Report to Council 2021
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Department of Economic Development Report to Council 2021 Taps & Tails is opening in 2021, converting this structure on Train Avenue in Cleveland into an active play space for dogs and dog owners in Cleveland. Despite the pandemic , entrepreneurship and small business development remains strong in Cleveland. Department of Economic Development CLEVELAND CITYWIDE DEVELOPMENT CORPORATION All loans over $50,000 go through a rigorous underwriting review by the Cleveland Citywide Development Corporation (CCDC). CCDC includes bankers, local community members, business representatives, and appointed officials. The loans first are reviewed by the Loan Committee and then go for final review by the Board of Trustees. Below is the roster as of 12/31/20. BOARD OF TRUSTEES Frank G. Jackson, Mayor Juan Hernandez, Business Growth Director City of Cleveland Growth Capital Anthony Brancatelli, Councilman Ward 12 J. Stefan Holmes, Sr. Vice President Cleveland City Council First National Bank Dr. Melissa Burrows, Director Dale R. Lenzer, VP SBA Product Specialist Cleveland-Office of Equal Opportunity Huntington National Bank Roger A. Carney, CPA N. Michael Obi, C.E.O. Community Housing Solutions Spectrum Global Freddy L. Collier Jr., Director Patricia Ramsey, VP Comm. & Econ. Dev. Cleveland-Planning Commission Fifth Third Bank David Ebersole, Director Michiel Wackers, Interim Director Cleveland-Department of Econ. Development Cleveland-Dept. of Community Development Luke D. Elsass, Vice President Natoya Walker Minor, Chief of Public Affairs First National Bank City of Cleveland Colleen Gilson, VP of CDC Advancement Henry West, Retired Banker Cleveland Neighborhood Progress, Inc. Zulma Zabala, CEO East End Neighborhood House LOAN REVIEW COMMITTEE Anthony Brancatelli, Councilman Ward 12 Dale R. Lenzer, VP SBA Product Specialist Cleveland City Council The Huntington National Bank Roger A. Carney, CPA Daniel O’Malia, Relationship Mgr. Community Housing Solutions Fifth Third Bank Peter Constantino Leonard E. Olsavsky, Vice President Constantino CFO Consulting, LLC U. S. Bank David Ebersole, Director Shawn Ondrejko, Senior Vice President Cleveland-Department of Economic Development Wells Fargo Bank Michael Gruss, Assistant Vice President Dean Razek, Assistant VP Bellwether Enterprise Real Estate Capital First National Bank Randy Horst, Sr. Vice President Derek Reed, Vice President PNC Bank KeyBank Jeffrey T. Verespej, Executive Director Old Brooklyn CDC 2020 Report to City Council Page 2 Department of Economic Development ECONOMIC DEVELOPMENT PROGRAMMING Vacant Property Initiative The Vacant Property Initiative helps overcome barriers in the full reuse of abandoned, idled or underutilized commercial and industrial properties within the City of Cleveland. Eligible activities are property acquisition, environmental site assessments, site clear- ance and demolition, “as is” and “as completed” property appraisals, new construction, and renovation. The program provides forgivable loans up to $180,000, tied to job creation and invest- ment. Loans are made over a five-year term, with forgiveness available at the end of the loan term if job creation goals are met. Job Creation Incentive Grant The Job Creation Incentive Program (JCIP) is utilized to attract or retain businesses in the City of Cleveland. The program provides a valuable tool for attracting growing and expanding companies to Cleveland. The grant amount paid is based on actual new pay- roll and income tax generated to the City of Cleveland, which is verified annually. Economic Development Loans Economic Development Loans funded with Federal Economic Development Administra- tion Title IX funds is designed to assist small-medium businesses who are creating or retaining jobs and looking to expand in the City of Cleveland. The Program offers long term, fixed rate financing for the a variety of purposes. Loans can be used for acquisi- tion of furniture, fixtures, machinery and/or equipment, as well as for working capital. Tech Delta Program The Tech Delta Program is designed to supply financial assistance to assist with the modernization of space to attract leading-edge companies to grow in Cleveland. Many companies experience much higher build-out costs or rental rates due to specific techno- logical needs for their operations. The Department of Economic Development can offer grants up to $50,000 to financially support upgrades, and in turn, make it financially feasible to expand operations or to lower rents. Therefore, companies with expenses as- sociated with tech and lab buildout beyond standard “white-box” space are ideal candi- dates for the program. Neighborhood Retail Assistance Program The Neighborhood Retail Assistance Program provides