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HomeMy WebLinkAbout2007-03-15 ACE MINUTES• • • ALLIANCE FOR COMMERCE IN ENGLEWOOD Ma rc h 15, 2 00 7 I. CALL TO ORDER The regular meeting of the Alliance for Commerce in Englewood (AC E) was called to order at 11 :35 a.m. in the City Council Conference Room of the Englewood Civic Center, Chair Schalk presiding. Pr ese nt: Vasilas , Schalk, Panetta, Verbeck, Guinther, Lonborg (exited at 12:30), Espinoza (exited at 1 :05) Absent: McDermott (excused) Also present: Olga Wolosyn, City Council Liaison (entered at 11 :47 ) Jim Woodward, Councilman Kersten Hostetter, Micro Business Development Staff present: Darren Hollingsworth, Eco nomic Development Coordinator Mark Graham, Planner Robert Simps o n, Director APPROVAL OF MINU TES February 8, 2007 Chair Schalk stated that the Minutes of February 8, 2007 were to be considered for approval. Vasilas moved : Lonborg seconded: The Minutes of February 8, 200 7 be approved as amended. Ms. Lonborg stated the name of the helicopter service out of Swedish is AIRLIFE , not Flight for Life. The motion carried unanimously. II . ACE BUSINESS Chair Schalk introduced Kersten Hostetter of M icro Business Development (MBD). Mr. Hollingsworth thanked Ms. Hostetter for attending the ACE meeting and providing information on the Micro Business Deve lopment Corporation program . He stated ACE has had a long time goal of working to better the business environment in Englewood . 1 • • • MICRO BUSINESS DEVELOPMENT Ms. Hostetter stated she is the President and CEO of Micro Business Development Corporation, a Colorado not for profit organization. The company was started in 199 3 as a rurally based company . It wasn 't until 1998 when the company began to focus on urban areas . Today the company serves 10 % of rural based individuals and 90 % of urban based individuals. Over the last 14 years they have lent out a little over 7 million dollars to just under 1200 entrepreneurs. The average loan size depending on the year is $4 ,800 to $6 ,800 . It is a very small average loan size , although they can do lending up to $60,000 to $80,000. The company finds that community based programming and sector based programming are the most effective and efficient ways for them to work with entrepreneurs . Micro Business Development provides a whole realm of wrap-around services to the business owner. They not only provide a loan, but help the business owner learn how to run their business and excel at what they are doing. Their focus for Englewood in not on lending, it will be on providing a whole continuum of business development services for the entrepreneurs within Englewood . Often what happens in the world of business and entrepreneurship is that people believe that putting capital into the business is going to be the answer to their problems . MBD has found that most often the business owners really don't need the kind of debt that they are looking for and actually would hurt or strangle the business in order to be able to pay back that debt. Before MBD ever provides a loan to a business , the business will receive between 10 and 1 5 hours of individualized service for a business assessment. In that business assessment they will establish where the business owner currently is , what their personal professional goals are for the business, and help them to figure out how to get from where they are to where they want to be. Often times what MBD finds is that people are looking for financing in areas that are not going to support increased cash flow or increase success in their business, but things such as a $20,000 web site , when only five percent of clients are reaching the business through that web site. MBD can help them develop a less costly web site. Instead of a $20,000 debt MBD is able to guide them to an area where they can get the same thing accomplished, do it well , have it be successful, but do it for money that they already have in their business and not take on debt they don 't need. Ninety percent of the people who walk into MBD stores come in for the money .... 80% of them stay for the business development. Chair Schalk asked Ms. Hostetter based on her experience as an example ... with a $100,000 investment what would the City of Englewood be expecting with your program to start seeing in terms of job creation here in the community. Ms. Hostetter stated 40 % of all the loan clients are creating new jobs within the first year of being with MBD. Sixty-eight percent are creating or expanding in the second year. With a $100,000 loan pool you can expect in the first year that we will do anywhere from ten to twelve loans . Because we are doing so many small loans we often have loans that are revolving within a short period of time. Using an example of twelve businesses that MBD has worked with over a year period of time, you can expect that there will be anywhere from five to six permanent full time jobs that we will have created through those businesses in the first year. There will also be some youth and temporary jobs. 2 • • • Ms. Lonborg asked who the principals of the company are and who does the business assessment work. Ms. Hostetter stated since it is a not for profit organization there is a Board of Directors. She stated that information can be found on the website at www.microbusiness.org. There are a group of Micro Business Associates consultants, who are primarily business owners from the community who have been trained by MBD, who do the assessments. First level start-up businesses or idea stage assessments are done by DU business school graduates along with a consultant. There are also numerous banks that volunteer their time to help out. We try to use someone who is within the community where the business is since we are also looking at market. The consultants go to the place of business so they can see how the business is actually run. Mr. Simpson stated the reason we are here today is because ACE completed the Economic Development Strategy in the last couple of years and there are certain areas of that program that still