TO: Urban Renewal Agency Board
THROUGH: Steve Powers, Executive Director
FROM: Kristin Retherford, Urban Development Director
SUBJECT:
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Exception to Urban Renewal Capital Improvement Grant Program to allow reimbursement for work completed prior to grant commitment
Ward(s): 1
Board Member(s): Kaser
Neighborhood(s): CANDO
Result Area(s): Strong and Diverse Economy
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ISSUE:
Shall the Agency Board authorize an exception to the Capital Improvement Grant Program guidelines to allow reimbursement for work completed prior to grant commitment for property at 220 Liberty Street NE?
RECOMMENDATION:
recommendation
No staff recommendation. The exception is before the Urban Renewal Agency Board per rule that allows the mayor or councilor to have an item on an agenda for consideration.
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SUMMARY:
The Capital Improvement Grant Guidelines prohibit awarding grant funds to reimburse costs for work completed prior to the issuance of a grant commitment. This guideline provides the Urban Renewal Agency with the opportunity to determine if the application meets grant requirements, including eligible project costs, historic review, and availability of funds.
If an exception is granted, the Capital Improvement Grant application for 220 Liberty Street meets the Downtown Strategic Action Plan objective for business recruitment and would qualify for a Capital Improvement Grant. Grant funds would reimburse eligible costs for completed work. The estimated Capital Improvement Grant amount is $44,000.
FACTS AND FINDINGS:
When a potential applicant asks about grant programs, staff reviews the requirements with the applicant, including not starting any work that might be grant eligible prior to receiving a grant commitment. In May 2019, Mr. Gene Derfler [representing property owners Eugene L. Derfler and Thelma M. Derfler] and URA staff had multiple communications regarding URA assistance to renovate the ground floor at 220 Liberty, formerly occupied by the Beanery, for renovations to recruit a new tenant, Alchemy Tattoo Collective. The communications included the grant requirements and processes.
On October 10th, 2019, Mr. Mike Bowers, on behalf of the property owners, called City staff requesting assistance with a Capital Improvement Grant application for reimbursement for the completed project. Staff reminded Mr. Bowers that grant funds could only cover eligible costs incurred after a grant commitment was signed and that pre-grant project costs were not reimbursable. On Friday, October 11th, staff shared again the grant eligibility requirements with Mr. Bowers, and Mr. Bowers requested an exception to the grant guidelines.
BACKGROUND:
In 2011, Mr. Derfler received an Urban Renewal grant for renovations to the building. The grant included the requirement that grant funds could not be used to reimburse for work completed prior to the grant approval.
For the URA Board’s consideration of the exception request, all application documentation was reviewed to determine if the project qualified for a grant. Mr. Bowers presented two separate grant applications for the first time: 1) Strategic Project Grant to cover 100% of the costs associated with extending the front of the building to close a setback area; and 2) Capital Improvement Grant to cover first and second floor tenant improvements, including electrical/plumbing upgrades, flooring, and stairway improvements. The Strategic Project Grant, separate from the Capital Improvement Grant program, was created to cover 100% of project costs that are specific to crime prevention and that are not eligible for a Capital Improvement Grant. The extension of the building façade to close the setback area and increase the internal square footage of the building is eligible under the Capital Improvement Program Grant.
Kristin Retherford
Director
Attachments:
1. None