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HomeMy WebLinkAboutAgenda - 10-06-2015 - 8a 1 ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: October 6, 2015 Action Agenda Item No. 8-a SUBJECT: Report on Small Business Investment Grants, Agriculture Economic Development Grants, & Small Business Loan Program DEPARTMENT: Economic Development PUBLIC HEARING: (Y/N) No ATTACHMENT(S): INFORMATION CONTACT: Application & Guidelines for the Small Steve Brantley, Director, Economic Business Investment Grant, Agriculture Development, (919) 245-2326 Economic Development Grant, & Small Business Loan Program PURPOSE: To receive a report on the current status of three (3) grant and loan programs ("Small Business Investment Grant", the "Agriculture Economic Development Grant", and the "Small Business Loan Program") that are funded by the County's one-quarter cent sales tax for economic development (Article 46 funds) and administered by the Orange County Economic Development Department to support the retention and growth of small businesses, agriculture and food systems-related agriculture ventures throughout Orange County. BACKGROUND: Two of the intended uses of Article 46 funds for economic development include the Small Business Investment Grant, and the Agriculture Economic Development Grant, which support the recruitment, retention and growth of small business development, plus farming & food systems related enterprises throughout Orange County. Although grant funds began to accrue in 2012 following the passage of the one-quarter cent sales tax in November, 2011, no grant activity immediately followed due to a delay in setting guidelines and application procedures. The two grant programs went "live" in 2015 after the Orange County Economic Development Department's Advisory Board in 2014 drafted recommended guidelines and applications, and following the BOCC's review, suggested amendments and approval of the two new grant programs in early 2015. The Small Business Loan Program is similar in to the new grant programs in the sense that the loan program also has an application review committee, guidelines and by-laws, is supported by Article 46 funding, and is also intended to support the recruitment, retention and expansion of small businesses in Orange County. The loan program seeks to assist small firms that may have difficulty accessing traditional banking financing due to small and start-up firms often having insufficient operating history, poorer credit history, etc. The County's loan program was created by the BOCC in 1999, received initial funds to lend in 2007, and became very 2 active in 2011 following a transfer of additional funds to lend. Historic loans have been made up to $50,000.00 for a maximum of 5 years repayment terms. A current summary of activities is presented below regarding the Small Business Investment Grant program, the Agriculture Economic Development Grant program, and the Small Business Loan program. (1) ORANGE COUNTY AGRICULTURE ECONOMIC DEVELOPMENT GRANT PROGRAM Agriculture Economic Development Grants: (summary dated 9/21/15) • 7 initial agriculture grants totaling $57,987.00 were recently approved in the program's first quarterly round of applicant reviews. • 1 application was denied. • Grant program is funded by up to $60,000.00 annually from Article 46 proceeds (one-quarter cent sales tax for economic development). • Program became active after being approved by the BOCC in March 2015. • $120,276.26 is available for future business grants. Approved Grants — 7 (initial quarterly review): • Taylor Fish Farm (Valee Taylor— fish processing) • BoxCarr Farm (Austin Genke — fencing for milk goats) • ColorFields Farm (Kelly Morrison — greenhouses) • Four Leaf Farm (Tim McCaller— greenhouses) • Smith Family Farm (Dawn Denson —well for irrigation) • Dawn Breaker Farms (Ben Grimes — small on-farm poultry processing equipment) • Sweet Retreat Orchards (Aniko Redmon — irrigation system) New Proposed Agriculture Grants (scheduled for second quarterly review): • 2 new completed applications have been received. • 6 additional applications are being completed by applicants. • $60,000 in total awards is forecast for the upcoming second quarterly review of new applications. • Initial marketing round included radio and newspaper ads; most recent marketing effort had 800 post cards mailed out during the week of September 7t"; several phone calls and e-mail inquiries have been received and indicate several more applications will occur. Agriculture Economic Development Grant Application Review Committee: • 5 total members, currently comprised as follows: ➢ 2 representatives from the Agriculture Preservation Board appointed by the BOCC - Vaughn Compton & Noah Ranells. 