ned to them what we're doing how we're handling this process um and so that's what we think is a better policy than a moratorium because the point that um mayor pro tem johnson just mentioned is that what you don't want to have is you do a moratorium folks don't pay rent when the moratorium ends then what happens you still have uh you still have this uh build up of rent that's owed and then how do you then solve for that problem the process that we have in place avoids you ever getting to that point to begin with thank you for that i have a couple just to continue on that i guess what my concern is if we have had folks who have been unemployed for several months uh even if they got a stimulus check which we know some folks did not get uh it was not a lot uh so my quit you know at a certain point the amount of income coming in may not be enough to cover and and like what are the policies for how how much time do people have to pay back rent uh is it actually something that's manageable for folks um so and and happy to we don't have to happy to get an email about that but i just want to know more because i my concern and i'm hearing this from a lot of people is if you've got three and four months backed up rent and you still don't have a lot enough income coming in and we're not really going to work with people in a very detailed way uh there's not enough there's not enough coming in to help it anyway if that if i'm making myself uh clear if you are there are two things i'll make it we can avoid the email one is that uh remember that doro public housing is income-based rent so if your rent goes down your rent okay thank you the other thing is that we absolutely work out payment agreements that are reasonable based on i appreciate this clarification you're welcome thank you very much council member uh council member reese thank council member freer thank you mr mayor good afternoon anthony how are you today oh well sir thank you great to see you it's a good presentation it's good to get an update on where we are um you know the people of this city made a pretty strong uh commitment to the dorm housing authority um this last fall um and uh i want to say that uh i am glad to see the work of the housing authority it's a little up to their end of that commitment uh continue even in these really difficult times of our global pandemic so thank you for the presentation had two um i have a question and more of a comment my question is about the relocation program um in your presentation you indicated that residents will be relocated to other dha properties or potentially receive vouchers for temporary uh relocation can you talk a little bit about what that voucher looks like and please reassure me that it's not the same kind of voucher that uh current voucher holders are finding impossible to spend in dorm right unfortunately it is that same voucher this is the housing charge voucher the only vouchers that we have um and so uh and that's that's one of those things where a person would have to want to use a voucher you know obviously they have to find housing with that voucher they wouldn't have to move it um but it is the same housing choice voucher that that they would be able to use um i'm sorry the first part of your question no no um i just want to be clear then is it is it possible that residents who are being relocated might not have another dha property they can go to as a result of a capacity problem and will be forced to leave holding one of those vouchers no they won't be forced to leave holding a voucher um and yes it's always possible i can't sit here and say it's not possible but one of the things that we do is we start to do um a holding of some of our units that to have them make it so that there will be places for people to move to um so we we uh for for the different sites that we have we hold vacancies so we can make sure residents will have units to move to under this process um you you have to do a special process you go through for it but basically you're allowed to do that and those vacancies don't count against you uh when i first came here the housing authority had some sort of freeze because they were looking to do renovation and they were looking to do some of that we we now that we've changed our program a bit uh we're still going to use the same strategy but the option of a voucher is something that's there it's not something that people are going to be forced to take okay great i appreciate that if um if there are capacity constraints and and anyway i know you're going to keep in touch with us as that goes forward and if you run into problems like that i hope you'll let us know well in advance so that we can help craft a solution um because that's the piece of this that i heard believe it or not a ton of concern about last fall when people were talking about the bond was where are people going to live while they're rebuilding these communities and um the first part of that answer is in many places that we're going to build in place uh so people won't have to leave until their new home is ready but in other situations they will have to relocate and the commitment that i think the city has made is that those folks will have a place to live and giving them a voucher and sending into the private market doesn't live up to that commitment i'm glad to hear you telling me that that's not going to happen but if but let's keep in touch because absolutely the city needs to be ready to stand in the breach uh and support those folks if it does in that if it doesn't become a necessity right and i just want to add one more piece to that is when i talked about the transfer it gives us the ability to have quote unquote so instinct we're transferring 21 units from the modem and liberty site 21 units available in that development is being built by someone else and it gives us the ability to kind of lessen that burden around where do we create these replacement units so it's not necessarily one hundred percent needing to be us but as we find interested partners they can assist in that relocation effort as well that's great um the last thing i wanted to say is more of a comment and you may want to respond to it or not it's up to you um i appreciate the questions that my two colleagues say this is i appreciate your service but if we come out of this pandemic and we see the same levels of dha eviction filings that we have seen in years past i will tell you that the commitment that my personal commitment to making sure that the rad conversion process that the bond supports goes forward will be tested each of those projects come before us individually for bond funding um and that's going to be a factor for me it's there's a tension there though because as frustrated as i might be with the number of eviction filings that you have the housing still needs to get built i don't know how to resolve that tension but i'm just telling you this is something that i want to make sure has your personal attention once it becomes possible to have eviction filings i know you and your staff are understand that this is a priority for us but i'm just telling you personally as a member of this council that that's going to be a huge deal for me so i hope you'll keep that in mind thank you and that's all i have mr. mayor thanks anything thank you and if i could just make one comment regarding that and i would just ask that all members of council all the advocates for our residents in terms of the eviction filings and this is something that i asked the group that was that was calling for a moratorium you know back at the beginning of the year and i asked a question i said will you commit to helping spread the word that we need you to come to the housing authority to work out agreement it allows us from the standpoint of reporting to HUD to show that we have an agreement to have that rent paid so the advocacy around the moratorium is just as critical to provide it for the residents to let them know that come to the housing authority if you're having problems they rent and we can avoid the eviction filing process all together but if people are not responsive to the housing authority then we need to take the appropriate action um or else we end up having problems on the back end dealing with HUD so that that's my response my commitment is never to evict someone because they have an inability to pay right thank you council member and thank you mr. scott uh council member freeman thank you i appreciate uh the questions of my council colleagues um prior and i appreciate the the responses that um nothing scott has given i just wanted to touch in and say that i'm really looking forward to our joint city dha housing meeting and i'm hoping that i'll at least be on an annual basis so that we can actually touch base because i'm i'm concerned about waiting for projects to come forward but um i i just wanted to touch on there were two things the on the soft side of this transfer you're putting out a contract for for partners is that process already laid out or is this something that you're just kind of getting together like where are you in that we uh we're hoping to be a little further long in that but given the COVID-19 concerns we decided to pause and just kind of take a look at what's happening in the market um we and that is let me just clarify you're talking about the request for um proposals for development partners for the rest of our portfolio yes yes so the intent was that we were looking to do that by no later than march of this year but when COVID-19 hit we were very concerned about where things were and how people would look at this so we have paused for now we're now taking a look at that trying to take a test to the market to see where things are but we will probably be looking to put out that RFP for the end of summer and i just want to make sure that i'm that i'm noting that i i have my own feelings about the moratorium conversation but um i really want to make sure that we're we're keyed into the fact that the people that live in this housing are people that we uh you know they're our neighbors and how we engage and make sure that their needs are met uh is important but it's also important to make sure that the opportunities are available because it's you know dha housing forever is just not uh really i don't think that's what they want and so just noting that that's exactly why i think it's important to make sure that there's resources available i'm hoping that you're partnering with the office of economic and workforce development on being facetious but um around making sure that those opportunities are clearly aligned and spelled out for your residents and i'll continue to keep watching there right and i i didn't talk about this in this presentation i just kind of referenced it in the first or second slide that as you know we have a whole um prosperity plan built into this overall with us a 30 percent um goal for both contracting and hiring and the current developers that we have on board have already signed on to that um as a part of what they do moving forward thank you thank you council member uh council member middleton thank you mr mayor and i want to thank each and every one of my colleagues who's insightful line of inquiry basically eviscerated most of my questions so i have uh that's a good thing uh so just a comment and just a quick question um but anthony good to see you man always good to see you um thank you as well i want to i um the the great black bard biggie smalls has a line in one of his songs that says my whole crew is lounging celebrate every day no more public housing and it it's it's a funny line but it's peaceful because the line indicates how resolved we are that public housing can't be a place of decency where folk can't build a life it's someplace to escape from rather than make a home or create memories and and as a product of public housing i wish that um i had had leadership and and focus conscientious as you uh during those times when i was growing up in public housing when during that time i can appreciate biggie smalls i was talking about so i know it's been a tough ride um i think the ironic thing is you're you're the leader that actually took these matters as serious as they needed to be taken and some folk have said well you know we need to get rid of the leader who's finally uh treated these issues uh with the attention that they deserve to be treated in that predate you about 50 60 70 years so i want to um thank you um for the heart for the spirit uh that you brought to this work the technical competency of course is there but i think you brought a spirit of heart and a genuine um perp a genuine purpose uh to this work so i'm gonna thank you uh for that as a as a as a as an alum of public housing um you can create memories there and they should be places of decency and respect and home uh where you can call home i also just want to remind folk that are engaged in this debate that focusing on housing decent housing and even evictions eviction is tied directly to income so we can't just talk about housing without talking about things like jobs as well or universal basic income or reparations and and we can't just get caught up and make sure the places look nice and there's fresh paint and good appliances and we want to stop evictions the best way to stop evictions is to make sure we do what we need to do with intentionality to raise income and to make sure incomes are steady which means that we might have to make some uh raise our flag and plant our flag and draw some lines as to what we will and won't accept in terms of job creation in our city uh and insisting like made our Jackson in Atlanta i know there's