Council Subcommittee

MINUTES OF THE GILBERT COUNCIL SUBCOMMITTEE ON AZ CARES ACT, SEPTEMBER 3, 2020, AT 3:00 P.M., VIRTUAL MEETING, GILBERT, ARIZONA COUNCIL PRESENT: Chair Aimee Yentes, Vice Mayor Yung Koprowski and Councilmember Scott September COUNCIL ABSENT: None STAFF PRESENT: Town Manager Patrick Banger, Deputy Town Clerk Chaveli Herrera, Town Attorney Chris Payne, Parks and Recreation Director Robert Carmona, Office of Management and Budget Director Kelly Pfost, Office of Intergovernmental Affairs Director Rob Bohr, Department of Economic Development Director Dan Henderson, Community Response Supervisor Melanie Dykstra, and Assistant Fire Chief Rob Duggan CALL TO ORDER Chair Yentes called the meeting to order at 3:05 pm AGENDA ITEMS 1. Approval of the minutes of the meeting of August 27, 2020 A MOTION was made by Councilmember September, seconded by Vice Mayor Koprowski, to approve the minutes of the meeting of August 27, 2020. Motion carried 3-0. 2. Review of outstanding items from previous meeting. There was no discussion. 3. Review, discussion and possible action of assistance for business. Economic Development Director Henderson discussed the three components of the Gilbert Together recovery program which outlined the phases of Relief- Business Grant, Recovery- Business Loans and Resiliency- Technical Assistance. He provided additional information on Phase 1 and asked the Council if there were any additional questions or need for clarity. Vice Mayor Koprowski asked about the potential difficulties for businesses to receive the maximum qualifications based on the current fiscal and economic impact. Economic Development Director Henderson discussed the benefit of partnerships for the program and spoke about bargain for consideration and developing need. He stated the difficulty would be dependent on direct and indirect impacts. He discussed the calculator being developed and stated that it would be public-facing and user-friendly. He spoke of impacts faced by businesses and the return of funds based on those impacts. He stated that the process was to be streamlined and as simple and straight forward as possible. Vice Mayor Koprowski stated that she would be open to considering a greater limit than $25,000 but confirmed that there was difficulty in raising the limit not knowing how many businesses would apply. Chair Yentes asked Economic Development Director Henderson if he had a recommendation based on the criteria set forth and public benefit. Director Henderson stated that the team developed criteria that he believed most businesses could qualify for and discussed the criteria. He emphasized the gift clause and bargain for consideration, adding it was difficult to answer because of the overall question of benefit. Chair Yentes stated that if they did choose to raise the threshold, they would need to also reevaluate the aggregate amount and assess other costs associated. Councilmember September spoke in agreement with Vice Mayor Koprowski in the idea of flexibility in raising the threshold for those who qualified. However, he expressed concern in money being wiped out and smaller businesses having less money or no access to money at all. He stated he liked the idea but was unsure how it would be implemented. Chair Yentes discussed the calculator and outputs based on guardrails in place. 4. Review, discussion and possible action of assistance for residents. Chair Yentes discussed tax/regulatory holidays to include Business License Suspension, Food for Home Consumption Tax Holiday and Residential Rental Tax Holiday. She discussed funds supplanted by Coronavirus Aid, Relief, and Economic Security Act (CARES) Dollars and the total CARES dollars. Vice Mayor Koprowski asked how long the tax holiday would be for. Office of Management and Budget Director Pfost provided background information on the processes for each proposed tax holiday. She emphasized the time periods required for each holiday. There was discussion on the estimated residential rental estimated revenue, to which Director Pfost provided clarification on appropriate tax reporting. Councilmember September stated that he would like to continue tax discussions at a future date but felt it would be difficult to implement the proposed changes as part of this program due to timelines. Chair Yentes asked for staff direction on the study of the tax holidays, to which Town Manager Banger suggested the discussion be included at an upcoming Council Fall Retreat. He stated it could be a deeper discussion and in the context of Town revenue as a whole. Vice Mayor Koprowski stated she would support the discussion at a later time but agreed it was best to not evaluate the items as part of the Subcommittee due to timelines. In regards to rental tax, she asked if landlords would be able to apply for grant monies as a business and discussed the potential benefit. Town Manager Banger stated it would depend on how the program was structured but stated that he could not think of anything that would prevent them from participating. The consensus of the Subcommittee was to move the tax discussions to the Fall Retreat. Economic Development Director Henderson elaborated on the guardrails put in place and stated that the guardrails were the gift clause and bargain for consideration, otherwise they wanted to make it possible for all businesses to apply. He