need to be worked on. One of thos e is economic development financial tools . Mr. Simpson learned of Micro Business Development from a friend who is a developer and thought the program could begin to fill some of the gaps that exist in our community. Mr. Simpson said the City has an underutilized revolving loan fund program that has been in place for many years. It doesn 't get used because we don 't have the capacity to do the loans . He said if ACE likes the program and feels it is something they would like to move forward on the City may be able to move some monies in that direction after speaking to City Council to get their thoughts . Chair Schalk asked about the cost of the program. Ms . Hostetter said the first part of what MBD would do would be to get involved in the City of Englewood ... the Chamber of Commerce, the business associations, the government agencies, neighborhood associations, church groups, etc. to try to get people to know them and understand them and to know they are a resource. Secondly, they would start working with the individual entrepreneurs. MBD's cost per client average is $800 per year per client. Mayor Wolosyn asked what is the exact proposed structure of the partnership on a dollar basis. Director Simpson stated he would be proposing the partnership to City Council and that we transfer the approximately $220,000 in funds in the existing revolving loans fund program to this program. Secondly, he said we hope to have a conversation with Council and the Englewood Small Business D evelopment Corporation. ESBDC is a partnership from many years ago that is composed of the Chamb er of Commerce and the City of Englewood. It also has approximately several hundred thousand dollars available, which could potentially be a help . Mr. Simpson stated he is a little critical of the program as it doesn't get the dollars out as effectively or easily as they should be . They tend to loan larger amounts, which is probably not exactly where the loan program wants to be. Mayor Wolosyn asked if the $800 was per loan cost and in addition to the money that would be put into the program. Mr. Simpson stated money is driven from the loans which begin to support the program. Mayor Wolosyn said she liked the idea of MBD getting out into the community. She asked that when MBD does go out into the community they may find weaknesses in what the City does and asked that MBD, as part of the partnership, to bring it back to the table in hopes solutions can be found . 3 • Mr. Panetta asked what the profile of a typical client is. Ms. Hostetter said she was going to answer that in two profiles. The first is the small idea, start-up stage client who is usually looking at some income patching. Often they are working one job with the husband working different kinds of entrepreneurial ventures. It is usually a family endeavor. They are usually low income, seventy plus percent minority businesses and usually within food-based or artisan trends. A lot of this sector is home based. Secondly, the other business owner is someone whose first career did not work out for one reason or another. They are serial entrepreneurs with higher income levels, but many will have maxed out their credit and are about to fall into the low income levels . Mr. Panetta asked what is in it for Englewood. Ms. Hostetter stated in addition to the increase in jobs created there is an increase in sales, property taxes, and hopefully some of the home based businesses will move into the retail centers. Specific sectors of Englewood were looked at, especially the healthcare sector. How can we support those micro- businesses that develop around the larger employers? Ms . Hostetter stated 100% of the money from Englewood will be reinvested in Englewood. Chair Schalk asked for a recommendation from the members. All members were in favor of supporting the program. Ms. Lonborg suggested MBD look at the medical practice sector. They may not need money, but the business advice could be very beneficial. • Ms. Hostetter discussed the financing aspects of the program. • Chair Schalk thanked Ms. Hostetter for her presentation. Mayor Wolosyn asked for a short one page summary for Council on the MBD program and the SBDEC program as Council may want to look at other programs too. COMMUNITY DEVELOPMENT CORPORATION Mr. Graham distributed a memo regarding the Community Development Corporation (CDC). Cities as a rule generally don 't do loan programs . In some cases there are Charter provisions that prevent Cities from lending money. One of the ways that Cities deal with that limit is to create programs like Community Development Corporations, which are generally non-profit corporations with separate Boards of Directors that are allowed to lend money. Council has requested more information regarding this type of program. General functions one would find in a Community Development Corporation include lending for affordable housing, lending for economic development, and other programs such as child care, summer camps and early childhood education, arts programs, and physical development programs for waterfronts and main streets. A Community Development Corporation is an umbrella that pulls together the lending and physical improvements and other community needs into one defined organization. Mr. Graham reviewed several examples in other cities . 