low-interest, patient existing and start-up small businesses and entrepreneurs. Many traditional lenders cannot provide financing to locally-owned, non-chain restaurants and retail in our neighborhoods. At the same time, strong retail corridors increase the “walkability” of neighborhoods adding vitality by providing street level goods and services ultimately improving quality of life. 2020 Report to City Council Page 3 Department of Economic Development ECONOMIC DEVELOPMENT PROGRAMMING Neighborhood Development Program The Neighborhood Development Program provides a tool to assist with predevelopment costs for sites throughout the City. Development within the City often faces challenges from historic industrial or commercial use that new development does not face. The NDP program helps to offset these costs to make new development viable and identify paths forward that can make a project work. Tax Increment Financing Tax Increment Financing is a tool that can be used to assist with new development. A TIF takes a portion of the new real estate taxes generated by the project and allows them to be redirected back into the project. The City regularly uses a non-school TIF, which keeps the school district’s share of the taxes whole. TIF proceeds can be used to support traditional financing, City financing, or for other resources. Municipal Small Business Initiative Partnering with U.S. Small Business Administration and Cuyahoga County, this perfor- mance grant allows businesses to reduce their equity in a SBA funded project from the required 25% to 10%. The City provides a grant of 15% (of total project costs) which is funded half by the City and half by the County. The goal of this grant is to leverage fi- nancing to benefit small businesses in the creation of jobs and opportunities in the City of Cleveland. COVID RELIEF PROGRAMS Safe Operations Grant The Safe Operations Grant offers grants up to $10,000 for costs incurred to operate safe- ly during the pandemic. The Safe Operations Grant is to reimburse for costs incurred to operate safely during the pandemic. Eligible costs include PPE, (not PPP) partitions, sin- gle-use menus and other equipment required to operate safely during the pandemic. Costs can be reimbursed as far back as March 2020. Emergency Working Capital Loan Program The Emergency Working Capital Loan Program can now provide up to $25,000 to small businesses to assist with working capital costs during the pandemic. The program does not require repayments to begin until January 2022 and keeps repayments limited to $15 per month for every $1,000 borrowed. The program helps to fund most costs of oper- ations, such as rent, utilities, business supplies, and other operations costs dating back to March 2020. 2020 Report to City Council Page 4 Department of Economic Development ECONOMIC DEVELOPMENT PARTNERSHIPS KIVA is a micro-lending website that enables everyday people to pool small lending contribu- tions to provide financial access to entrepre- neurs. With lenders pledging as little as $25 each, businesses are able to raise up to $10,000 toward their project. This platform gives res- idents the ability to support concepts they’d like to see in their neighborhoods and strengthens the bond between entrepreneurs and their community. At a 0% interest rate and with no additional fees, KIVA is a great first step for borrowers in receiving external funding. Hebrew Free Loan Association—Start- Up Working Capital Loan Fund The Start-Up Working Capital Loan Fund provides loans up to $5,000 at 0% interest to finance working capital expenses for start-up recipients of the City’s Neighborhood Retail Assistance Program as well as recipients of the City’s SBA Municipal Small Business Ini- tiative Program Grow Cuyahoga County Fund (GAF) The Grow Cuyahoga County Fund, is a partnership between the City of Cleveland, Cuyahoga County and the Grow America Fund, Inc., a subsidiary of the National Development Council. The partnership works to provide loans to small business that need capital to grow while creating & retaining jobs. The Fund provides loans from $100,000 to $3.4 million at or below market rates with longer loan terms, up to 25 years. Goldman Sachs 10,000 Small Businesses Goldman Sachs 10,000 small businesses is an educational program that links learning to results for small businesses entrepreneurs. Business owners gain skills in negotiation, marketing, management, and they receive customized growth plans to take their businesses to the next level. In Cleveland, the program is administered through Cuyahoga Community College. 2020 Report to City Council Page 5 Department of Economic Development MINORITY BUSINESS DEVELOPMENT CAPITAL ACCESS FUND In 2016, Capital Access Fund (CAF) of Greater Cleveland was launched with the simple long-term goal: to sustain