a different kind of legal situation here but be as bold as made our Jackson wasn't in Atlanta in insisting that our people are unable to participate uh so they won't need to work out of eviction diversion programs they'll have the money uh Chupak said i love paying rent when the rents do everybody talks about that does mentality but even he wants to pay bills on time wants to have the ability to pay bills so so while we talk about housing let us remember that that paychecks and income are important as well not just a nice place a place that's aesthetically pleasing that goes for public housing as well um my question is is about the relocate the uh right at first return and i'm glad you mentioned it that rat dictates it but let's let's be honest many of us have been hurt before uh and there are folk in the city who just don't trust us that we're not going to displace folk um and no matter how much we talk about the right at first return and you're guaranteed to return um there's some things that can happen in the interim when folk are are temporarily displaced so i want to ask about our tracking how robust our tracking systems are for folk that may move while their unit is being rebuilt there are not there are things that occurred natural attrition folk die folk move folk decide that um they don't want to return i like it where i am now but i've spoken to folk uh over the years in different cities and public houses that when their new unit was ready nobody told them they just kind of got they fell through the cracks and got lost in the system uh they they moved them somewhere else they built a shiny new uh uh complex and they started the process of bringing people in the screening people for that complex and and folk just fell through the cracks so i i want to ask you how robust our tracking and information sharing how well will we be keeping in touch with folk who may be displaced to let them know when the project is finished that if they haven't moved out of town if they haven't passed away if they haven't you know just decided i want to stay here that your unit is ready and and and we will get you back there if you want rather than let folk fall through the cracks that makes sense it does and i think a lot of what you're referring to is a big issue under the whole six program um those things that i talked about with rad where i said it requires this requires that it's actually built into the law and it wasn't part of the law it wasn't part of the whole six program essentially we're rad and a lot of people don't know that rad is actually a program that was created and championed by housing authorities and they they lobby for years to try to get something that made sense for how we can improve our public housing communities learning those lessons from the past with hope six and so that's built into the law we're required to track those families and have them come back they can't be out for more than 24 months and we have to and we require to track them if we are not hud does not allow us to move forward so you don't get to open that nice shiny new building unless you are accounting for those residents that were a part of that building from the beginning so it's a lot of things that are built into the law of the program it didn't exist before based on some of those really really harsh lessons learned going back to 1996 when Atlanta housing authority started what became the hope six program all the way up into choice neighborhoods into what we have now as rad so we'll be definitely tracking those and you think about you know we've gone through rad already with marina de mar so we had to move i think about 10 people 10 families i should say between those two sites and move to other places now they're they're they're moving back to the completed units and we definitely have to track those folks as long as they're dha resident it's easy to track them because they're either going to be you know in another public housing unit or in rare cases they might select the voucher but they're going to be a in a dha program where we can track them now if they choose to move out of public housing entirely that is a day or no longer in public housing or no longer part of the voucher program that's different but then they're not part of the dha family to begin with well thank you so much for that i wanted to give you the opportunity to say that over here i think it's important because i want the folks that are watching that have concerns about displacement that they're not hallucinating and that their fears are not unfounded and that there's a real historical precedent with it not being you know a paranoid there's real factual historical reason for us to be cautious in the term we've been we've been hurt before but i wanted to give you an opportunity to to state that um without ambiguity on record that that we will we will not allow that not on this watch to to happen uh to folk so um that's all i have thank you so much um miss scott keep up the great work thank you mr mayor thank you council member mr scott um the uh for damar court and maureen road have you all realize developer fees we have not even though the construction is finished we haven't technically completed all the steps that will allow us to close out the project if you will what will the can you give me an estimate of what those developer fees will be um i believe those developer fees in total would be at or around a million dollars but that is still very preliminary because we've had construction delays as those delays occur we as a developer are responsible for those overruns and costs and so i developer fee will be going towards those overruns and costs well i am looking forward to you all receiving those developer fees i know you are too and not as much as we are i know that but that's great i mean i think this is the this is the future of dha uh developers realizing developer fees plowing them back into the ability to redevelop and so i'm really glad to hear this um the um one of the things that you didn't mention uh property that is in the hands of the housing authority is Fayette Place and you and i have had discussions last week about Fayette Place and can you talk a little bit about your thinking there it's not in the first phase of the bond we have heard from our friends at Durham can about a planning process and that you and i both said that we would participate in can you just speak some about Fayette Place and your thoughts about it going forward well as we both have committed we expected to have a planning process begun within the first six months of the year obviously we had to do a terrace to deal with and then uh overlaying that we had the COVID-19 situation that pushed a lot of things back um you know when you look at what we have in the DDMP plan we have what i like to say is the floor and that's true with all of those plans right so it calls for over 500 years of housing 20 000 or so square foot for a grocery store but i think that we can certainly do more and something that's uh more exciting for that community than just housing in a small grocery store that's my goal but ultimately it's going to be determined by the interests of developers who can bring in um the necessary vendors um and and and uh people who are going to leave that space we're going to make that happen i think that there has to be a comprehensive effort would say a place that includes that downhill street corridor going all the way down to nccu at minimum and that that becomes a larger part of this is part of what we've said from the beginning would say a place one of the reasons why that ended up moving further down in our priority list is because as a part of the DDMP we did a full-fledged market study and the market study indicated that they have a place because look think about it wouldn't it be great if we could have started at a place build housing but there's none now and then as we talk about tearing down other units and people have a place to go that was the initial thought i had from the beginning when we started this but we have to let some of the facts and independent information help guide us so that we won't be uh taking on developments that just don't make sense or can't truly realize their true value to the community so now's the time to begin to look at say a place again to see how we might be able to expedite that timing that we have the one thing we've always said is because of the nine percent we've created a kind of a linear program but it does not mean that we have to go about it in a linear way the nine percent tax credit component of whatever those sites are we'll have to be linear but we can still do other things on any of those other sites that's why the RFP that was referenced by council member Freeman is going to be an important um indicator for how uh people see the opportunity to develop say a place side or the four-seal side or any of the other sites that we have and that's because it's all going to be market-driven so i think with the planning work we do with some understanding of how other things could be done in that ati community will all go towards the appeal of developers for what can happen on the fair play site it has to be something that is adding value to the ati community and not just um sort of a a kind of one of the meal housing development only thank you i have one more question uh and this relates to one of the two items that we have for dha funding today uh which i'm very supportive of the item 16 is operational assistance contract with the housing authority uh for the ddnp and am i correct to say that a lot of these funds are going to hire development staff at the housing authority yeah development all along it's been excellent at guiding us through this process thank you all right council members any more questions we've been at this meeting for more than three hours already and we've got two big agenda items but i think this was a super important discussion all right mr scott thank you so much we really appreciate you you're you're a great leader we're so lucky to have you and uh we appreciate you being with us today thank you thank you um mr manager i'm without objection we're going to put the housing authority items on consent as well thank you mr mayor all right uh we have two more items and um the first item is the small business plan and i see mr pedigree welcome we're glad to see you okay afternoon mr mayor mayor pro tem and members of city council happy to be here to follow up on our conversation about the the Durham small business recovery fund based on our last meeting at work session uh we took your input uh we did some additional research as well as talk to our potential partners to come before you with a new proposal today i'm going to cover uh the background of that proposal provide a timeline as well as eligibility and funding terms for this program um i'm waiting for them to put my slides up we'll be patient as we always are there we go okay and we can go right to the next slide we can go to the next slide that's possible so and i'll just begin talking uh as a part of the program overview again there's clearly a lot of interest around this project but more importantly there's a lot of need for our small businesses and again we're coming before you to propose that the city council authorizes the city manager to establish the Durham small business recovery fund it's a financing program that is going to help eligible small business in our community who've been negatively impacted by COVID again we have put together a single program that the city is developing but there are two component parts you heard last time about the loan aspect of our program uh but we have since been able to find a way to provide a grant portion so it's a single program with a grant option as well as a a loan option uh we have selected the carolina small business uh development fund uh as the administrator of this program again just to remind we can go back to the next slide having a little problem with our slides but colleagues also this is in our in on our agenda if you look at the very last agenda item the slides are also present there while the clerk is trying to get them together so go ahead and i'll continue in our last conversation we talked about the fact that the city did not have a infrastructure to administer and manage a program like this and thus we needed a third party we're happy to have the carolina small business development fund be a part of this program uh kevin dick who is the president and ceo of carolina small business development fund uh is joining us on the line uh he's available again if there are any specific questions as we get through the presentation again we selected them uh because of their experience uh there are 30 have 30 years of experience of doing small business lending uh in north carolina uh they have a track record with us here in durham they serve as a member of the oewd small business advisory committee and maybe more importantly because of the speed that we needed to get this program up carolina small business fund is one servicing the statewide rapid recovery home program but it also has stood up in his managing the mecklenburg county emergency recovery program and thirdly uh when we decided that we could find a way to do a grant program uh they are the only organization that's managing a grant program uh they developed and are implementing the raleigh grant program and so we thought that combined expertise and background was really critical to the work that we're doing so the fund is set up uh with two parts as i mentioned uh it's set up to receive funds from the public sector as well as the private sector again