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HomeMy WebLinkAbout2020-04-16 HRA regular minutesMINUTES OF THE REGULAR MEETING OF THE EDINA HOUSING AND REDEVELOPMENT AUTHORITY APRIL 16, 2020 7:30 A.M. 1. CALL TO ORDER Chair Hovland called the HRA meeting to order at 7:30 a.m. and noted the meeting was being held virtually to comply with the Governor's Stay -at -Home Order due to the COVID-19 pandemic, then explained the processes created for public comment. 11. PLEDGE OF ALLEGIANCE III. ROLL CALL Answering rollcall were Commissioners Anderson, Brindle, Fischer, Staunton and Chair Hovland. Absent: None. IV. APPROVAL OF MEETING AGENDA — AS PRESENTED Motion made by Commissioner Anderson, seconded by Commissioner Fischer, approving the meeting agenda as presented. Roll call: Ayes: Anderson, Brindle, Fischer, Staunton and Hovland Motion carried. V. COMMUNITY COMMENT No one appeared. VI. APPROVAL OF CONSENT AGENDA — AS PRESENTED VI.A. Approve Minutes of the Regular Meeting of March 12, 2020 VI.B. Approve Payment of Claims, HRA Check Register January 16-April 9, 2020 totaling $95,764.52 Motion made by Commissioner Brindle, seconded by Commissioner Fischer approving the consent agenda as presented. Roll call: Ayes: Anderson, Brindle, Fischer, Staunton and Hovland Motion carried. VII. REPORTS/RECOMMENDATIONS VII.A. AUTHORIZING SMALL BUSINESS EMERGENCY ASSISTANCE PROGRAM —APPROVED Economic Development Manager Neuendorf explained the proposed Small Business Emergency Assistance Program and request to authorize the HRA Executive Director to execute loan agreements with impacted businesses. He explained how the item pertained to local efforts to support local businesses as they bear the impacts of temporary business closures and other impacts due to the COVID-19 pandemic and said the item requested was to modify the HRA budget to fund a temporary program that would support local businesses with forgivable loans in 2020. The disruption to most businesses due to the COVID-19 pandemic was extensive with the vast majority of businesses in Edina temporarily closed and those that remained open were experiencing dramatic declines in foot traffic and revenue. He explained how Federal and State lawmakers had authorized financial assistance but that recovery and relief funds being administered by the U.S. Small Business Administration (SBA) and Minnesota Department of Employment and Economic Development (DEED) were slow to come and establishment of a local small business emergency assistance fund was recommended to further assist local businesses that may not easily be awarded federal or state assistance yet still make a significant contribution to the vitality of Edina. Mr. Neuendorf explained the Small Business Emergency Assistance Program would provide forgivable loans to help local small businesses that operate with between 2 and 25 full-time equivalent (FTE) employees and annual revenue not to exceed $1,000,000 and cover two months of operating Page I Minutes/HRA/April 16, 2020 expenses. The maximum loan amount would be $10,000 and there would be no fee to apply to this program and the loans would bear no interest. The loans would be forgiven for businesses that remained operational two years from the date of the Loan Agreement, provided that they remained in Edina and retained at least 75 percent of their employee positions. He stated up to $100,000 from the 2020 HRA property tax levy was recommended to be used to support local businesses originally intended to partially fund staff and a new fa4ade improvement program. With the creation of this new program, partial funding for staff would be shifted to administrative expenses of TIF Districts and the facade improvement program placed on hold for a future year. Mr. Neuendorf outlined the application procedure and stated the need for this type of program and implementation had been crafted in consultation with many peer groups including Edina Chamber of Commerce, 50th & France Business Association, Open to Business program, and economic development peers from cities and counties in the Twin Cities. A Loan Agreement template would be used to execute the loans. He outlined ineligible businesses that included new businesses, corporate chains, those in default, non -for -profit, government owned and businesses owned by elected City officials, then explained if approved, the program would be rolled out immediately with a one -week application period, review and selection and distribution of funds by mid -May by a panel selection process, who would review applications and rank based on criteria. Lori Syverson, Edina Chamber of Commerce, thanked