3 ➢ 1 agriculture sector representative from the Orange County Economic Development Advisory Board - vacant. ➢ Orange County Cooperative Extension Agent— Dr. Carl Matyac. ➢ Orange County Economic Development Department's agriculture economic developer — Mike Ortosky. • Meets quarterly; next meeting date is November 18. Activity contributing to public awareness of the Agriculture Grant Program: • Breeze Farm Master Plan preparation —for funding purposes. • Piedmont Food & Agriculture processing facility (PFAP). • Rural Food Aggregator/ Food Hub / and PFAP expansion concept planning. • Farmer and food business entrepreneurs meetings & assistance. • Recent workshop at Durham Tech on food system entrepreneurs. • Farm to Fork 2015 event planning. • Orange County Agriculture Summit 2016 planning. • Ongoing presentations to groups regarding agriculture economic development. • Meetings regarding a concept for a large food hub campus & food enterprise district. • Meetings with area county officials, consultants & residents regarding the formation of a regional food innovation cluster& an Orange County food council. (2) ORANGE COUNTY BUSINESS INVESTMENT GRANT PROGRAM Small Business Investment Grants: (summary dated 9/21/15) • Funded by up to $100,000.00 annually from Article 46 proceeds (one-quarter cent sales tax for economic development). • Grant program became active after being approved by the BOCC in March 2015. • 8 initial grants totaling $61,712.00 were recently awarded in the program's first quarterly round of application reviews. • +11 new and/or deferred applications requesting up to $83,188.00 are expected to be received by the second quarterly review on Oct. 22. • $238,288.00 is available for future business grants. Approved Grants (initial quarterly review): • 15 grant applications were submitted & reviewed: ➢ 7 — Hillsborough ➢ 5 - Chapel Hill ➢ 3 — Carrboro • 8 grants were awarded: ➢ 4 - Hillsborough $317352.00 4 ➢ 1 - Chapel Hill $10,000.00 ➢ 3 - Carrboro $20,360.00 $61,712.00 Carrboro Carrboro Community Acupuncture (Kim Calandra — business expansion) Tempeh Girl(Beth May — sales expansion) Woman Craft(Katherine Palomba — promotional activities) Chapel Hill Trill Financial(Simon Jung — computer testing equipment) Hillsborough MasterPeace Barber(Mark Holt— improvements to home-based business) Regulator Brewing (Anna McDonald Dobbs — marketing) Seal The Seasons (Patrick Mateer& Will Collins — frozen food production equipment) The Accidental Baker(Kevin Mason — new bakery equipment) • 1 application was withdrawn by applicant. • 1 application was referred to the Agriculture Grant Program. • 1 application was denied (in appeal). • 4 applications were deferred for the upcoming quarterly review. New Proposed Business Grants (scheduled for second quarterly review ending September 30, 2015): • 4 deferred applications — Chapel Hill $27,188.00 • 1 denied (in appeal) — Chapel Hill $10,000.00 $37,188.00 • 11 new applicants: ➢ 1 - Cedar Grove applicant $10,000.00 ➢ 4 - Chapel Hill applicants $23,000.00 ➢ 1 - Efland applicant $10,000.00 ➢ 5 - Hillsborough applicants $33,000.00 • Total of new grant requests received (as of 9/28/15) $76,000.00 • Total of new & deferred grant requests in 3rd Q $113,188.00 Business Investment Grant Funds Currently Available to Award: • From Article 46 Quarter Cent Sales Tax $300,000.00 • (Less 2Q Awards) ($61,712.00) • Available funds for future business grants $238,288.00 5 Business Investment Grant Application Review Committee: • 5 — 7 total subcommittee members from the Orange County Economic Development Department's Advisory Board. • Meets quarterly; next meeting date is October 