the public sector funding will be directed towards the lending part of the program where private sector funds can be set up uh and to be used for grants currently the city has committed a million dollars for the loan program uh and duke uh has committed a million dollars uh for the private side and again we intend to uh continue to fill that uh to go out and get additional funding uh next slide the carolina small business fund give me one second um mr pedigree the the clerk and i have been in communication uh behind the scenes she's having trouble um this getting the slides to move so we'll just move them as quickly as we can uh but colleagues again i do want to remind you that if you want to follow along on the slides they are in um on the last item of the agenda you'll see the presentation there and that has the slides i'm sorry go ahead okay uh the carolina small business development fund will manage both programs um they'll administer the loan program by essentially providing all of the the loan uh origination underwriting and servicing that's required as a part of that program uh they will essentially provide the technical assistance that supports the the borrowers in that program uh they will also manage the grant program and again i'll talk about the terms later this is a unified program where we will essentially work with them to provide the outreach and marketing to promote the program um i think we know from experience so far uh in regards to these local recovery programs that the funds will be exhausted fairly quickly and uh again having uh an experienced administrator with systems programs and forms already up uh that's going to accelerate our work one of the primary interests uh in this program is how we connect these opportunities these financing opportunities uh to our communities of color uh to our disadvantaged businesses in our community um again in managing the programs that the carolina small business fund has done uh and i had an opportunity to talk with my colleagues in raleigh as well as mecklenburg county about their work uh they've been able to really achieve uh a a very effective level of diversity in terms of participation of these programs uh in raleigh they actually provided an intervention that i think has helped uh the abilities for uh our smallest businesses or disadvantaged businesses to participate uh that intervention uh and this is something that we'll do as part of this program uh is to essentially open a time period for applications to come in so there's not a rush to be in the system on the first come first serve basis that actually also enables uh us carolina small business fund to provide some advanced technical assistance uh one of the things that we have found with all of the programs both at federal and state level uh the level of preparation in terms of making sure that the proper forms and documentation are available and by having that sort of runway uh it has enabled more of this targeted community to successfully apply uh the third part of their approach that i think is innovative in that uh once all the applications are in i think they had over six hundred uh in the rally program uh they randomly select all the qualified applications uh in a hundred units so the first hundred are applied against the amount of dollars that are available um again if that hundred exhausted uh the fund uh then it would be done uh if it only exhausted half of the fund uh a next round of a hundred firms would be selected um again this actually this process has actually generated a 59 percent uh participation rate in terms of businesses of color receiving the grants uh they did not utilize uh this approach uh in mecklenburg but again the success of the loan program in mecklenburg uh is at 52 percent uh businesses of of color uh i asked both of my colleagues what they thought the key elements were to their success above and beyond the interventions that i talked about the carolina small business fund actually has a documented track record of working with disadvantaged and low income businesses uh it is core to their business it's a part of their core mission they have the credibility they have the connections and the systems that enable us to sort of make that happen and that it works so again we're happy to have them as a part of the program uh again the urgency of getting work out uh again uh if we can go back to the slide okay the timeline for disbursements if we can get back to that slide because there are a number of points i wanted to make there well maybe not so we've set up a timeline uh that essentially assuming that we get council's approval and can most negotiate a contract by june 8th we can get the application process launched available for our our businesses to apply by june 18th and again i'm looking at the grant portion of this by june 18th keep that window open for the 10 days that i described earlier again going through the review and selection process the grants can be received by july 10th so this is effectively around six weeks i know that again this is about the same timeline a little faster than what they were able to get their program up with rally is again they have the infrastructure and the services to be able to do it a similar timeline for the loan program the difference about the loan program is once it's open we will evaluate loans and make you know loan determinations and fund those on an ongoing basis again there's no need to sort of keep that window open it's it is a first come first serve but we will apply the marketing outreach and technical assistance approach and again it's generated good success in mecklenburg next slide so eligibility um just kind of want to work through that and i'm i'm mindful of the importance of people understanding uh what who and what this fund is for so independently owned and physically you're located in durham uh these are locally owned and based businesses in durham the size standard uh the size standard is 25 employees at less than two million dollars in total revenue i want to pause to talk about that size standard and and why and how we've come up with that uh there've been a number of surveys out in terms of measuring the impact of covet on different businesses first of all every business large and small has been impacted by covet i reference a study that was done around north carolina over 468 businesses done by the institute the minority institute here in durham where it talked about some of the challenges that these firms have had most of the respondents were businesses of color um the vast majority of the 468 firms uh had employees less than 25 over 80 of those businesses were less than 25 um the state did a hub survey taking a look at hub firms this survey was about 300 and again the impact on these businesses in terms of doing state work uh the survey showed of those businesses uh that here again the vast majority over 80 had employees less than 25 um again the point here is that the very small businesses um you know are the ones who have been impacted every business has been impacted but again the smallest of the businesses and many of them uh most of them being small disadvantaged businesses are the ones who were not successful uh with the PPP program they have struggled in terms of getting involved with some of the state programs and so we have chosen this demarcation and every business any business in durham that meets the size standard uh are eligible now inside of the program uh you know businesses that have revenue under a half a million dollars will be eligible for the grant program again this is an effort to provide funding for those very smallest of our businesses however businesses with revenue over a half million and up to two million dollars are eligible for the loan program and i'll talk about the terms of the loan program as we go forward uh all businesses must be able to determine uh or demonstrate that there's a at least a 25 percent decline uh in their revenue uh due to covid uh we expect them to show a minimum of two years of profitable operation and a growth trajectory again this intervention is to mitigate the impact of covid uh next slide the loan amounts uh and again the loan amount range is from five thousand to thirty five thousand dollars uh this amount uh is consistent uh with the loan amount that meckenberg county has done i think their average loan is somewhere between 25 and 27 thousand um the maximum grant amount uh is 10 thousand dollars this too is similar to the grant amount maximum grant amount within the rally program in fact the grant amount is up to 10 thousand dollars or two times the business rent or big business mortgage uh for the business so again uh these are for storefronts uh businesses that are actually paying a commercial rent or are owning a property going forward uh the loan is a term loan up to 10 years the interest rate is three percent uh which effectively is just below prime um again this is favorable terms um the deferred principal payments are up to 12 months so uh for the first 12 months uh first year the businesses will be asked to pay interest only uh on their loans um again personal guarantee for all business owners uh 20 percent or more ownership uh we are not taking any ucc one filing so effectively uh we are an unsecured creditor uh in this in this model uh next slide so the cost of of administering the program again we still have to negotiate these but this model is consistent with the model uh that is being done uh in meckenberg uh as well as raleigh and in some of the other statewide program uh so effectively the loan administration fee is 10 percent of the loan fund plus 10 percent that's set aside for technical assistance uh the technical assistance is the sort of accounting marketing the support that's tailored to the needs of the individual businesses uh and again that is paid over the term uh of the contract uh there is interest the three percent interest is split the city will get two and a half percent of that interest repayment back into our program along with the principal and the point five percent uh is uh provided to the carol lion small business fund to essentially handle the performing and in essentially managing the the the fund dollars uh in the loan fund uh the administration of the grant because the grant program is a simpler program uh there is not a long term technical assistance component however there is technical assistance that's available in the small business network ecosystem uh there's a 10 percent grant fee uh for the administration of the fund so uh with that i'll stop and again be prepared to answer questions and uh if there's an opportunity we'll have kevin dick weigh in in terms of clarifying some of the points thank you very much andre um let's see um if the clerk can take the slides down now so we can see everybody uh and let me just say uh we're glad to have kevin with us kevin are you uh with a hearing distance i hope you can hear me great yes we can great to see you um and as well as the rest of the council members um and please have this opportunity to um potentially address you or support andre however i can't it's great to have you back in Durham virtually kevin thank you hopefully we can make it in person soon one of these days right um all right mr manager did you have a comment thank you mr mayor i was just wanted to andre to kind of follow up on that last slide and clarify the cost of the program costs and are those 10 costs and fees something that we'll be looking at covering on behalf of the program or are those fees that will be taken out of the individual business loans could you just clarify that a little bit more please thank you the management fee the administrative fee uh is uh an additional cost our goal is to put the two million dollars on the street and again we'll need to cover the administrative costs uh from uh our budget from our our our sources right just wanted to be sure everybody knew that's what the intention was thank you really appreciate that clarification thank you colleagues uh you have heard mr pedigree's presentation and now i'll ask if there are questions or comments or members of the council council member reese yeah i'm gonna have to switch off the video hold on i was not looking good can anybody hear me okay yes yes we can andre good to see you thank you for this presentation um rather than he prays on you for doing great work in a short amount of time i want to get right to it because um we've been here for a while and we're going to be here a while longer i want to turn straight to the grant and loan terms a portion of the of the presentation um there are a couple of things here i want to ask you to consider first of all the second item the maximum grant amount of ten thousand dollars or two times the business's rent or mortgage whichever is lower i think this provision especially the second part of it excludes a number of our businesses that don't pay rent or have a mortgage uh food trucks folks who own a business that runs out of their own home for example um and i had a friend uh actually just text me uh constituent just text me during your presentation uh to talk about um the the fact that that would exclude him from the program um i think it i don't know what we gain well i don't know how much we gain by including the portion of that second bullet after ten thousand dollars uh so that's one thing i would ask us to consider today as we um think about how to roll this out uh second of all um i want to hear more about the implication of a personal guarantee and what that means you talked a little bit about it but i'd like to hear that one more time with a little bit more detail