Portland denies call for businesses' CDBG funding
Photo/David A. Rodgers
Greg Mitchell, Portland's economic development director, says the city will revisit how it doles out state CDBG funds
The Portland City Council voted unanimously last night to allocate its community development funding to a variety of social service and public infrastructure projects, despite a growing outcry that more public dollars should be spent on private companies to boost local economic development.
This year two Portland businesses applied for a chunk of the $2.1 million pot from the state's Community Development Block Grant program. Schlotterbeck and Foss, a gourmet sauce and condiment company on Preble Street, and Hot Suppa, a breakfast and lunch spot on Congress Street, both applied for matching grants to pay for equipment upgrades and other company improvements. Both were rejected.
Portland City Manager Joseph Gray and the citizen's committee that evaluates CDBG applications recommended that that the businesses' applications be denied.
"[The committee members] felt there were more important needs in the community than were represented by those two applications," Gray told Mainebiz Tuesday. "Because the [CDBG] program is targeted for low- and moderate-income neighborhoods, part of the investment in these neighborhoods is infrastructure, streets and sidewalks. Historically the city has used the funding for those types of investments."
Moses Sabina, co-owner of Hot Suppa, said he had requested $75,000 to invest in his restaurant to start opening for dinner and create eight new jobs. When he applied for the CDBG grants last fall, he says he did so in part because he wanted to stimulate a conversation about how Portland pursues sustainable economic development.
"I think it is important to use CDBG funds for economic development because when the city is investing in small businesses it is investing in its own tax base," he says, adding that he also thinks private companies should not have to compete against social services agencies. "It is a really awkward position to be vying against public access for everybody," he points out.
Paul Dioli, CEO of Schlotterbeck and Foss, was away this week and could not comment on the $200,000 in matching funds he asked for to improve energy efficiency and manufacturing capabilities at his plant. But The Forecaster recently reported that Dioli says he needs city assistance to upgrade his facility or he will have to relocate his company because of rising rents.
The city will work with Schlotterbeck and Foss to try to keep the business in Portland, Gray says.
Portland's relatively new economic development director, Greg Mitchell, says the city has in the past reevaluated how it allocates its CDBG money, and will continue to do so. "My experience is that the money could be well spent in the area of economic development in a focused fashion," he says, such as funding commercial loan programs or façade grants.
Mitchell continues, "This discussion will continue this next year, and could result in some directional changes in the program."
Most Recent
Most Recent
Comments