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HomeMy WebLinkAboutAgenda - 04-13-2004-5iORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: April 13, 2004 Action Agenda o Item No. !'j-~ 1 SUBJECT: 2003-2004 Small Business and Technology Development Center (SBTDC) Contract Renewal DEPARTMENT: Economic Development PUBLIC HEARING: (Y/N) No ATTACHMENT(S): INFORMATION CONTACT: A, SBTDC Contract Dianne Reid, ext 2326 B, Orange County Success Stories TELEPHONE NUMBERS: Hillsborough 732-8181 Chapel Hill 968-4501 Durham 688-7331 Mebane 336-227-2031 PURPOSE: To consider renewal of a contract to continue support of small business development services for Orange County citizens, as stated in the Economic Development Strategic Plan adopted May 14, 1996, and reaffirmed by the Economic Development Commission in its strategic planning session in August 2000, BACKGROUND: A primary goal of the Economic Development Commission since its inception has been providing assistance to small businesses to enable them to grow and prosper in Orange County, The Small Business and Technology Development Center (SBTDC) provides significant services to local businesses and has operated under contract with Orange County since 1990, The contract provides for $10,000 to be paid in two installments of $5,000 each. The first is to be paid on or about April 30, 2004, and the second on or about June 15, 2004,. During calendar year 2003, the SBTDC staff (which included one bi-lingual counselor) served 174 Orange County clients for a total of 2,542,25 hours of counseling time: • 111 were considered Emerging Businesses (pre-venture clients - in the process of starting their business -and start-up companies). These businesses received 929..75 hours of counseling and represented 36,5% of all cases in the region. • 45 were Traditional Businesses (mare than 3 years in business and less than $1 million in revenues). These firms received 372.75 hours of counseling and represented 14,75% of cases in the region. • 18 were Small-Medium Size Enterprises (more than 3 years in business and more than $1 million in annual revenue). These firms received 1003.25 hours of counseling and represented 32.25% of all cases in the region. The 2003 Orange County figures represent a 5% percent decrease from the previous year in the nramber of Orange County clients - 174 versus 184 - but a significant increase (68%) in counseling time - 2,542.25 hours versus 1,510,5 hours. During 2003, the SBTDC helped six Orange County businesses secure $7,141,000 in capital (including debt financing, equity investment, and one refinancing). Attachment B describes several local business success stories far last year. Annual economic impact assessments undertaken at the state level (performed by an independent assessment firm) show that SBTDC clients significantly outperform the average for all North Carolina small businesses in both sales and employment growth. FINANCIAL IMPACT: The annual budget for the Economic Development Commission approved for Fiscal Year 2003-2004 includes $10,000 for professional contract services for this contract. RECOMMENDATION(S): The Manager recommends that the Board approve the renewal contract and authorize the Manager and the Clerk to the Board to execute the contract. NORTH CAROLINA ORANGE COLINTY THIS AGREEMENT, made and entered into the day of , _, by and between Orange County, North Carolina, 200 S. Cameron Street, Hillsborough, North Carolina, hereinafter referred to as "County" and the University of North Carolina at Chapel Hill for and on behalf of its Small Business and Teclu~ology Development Center, .333 Fayetteville Street Mall, Suite 1150, Raleigh, North Carolina 27601-1742, hereinafter referred to as the "SBTDC". WITNESSETH: WHEREAS, the on-going work of the Orange County SBTDC is consistent with the Orange County Economic Development Strategic Plan; and WHEREAS, the work of the Orange County SBTDC, the development of more comprehensive small business information, and a public awareness and educational program on the services available to small business, is an integral part of meeting the objectives specified in the Orange County Economic Development Strategic Plan; and WHEREAS, the Orange County Economic Development Commission, hereinafter referred to as the EDC, has endorsed the Orange County SBTDC concept, and has encouraged the County's support, financial and otherwise; and WHEREAS, the EDC is an agency of the County; and WHEREAS, economic development is an important public purpose which can be aided by contributions of Orange County funds; and WHEREAS, Orange County supports the Economic Development Strategic Plan, and public-private initiatives to implement the Plan.. Now, therefore, in consideration of the above and the mutual covenants and considerations hereinafter set forth, the County and the SBTDC agree as follows: First, in consideration of the EDC's on-going support, the SBTDC will maintain a regional office in Orange County. This will consist, at minimum, of the presence of three professional staff members in the County.. Second, the SBTDC will make its general business consulting services and more specialized services and counseling in the areas of international trade, technology development, and government procurement available to small firms and would-be entrepreneurs tluoughout the County. Where appropriate SBTDC will work with specific clients referred by the EDC. Third, one or more resources libraries will be maintained in the County and hand- out materials will be available. The SBTDC also will provide access to specialized soflware and other business start-up and assistance resources at no charge to the businesses. Fourth, the SBTDC will continue to develop and offer with the EDC and other sponsors a variety of training programs both for small business firms and for those who serve small businesses (such as bankers). These will be scheduled bi-annually tluoughout the term of this agreement. A specific focus during the term of this contract shall be assistance to female and minority owned businesses. Fifth, the SBTDC will work actively to increase public awareness of and access to its services throughout the County. A visitation