um i as i as you heard uh in our last time together um i want to resist um collateral to the extent i can it seems like this might accomplish that but i want to hear more about it um and uh third of all i want to talk about the timeline for getting from where we are today uh approval uh to the disbursement of grants and loans um and maybe that is a question for kevin in terms of what can be facilitated if uh if if there's if there's anything the city can do financially to make that move quick more quickly i'm interested in hearing about that so those are the three things i have for you um thanks sure um on your first point um you know in the discussion there there has been uh emphasis around uh businesses uh that were either storefront or paying commercial rent as opposed to home-based businesses and again we can talk about that in fact i'll ask kevin to maybe also talk about that uh the the trucks um they're uh included in the rally program so uh vendors uh like the uh the trucks restaurant trucks um would be included in in the activity um you know again we can talk about that again we're trying to service the pleasure of the of the council here um and kevin can talk a little bit more about how rally has implemented the program i wanted to maybe also now talk a little bit about the the unsecured credit position that we have so a personal guarantee means that the individuals uh who sign on uh are are are liable uh again if if there was some form of liquidation uh we would have to stand in line uh with other other creditors uh we need to hide any secured creditors uh that the borrow might have uh and so uh again uh you know how where we are in the line uh i don't know i i just know that essentially as an unsecured creditor uh it's not the uh it's not a secure position so i hope that it put some light on it um i did have a hold on having a technology problem here i did have a question about what about what other jurisdictions um that are doing these kind of loan programs is there a consensus about whether or not collateral or personal guarantees being required to some of them do neither what's what does the landscape look like out there well do you mind that kevin maybe jump in since he's participating uh in uh both statewide as well as local programs uh to kind of talk about the island for you i know there's a range great thank you kevin will you uh will you um comment on that yes happy to mr mayor and and uh council member reese great to see you appreciate the question um it really uh varies from jurisdiction to jurisdiction um we generally uh we've seen in mecklenburg for example where we are um collecting uh ucc filing but that it doesn't necessarily have to be a deal breaker um we're with the um statewide program um that that collateral uh expectation is there the 20 percent um the the guaranty the personal guarantee for anyone that owns 20 percent of the more or more of the business is there as well um and i believe that's also the case in mecklenburg uh in the city of riley because it's a grant program none of those provisions would apply um thank you that's that's good to hear um and um kevin will you also talk about the storefront requirement which i think uh which i think is really um uh what that second provision does it really requires you to have a physical location whether it's a storefront or an office or something can you talk about how that has worked in other jurisdictions as well sure and and really um what that counts comes down to councilmember reese is really a policy decision relative to what you want this program to do in riley the storefront provision was there because the grant fund was seen as a mechanism to also drive place making and and really drive um you know helping businesses that help contribute to sort of the vibrancy and the character of the city visually and create places for gathering um obviously at this current time um you know there's a there's a certainly a restriction with gathering but they wanted to really um drive place making and and and drive the ability to um help help strengthen the character of the city so the storefront provision as well as the food truck uh provision was placed into the grant program but um and it's it's been effective in terms of the the fact that we had 615 applications this morning we actually wrote letters to 116 successful grant applicants um and as andre alluded to we we launched this the program may 11th and we um are deploying capital on june 4th so three and a half weeks um from the time that the program was launched to the to the time that folks uh will start to get folks should start to get a um aca transactions as early as tomorrow and into early next week so in terms of the effectiveness of the program it has not hindered the effectiveness of the program um from that standpoint all of that said it that is also um you know that's a policy question the program does not have to be um run that way i think that uh in in talking with andre and in talking with the folks in raleigh we want the the program to meet economic development uh outcomes and and objectives that are very holistic and so you know from an economic development standpoint it's about getting capital into the hands of businesses but it's also about trying to sustain the community vibrancy um in the best way possible but it's really you know it will really be up to the discretion of counsel thank you kevin i appreciate that that's that's helpful um i guess just to close um i i know i guess the council's gonna have to have a conversation about that i don't know if the folks are going to have questions so when that happens we'll we'll we'll we'll have a conversation about the issues around thank you about um the mortgage rent requirement um the um uh so that that'll be good i guess the other the last thing i wanted to say is not really a question just uh when we get to that point where we're talking about how uh when we come to decide about how we feel about the requirements i've had good conversations with many of you and with staff about the one million dollar commitment that the city of durham has already made to this fund i think that's a good place to start but i was having conversations with some of you immediately after the last work session telling you i thought we were going to need another two million another million dollars in it um i don't know how to handle that um in this context but i think we should signal to our community that we're willing to put in another million dollars when it's necessary and i know there's a difference of opinion about that in the council and hope we can have that conversation with the time comes i'll stop talking now for a bit thank you sir you're welcome thank you council member um okay other questions and comments for mr pedigree or mr dick yes mark uh councilmember mills thank you mr mayor and uh thank you councilor reese i don't think i was one of the people you spoke to after the meeting about another million but i certainly am on record thinking that the first million is a great start and certainly i'm willing to do more as the program rolls out so no difference of opinion from me um andre and kevin good to see you both always good to see you thank you for the work uh you've done and you're doing on this um a couple of questions i um first on on the program eligibility i um i'm not even close to being a restaurateur restaurateur uh but but from my work on the board of the ddi i know for a fact that there are our restaurants downtown that have more than 25 employees um so i i'm wondering how are they just out or or can we tweak uh somehow um the uh you know the the eligibility requirements are i know we don't want to inadvertently send a signal that we're not really interested in restaurants but i know that for a fact some of them i frequent have more than 25 uh employees so so and i'll just do these in shotgun and you can respond uh after i'm done i also want to i want to uh ask a question about the the the language and if it's fair to interpret when i read businesses with revenue under 500,000 are eligible for grants does that mean they are exclusively eligible for grants that businesses under 500,000 are not eligible for grants and loans and businesses with revenues over 500,000 are eligible for loans that loans exclusively um just go ahead if you want to yeah no that's that's correct we we've chosen to essentially bifurcate the program for the smaller firms to be able to be eligible for the the grants okay under half million and again you're you're not required you're not eligible for the loans and those with uh over a half million are eligible for the loans only uh and again yeah and and again you know this is a very flexible uh loan term uh you know 10 years and and what have you it it's it's not a grant but uh you know we you know uh we think there's a market for folks who can take on loans everybody can't take on loans that's as measured by uh the fact that the both the rapid recovery loan fund program which is about 125 million dollars uh has a very good set of firms who are applying uh for that as well as again some of the experience and some of the other local loan programs got it so and what are we going to say to restaurants or places that have more than 25 employees so um again we did not make an industry determination right so we know that uh there are businesses that have more than 25 employees um uh the data that I showed was really one how to essentially reach the businesses that the research has shown it has had the greatest difficulty accessing resources again this is a policy question uh again we serve it the pleasure uh of of council here uh but the research has shown that disadvantaged businesses businesses of color uh are mostly businesses that have 25 or less uh the surveys uh both here in north carolina as well as national has talked about those firms failing to be able to access these resources uh ppp you know other state and in federal programs and even grant programs on a first come first serve basis and so based on that data we chose to pick something that covered actually 80 of the businesses in our community there are absolutely businesses that have more uh than 25 there are businesses that have more than 2 million in sales uh again that's a decision that was made is there a cutoff data as to when you had those 25 employees because I imagine this might incentivize some folks to cut their employees until they get under 25 or if you had 25 while you were in business and you're not in business anymore you may very well not have 25 anymore so is there a date certain that you have to stipulate at this date I had such and such employees or is it when you fill out the application well it's part of when you fill out the application Kevin help me in terms of uh there's a time range where we're looking at uh when businesses are are are sort of operating uh until we are going back in time not just what the current figure is before Kevin answers I think one of the important things around this program uh is that it is not the end all uh you know we are going to support uh grantees as well as borrowers to access other funds for example uh there still is 160 billion dollars out there for PPP and again many of these firms were not able to access PPP partly because they didn't have a bank relationship and partly because they didn't get the format so again you can access our program as well as that uh everyone that's applying for our program should be also applying for the golden leaf rapid recovery program again these are just ranges of capital and for a lot of our smaller independent businesses for the first time freelancers sole proprietors and self-employed people can access the federal and state unemployment insurance again that doesn't replace your revenue but if you don't have overhead like rent and some of the other things that's been a viable source we've been able to connect entrepreneurs sole proprietorships and self-employed people to access that resource and again uh accessing that resource or any other resource doesn't disqualify you from participating in our program got you um I appreciate that turning the grants the grant and loan terms is is it possible to get something less I mean that's not tethered to rent I mean uh I see the rent or mortgage and I appreciate uh council recess and about this I see the rental mortgage um um stipulation but is it possible are we losing some type of metric to determine another could you get a grant less than 10 grand for whatever reason are you are we looking at income statements or or I just said we're giving you six or four or and what are we basing it on so I'm not going to try to guess one of the things that I said to you we're going to we're relying on the Caroline Small Business Fund because they've actually processed over a thousand applications between grants and loans and so this is an opportunity Kevin maybe to share what you've learned from that experience because again that's informing our view we don't have a loan program again I want to say that again the city of Durham has not processed an application or review the grant through the office of economic workforce development and so we have to rely on partners with the experience and that's in part uh you know why we have Kevin here today to kind of help give us some additional insights uh based on that experience so okay thank thank you Andre yes council member Middleton um hey man I'm sorry no I said hey man how you doing I'm doing well how are you you're well I asked for the video to come up so you all could see me but I'm not sure what's going on but um what we found in Raleigh is that the average grant size