Opinion: City of Elk Grove Needs an Incentive Program for Existing Small Businesses

Written By EGN on Saturday, August 24, 2013 | 08:17


By Connie Conley | August 24, 2013 |
 
As reported recently in the local media, the Elk Grove City Council is considering a $175,000 incentive for the Broderick Restaurant & Bar that wants to open a restaurant in the former Elk Grove Brewery building in Old Town .
 
During the few last years, the Elk Grove City Council has awarded millions of dollars in economic incentives; most notably over three million dollars for the relocation of the State of California Prison Health Care Systems to Elk Grove, and $500,000 to Elk Grove Ford.
 
However, funding economic incentives with large sums of taxpayer money are about to end.  Elk Grove City Manager Laura Gill announced at the April 24 Elk Grove City Council meeting that the economic incentive budget for new businesses, if approved, for 2013-14 fiscal year is a mere $200,000.  
 
Based on what is being requested by World Class Heroes, which owns the Broderick Restaurant & Bar in West Sacramento , just one similar request next year and the entire budget is gone.
 
Of late, Elk Grove small business owners have been speaking at council meetings, asking for the council to assist them with advertising and marketing.  But the council only seems interested in helping those wealthy developers who can afford large monument signs.
 
The Elk Grove City Council needs to institute an incentive policy for the small existing businesses; ones who have put their hearts, soul, and probably mortgaged their homes to provide Elk Grove residents with local services.
 
In 2007, the Elk Grove Chamber of Commerce held a small business workshop.  The keynote speaker, Jack Schultz, author of “7 ½ Keys to Success,” told a very crowded room what we already know, reinforcing that we must get back on the right track, no matter the odds, with our vision and mission for Elk Grove to help small businesses by creating more viable alternative services and resources.  To this resident, that is true economic development.
 
With that in mind, I sent a proposal to the Elk Grove City Council for consideration in next year’s budget.  It is solely for existing small businesses; asking for a matching budget of $200,000.  After all, isn’t business retention just as important as business recruitment?  [As a point of reference, the Elk Grove City Council passed other proposals submitted by active citizens including the Best in Elk Grove Business Awards and Shop & Dine Elk Grove]
 
The Small Business Economic Development Incentive Program proposal is designed to stimulate private sector investment, economic growth job creation in the city by offering incentives with this policy and available funds.
 
Moreover, it establishes a consistent process for the city’s participation in the development of small business activity which will have a significant and positive effect on the economic health of the entire community.
 
Currently, the city of Elk Grove offers several economic development incentive programs to only new businesses.  The city of Elk Grove now needs to establish an incentive program for those small businesses already in business. 
 
To be eligible for these programs, a business or company must: create new jobs, increase the city tax base through capital investment, and/or become a catalyst for future business development.

In the draft proposal, the city would provide an incentive to eligible companies or businesses of between $1,000 and $25,000.
 
At that luncheon back in 2007, and it is true today, Schultz fearlessly marched over to the VIP table where he knew two Elk Grove City Council members were sitting, got directly in their faces, and screamed at the top of his lungs, “Are you listening?  Do you understand that small businesses in this city are suffering?” 
 
The question, with or without the screaming, needs repeating to the Elk Grove City Council, “Are you listening?”
 

6 comments:

Anonymous said...

While I agree with some of what you say, the truth is IMO, those incentives make little difference in a business staying or coming to EG. That's just pennies in the whole scheme of having a successful business thrive in EG. What I would like to see instead is the city finishing some of the projects they started before going on to a new project such as the Aquatics Center or Soccer Stadium. That would be the Civic Center that the city has spent thousands on and the Railway Property purchased for $1 M. Now I realize the Civic Center is probably not the smartest investment we have made, but the RR property might be a good investment if done right.

Broderick Restaurant & Bar....been there and just not a fit for EG.

Not fooled for a minute said...

I spoke recently to a co-owner of a new restaurant in a strip mall space that had sat vacant for two years, and he said it took him 18 months of going through red-tape at City Hall before he could open (paying on a lease for empty space!), and the new McDonalds near I-5 got it all approved in 6 months. He was not happy and felt like the big wheels get the grease around here. Time is money and ambivalent public-sector bureaucrats with a guaranteed salary can kill economic development through word of mouth. It takes more than a few dangling carrots to conclude that "Elk Grove is open for business".

EGN said...

No fooled for a minute, feel free to contact me at elkgrovenews @ yahoo. If what you say is true, it might be worth an examination. I would be happy to discuss this with you or the business owner you speak of and take a closer look at the matter.

Lynn said...

I am not a business person by trade so when the first business incentive program was brought forth I had many concerns about the subjectivity in choosing a a recipient for the monies. I went to two business people; one in manufacturing and one in development requesting feedback. I shared this feedback with our city leaders...and received the usual response. Well some of what I thought would occur; it has...and here we are with another plan being brought forth that leaves it open. Until the rules have clear objective means of awarding a recipient nothing will change here. Council member Cooper said 12 million has been invested in our old town...I would like to believe the place is thriving...not seeing it. If so more incentive monies would not be needed to fill the empty brewery space. Let our leaders keep doing the same thing over and over....maybe eventually it will work, or maybe not...

Connie said...

Though I never got a response from Randy Starbuck regarding this proposal, or any other email, it is interesting to note that on the agenda for Wednesday's council meeeting, Agenda 10.2, is an "Economic Development Incentive Program" for existing businesses.

I did, however, get a response from Mayor Gary Davis back in April that the proposal was worthy of consideration.

http://www.elkgrovecity.org/documents/agendas/2013/ag-08-28-13.pdf

Thorough Reader said...

With all due respect to the author, I think she needs to read the existing program more carefully. There is nothing that specifically prohibits existing businesses from taking advantage of the current program. And from what I can tell in the new staff report, they are still eligible to use the program. I watch the Council meetings regularly and know that Council constantly talks about supporting local businesses and it seems the proof is in the pudding here. Exisitng businesses are already eligible for incentives.

Insteading of asking the Council "Are you listening?", perhaps, Ms. Conley should ask herself, "Are you reading?"