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HomeMy WebLinkAbout2003-12-11 ACE MINUTES• • • ALLIANCE FOR COMMERCE IN ENGLEWOOD Dece mb e r 1 1, 2003 I. CALL TO ORDER The regular meeting of the Alliance for Commerce in Englewood (ACE) was called to order at 11 :35 a.m. in the City Council Confere nce Room of the Englewood Civic Center. Chairman Pa- netta presided . Present: Absent: Council Liaison: Chamber Liaison : Staff: Guests : Rees, Cook, McDermott, Ashenfelter (late), Panetta Schalk, Guinther, Vasilas (provided previous notice) Yurchick Ackerly Darren Hollingsworth, Business Development Specialist John Voboril, Planner Olga Wolosyn, City Council member ESBDC members: Bill Clayton, Connie Sanchez , and Gary Oxman II. APPR OVAL OF MINUTES November 13, 2003 Chairman Panetta stated the Minutes of November 13, 2003 were to be considered for approval. McDermott moved: Rees seconded: The Minutes of November 13 , 2003 be approved as written. The motion carried . III. NEW BUSINESS A. Englewood Small Business Development Corporation Mr. Panetta welcomed members of the Englewood Small Business Development Corporation (ESBDC) to the meeting . Mr. Hollingsworth provided a brief introduction on the ESBDC origin, purpose, and activities , pointing out that the ESBDC was initially begun in 1992 and funded by the City of Englewood, the Chamber of Commerce, and the former Englewood Downtown Development Authority. Mr. Hollingsworth referenced in formatio n included in the ACE packet, and noted that the application and loan criteria information may be accessed via through the City's web page. Three loans are outstanding, and there is in excess of $230,000 available for loans . Ms. Ashenfelter entered the meeting during Mr. Hollingsworth's presentation, and took her seat with the membership . H:\GROUP\BOARDS\ACE\Minutes\2003\ 12 -l 0 -03 .doc 1 • • • Ms. Sanchez , Mr. Clayton, and Mr. Oxman provided insight on issues of concern to the ESBDC, namely lack of qualified loan applicants. The ESBDC has provided assistance to a number of new businesses in years past, and there are "success" stories. There have also been loans written off by the ESBDC --businesses have not been successful, or have relocated and the outstanding debt has not been collected, etc. Mr. Clayton emphasized the importance of a good, solid busi- ness plan required as part of the loan application package; he suggested that the business plan is more important than the type and amount of collateral offered by a loan applicant. Mr. Clayton also suggested that in his opinion, the ESBDC should offer flexibility on the interest rate charged on the loans. Mr. Yurchick asked why loan applications are not coming in. Ms. Sanchez responded that the ESBDC members don't know why; the board has discussed adjusting the interest rate, and/or increasing the loan cap. Mr. Oxman suggested that perhaps the marketing efforts are not target- ing the business groups that may need the type of assistance ESBDC can provide. Members ac- knowledged that some of the loans they consider, and approve, are "high risk" business loans. Ms . Wolosyn entered the meeting and took a chair with the membership. Mr. Panetta asked when the last loan was made by ESBDC. Ms. Sanchez estimated approxi- mately six to eight months ago. Ms. McDermott stated that in reviewing the ESBDC information included in the ACE packet, her impression was that it would be expensive and time-consuming to apply for an ESBDC loan . She suggested that the 10 % interest rate, plus the 10 % loan premium may "scare" applicants. Mr. Clayton emphasized that a charge to the ESBDC is to not be competitive with the banking industry. ESBDC is to be the "last resort lender", and applicants were , at one time, required to be denied loans by three banks before the ESBDC could consider a loan request. Mr. Panetta commented that the "lender of last resort " statement may have a negative connota- tion to loan applicants. He suggested that there may be a disparity between what the ESBDC may present as their "mission" and what is actually being done. Ms. McDermott noted that one statement indicates that a "credit check may" be run on a loan applicant. If a credit check is "required" to be run , this could alleviate some of the "risk". Ms. McDermott further suggested that the collateralization requirements are pretty steep and loan ap- plicants have to comply with "heavy duty requirements". Mr. Clayton further discussed the issue of collateral, noting that the ESBDC will not make loans with no collateral, but in his opinion a good business plan is very important. He stated that the ESBDC will not make signature loans , and possibly the $30,000 loan cap should be increased. Mr. Oxman discussed the intent of the 10 % premium required on loans - a means to maintain a viable balance for loan purposes. Mr. Hollingsworth advised that if an applicant has a good payment record on the loan, the 10 % premium may be reduced or waived . H :\GRO UP\BOARDS\ACE\Minutes\2003\ 12-10-03 .doc 2 • • • Mr. Hollingsworth stated that at the November meeting of ACE, Chairman Panetta asked staff to research "micro loan programs". Mr. Hollingsworth distributed information from the Colorado Enterprise Fund regarding assistance to small businesses. The maximum loan amount through this program is $150,000, interest rates range from 9% to 12% per annum, and loans may be am- ortized up to 7 years . Mr. Hollingsworth stated that ESBDC would like to get some suggestions from ACE on im- proved marketing ideas, and other ways to improve the functionality of the