has been about $7400 to $7500 um and I did want to just again offer this perspective about the two times rent or mortgage again this is not necessarily um this it's ultimately is a policy decision and we follow what the client wants but the basis behind the two months rent or mortgage was that um we wanted to to have sort of a baseline uh that we could really um we could use a baseline to come up with a solid amount and um what we were trying to achieve really was first of all to stretch the grant dollars as much as we could so in other words instead of everyone getting $10,000 per say if you if you had um something that said all right well we'll make a max of $10,000 um but have some baseline that really uh is related to actual expenses that a business owner might have um and we we figured that doing it based upon rent or mortgage was more universal than doing it based upon payroll because that you know micro entrepreneurs or sole proprietors wouldn't necessarily have payroll but most people would probably rent a space so you know and obviously that's not an absolute but it we thought it to be more general um so that's but I hopefully that answered your question uh about the average grant size as well and I also wanted to provide some perspective about the choice of rental mortgage finally I will say I did get a note from staff that even with say food trucks as long as you are connected to some sort of commercial lease so in a food truck uh in the case of a food truck it will be a commissary where they have to pay rent or things like that um that would also be considered as well now that that's extremely helpful and demystifying some of the methodology behind uh this stuff uh finally uh the the three percent interest rate is that is that the best we can do and I don't mean from our perspective I mean from the perspective of the uh of the lindy's how did we come up with three percent as opposed to one percent uh sorry go ahead Hunter well I was going to say part of the the premise is that uh we have to uh for the public money charge a competitive interest rate a market rate uh we're choosing to use prime which is the the best rate available to any borrower large or small and reduce that by a quarter of percent uh and again part of the legal construct is that we can't put together a program that competes with other lenders or borrowers and so um again I I think you know just to cut to the chase uh while we're putting this together uh we'll make sure that we are able to do the very best in terms of the the loans by the way some of the other programs are at five point five percent Kevin you have a better sense of the of the competitive rate uh ours is one of the lowest of the rate that are out in terms of the loan programs Kevin do you want to comment on that uh the relative loan the relative interest rates of what you're seeing in some of these other programs sure thank you mayor shul um the only interest rate that I've seen lower than that was sba idle um on a 30-year term that's 2.75 percent I haven't seen anything lower as andre said we wanted to um you know really look at prime as a baseline and then discount it lower than that but I would also say that with a 10-year repayment term um that's still a pretty favorable um monthly repayment for most business owners okay um and now I appreciate that and I guess my question is and I understand the the uh the competition argument are are we legally uh constrained to comport ourselves to not undercutting other lenders or or is it a choice on our part I mean I know we want to recoup some money as a government but we're a government operating under emergency circumstances this isn't really a for-profit venture for us as a government we're trying to stabilize our economy and help our residents and therefore operating under that motivation and in that spirit do we have to set it at three percent I guess is my question I mean if we wanted to do one percent could we legally council member uh I'm going to refer any legal question to the city attorney all right madam attorney good afternoon um I also have on this call assistant city attorney Krista Kukaro who has been working closely with oewd on this project so I'm actually going to let her address that question council member Middleton if you don't mind thank you councillor yep she says her audio cut out she can send you notes and you can cheat off as best I understand it um the city cannot just set a one percent interest rate I'm hoping she's going to text me she's back let's jump in um we can't undercut the natural market for one um and Krista can you hear me yeah I can hear you can you hear me okay yes okay um yeah you good afternoon council um and thanks for for the opportunity to answer this question Andre um and can you are on the the right direction I do believe that we are somewhat limited um in in what we're able to do as far as interest rate um do you think we have to remain competitive um however I do think you know one of the questions I think we can talk with Carolina small business development borrowers who may be this is meaning that they may not be access traditional financing whether there may be the availability of lower interest rates for those borrowers and I think that that's something that we can talk with Kevin about and I think legally that would be justifiable absolutely I'd be curious in knowing the absolute lowest we can go and not run afoul of the law and that's a question you know just put it straightforward like that understood um thank you gentlemen mr. mayor I think I've taken up some time I think that's all I have on this thank you sir thank you colleagues thank you Kevin and Andre thank you council member thank you council member who who else would like to ask questions at this point or have comments council member freeman thank you mr. mayor I just wanted to uh to make sure I weighed in and share uh first I'd like to welcome um Kevin back to the bull city as a fellow mountie uh I um I just wanted to make sure that I noted um council member Reese mentioned uh if there were costs associated with moving any faster I would definitely like to hear if there is any way to to shift the move up the timeline as as much as possible and then also uh around a lot the conversation around the additional funding I too had not had conversations with Reese council member Reese but um I would be interested in figuring out how to make sure we do make sure that the that if it funds ran through in a week that there were there was a way for us to continue to um provide funding in this case so uh council member freeman um I'll take the first question I think the the second one obviously is um not more council related and I'll take the second one in terms of the first question um I believe that we could move faster um and I don't we don't necessarily need to make a cost be associated with that um for example we used a review period in Raleigh that was 10 days we may be able to have some flexibility on that um it wouldn't necessitate really strong technical assistance between contract execution and the launch period so that we could really make sure that people had their paperwork in order so that they could definitely meet that five-day window um but I I do think that that is an example of how the whole process would move faster and each subsequent step would be moved up um five days okay thank you sure so I want to uh stick with that topic a minute because one of the concerns I have about moving faster or too fast uh is that it is it potentially will be at the exclusion of many businesses that need is additional technical assistance and we you know we have we'll have a you know somewhat of a challenge and communicating to a lot of businesses we know that that the businesses that are in the know are going to be quick to quick to uh to get their applications in but I think I'd like to hear staff you know think about or at least talk about you know what are the expectations for getting the word out how we recruit potential candidates and in particular what technical assistance uh they might need to be able to be you know submitting uh applications and eligibility applications so I mean that that's one reservation I have I know I understand the urgency of get it out get it out but I also think you have to think about uh is there a an unintended consequence of moving too fast if it if it sets up for the potential for uh you know limiting uh many of the businesses that we're interested in in recruiting so if you could talk about that a minute and I'll come back to the funding question after that so um again there's been a lot of learning over the last uh month uh in terms of these various financing programs and again it's documented evidence uh that minority small businesses did not do as well and again the bank relationship was one of the biggest stumbling blocks because in the ppp program the sba program uh it was first of those who had the relationship and most of our businesses start their businesses with their own capital and did not have the bank relationship but second was the number of folks who got knocked off the site because they did not have all of the forms uh available in order to process the the the information again we have worked very hard again we are co-hosting a number of seminars webinars uh in literally in terms of how to uh and what forms you need uh if you have not processed as example uh your your schedule c for your tax return for 2019 uh that is a very important form to be able to do uh again that sort of is the technical assistance of getting that level of documentation uh in other things that are related to your payroll a whole host of things that are important in terms of the loan underwriting um you know same thing for the grants it's it's not simply there's a criteria for for getting grants and the kevin can speak to uh those who uh aren't successful in getting grants and what some of the problems were uh around that so i i don't want to downplay that again i'd like to make sure that we use the have a runway to provide the technical assistance we know that people need the money and they're ready to jump but if we're really looking at what some of the challenges were for the firms who weren't fully prepared uh we want to use this time to market it and provide the direct technical assistance going forward so kevin maybe you can talk a little bit about how you have used the runway sure um we extended the runway on the front end by making sure that we had technical assistance sessions both in english and spanish in rally and we found that to be very effective we did that through webinars um they were well advertised we we actually um in that case partnered with the city of rally's economic development staff we made sure that we had buy-in from groups like the rally chamber way county economic development and so forth um and we also used um you know the opportunity to appear on television with mayor baltwin and rally with when a vision television so that we could also um and and i did that with our latino programs director um so we have by the way three bilingual staff who are all conversant on the loans and grants um we also uh partnered with shaw university and use social media platforms to make sure that um knowledge about the grants went out um to the right channels and mecklenburg we just partnered with their their pio office and economic development department uh in in order to make sure that um the word got out that way obviously social media um was a very important component as well um and so we used uh we did intensive technical assistance for a few days right before the launch period um and i would say the first day of the launch period in rally we had 615 applications in total over the 10 days we had over 150 that first day so um to manage your bond fields point um there could be an unintended con consequence of keeping the review period too short it may have lessened the number of applications we would have gotten at rally for example um but again that's a that's a policy call and i think you know my point was that our infrastructure can accommodate whatever time period you want that thank you i just want to note that i i hear with um with uh our city manager saying and i think in this case that folks are upside down in this and that the folks who are most impacted in this have been waiting a long time and they've been looking for something and so the word getting out is is very important and i appreciate him acknowledging that you know we don't want to miss anyone um that should be at the forefront of this and uh i i mean i'm i'm i'm open i hear i hear that that conversation so i'll let uh andre decide whether it's a quicker turnaround or not but any other thoughts on council members i'm sorry council member freeman just on that second point around making sure that that folks understood that funds were available you want to make a comment oh well i'll come back to that if we could just get any other feedback from council on the timing issue i think that's a pretty critical piece to uh to give the caroline small business fund you know the the heads up as to what the expectations are uh obviously we're going to do everything we can to to market the program um but um we know the challenges when we're in many of the communities that are uh that are that are typically negatively impacted by a lot of things we market it they don't have the same access to information that that uh individuals and businesses that are kind of you know at the at the access points typically do any other comments on that council members well i'll just say that i i'm comfortable you know i'm comfortable with the um