Superior is making some changes to its Small Business Grant program after the first round of grants were approved by the City Council.
The changes include creating a scaled funding chart with grants capped at $25,000, defining property acquisition as an eligible use and changing the frequency at which a business can receive a grant.
“Some of the main things were the dollar amounts and how we were distributing the money as well capping,” said Jason Serck, economic development, port and planning director. “We brought the cap down to preserve the money.”
The grant program developed last summer originally capped grants at $50,000.
The largest Small Business Grant awarded under the original program, $47,213, was awarded to KD’s Family Restaurants to cover 15% of its $314,757 in costs to acquire and improve the former Breakwater Restaurant in Itasca.
Under the program originally adopted by the Council, the grants would provide city funding up to 15% of total project costs. That led to Derek Medved, owner of the Korner Store in Allouez, receiving a grant for $2,511 to help with the $16,742 cost of replacing rooftop heating, ventilation and air conditioning units on his store, and Scott Wallin, CPA, receiving a $1,329 grant for an $8,864 project to replace a front door at his firm in East End.
Under the changes approved Wednesday, Dec. 18, by the Plan Commission, both projects could have been eligible for 50% city funding through the new grant program. The change allows small business owners to receive a grant for 25%-50% percent of project costs, with less expensive projects receiving more city funding. Projects with costs of $20,000 or less could receive a grant for 50% of project costs on a scale that diminishes by three percentage points for each additional $10,000 in costs.
Projects over $100,000 would simply receive the maximum grant of $25,000, rather than a scaled percentage under the changes.
“I think it’s a little more fair,” Serck said. “It puts a little more grant money into projects.”
Commissioner Dennis Dalbec questioned allowing property acquisitions grant funding.
“What would stop someone from getting money from the city to purchase that property and then turning around and selling that property for a profit?” Dalbec asked. “Is the city going to be on the deed or have a lien or anything?”
Serck said the development agreement business owners are required to enter to get the grant funding would include default language to cover that.
Property acquisitions were included as an eligible use when the program was developed, but the changes now require applicants to prove the acquisition is not feasible without the city grant and requires application and approval for the grant prior to closing. It also prohibits grant funds from being used for property improvements and grantees would not be eligible for another grant until one year after the closing date.
Commissioners also discussed placing application deadlines on the program but decided to leave it open-ended for now to respond to the needs of small businesses.
“Businesses are usually trying to react to an opportunity or navigate a problem or something along those lines,” Commissioner Brian Finstad said. “I kind of think I like the idea that people can apply at anytime just because that’s going to be most responsive to their needs.”