ELYRIA — Mayor Holly Brinda has held off unveiling her full economic development plan for the city, but she has showed her interest in working with small businesses and promoting business growth.
Brinda on Monday offered two ideas to help companies get money and/or property.
The first is forming the Elyria Community Improvement Corp., a nonprofit organization that can acquire properties in prime business areas of the city. It will give the city arms’ length control over development projects while shielding city government from unnecessary liabilities, Brinda said.
“This is a proactive tool that allows the city to respond quickly to economic development proposals,” Brinda said. She presented the idea to members of City Council’s Community Development and Finance Committees Monday night.
She reminded Council members that larger cities have turned to private-public partnerships to transform their communities.
Twenty years ago, the Gordon Square Arts District in Cleveland’s Detroit-Shoreway neighborhood formed a partnership between the city and developers to convert the area into a destination neighborhood.
Brinda said at least five possible projects could benefit from the Community Improvement Corp. in Elyria, including possible land donations downtown as well as the old General Industries property.
City officials are conducting a market analysis of downtown, Cleveland Street and Midway Mall business districts with a grant from the Northeast Ohio Areawide Coordinating Agency.
Officials hope private property owners will put their money on the table so the new corporation can assist them, said Attorney Jack Waldeck Jr., of Walter Haverfield LLP, who handles the city’s real estate interests.
“It’s the only real way projects are going to happen in the future,” he said. “There is no real reason for a developer to rehab a commercial property unless they can team up with a city to make it happen. It’s the way East Fourth Street in downtown Cleveland was put back together. It wouldn’t be the way it is today without the city of Cleveland’s help, without federal tax dollars and without private developers all putting their money in the mix.”
The shopping centers around the Van Aken Shaker Square district in Shaker Heights also benefited from a similar funding mix, Waldeck said.
Council members seemed to favor the idea, believing it would give developers an incentive to work with the city on future deals.
Councilman Jack Baird, R-at large, wondered how both the Lorain and Lorain County port authorities would come into play, since the function of a CIC and a port authority are similar. But Brinda and Waldeck said neither port authority is positioned to do what the city needs to do at this time.
Revamping loan program
Brinda’s second idea is to change the way the city loans money to downtown business owners.
The city has a revolving loan program, but is looking to revamp it into the new Elyria Growth Opportunity Fund.
James Graham, the city’s economic development specialist, said a few tweaks in the loan program will make it a better product for business owners, especially those in the targeted downtown area.
“Banks are in the business of risk diversion and not funding small businesses,” Graham said.
With small loans, the city could make a big impact, Brinda said.
The existing revolving loan fund has a $10,000 cap per loan application. The money can be used only on facade improvements or code enforcement for downtown businesses.
The proposed change would open up funding for other uses such as working capital and allowing for the purchase of machinery and equipment.
It would have a floor of $5,000 to $10,000 for working capital and machinery and equipment. The floor will be the same of $5,000 for facade improvements and exterior code compliance, but the maximum loan will be increased to $15,000.
The loan money comes from Community Development Block Grant funds. Brinda said in the future the pot of loan money will come from a combination of block grant funds and possibly philanthropic donations, with the hope of one day weaning the fund off the city’s allotment of federal funding.
In other news:
It’s just a sliver of vacant property, but Council voted Monday to sell land to a longtime business neighbor. The 20-by-128-feet parcel on Elbe Street is sandwiched between the Elyria Spring & Specialty Holding Co. and another business. It is a fenced in, grassy area.
The property has been appraised at $3,000. Elyria Spring will pay the appraised value of the property as well as any filing fees and recording fees.