Economic relief proposed

Patrons attend a 2019 Music on Miner event in downtown Ladysmith. City officials are considering an economic relief package for downtown and other city businesses.

Many Ladysmith area business owners turned out Monday for a Ladysmith Community Development Committee meeting to hear more about a proposal to help them through government ordered shut downs and reduced hours of operations because of the COVID-19 pandemic.

The committee voted 3-0 to recommend a proposed new COVID-19 Micro Business Emergency Relief Fund designed to provide assistance at the local level. The city council is expected to discuss and consider the recommendation at its meeting on Monday, May 4, which will be held in the Rusk County Board meeting room to utilize the county’s teleconference equipment.

Many who spoke expressed frustration about the shutdown and difficulty in aid from the state and national levels.

“This is really affecting us,” said Kelli Grotzinger, who operates The 211 Club on Miner Avenue in the city’s downtown.

Sharon Reynolds, who owns The Plaid Peacock on Miner Avenue, called the shutdown “really tough.” The business recently started curbside pickup, which she said has helped after being completely closed down for weeks. She expressed concern about the likelihood of having Mother’s Day and Memorial Day seasonal items for sale and no shoppers out buying. 

“To recover from this is going to be really tough,” Reynolds said. “I am so small I did not qualify for [Payroll Protection Loans]. I tried with two different banks and they were no help at all.”

Reynolds is worried the virus could return in the fall.

“If this would happen again in September, October or November it would probably take us out,” Reynolds said.

“For a small gift shop in a tiny town,” Reynolds said. “This has been an absolute huge hit for my store.” 

Chrysa Ostenso of Dr. Erik Ostenso Optometry called the next two months the busiest for the Miner Avenue practice. She added it is also important to not risk health concerns, noting returning employees should also feel safe for their own well-being.

“It is a really big hit to have a lot of our routine business shut down,” Ostenso said. “We do want to come back slowly and safely.”

Robert Grotzinger of The 211 Club noted the family currently has no income. He added the business has applied for economic assistance without much help.

“The only ones who will help the city is the city,” he said.

The proposal calls for grants up to $6,000 not to exceed three months of operational costs to 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. 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 commensurate with the fund provided, may be requested by the funding agent.

Funds will be made available as a no-interest loan, with no payments due until after affected operations are legally allowed to resume by state or federal decree. 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. Business is expected to seek further assistance through its bank, the SBA, or other source if necessary, to cover other personal and sundry expenses, unless such expenses are reviewed and approved on a case by case basis, through the fund agent.

At a date yet to be determined, dependent upon available funds, the TIF-8 umbrella may be extended to those businesses which meet the conditions of the COVID-19 Relief Fund, or within a city TIF area which contributes TIF funds to receiver district TIF-8.

All applications will be strictly confidential, and the information contained therein will be limited to agent and submitting business, subject to legal repercussions and consequences.

Funds in this BERF will not be affected by any other assistance this business may receive from state or federal stimulus programs.

Funds made available through this BERF will be limited to those accrued in TIF-8 and any participation by the Ladysmith Industrial Development Corporation and its affiliates, unless other funding is made available. No city-wide property tax or personal property tax will be used for this proposal.

Business owner Rick Nash questioned the difficulty for city officials to decide which businesses need money the most and which businesses are most important to have them succeed.

“If we were to lose a tavern in our city would that be a critical business to lose. If we were to lose a dental office in our city would that be a critical business to lose,” Nash said. “There are a ton of people in our city who have no income too. We can’t give them income because they don’t have income. I don’t know how we think we think somebody is going to decide one bar deserves money than any other bar.”

The proposal was backed by committee member Marty Reynolds, calling it his draft proposal. He said funds to be loaned and granted will come from Tax Incremental District 8 revenues and not general property taxes. He added this money won’t be impacted by any state or federal stimulus assistance

“We are not talking about taking money out of the taxpayers pocket. We are not talking about taking money out of the general fund. This is strictly TID 8 dollars and maybe getting the Ladysmith Industrial Development to go along,” Marty Reynolds said. “The bottom line is state and the federal government are not going to help because it is too much without a salary, wages or something else. You still have mortgage, insurance, rent and fees to deal with. You still risk your building before anything else comes through, and when it does come through it may not be enough to cover your expenses.”

The city has about 60 businesses, and not all have been closed or affected by the shutdown. Even if all 60 would qualify, the business economic relief proposal is expected to total $360,000 however that amount is not expected to be reached.

“There is clearly enough money in the TID to do this,” City Attorney Allen Kenyon said.

Marty Reynolds said his goal is to help cover expenses that are the cost of doing business.

“I am trying to keep businesses alive,” Marty Reynolds said.

Committee Chairman Brian Groothousen expressed concern about a separate proposed relief measure to waive business-related license fees for 2020 in an attempt to reduce the burden on owners, citing the city budget was developed on this approximate $15,000 in annual revenue being generated. This matter was tabled without action.

Groothousen also backed the business economic relief proposal.

“I honestly think the program should be open to as many businesses as possible,” Groothousen said. “I like the plan.”

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