ESBDC. Mr. Clay- ton asked that if any member of ACE was aware of a small business in need of financial assis- tance, to please make them aware of the ESBDC and the services this group can provide. Mr. Panetta asked for comments from ACE. Ms. McDermott stated that marketing efforts must be improved; the willingness to negotiate in- terest rates and collateral requirements must be stressed, and she suggested that perhaps the mar- keting brochure be modified to be Jess specific. Ms. Ackerly, Chamber liaison to ACE, suggested that ESBDC prepare an article for inclusion in the Chamber Newsletter. Mr. Hollingsworth pointed out that the ESBDC information is on the City Web-site, and that the information is included in business packets distributed to all start-up businesses, or business in- quiries. Mr. Hollingsworth noted as an aside, that a prospective restaurateur may be before the ESBDC in the very near future -this business is interested in locating in the 2900 block of South Broadway, and is in need of financial assistance. Mr. Yurchick suggested that ESBDC could relax some of the requirements; he further noted that for high risk loan applicants, the ESBDC will be a "last resort lender." He further suggested that the statement "last resort" be explained -it does not need to mean bad credit on the part of the applicant. Mr. Rees cited a discrepancy in the "premium" charged on loans - 5 % vs. 10 %. The information must be consistent. Mr. Rees also suggested instituting a "floating" interest rate of possibly 2 % to 2.5 % above the bank rate rather than a flat 10 % interest rate. Ms. McDermott suggested that ESBDC might also assist loan applicants in developing viable business plans to support their loan applications. A resource list on writing business plans could be developed for those interested. Mr. Clayton stated that at the time the EDDA was dissolved, the ESBDC amended their Bylaws to address that issue . Now , the ESBDC is composed of representatives of the Chamber of Com- merce and the City of Englewood, with a member appointed by the ESBDC membership . He suggested that ACE membership might consider appointing a member to sit on the ESBDC. He stated that the ESBDC Bylaws would have to be amended again to accommodate this representa- tion if ACE is so interested. Mr. Panetta stated that appointment of a member to represent ACE would have to be placed on the agenda for the next meeting to discuss. H:\GRO UP\BOARDSIACE\Minutes\2 003\12-10-03 .doc 3 • Ms. McDermott asked how many loans the ESBDC has granted since 1992. Mr. Oxman esti- mated that at least 10 loans have been granted, possibly more. Mr. Yurchick noted that an issue that ESBDC may want to take into consideration is that a busi- nessman may feel more comfortable going to "strangers" to discuss business plans and financial needs rather than applying to someone, or a group of people, with whom they may be ac- quainted. Mr. Panetta asked if the loan terms have been the same since the inception of ESBDC? He of- fered the following suggestions: 1) Look at raising the maximum loan amount; and 2) is there a peer group in other municipalities who have the same responsibility as ESBDC, and if so joint discussions on marketing strategies and loan technicalities might be helpful. Mr. Panetta thanked the ESBDC members for their attendance, and noted that they were wel- come to remain for the balance of the meeting if they so desired. The ESBDC members excused themselves from the meeting . B. Nominations for Business Awards. Chairman Panetta stated that ACE has been asked to submit names for consideration as the "City of Englewood Representative of the Year" at the Chamber of Commerce/City of Englewood "gala" planned for January 29, 2004. • Ms. Ackerly stated that ideally, three names are desired for consideration . • The 2002 winner in this category was Jan Johnson, former Business & Redevelopment Coordi- nator. Discussion on eligibility for this award ensued: City employees and members of boards and commissions who may have made a positive contribution to the overall business climate in the community. Members pointed out that they do not know who is serving on other boards and commissions. Mr. Cook asked if there is a "matrix" or record of people who have been instru- mental in bringing new businesses to the community. Further discussion ensued. Mr. Rees stated that Ms. Wolosyn should be considered for this award. Mr. Cook nominated Mr. Rees for the award. Mr. Panetta noted that both Ms. Wolosyn and Mr. Yurchick, as City Council members, and Mr. Rees as a businessman, have been very involved in community efforts for im- proved business climate. Ms . Wolosyn, Mr. Yurchick, and Mr. Rees were asked to step out of the room while other mem- bers of the Commission discussed the nominations. * * * * * * * * * Discussion ensued . H :\GROUP\BOARDS\AC E\Minutes\2003\ 12-10-03 .doc 4 • • • Cook moved: Panetta seconded: The names of Ms. Wolosyn, Mr. Yurchick, and Mr. Rees be submitted for consideration as the City of Englewood Representative of the Year Award. The motion carried unanimously. * * * * * * * * * * Ms . Wolosyn, Mr. Yurchick, and Mr. Rees were called back into the meeting. Chairman Panetta announced that ACE is most pleased to submit their names for consideration as City of Engle- wood Representative of the Year, and that all three candidates exemplify the intent of this award. IV. OLD BUSINESS A. Economic Development Strategy (continued discussion) Mr. Hollingsworth stated that discussion at the November meeting concluded at Row 30, Page 3. Discussion at this meeting