5,000 is not enough funding but was pleased to hear there will be a second round of funding if needed. She stated all in all she is comfortable with the programs and what the city is trying to accomplish here. Commissioner Brausen stated he wants to see the city preserve as many jobs as possible. Ms. Barton suggested allowing an initial application period of 1 week, at which time all of the applications received during this period would be scored and evaluated for DocuSign Envelope ID: 4D569023-15B1-4B77-AA0F-8E8B8CCD85E0 Economic Development Authority -6- April 20, 2020 funding based on highest scores first. If funds remained after the initial application period, the funds would then be allocated on a first-come, first-serve basis. Council agreed with this suggested change. Mr. Harmening stated staff will also need guidance on business owners who reside in St. Louis Park. Commissioner Mavity stated the lesson of race equity is if race is not centered in the conversation, it gets diluted, and if the city gets race right, they will get everythin g else right too. She added she believes race should get priority over residency. It was moved by Commissioner Mavity, seconded by Commissioner Brausen, to adopt EDA Resolution No. 20-08, approving the small business emergency assistance program to aid local small businesses adversely impacted by the COVID-19 pandemic and related emergency orders, as amended to add: Whereas women and minority-owned businesses have historically lacked access to capital equity and are a priority for accomplishing the city’s race equity goal. The motion passed 7-0. 8. Communications – none 9. Adjournment The meeting adjourned at 7:12 p.m. ______________________________________ ______________________________________ Melissa Kennedy, secretary Rachel Harris, president DocuSign Envelope ID: 4D569023-15B1-4B77-AA0F-8E8B8CCD85E0