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

by Connie Conley | May 3, 2013 |   As reported recently in the local media, the Elk Grove City Council is ...

by Connie Conley | May 3, 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 LLC, 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 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 only to 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?”

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Anonymous said...

If I remember correctly, the owners were asking for this incentive in addition to a loan from the bank as capital needed to open the business. I don't believe "incentives" should ever be used for that purpose. If you can't afford to open your business, you're in trouble already. Incentives should be used to EXPAND their business...Accounting 101! It should be offered as a reward for increased productivity for motivating employees or increasing sales, to help them cross the funding “Valley of Death” so they can innovate, grow, and create jobs.

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