effort will be conducted to acquaint Orange County's employers with services that can assist them with expansion. Efforts will be made to fully involve other agencies and resources such as Chambers of Commerce, SCORE, the local community college, Goodwork, Self Help, and local professional and civic groups. Sixth, the SBTDC will provide technical assistance, business plan and loan package preparation assistance to businesses and individuals preparing to apply for financing from the Orange County Small Business Loan Pool.. Seventh, the SBTDC will provide the EDC with a written report within 30 days of the close of each quarter. This will detail the program and service activities of the SBTDC in Orange County for the quarter. The SBTDC also will provide a report of client evaluations of services each quarter. Eighth, the SBTDC will make its best good faith effort to continue and/or expand the level of service in Orange County proposed under this agreement beyond the terms of this agreement. Ninth, in return for the foregoing, the County will pay the SBTDC $10,000 in two $5,000 installments. The first such installment shall be paid on or about Apri130, 2004, and the final payment will be paid on or about .Tune 15, 2004. Tenth, the EDC will actively support and promote the programs and services of'the SBTDC within Orange County, Eleventh, the Director of the EDC will become a member of the SBTDC Regional Advisory Board, as long as this agreement is in effect. Twelfth, the term of this agreement will be 1 year beginning Tuly 1, 2003 and ending .June 30, 2004,. Thirteenth, this agreement maybe terminated at any time upon the mutual consent of the parties or upon 90 days advance written notice by either party. Fourteenth, the SBTDC authorizes inspection by the Orange County Finance Director or his designee of so much of the books and records of the SBTDC which document receipt and expenditure of County funds.. The books and records of the SBTDC shall be made available to the County Finance Director or his designee upon reasonable notice, Fifteenth, in the event that the SBTDC ceases to function or ceases to provide the services described herein without a County approved written assigrunent or release by County of its responsibilities, this agreement will terminate and the SBTDC will return any moneys paid the SBTDC pursuant to this agreement. IN WITNESS WHEREOF, Orange County has caused this Agreement to be signed in its name by its County Manager, attested by the clerk to the Boazd of Commissioners and the University of North Carolina at Chapel Hill acting for and on behalf of its Small Business and Technology Development Center has caused this Agreement to be signed in its name by its Director, Office ofResearch Services, and all authority duly given, the day and yeaz first above written, ORANGE COUNTY ATTEST: Clerk to the Orange County Boazd of Commissioners By: Tohn M, Link County Manager UNIVERSITY OF NORTH CAROLINA AT CHAPEL HILL By: Robert P, Lowman, Director Office ofResearch Services NORTH CAROLINA ORANGE COUNTY I, , Notazy Public for said County and State, certify that Domra Baker personally came before me this day and acknowledged that she is Clerk to the Board of'Commissioners of Orange County, and that by authority duly given and as the act of Orange County, the foregoing instrument was signed in its name by John M. Link, Jr,, Orange County Manager, sealed with its official seal, and attested by herself as its Clerk. Witness my hand and off cial seal, this the day of , 2004.. Notary Public My commission expires: North Cazolina Orange County I, , a Notary Public for said County and State, do hereby certify that Robert P. Lowman personally appeared before me this day and acknowledged that he is the Director of the Office of Research Services, University of North Carolina at Chapel Hill, and that by authority duly given and as the act of the University of North Carolina at Chapel Hill, the foregoing instrument was signed in its name by him, Witness my hand and official seal, this the day of , 2004. Notazy Public My commission expires: Attachment B SBTDC Orange County Clients: Selected Profiles Retail Store- Hillsborough "S.G" has operated a retail stare in Hillsborough and was experiencing cash flaw and revenue problems. The SBTDC was able to identify spending reductions and inventory issues to improve cash flow. Client was able to reduce monthly break-even to improve cash flaw and to increase revenue by implementing additional and different marketing approaches. Drv Cleaner- Chapel Hill Client approached SBTDC with decreasing sales and increasing expenses. SBTDC reviewed financials and suggested changes in operating practices and a potential change in business model. Client was also provided with a legal audit of operations by a law student from NCGU. Retail Store- Carrboro "W.S" bought an existing store in Carrboro. The client approached the SBTDC for assistance in writing business plan, cash flow projections and packaging loan. The SBTDC helped to develop the plan and packaged the application for funding approval. The purchase was finalized after the SBTDC's assistance. Tanning Salon -Chapel Hill Longstanding SBTDC client requested assistance with goal of expanding tc larger, newer facility, essentially doubling capacity and adding several product lines. SBTDC helped develop successful loan package, financials, market research and product line expansion to include physician-delivered dermatological services, retail goods, and safest, most current technologies in the industry. This expansion will result in several new jobs for the community. Specialized Gallery -Carrboro "K.S", herself an artist, requested assistance from SBTDC with a marketing plan, and creating a special marketing event. The SBTDC brought a team of MBA students to this task, to assist the business counselor. In addition to helping develop a focused marketing plan, the SBTDC helped design and implement a highly successful special event that involved 13 other art-related businesses, with the local chamber of commerce as co~• sponsor. The event, the Second Friday Art Walk, resulted in more exposure and more business for these participating enterprises.