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PORTLAND — The City Council on Monday approved a restructuring of economic development programs to make it easier for businesses to access grant funds and city-backed loans.
Changes include increases in the amount and flexibility of loans, especially in support of the creative economy, offered through the Downtown Portland Corp., which was renamed the Portland Development Corp.
The action also begins funding implementation of the Portland Economic Development Plan.
Sam Spencer, a former president of the former DPC, said the changes will allow the renamed group to increase its loan portfolio and remove barriers for businesses to receive funds.
Current PDC president Donna Katsiaficas said the group loaned about $220,000 in loans last year, leveraging more than $1 million in private investments.
“We think that’s a pretty successful year,” she said. “We hoping to continue our lending activity and increase it in the coming year.”
The Portland Development Corp. has worked closely with the city’s Economic Development Division since 1991. The corporation is funded through a combination of grants and the city’s Capital Improvement Plan.
According to a memo to the council, the PDC will have more flexibility to use funding from recycled Urban Development Action Grants and CIP funds without seeking council approval.
Changes would also increase the maximum loans through the Micro Business Loan Program from $25,000 to $50,000. The Creative Economy Loan Program also becomes aligned with the micro business program, increasing the maximum loan from $5,000 to $50,000.
Businesses will also be able to refinance debt through the corporation, provided they meet criteria that include expanding the business by 25 percent more than the refinanced debt.
Spencer said the changes will make programs “simpler, more flexible and more attractive to entrepreneurs.”
Funding was also established for a new Portland Economic Development Plan Implementation Program. The group plans to use $250,000 in grant funds to start the program, which would award grants of up to $75,000 each.
“We’re very excited,” board member Jack Lufkin said. “By no means do we think the $250,000 we would reserve would be spent in the next couple years. It’s likely to be a multi-, multi-year program.”
Nelle Hanig, the city’s business development representative, said Tuesday other important changes will create a “60-30-10” loan program, where a private business only needs to provide 10 percent equity of the loan while a bank and the city provide the remaining 60 percent and 30 percent, respectively.
Hanig said this program is better for businesses and banks, because it doesn’t have the fees associated with a similar Small Business Administration program, which doesn’t really make sense for loans smaller than $500,000. Banks, she said, would have their loans guaranteed by the city.
“It’s less exposure for the banks,” she said.
Hanig said other changes will allow business loans to be used as working capital and maximum loans from the Finance Authority of Maine would increase from $200,000 to $250,000.
“We feel this will meet a significant need,” she said.
PORTLAND — City Manager Mark Rees on Monday said the Maine Department of Transportation is expecting to complete a long-await trail in Bayside by the end of the year.
Rees said the DOT is looking to accelerate the process and begin construction in November on the trail that would connect Marginal Way and the Back Cove Trail.
To make that happen, the City Council approved $22,000 in local funds to move the $195,000 project forward.
Since the funds were not budgeted for this year, Rees said the funding will likely come from the city manager’s contingency fund.
Councilors Kevin Donoghue and David Marshall said they are pleased to see the project moving forward so quickly. Both complimented city and staff for moving the project forward, but suggested it wouldn’t have happened without public pressure.
Residents began to question why the trail connector was not included nearly two years ago when the DOT was widening the Franklin Street interchange of Interstate 295. DOT eventually moved away from its original position that the link could not be safety built.
“I’d like to recognize the bike-ped committee as well as other citizen groups that really pushed this issue,” Marshall said. “If it wasn’t for those groups, this wouldn’t be happening right now.”
The council on Monday also conducted first readings of changes to the petition process for placing a referendum on a municipal ballot. The changes would institute a rolling petition process, where groups could continually submit signatures to the city clerk’s office, which would have 15 days to verify them.
The current process only allows petitioners to submit their signatures as a total package and does not allow them to collect more if they fall short.
Another change would require citizen initiatives and vetoes to be placed on the ballot for the next regular election. Currently, the city must hold a vote on such referendums within 150 days of a public hearing on the verified petition.
— Randy Billings