Ladysmith won’t make public names of businesses receiving city aid
Ladysmith officials last week refused to make public who the city recently awarded $87,487 in economic relief.
The payments were part of the council’s Business Economic Relief Fund that provides stimulus money during the current COVID-19 pandemic. The program was approved last May by the city council and its oversight assigned to the council’s Community Development Committee. These committee meetings were held in closed session, and not open to the public.
BERF awards were capped at $6,000 per applicant.
Application materials state funds will be made available as a no-interest loan, with no payments due until 2 months after affected operations are legally allowed to resume by state or federal decree, whichever occurs later. A business must show a good effort and a meaningful intent to resume operations at that time. If these conditions are met, the loan will assume grant status with no repayment required, subject to certain conditions.
Under the federal Freedom of Information Act and Wisconsin open records laws, the Ladysmith News requested the names of individual businesses receiving BERF money and the amount each received.
BERF funding came from city TID revenue and Ladysmith Industrial Development Corporation. City officials released the total amount awarded and total number of businesses receiving money.
Out of 28 original applications there were 26 deemed eligible for funds and 23 who submitted necessary documentation on-time and received funds.
It is unclear if more money will be awarded as the program was capped at $300,000 and so far less than one-third of the total has been awarded.
A motion at the council meeting, Monday, Oct. 12, to disclose the list of businesses receiving BERF funds failed for lack of a second.
Ald. Mark Platteter, who made the motion, argued for the release, saying he agreed with a recent editorial in the Ladysmith News that argued for making the payments public.
“I kind of agree with it,” Platteter told the council.
Ald. Marty Reynolds, who originally proposed the BERF program, said few local businesses likely qualified for federal and state relief programs. He opposes making Ladysmith BERF recipients public.
“I have a problem with putting that out there,” Reynolds said.
BERF program application materials included a list of conditions. They include a business must have been established prior to Jan. 1, 2020 or been an active business if purchased from the owner after that date, and a business must have a physical storefront within the city area covered by Tax Incremental Districts 8, 9, 10 or 11, or these TID’s umbrella areas. A business can’t be home-based and must be current on taxes and any other municipal obligations not covered by the BERF program. A business must be open to all persons, one that was required to close, or has limited its operations due to conditions and regulations as a direct result of the current COVID-19 pandemic, have between zero and 20 full-time equivalent employees at its Ladysmith location and have annual net revenues of less than $200,000 to be verified by financial statement or other financial documentation.
Loans up to $6,000, not to exceed 3 months of operational costs, will be made upon approval of applicant’s submittal. A limit of 10 percent of this grant may be used for undesignated expenses, if the business has one or less employees reported under W-2 conditions. Funds may be used to cover and are limited to mortgage payments, rent or lease payments, utilities and/or insurance from March 1, 2020 through May 31, 2020. Funds may be used to cover the cost of security measures if they have been deemed necessary to protect the premises or business locations.
Funds may not be used to cover delinquent property or personal taxes, special assessments or other obligations to the city, state or federal government. Prior to loan forgiveness, cost obligations corresponding with the fund provided, will be requested by the funding agent.
All applications will be kept strictly confidential and the information contained therein will be limited to funding agent and submitting business. Funds in the BERF program will not be affected by any other assistance this business may receive from state or federal stimulus programs. Appeals were decided by the Joint Review Board.
In a response for the council, City Attorney Al Kenyon cited the BERF program condition that applications and submitted information will be kept strictly confidential and information limited to the city and business. In the letter, he stated be believes the city may release the total number of applicants, the total number of loans made, the total amount loaned, the number of loans converted to grants and the amount of loans converted to grants.
“I believe therefore that the city may not release the BERF applications, the name of the BERF applicant, the amount applied for, the amount granted, and whether or not the loan was converted to a grant,” Kenyon stated in the letter. “Because the information was requested by the city with a promise of confidentiality, I believe that identifying details such as the name of the business, the business owners name, the address of the business or the amount loaned or granted to any particular business by name may not be released. Likewise I believe the type of business, because of the nature of our community, cannot be released. It would make identification easy.”
Kenyon also stated in the letter he has drafted and provided to the city clerk a form by which any recipient can consent to the information being released.