VOL. 126 | NO. 41 | Tuesday, March 1, 2011
City Seeks Funding Swap for Loan Programs
By Bill Dries
Two loan funds that are part of Memphis Mayor A C Wharton Jr.’s administration’s move to a broader minority and small-business development program are on Tuesday’s agenda at a City Council committee meeting.
The meeting, which begins at 10:30 a.m., will be followed later at 3:30 p.m. by a full council meeting at City Hall, 125 N. Main St. At that meeting, discussions will be highlighted by consideration for a new slate roof for a landmark house in Victorian Village, part of a broader attempt to reopen for public tours.
A full meeting agenda can be found here.
For the funding swap, the administration wants to move $1 million between the city’s operating budget and its capital improvements project budget to fund two minority and small-business loan fund programs.
One would be a micro loan fund and the other is called the “Grow Memphis Fund.”
With council approval, a $5 million economic development fund was carved out of the Capital Improvement Project funding last year to help recruit industries to Memphis. It is essentially a pool of money the administration can access quickly.
Of that, $3 million was used for the public parking project that is part of the move of Pinnacle Airlines Corp. to One Commerce Square. Another $1 million is being held in reserve for similar large business prospects.
Because the CIP funding is one-time only and is for construction projects, it can only be used for public infrastructure like roads and sewers.
The administration is proposing that there be a switch to funnel the remaining $1 million in the fund to the loan program.
The CIP money would be replaced with $1 million from the city general fund that is presently budgeted for public improvements.
Of the $1 million, $400,000 would go to the Grow Memphis Fund, which is a partnership with the nonprofit National Development Council. NDC will leverage the city funds to create a $2.4 million fund. It will also underwrite and administer the loans based on federal Small Business Administration criteria and standards. The loans could be used for working capital and fixed assets.
The micro loan fund is a $600,000 city funded program administered by the city’s Renaissance Business Center. The loans would be up to $25,000 to eligible firms to include equipment financing, facility improvements, inventory and working capital. The “unconventional” loans include technical assistance from the business center.
Meanwhile, the Mallory Neely House, built in 1852, has a slate roof that is deteriorating. The city would replace it with the funding request on Tuesday’s agenda.
The house at 625 Adams Ave. is closed temporarily but Wharton’s administration has said it intends to reopen the home for tours.
The city is already seeking proposals for the private redevelopment and use of the neighboring James Lee House at 690 Adams Ave., built in 1841.
The Lee House was the original Memphis College of Art.