4 • • • Mr. Verbeck stated he would like to take a look at the Community Development Corporation . Chair Schalk stated he thought the pro gram sounded good but would like to see more of a business leadership spearheading it instead of a council or city or maybe a combination of both. Councilman Woodward sug gested the City of Northglenn 's CDC be looked at as an example. Mr. Panetta preferred the CDC approach to MBD, but needs to know what En glewood is trying to obtain before making a decision . Mr. Verbeck said we have two pieces here, one for the independents and small business owner and one for the larger clients. Chair Schalk said it sounds like the consensus is to move forward on the CDC knowing it is going to be a long-term and maybe expensive project. Mr. Simpson said the idea will be presented and discussed with City Council. Since it is a big issue more work on it will probably be needed. BUSINESS RETENTION: VISITATION PROGRAM Mr. Graham said this discussion is a follow-u p to business v1s1tation, which has been di scussed by ACE before but the emphasis is different. Emphasis this time will be on primary employers, not retailers. This is a follow-up to the Primary Employers Study. Businesses will be regularly contacted to discover whether they are stable and growing or ready to shut the doors and move operation off-shore. This proposal would have Staff using a software package that is being used throughout Colorado . It helps track the request for service that is sent out to other departments (police, building, etc.), allows Staff to make commitments for communicating back to the business and what is being done. It is connected to a database th at tells Staff about those industries both in Colorado and nationwide so that Staff has a sense of the portfolio of businesses. It is a structured interview that allows Staff to understand whether those businesses are making the kind of standard or sub-standard investments for their field , whether they have had or will have a new product in the last two years, and a snapshot of the overall health compared to other businesses in the same industry classifications. Staff proposes to go forward with a businesses representative and a Staff member attending each interview. Staff suggested twelve interviews in the year 2008 and doubling that in 2009. He asked the members if this would be something they would like to see happen and if the goals sounded reasonable . The members thought one interview a month might be too much . Ms. Mendel asked how many businesses are in the group that would eventually be seen. Mr. Graham said there are about 600, but that group can be further refined. Most communities decide if they want to talk to the biggest employers, the middle group or the smallest group. The programs that Englewood has to assist businesses aren't targeted at the lar gest group; they are more useful to the middle group . We don 't want to over commit up front and not meet our goals. It has been said the City does not have much interaction with the City 's employers . Staff would like to change that. This program would begin to give Staff regular contact with employers in the community . 5 • • • The members asked Staff for more information and research and to report back at next month 's meeting. Mr. Hollingsworth visited Adams County to look at how they run their visitation program . He met with Mr. Frank Gray who conducts the interviews . He seemed to think the businesses were very receptive to the visits; they received good information, and were able to help businesses. Mr. Graham said he would be happy to share some of the reports you get from the program and the survey questions with the members. He also provided a web site if anyone wished to visit. He will share more information at next month 's meeting. Business mixers were also suggested as a way to get people together . 111. COMMENTS & EVENTS CHAMBER OF COMMERCE Ms. Mendel updated the members on Chamber events. • Next Wednesday there is a member luncheon at the Twin Dragon • Ribbon cutting on March 24th for a new business, Serenity Laser Group • On March 29rh from 5 to 8 there will be a Business After Hours at Undici • On April 12th the Student Recognition luncheon will be held at the Area Vocational School • On April 13th there will be a Women in Business meeting ACE MEMBERS Mr. Vasilas stated he has concerns regarding the building on Broadway and Old Hampden. There is a Sullivan Hayes sign on the building ... are they the owners? The building has been boarded up for several years . He said one individual was interested in buying the building, but the brokerage company told them they were not interested in selling ... only in leasing. Mr. Vasilas asked Staff is there is anything that can be done. Mr. Hollingsworth said the property is not in violation of any codes, but Staff will look into it. BID COMMENTS Mr. Vasilas stated the BID Board approved placing banners along Broadway from Yale to 285. Community Development is helping out with the artwork. He said the BID is in search of a name for the district. He asked the members if they had any ideas. Ms. Mendel suggested holding a contest to come up with a name for the area. She offered to place an ad in the Villager regarding the contest. Mr. Vasilas said the BID is working on a sidewalk cleaning program within the area this spring. Chair Schalk stated he has received several calls regarding zone changes and setbacks in regards to halting multi-unit development on 50 foot lots. Councilman Woodward asked if he was referencing the building of duplexes. He said that was correct. Councilman Woodward said his position is as far as the development of duplexes, he would support 6 • • • duplexes provided that there are certain standards that go along with that development. He does not support building cheap duplexes for the sake of landlords or for owners to rent out. He wants quality type duplexes . Mayor Wolosyn agreed. Mayor Wolosyn stated the Planning and Zoning Commission, Board of Adjustments and City Council worked together for a period several years ago to establish the Uniform Development Code . Our goals were to encourage better development and single-family ownership, not stop development. Mr. Hollingsworth stated you have to look at the numbers. When you look at a rental unit it has to cash flow. To build a brand new unit at whatever cost it is to acquire the ground, scrape it and rebuild, the price per unit becomes very expensive . Would people pay that price? Due to the lateness of the hour the zoning issue was tabled until next month 's meeting. STAFF COMMENTS No further business was brought forth for consideration. The meeting was adjourned at 1 :26 p.m. The next meeting is scheduled for April 12 , 2007. ~L_,__~uJ Barbara Krecklow, Recording Secretary 7