schedule as proposed i agree that in this case speed is the enemy of access uh and uh i think that being able to give the technical assistance being able to reach the disadvantaged communities that's going to be important i mean it's all we all wish it was out now it's not out now um but i think that let's don't hurry it uh in order to you know and then miss out on a lot of the businesses that we really want to be able to serve any other comments on that all right other questions and comments on the council members so may i want to follow up on the money question yeah go ahead calcium average thank you could i could we um that seems to be an important question and apparently it's being framed as either we're inclusive with the money or we move quickly and so if that's the choice i wonder if we could just get a sense of the council about where the council's priorities are that would be great okay i'm i'm happy to hear that uh you heard where mine are you heard where councilman frayman's are others mayor pro tem and council member caballero sure thank you mr mayor and i think it's really important for the funding to go to the businesses that we're targeting we want to make sure that people who really need this money can access it and especially you know along with our um with our you know strategic plan guidelines and our values around supporting disadvantaged businesses so i think that that would be um like that that's my primary concern um it's making sure that the money gets to who really needs it thank you council member caballero name if the if the will the council was to speed it up i would go that way as well but i think that i guess my biggest concern is within the latino community we are there's always a communication lag i don't know how well uh translation interpretation is how quickly you can get done and so just knowing that and and that's just in spanish i don't even know how we do it with other languages um i'm i'm hesitant because i think there will be a large percentage of the community who will literally hear about it much later unless we have that real tight yeah i mean i think that this timeline um you know it would we always that we were doing this center we're not but now that we're doing it when we are what's the timeline that's going to get us the businesses that we want okay i think we have some consensus councilmember reese do you want to join that consensus or do you want to uh or councilmember millton yeah i i want to join that consensus i i think uh what the mayor pretends that makes a lot of sense i also find council copy arrows concerns about uh access compelling as well my assumption is that i don't think anybody it's a secret how quickly we wanted this thing turned around as possible how um um important this was to us my assumption is that this timetable that's been brought to us took that into a counter i don't think we does any more we can do to make folk know how much we want this to go out as quickly as possible so my assumption is that that timetable is predicated upon knowledge of that and i think it also allows uh for us to get the right people as the mayor pretend said in council copy arrow as well so i'm cool with this timetable based upon that all right thank you councilmember let's hear from the manager on the um issue of the funds and then what i'm going to try to do is i'm going to try to distill what i've heard as the questions and get some consensus around that or uh decision around those uh it is now five it's now 10 minutes after five and we've got a bunch of budget work to do so i'm going to try to help us focus this discussion and um we'll start with the manager so thank you mr mayor uh so what i wanted to say about the the money side you know we we have the million dollar commitment for the loan fund from the city and the million dollar commitment from duke for the grant um i i think we we acknowledge or we need to recognize that there will likely be a need for more funds and i think we have the potential for you know for doing that uh in the the money that we're setting aside in in covet but i have a couple thoughts about that one this this is for us for Durham uh new territory uh i think it would be more prudent to to let this first pass happen at the million and million and then doing a you know a quick evaluation of how successful we were meeting the the objectives that and the values that we've laid out uh for example if in fact uh the the random draw system doesn't attract the uh the the disadvantage minority of businesses that we'd hoped we may need to go back and pivot how we think about that uh if in fact it's uh um you know successful uh you know we can we can react that way but rather than commit you know at the extra million dollars right now to this program i believe that there's an opportunity to come back for a second round if this is successful or maybe come back with a a modified program if there's things that we needed to learn from that i also think that um at some point you know we're going to probably have a more uh full and deeper conversation about other community needs uh and how the requirements and the expectations for the the the monies that we've put aside for covet response are going to be deployed and right now we're you know obviously laser focused on the the small business fund we really have not talked about many other community needs and i suspect we will in the next uh you know coming days so whether it's next week or the next month but just a little hesitant to commit too much to one program both in terms of structure and in terms of just the the segment of of of that resource so uh i acknowledge you know that that maybe we say if it works there's more money to come but i just would be hesitant to to put that in there right from from the get go that those are that's just some of my thoughts thank you mr manager let's go ahead and take up that question is there anybody that thinks that we ought to allocate any more money right now let me also add by the way that the county is putting in a million dollars so um we'll be starting uh there they apparently are going to be voting on that uh at their budget meeting uh but that's my understanding from uh commissioner Jacobs that there was support for that last night or two nights ago uh so i'll i'll ask now are there people that think we ought to be allocating more money now uh or do people think that we ought to wait see how this goes and then allocate more money if necessary i'll focus the question this first question mr mayor councilmember freeman i just wanted to to just um clear this clear the um the conversation and making it making it more pertinent to what we're talking to what i'm talking about and that i acknowledge that we're trying to be intentional about reaching small businesses but i want to be real specific in saying that i would like this money to reach small black and brown businesses who are at their end and i have been trying to be very patient in this process as as a councilmember i feel like it's incumbent upon me to make sure that i am pressing as hard as possible to make sure that we're doing what we can now because this is our future tax base and so the small businesses that are on main street are a small subsection of what we're seeing and how hard um businesses are being hit and so i don't know that that conversation and context is included in this but this is this ties back to the initial conversation around uh what white violence looks like and so acknowledging that reparations have never been paid there are small businesses in this community that are just barely skipping by and so the additional time and then the lack of whether or not they'll be able to get through on the first um in the first process of the second it's a it's just it's just a lot right now and i just want to make sure that i that i clearly state that that's where i'm coming from in this and so i i really appreciate what andre has pulled together and his staff um with mr kevin dick and i'm grateful that we're at this point but it's not it's not so much that that i don't think that we'll we'll get this wrong or we'll miss these folks it's really just that we're so far behind and this is pre-covid behind we haven't touched we haven't been able to reach those those businesses in a way that was impactful in this entire fiscal year and i want us to be as intentional about this now while we can and so that's exactly why i'm just like i mean the time and the money is the time is just now and i just want to be clear and saying that thank you i'll go back to the question i was asking which is is there anyone uh or i'll put it this way um the manager has recommended that we um spend this money that we do a quick evaluation on how it goes see what we need to tweak and then if we would like to put more money in that we can is there anyone that wants to offer a different position i'm mr mayor hi it's me charlie i'm on audio again because no problem things stink um yeah i do want to offer a contrary position um and that is that um that i think everyone on this call knows that a million dollars isn't going to be enough we should we should model our public policy around what we know um and we should if we don't allocate the two million dollars today we should say we know we've allocated a million dollars and we were prepared to allocate another million dollars um when this uh when this particular fund is exhausted that's what i think we should say okay other thoughts councilmember middleton thank you sir and then council and then mayor pro tem i i i think the manager's um recommendation is sensible i'm already on record saying that i support more money and i think we're going to have to get more money but i also realize you know our count there are other counties that got a zillion dollars in cares funding uh and we did not and and there's a lot of counties that are getting credit for doing stuff and they're not they're spending federal money not their money it's a million from us it's a million from the county it's a million from duty it's three million uh that's a start i but i'm also mindful that there's some other things that we're gonna have to address i am deeply concerned deeply concerned about the rising infection rates among our the latin eds community uh with kofi we may need to spend some money on ppe and and and stuff in that community coming up uh we still don't know what the price has had on the google terraces we still don't know what eviction rates are gonna look like uh and if we're gonna need to do more on eviction diversion relative to this uh pandemic so i want to give 10 million dollars to everything to everybody but i realized that we did not get the same federal help as other counties did um and as a as a policymaker i'm constrained by that and compelled that by that as a bleeding heart liberal i want to write a billion dollar check to everybody i'm for every cause um and i wear that print and i say that proudly um so i i think the manager's recommendation with the and i'm glad to hear that the county's come up with a million uh with three million going into this uh with this time until that's presented to us i'm comfortable with that and i will i will make a declaration right now publicly uh that i'm more than willing to revisit this and add another million uh at least um after uh we get this money out the door so i'm i'm going to uh affirm the the manager's recommendation at this point thank you councilmember councilmember caballero um i am comfortable with saying we're willing to dedicate another million i think that basically it'll be two million because hopefully the county's money will be ready at that point and so it's two million now and two million whenever whenever we just say we allocate it we're going to allocate it i should say and i we only have five million dollars we know we need so many more million dollars to do the relief that durham needs uh and there are going to be the list of needs as long and we just need to be um very careful right now mayor pro tem thank you mr mayor um i'm not comfortable with the um with adding another million to the pot at this time i think that we've spent a lot of time talking about small business relief and haven't spent as much time evaluating all the other needs that might exist in the community for this five million dollars so i'm reluctant to commit 40 of our total covid really fund to small business without having evaluated any other potential um needs that exist in the community i feel good about a million and the county and do coming in with a million and we may find that you know we think an additional million dollars for this is where this money can best be spent but i feel like we haven't really evaluated our options fully and i don't want to commit to something before i feel like i know what all of the um potential needs are that are on the table thank you madam mayor pro tem um i am hearing uh three people at least who are not ready to add another million and so i'm going to say that uh we're we're um since there are only six of us uh that that's where we're heading uh we're we'll we'll go with the manager's recommendation um i believe is what i'm hearing um i think we're all very clear that we're interested uh quite interested uh in the evaluation of the program a quick evaluation uh and to then see if we want to tweak it what we want to add to it but i think that that's uh the high i'll just consider that question uh settle are you comfortable with that councilmember race i will concur with you that it takes four votes to change the uh proposal and those don't exist to change the proposal thank you mr man thank you and mr man if i