will begin with the following strategy: Investigate and overcome regulatory and financial challenges to the establishment of targeted new businesses. Action items addressing this strategy were discussed. Mr. Hollingsworth emphasized the need to over- come these "hurdles" to become more competitive in attracting new businesses and retaining ex- isting businesses. Ms. Wolosyn noted that a ll of the actio n items are given a #2 p1iority , and suggested that a re- classification of priorities is needed to "get so mething going". Mr. Panetta agreed, and sug- gested that all the action items should have a #1 priority , not a #2 priority. Mr. Voboril stated that the "action" items were broken out to make sure that all issues impacting regulatory and financial challenges were cited and addressed. He noted that all of the action items should have the same "timing" to address this "strategy". He stated that all action items will be reprioritized to #1. Di sc ussion ensued. Mr. Yurchick commented that if "regulatory " challenges were addressed, other impacts would "s hake out" and follow through. Ms. Wolosyn pointed out that regulatory challenges are different than financial challenges, and may call for a different approach to reach a viable solution. Mr. Hollingsworth noted an article from a recent Denver Business Journal regarding permitting processes . He stated it was a very good article; it will be copied and sent to ACE members . Mr. Cook asked about the possibility of integrating the type of business we want to attract into the Economic Development Strategy Pl a n. Mr. Rees asked why the project next to the "Becker's Store" on Broadway fell through; was this a result of Planning and Zoning regulations? Mr. Hollingsworth stated that he was not sure why this project did not materialize; however, the owner still has an interest in redeveloping the site . Mr. Voboril suggested that inability to comply with minimum parking requirements impacted the H:\GROUP\BOARDS\ACE\Minutes\2003\ 12-10-03 .doc 5 • • proposed project. Ms. McDermott pointed out that land is very expensive, and this may also have impacted the viability of the project. Mr. Rees commented that "this was a good project". Mr. Panetta noted that use of a "consultant" is referenced frequently in the Strategic Plan; in light of budget constraints, is consultant use a viable option, or should staff and ACE membership take a more active role. Mr. Voboril acknowledged that the budget for consulting services has been reduced , but funds for a consultant are still available when needed. Mr. Hollingsworth noted that review by and expertise from a third party (consultant) is valuable. Mr. Yurchick asked why ACE membership cannot assume responsibility for critiquing reports and documents. Mr. Voboril stated that ACE review and input is very important, and the Commission will be working cooperatively with staff and a consultant on document and plan reviews. Discussion ensued. Mr. Panetta commented that Messrs. Voboril and Hollingsworth are looking for ACE input; the ACE role is more "now-oriented". He suggested that ACE members should pick an item and assume the responsibility to investigate that issue and report back to ACE. He suggested that Mr. Rees, for instance , could probably report right now regarding "site challenges" -availability of sites for new businesses , etc. Ms. McDermott supported Mr. Panetta's suggestion, and noted that in her opinion the ACE members are very "task-oriented", and willing to take on this responsibility. Ms. Wolosyn agreed; in her opinion ACE wants to take an active role. Mr. Voboril referred to the column in- dicating the roles that ACE and Chamber members can play on each issue -research , promotion , etc. The role of staff is indicated in a separate column. Mr. Voboril suggested that for the Janu- ary meeting , he will prepare a work plan addressing items of one or two priorities . Ms. McDermott stated that Lines 31 through 36 should be changed to# l priority , and that ACE take the lead on working on these item s. Mr. Rees and Mr. Yurchick agreed. Ms. McDermott suggested that the focus of the next meeting be one of these referenced action items. This pro- posal met with the approval of ACE, and Mr. Hollingsworth noted that it will be an "action item" on the January agenda. V. COMMENTS AND EVENTS Ms. Ackerly reminded members of the joint City of Englewood/Greater Englewood Chamber of Commerce "gala" scheduled for January 29, 2004. This event will be held at the Gothic Theater. Mr. Hollingsworth stated that tickets will be provided to ACE members. Spouses or guests of ACE members are welcome to attend. Mr. Rees inquired on the status of the "Fullerton Project" on the old General Iron site. Mr. Hollingsworth stated that he understood it is on hold until a determination is made regarding the light rail station at Bates. Mr. Yurchick stated that the City is out of the project; RTD has re- turned the unused southern portion of the site to B a rton Brothers, and they are exploring devel- opment options. • The meeting was declared adjourned. H:\GRO UP\BOARDS\ACE\Minutes\2003 \ 12-10-03 .doc 6 • Ac ti on Items: • Review Economic Development Strategy • Expand on removal of regulatory hurdles • Cite tasks to be done to accomplish removal of regulatory hurdles • ACE members volunteer for specific tasks Janu ary Agenda Items: • Economic Development Strategy Work Plan -Voboril • Include Den ver Business Journ a l article on Permittin g Proce ss in p ac ket • ACE representation on ESBDC • • H:\G RO UP\BOARDS\ACE\Minutes\2 003\1 2 -10-03 .doc 7