discussed the partnerships and what other cities and towns were doing with their allocations. He discussed administrative fees and the ability to negotiate. He stated this was a high-level overview and there was a need to evaluate the cost to administer a program of this nature. Councilmember September asked Director Henderson if a number was needed in order to obtain accurate cost information, to which Director Henderson stated that a recommendation in funding would allow staff to procure services and provide a better evaluation of costs to the Council. The consensus was to look at all phases as a whole before assigning an allocation. Economic Development Director Henderson provided information on the Recovery portion of the program to include business loans. He spoke about funding the business loans, recognizing that the funds were at the Council’s discretion, and provided examples of what other cities implemented. He recommended that more dollars be committed in order to bring lowest interest rate and discussed the framework. Chair Yentes asked if Director Henderson had any recommendations for terms in loans. Director Henderson stated that there were many structures available and room for creativity in the program. He provided additional information on the structuring of the program and discussed the importance of partnerships. Chair Yentes asked about possible limitations of the program. Director Henderson discussed options for structuring it broad-based or narrow, depending on the focus and direction of the Council. Councilmember September discussed the proven method from other cities and towns and asked about debt service. Chair Yentes discussed Phases 2 and 3 running parallel. Economic Development Director Henderson discussed the importance of creating options for the community and prevailing themes. He provided additional information on resiliency, technical assistance and accommodating the needs of businesses. He discussed the transformation of businesses during these times and the use of real data. He provided information on selection criteria and creating options. Chair Yentes asked the Subcommittee if there was enough information to make a recommendation. Councilmember September discussed the monetary value of Phase 1 and asked Director Henderson for a recommendation on the three tiers. Economic Development Director Henderson said if he were pressed for a number, he would recommend $9,000,000 for relief grant business grants, $9,000,000 for recovery business loans, and $2,000,000 for technical assistance. There was discussion regarding need, administrative costs overlapping with technical assistance, and allocation of the three tiers. A MOTION was made by Councilmember September, seconded by Vice Mayor Koprowski, to recommend $11,000,000 for Business Grant Relief, $5,000,000 to Business Loans Recovery, and $2,000,000 to Technical Assistance. Motion carried 3-0. Economic Development Director Henderson stated the recommendation would help structure the program approach for the presentation to the Council. Chair Yentes suggested some aggressive outreach for getting community feedback and stories of how the program would benefit businesses going forward. She suggested working with Sarah Watts from the Gilbert Chamber of Commerce. She stated an action plan for checkpoints and reporting should be prepared for the Council in order to provide accountability and transparency. Economic Development Director Henderson thanked several team members and the community partners for their participation. 5. Next steps including timelines and checkpoints. Vice Mayor Koprowski stated that she would like to add for future discussions items of public safety to include the Police Dispatch Center and the Emergency Operations Center Expansion. She would also like to find out more information on the recycling study. She would like to evaluate if any of those items could be addressed after the CARES Act due to its limited funding. Councilmember September discussed the possibility of opportunities with hazard pay to those employees who have accepted additional risk during these times. Chair Yentes expressed concern in having discussions of one department’s concerns over another and suggested those discussions be tabled since it was out of the scope of the Subcommittee. She directed Councilmembers to work with Parks and Recreation Director Carmona on any additional requests. She asked the Councilmembers to consider what the calendar would look like for the remainder of work of the Subcommittee and asked Councilmember September about public outreach. Parks and Recreation Director Carmona stated that the Town has received additional requests through the home repair program and suggested staff bring more information on that program at the next meeting to which the Subcommittee agreed. Chair Yentes discussed additional areas from the Parks and Recreation Department that would benefit all residents. Parks and Recreation Director Carmona stated he would look into possibilities for the Subcommittee to consider. ADJOURN A MOTION was made by Vice Mayor Koprowski, seconded by Councilmember September, to adjourn the meeting. Motion carried 3-0. Chair Yentes adjourned the meeting at 4:33 pm ATTEST: ___________________________ ___________________________________ Aimee Yentes, Chair Chaveli Herrera, MMC, Deputy Town Clerk