might say what gives me what gives me some some confidence and comfort the apparatus and and machinery for dispersing it will already be in place the relationship is already existed will be existing with the loan manager so it's not like we're gonna if we put that other money in it it'll be almost instantaneous the ability to get it out because we're doing the work of putting the machinery in place now so i do take some comfort in that that's not going to be months before if we add another million is going to get out the door the machinery is already in place so it will be in place thank you mr mayor thank you all right i see i see a couple of other issues that i want to define and um move towards some closure and decision making on one of them is the issue of the personal guarantee another is clarity around i just want to make sure that that i understand about the the uh business needing uh the food truck issue i'll call it and then the uh the idea of the lower interest rate for businesses who are not able to access capital on the uh on the private market uh so i'll start with the what i think what i think i understand about the about the uh the the businesses who are able to access this am i is it are we are we uh can can food trucks access this can businesses that have home offices access this am i to understand that that's right food trucks can but i believe that that uh home-based businesses would not okay and kevin just validate how it's being applied yeah kevin did you comment on that sure um the way andre just described it is how it's been administered thus far okay so colleagues are we comfortable with that that do we want food trucks to make sure that food trucks are included yeah okay thank you mr mayor mr mayor councilmember reek sure i uh it appears to be that kind of day for me um just will say that i don't i understand that there's going to be a lot of need that we have to be selective but i don't think it makes sense to exclude uh businesses that operate out of their own homes many larger businesses started that way uh and i don't think uh it's fair to exclude them but since everybody else raised their hands i'll stop talking now thank you i don't know that we've had a full discussion of that i'm happy to hear more um kevin do you would you all first of all councilmember cabillero and then we'll ask you kevin i thought we were taking it one by one so talking food trucks and then moving to home-based businesses uh okay i'm not comfortable um home-based businesses i'm sorry i mean say that again i am not comfortable excluding home-based businesses because i know that a lot of those businesses are sole proprietors and they are not getting and and they are um folks who who are having a hard time qualifying for unemployment and have a lot of barriers right now okay um kevin you want to talk to us about home-based businesses any reason that we should not include them uh again mr mayor and council i believe that that is a policy call um if you are interested in in sort of the place making aspects of business growth and business sustainability then you exclude home-based businesses but if that's not a priority you don't have to and we i think we'll just figure out a way to um to to verify all of the documentation um based on this this new element all right thank you kevin so i've heard two people voice their support for home-based businesses is uh mayor pro tem thank you i don't um i feel fine with including home-based businesses but i'm wondering about the grant maximum being related to the rent payment as an issue potentially if we're going to include home-based businesses yet it that's if i could just that's why i wanted to remove everything after ten thousand dollars in that bullet do you want to comment on that either kevin or andre the what what i would say is the mayor pro tem is correct i mean we we would have to find some of either find some other alternative threshold to a ten thousand dollar max or um go with what council member risa said and just make the max ten thousand dollars um you know that's that's a policy call i will say i will say this in raleigh the grant fund was eight hundred and fifty five thousand dollars um at a max of ten thousand dollars just flat you know everyone can receive basically ten thousand dollars and no real thresholds or or um documentation requirements that would evaluate an amount up to ten thousand dollars but everyone just getting ten thousand that would have meant that 85 businesses would have been funded uh and the program thus far 116 have been funded with that eight hundred and fifty five thousand dollars i just i'll offer that for perspective and nothing else the grant funds were stretched further by having a parameter somewhere between zero and ten thousand dollars but again that's a policy decision and we leave to you the um creation of the parameter that would apply to a home base business we'll figure something out sure we we can we didn't consider that we we would just take a look at it but again having a qualifier again is something that we would work on to try to solve all right okay colleagues and i'll uh i'll ask uh for a thumbs up if everybody could uh show me your thumbs if you're in favor of keeping into home base businesses i'm trying to get my thumb up okay i'm seeing a solid majority of thumbs i'll now move to the question of um lower interest rate for businesses who can't access capital in the private market what i heard um christus say was that uh there there is a potential exception for those businesses in terms of the interest rate they were able to offer i think we're all interested in offering his lower rate as we can um and so um how would that it could that be something that you all could operationalize kevin and andre either you all have any comments on that i will be so i'll be frank i i definitely would need to check back with my credit department and see what sort of administrative um concerns if any we would have there um it it i i can tell you it's probably more expedient to have the same interest rate for all of the businesses that qualify rather than having parallel underwriting guidelines that just it slows the process down but um you know it's something that we could look at i would say based upon the um the the request for and desires for urgency and a real you know somewhat finite time frame um relative to how to how soon businesses get funded i would recommend keeping a standard interest rate um again it's it's pretty competitive but um you know uh that we can we can i will at least commit to checking back with staff to see if it creates any constraints and mr. mayor if i can be clear i and i agree in terms of expediency not having two separate rates my um request was or my my inquiry was what is the absolute lowest rate we can have for everybody that does not run afoul of the law and as i've heard that from our our attorneys my understanding is that um that the what is here is at least very much in that ballpark it's prom just slightly below prom and attorneys feel that that that would that would meet the criteria and as i hear them that's because we can't be you know less than a market rate uh that that would be the reason that for that for that interest rate is that am i getting that right andra yes and uh that mr. mayor and council um you know we have to sort of put together negotiate this deal and a lot of these terms and conditions and so i think the the spirit of uh councilman councilmember millington is to make sure that we have got as close to the the right line as possible and again let us go back and and and see that and if if if in fact we can go lower our goal is to go as low as we can without you know causing any other thing so let us take another look at what was proposed and and come back as a part of it again we need to talk to underwriters and the market here we don't get to set the interest rate you know willy nilly so again we understand what the intent is give us the opportunity to go back quickly and find out what the limit is okay and that's all i want to know it's it's not only a spiritual question it's a math question what is the lowest we go without getting in trouble is it if it's if it's 2.75 or 2.5 or two i just like to know that number what that number is so thanks um other comments on the interest rate question are we all in agreement with the position put forth by councilmember millington i see some thumbs great okay i just want to say um about that you mentioned coming back i would just say uh let us know what it is yes yeah okay uh the last question that i have on my list uh is around the issue of a personal guarantee um i am very troubled by the idea of a personal guarantee and uh wondering what we need to require that uh mr mayor i don't know if you want to go ahead kevin i'll weigh in so mr mayor you know i think we're just we're cognizant that we are managing public funds and so the personal guarantee is the somewhat standard provision with many of the loan programs you see being administered around the state um i i'm not certain that there is an absolute requirement um i would want to confer with our credit department just to make sure and we can do that very quickly um but you know it's it's really a matter of um trying to you know we realize we have fiduciary responsibility with city funds and we we do want to make sure that um yes it's a fairly uh liberal loan package but we do want to make sure that funds get lent um responsibly and appropriately um other than that you know again absent any specific apprehension of our credit department um is certainly something we can consider if that's what you want us to do okay go ahead america i just add this i yeah you know many of the businesses that we are targeting um don't have strong credit facilities in some ways this loan is a credit facility that will enable those who are able to continue and be successful to get the next loan uh you're not going to be able to finance your business if you're successful on grants alone at some point you're going to need some form of financing and for many of the businesses that will be participating in our program uh this will be a term loan favorable that demonstrate their ability to pay and all that sort of stuff to connect them to the capital markets and again i think we should be mindful of that uh this is a a bridge loan or a facility uh that is getting them to the next level understood um i i'll just say i understand uh about our fiduciary responsibility um i'm also i i'm i don't like to predict this ahead of time but i am that we're going to have a high default rate if we're reaching the businesses that we really need to reach that we're going to have a very high default rate and a high default rate amongst businesses that are owned by people again if we reach the people that we want to reach are people without much resources um do we want to be taking a personal guarantee from them um that is my concern any other comments well why don't you check on that kevin let us know uh we'll do yeah all right um i think that that is all the questions that we had raised i think there are a couple of them that need um some more clarity uh but i think our direction for you needs to be go ahead do these things you know bring us the clarity uh but i see the manager and i bet you he has some advice well i don't miss samir but i want the clarity part was what i was going to ask you because uh i want to know you know from the direction uh that you know we would recommend give us the authority to move forward yeah and we meet again next wednesday and then we meet again on the 15th and i want to be sure i know you know in terms of moving this along what the expectations are if if you know there's there's still you feel like there's still another level of of council review that we need to come back to we can certainly do that but i also want to be sure everybody knows to what extent that may impact the schedule or not and i i don't know that answer i defer to andrew and kevin about the schedule you put up is conditioned on a go forward when well i i think we were considering a go forward today from council and then uh you know resolving some of the things that you talked about uh to me i understand the intent to try to come up with the most favorable terms interest rate credit requirements uh and if we have uh the authority to move forward and resolve those those issues um to the best of our ability and within the legal constraints uh i would hope we wouldn't have to come back to you guys if you essentially allow us to take your intent and you know push it to the limit uh that will allow us to keep moving and again we obviously will inform the city manager and council in terms of what the results are but we clearly understand the intent and you know i don't want to come back and have to say well we can only move it a quarter of a percent i'd rather move it to what that limit is and get the program going agreed um uh kevin i do have an answer for you um i've just heard we don't necessarily have any specific issue there is a path forward i would say to waving the personal guarantee if that's what you want to do that's my personal preference um i i guess i'll ask for thumbs i see a majority of thumbs can i ask a clarifying question about the program before we go much further the slide about eligibility says that businesses with revenue over 500 000 are eligible for grants businesses with revenue you know under 500 000 are eligible for grants over 500 000 are eligible for loans is the opposite also true that a business with under 500 000 is not eligible for a loan and a business over 500 000 is not eligible for a grant that's