the Commission for consideration of this program and noted a recent online survey, about how businesses were changing over this crisis, showed many have applied for some other type of disaster program relief but the concern was the delay in getting funds. Rachel Thelmen, 50th & France Association, thanked the Commission for their consideration then spoke about the need for businesses for resources and how some were trying for other governmental loans but funds were not coming quickly and how this would help fund a gap. Rob Smolund, Open to Business, said this was a great tactic because businesses need money now and although Open to Business had an allocation of $1 million to provide, they had 600 applications to review and with their small staff, the eligibility and underwriting was a slow process. He said businesses needed cash flow help once this subsided and were back in business and commended the City for consideration of this program. The Commission asked about the HRA levy and if staff was considering using $100,000 from a $192,000 HRA levy and concerns we would be caught short with payroll. Mr. Neuendorf said the HRA levy was started a few years ago to stop reliance on TIF funding for staff support, and while we would have to use TIF dollars this year to support staff, there was adequate funding in the Centennial Lakes, 50th & France, Southdale and Pentagon districts to support staff, but would eliminate the intended fagade improvement program for this year as it was no longer necessary at this time. Manager Neal commented the money paid for staff costs was an allowable cost out of TIF funds but the levy had a wider scope of programs and expenses allowed and this program fit that scope. The Commission asked what portion of funds were from the fagade program and did this fall within the EDA State law under HRAs. Mr. Neuendorf responded the fagade program had not been finalized yet but was in the $50,000-$75,000 range. City Attorney Knutson confirmed the program would fall under MN Statute Chapters 12 and 469. The Commission asked how many businesses could be helped through this program and asked if more significant needs were identified could the program be expanded. Mr. Neuendorf said the hope was to help businesses with two months of expenses with a cap of $10,000, so would serve 10 businesses. He then shared the City had approximately 1,000 businesses of less than 25 people and 600 with an annual revenue of less than $1 million. He noted other cities had created programs with caps of $5,000-$7,500 and larger businesses could apply to other federal programs, but this would serve smaller businesses. He added the HRA could look at funding up to the full levy amount after review of impact of this program. The Commission confirmed a loan agreement would be required and thanked staff for being creative with housing and businesses assistance and said this program would help keep businesses as viable as possible during this difficult time. Motion made by Commissioner Brindle, seconded by Commissioner Fischer, to approve the local Small BusUomym Emergency Assistance Program and authorize the HRA Executive Director to execute loan agreements with impacted businesses. Roll call: Ayes: Anderson, Brindle, Fischer, Staunton and Hovland Motion carried. The Commission asked about the number of employees in qualified businesses and noted small service providers such as salons utilized independent contractors and the need to find a balance for these, as well businesses then confirmed this was aone'tinoa request like rental assistance or could be reopened. Mr. Neuendorfreopondad the $100'000 program would likely be oversubscribed quickly but staff would monitor and could provide additional dollars for Commission consideration inthe future, but right now believed this would be aone-time program. He explained o business could only apply once and if someone owned two buxinaaaea, could only receive one loan and not be able reapply. He added the evaluation process of three-quarters of existing employment was arbitrary but measurable and would be counting full-time employees and convert any part-time to full-time equivalent to give businesses adequate flexibility with the goal to survive substantially as it was in place today. The Commission thanked all involved for leading the way in the region on how government could help during dire circumstances. X EXECUTIVE DIRECTOR'S COMMENTS Motion made by Commissioner Staunton, seconded by Commissioner Brindle, to adjourn the meeting at 8:35a.mm. Roll call: Ayes: Anderson, Brindle, Fischer, Staunton and Hovland Motion carried. Respectfully submitted, �-