22. (3) ORANGE COUNTY SMALL BUSINESS LOAN PROGRAM Small Business Loan Program: (summary dated 9/21/15) • Funded by up to $200,000.00 annually from Article 46 proceeds (one-quarter cent sales tax for economic development), & from the loan program's repayment balances. • Loan program was created by the BOCC in 1999, received initial funds to lend in 2007, and became active after receiving $200,000 in additional funds in 2011. • $507,000.00 total of all approved loans in program's history. • $214,099.00 current balance for 10 outstanding loans; no delinquencies. • Remaining Loan Funds Available to Lend: ➢ From Article 46 Quarter Cent Sales Tax $6007000.00 ➢ From program's loan repayments (cash in bank) $133,682.00 $7337682.00 • Loan History: Original Loan Current Loan ➢ Carrboro Ceremony Salon $30,000 $26,151.00 ➢ Cedar Grove Tin Can Ventures $47,000 $42,059.00 ➢ Chapel Hill Santosha $50,000 $0.00 Isis LT. $20,000 $8,117.00 Orange County Gymnastics $45,000 $0.00 Flawless Day Spa $10,000 $6,808.00 ➢ Hillsborough Phd $68,000 $7,260.00 Skram Furniture $40,000 $0.00 The Depot $30,000 $4,206.00 Mystery Brewing $40,000 $10,884.00 Accidental Baker $44,000 $44,000.00 MasterPeace Barber $15,000 $14,749.00 Seal the Seasons $50,000 $50,000.00 Total $507,000 $214,099.00 6 Loan Application Review Committee: • 8 total members, currently comprised as follows: ➢ 2 representatives from the Orange County banking community (Jim Evans — Bank of North Carolina; Jonna Walton— BB&T). ➢ 2 representatives from small business owners in Orange County (Tom Proctor— Vacuum Cleaner Hospital; Sherry Gray— Yesterday & Today Frame Shop). ➢ 1 representative from the Orange County Board of Commissioners (Commissioner Mark Dorosin). ➢ 2 representatives from Orange County government (Activing Chief Financial Officer Paul Laughton, & Orange County Economic Development Department Director Steve Brantley). ➢ 1 representative from the Orange County Economic Development Advisory Board (Lori Eichel — Bank of North Carolina). • Meets the third Thursday of every month; next meeting date is October 17. • Loan committee agreed on 9/17/15 to increase the maximum loan amount to $100,000.00 (up from $50,000.00) and double the repayment term to 10 years (up from 5 years) in consideration of future loan applicants. Purpose is to increase the loan activity. FINANCIAL IMPACT: There is no direct financial impact associated with discussion of Article 46's two grant programs & loan program. Funding is provided by Article 46 proceeds, and not from the General Fund. SOCIAL JUSTICE IMPACT: The following Orange County Social Justice Goal is applicable to this agenda item: • GOAL: ENSURE ECONOMIC SELF-SUFFICIENCY The creation and preservation of infrastructure, policies, programs and funding necessary for residents to provide shelter, food, clothing and medical care for themselves and their dependents. RECOMMENDATION(S): The Manager recommends that the Board receive the report for review and comments. Agriculture Grant Recipients 7 LB 0 C A R R F A R BOXCARR FARMS COLORFIELDS W03 9 to)I o Dawnbreaker Farms DaNYber Farms 1-11::11,LI HY, !�AH� L7L-LI1,,;10U� Four Leaf Farm led Smith's Family Fun Farm F"O"" _a "Grvyyind A8' sweet retreat ORCHARD TAYLOR FISH FARM .:; TAYLOR F a K FARM ot ee re real T KE a EST Tr lAP1A i N rti E WaruV. ORCHARD., Orange County's Small Business Investment Grant Recipients CARRB°R° Carrboro Community Acupuncture COMMUNITY ACUPUNCTURE MasterPeace Barber Shop Hillsborough Regulator Brewing Company, LLC - Hillsborough SfAI THE Seal The Seasons - Hillsborough SEASONS Al IOU.t All Yfh0.AOYMU The Accidental Baker - Hillsborough Trill Financial, LLC — Chapel Hill tempeh girl - Carrboro tempeh girl culturing a revolution MANOR 9 womancraft - Carrboro Small Business Loan Recipients '° Ceremony Salon — Carrboro S A L O N Tin Can Ventures — Cedar Grove Grey Matter/Isis I .T. — Chapel Hill f W[t S� Flawless Day Spa — Chapel Hill V.n151O1P� ' ,5 The Depot - Hillsborough Small Business Loan Recipients 11 � Mystery Brewing Company - Hillsborough Seal The Season - Hillsborough SEAL THE SfASONS ""°`°' All "°°°°�' MasterPeace Barbershop — Hillsborough Accidental Baker — Hillsborough OPHD - Hillsborough