Business Retention and Development Committee Agenda and Packet 2020 07 06

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SUBJECT: LOUISVILLE'S RECOVERY & IMPROVEMENT PROGRAM PROPOSAL DATE: JUNE 19, 2020 PAGE 3 OF 4 Staff suggests that a similar process be employed for the Recovery & Improvement Program. A packet would be created to communicate the program criteria and would include a simplified application form. Applicants would be required to submit cost estimates for the project and explain how the project also aligns with program criteria. The application should be crafted to be clear that applicants must pledge the matching funding. Staff would review the form, communicate with the applicant, and prepare a recommendation for the City Manager, including project summary and funding. To facilitate responsiveness, staff proposes to administratively approve Recovery & Improvement Program applications, within the funding allocated and matching funding level (see discussion below). Staff envisions an agreement would still be required between the applicant and City, to include an appropriate clawback if the project is not performed or is not completed within a certain timeframe. If a request is approved, staff would coordinate with the applicant and proceed to disburse funding. If a request is denied, such as for not meeting the program criteria or not pledging matching project funds, the denial would be communicated to the applicant by staff. Staff would provide a monthly update to the EVC on program applications, including approvals and denials. Funding Through the current BAP, the City offers a percentage of rebates on taxes and fees. These are generally paid after the business obtains a certificate of occupancy or meets other milestones for taxes. There is not an allocated budget for incentives, since it is assumed the City has generated and received new tax or fee revenue before rebates are paid. For the Recovery & Improvement Program, staff alternatively suggests setting aside a pre -approved amount of funding that is available. This method would also be a good fit if the LRC is a program/funding participant, because they could set their own threshold of funding available to businesses within the Urban Renewal Area (URA). Staff and EVC also briefly discussed a "matching" funding structure. For example, the Recovery & Improvement Program could provide matching funds of up 50%, not to exceed a certain dollar amount (such as $10,000). The top threshold should consider the variety of projects for which businesses could seek this type of assistance and to make the process to apply and receive approval efficient. The EVC should give staff input about overall funding and individual project dollars. Staff suggests that a business entity only be permitted to receive one-time funding under this program to make sure a number of eligible businesses have sufficient opportunity. Due to the economic circumstances created by the pandemic, matching funds would be provided at the start of a project rather than as a rebate. Staff believes this will encourage businesses to take advantage of the program for projects they would otherwise not have sufficient cash flow to pursue. If the EVC wishes to advance the Recovery & Improvement Program, staff can take input to refine the program criteria and process. The next steps would then include obtaining approvals (potentially from LRC and City Council) and creating the process tools and promotional information. With summer meeting schedules, the program could probably Agenda Packet P. 12