correct okay so they're meant to be exclusive categories that's correct okay great thank you all right i'm really working hard to draw this to a close here you guys and i want you to help me okay um if you don't have a super important question please don't ask it i am uh what i hear from uh uh from andre and from the manager is that they would like us to give approval to move ahead uh with a couple of unsettled questions and and and you heard that andre described to us that he the way in which he has heard our concerns on a couple of really not many one or two unsettled things uh so i'm going to ask the council uh i think we'll vote on this um i'll accept a motion that we move ahead that we authorize the administration to move ahead with this program uh on the time scheduled that they have that they have outlawed uh and and with the uh to contract uh with carolina small business fund to do this uh and that they using the million dollars that we put forward um the city to provide the administrative funding outside of that to support this work uh and that we hear back from the administration uh what they have decided on the couple of unsettled questions so move let's think we need to suspend the rules mr mayor thank you we do uh and i'll move to spend the rules on that purpose all right thank you to move to second that we suspend the rules and vote madame clerk will you please call the roll mere shul hi mere pro tem johnson hi councilmember caballero hi councilmember freeman hi councilmember middleton i vote yay councilmember riz hi thank you uh i put forward a motion councilmember freeman would you like to uh make that motion so moved second thank you was there a second second councilmember caballero thank you madam clerk will you please call the roll mere shul hi mere pro tem johnson hi councilmember caballero hi councilmember freeman hi councilmember middleton i vote yay councilmember riz hi thank you thank you thank you andre thank you kevin uh we appreciate you and hope you have the direction you need and we're looking forward to getting the money out the door uh i wish it was june but it's going to be in july and uh i think we'll be able to help a lot of businesses so thank you thank you for the support thank you now we'll move to uh our budget discussion colleagues i know everybody's been sitting here a long time uh we're going to go ahead and persist we're going to push through this uh if you need to turn your camera off and run to your refrigerator or stretch your legs please feel free no one will uh no one will question your dedication okay um i see uh our uh manager of a budget uh director bertha johnson here miss johnson welcome good afternoon mayor i'm barely coherent at this point i understand um bertha johnson director of budget and management services um this agenda item was created to provide answers to questions raised by city council during the budget work sessions on may 27th and 28th as well as questions we received subsequent to those meetings some of the responses we deem as information and some required decisions to finalize the budget i'm happy to go through the document or proceed as council wishes thank you very much um i apologize i just want to share that my my uh ipad is died so i can't see if there's the attached documents i just have the budget sheet so i'm just going to ask that you bear with me on this yeah no problem council member freeman do you want me to email you that document please we'll do right now um so uh we have in front of us the document this is item 49 that was provided item 49 i just want everybody to wrap their mind around that for a second um the presentation there which um no i'm sorry for item 48 apologize we have the document there the budget follow-up exhibit and then there's a separate one for the water management positions and so our objective here today uh we've got a budget to pass in a couple of weeks uh is to give the administration a little less than a couple of weeks uh is to give the administration very clear direction this is our time where there's something we want in or out of the budget uh this is our time to make that decision to have those discussions um and so uh i will so so there's a in the uh the memo that we received i guess i would not favor going through all of them because some of them are simply for example the police headquarters sale is simply an accounting of how much we're receiving for the sale of the police headquarters it's not really a budgetary item for budgetary consideration it's informational uh so um maybe what i will do and i'll ask my colleagues to help me i will go through this memo and pull out the items for discussion that i think uh are ones that we actually want to discuss if you all have another one that you want to discuss that you think i've missed let me know and then we'll go after we've done that we'll go to the water management question and then after that we'll take up any other budget issues that anyone else has and we go with that okay right javier is good with it and i'm good with it and so we're good with it okay everybody that's good too thank you uh the the first is the transportation position uh this is the this is on page one of 14 this is the business services manager uh and the transportation department described the reasons that they need that position so i think i'll ask now uh is there discussion of that position are there questions about that position um or any any concerns that anyone wants to raise at this point mayor pro temp thank you mr mayor um it looks like from this memo that the staff is now recommending to move all of the funding for that position into the parking and transit funds and out of the general fund um which would be a hundred and eleven thousand two hundred and sixty five dollars from the general fund that would be saved and that sounds good to me that's the way i read that too is that correct uh that is correct that is correct does that mean that that hundred and eleven thousand dollars could we could put it towards something else yes you could we would reduce the uh contribution in some of the area we would reduce the fund balance contribution to the general fund if we didn't put it to something else that is correct right thank you um the i'm going to say that the police headquarters sale is not an item that we need to consider uh the public works positions is the next item on the list mr mayor can we just on the police headquarters sale i just want to make clear again to the public that this money is not programmed into this year's budget thank you that's right it's it's in the general fund it's not oh did we moved to the affordable housing no it's just it's not anywhere because we are it's not on any budget at this point until the sale goes through but eventually the money will flow into the general fund and then the council can determine what to do with it at that point yeah right okay thank you there's nothing actually budgeted for it that's right i remember now thank you for that clarification by the mayor pro tem can i ask you would be helpful to direct it to the affordable housing fund now rather than wait if that's because i know that's been the issue around in the public it just really isn't the way the accounting rules would have the revenues flow since that's a sale of a city asset it needs to first flow through the general fund and then be reappropriated i just want to make sure that says thank you i but uh our understanding is it won't be allocated without coming back to the council we've been assured that by the administration that's right yeah thank you the public works positions uh but thank you madam mayor pro tem for remembering that the public works positions um is the next item uh there is a description of the public works positions and how they're going to be covered some from fee recovery and so forth um i'll just ask if there are people that want to discuss this one now i mean is there are there are councilmember cabrera and then mayor pro tem i just wanted to say thank you for doing the prioritization that i asked it's very helpful all right thank you so much mayor pro tem thank you mr mayor i was just i wasn't clear from this prioritization like of these positions of these top three are these general fund funded or are they cost recovery or are they um stormwater fund one one of the positions and one of the vehicles will be funded by the stormwater fund one of the positions by development fees and one of the positions and a vehicle in the general fund okay so that that's the that's the current proposal yes that is okay move from the six positions to the three positions okay thank you and what how much does that save us in the general fund it's about five hundred and four hundred and seventy five thousand okay thank you i'm sorry mr manager go ahead now we'll get councilmember i apologize i just wanted to clarify were was there revenues associated with the positions that were those other three positions that weren't uh recommended there were revenues associated with one of those positions i believe that amount was a hundred and thirty five thousand so the net of that would be because those revenues are programmed and the net of that compared to the four hundred and seventy five thousand would be so the number you you gave was was a net number not the it it took into account the revenues that we wouldn't receive or whatever well not necessarily but that is the amount they associated with with that okay all right thank you it all depends on of course the development fees that come in right thank you thank you councilor milton thank you mr mayor i just wanted to confirm these three positions listed are directly linked to us um being regulatory compliant is that correct those those those were not those three positions the question was um if they if they would get three positions versus six which positions three positions what they prioritize i'm looking i gotta get this coffee me quicker i'm looking at the wrong i got you yeah i got you thank you i'm sorry thank you mr mayor no worries it's late um any more questions or comments on the public works positions uh furlough part-time employees any comments on the or questions on the furlough part-time employees uh item i just want to thank the staff for this i had to ask for this detail breakdown my thanks to the staff for just very helpful thank you uh the next item is not really a budget item so much it's uh it's the it's a re um an imaging of the engagement matrix that was asked for um this i know that's not a budget it it isn't it isn't a budget item but it's something that i do think whether the council provides that feedback as a part of adopting the budget or at some point we do need to have clarity around uh uh expectations around the engagement of those programs whether they should continue virtually or um in some cases be you know be suspended whatever until we can get back physically so mr manager um i don't think we're gonna do that tonight i understand are you good with that yes i just want to remind you that you know it is something that we need to have some determination from the council acknowledging it's not necessarily a budget adoption uh limitation so um can i ask that you i mean perhaps we could put this on one of the upcoming special meetings we could or we could wait till august if you'd prefer but um you know can i ask there is it i'm recognizing that there's budgetary programming plan around some of these areas the ones that are in the non non urgent non non mandatory section is it possible that we we set um some like parameter around i guess where the budget is so that it's tied and it kind of puts it on a hold so to speak so recognizing that we know we might not know right now that we're going to have a budget shortfall based on the sales sales tax or whatever tax that's coming in is there is it possible to set like some parameter that says that the non urgent like as a council as a non urgent non non mandatory items could be held um until we you know we've established where we are kind of financially that would be your decision so i think what we'll do is we'll wait till this comes back to us and we could we could figure out how to handle that then okay and we'll take it up on your timeline mr manager thank you uh the next item is engagement public art this is also not really a budgetary item so much uh as it is a question of how people are being engaged around this um any questions or comments on that if not we'll move to community development and this is information on the long-time homeowner grant program we have approved the uh at our last meeting we voted to continue the current program and this is information about that we're going to we're going to look at the water management separately in a moment because there's a separate memo on that uh then there's the city of Durham fte's and uh this was a question about the um the fte's positions added uh in the budget uh and there's a listing of the of the positions and how they're being paid for so questions about that comments anybody okay um then there's the police department reconciliation um this is uh it's a it's a uh comparison of actual adopted estimated and proposed budgets uh as you can see there uh i'll any any questions or comments about that at this point mayor pro tem thank you mr mayor i think we just i think we need to just be clear about what's in the police department budget and what's changed from last year because there are a lot of ideas flying around about how we're increasing the budget what the money is going for i've heard a wide variety of of wrong information about what's going in the budget so i just want to take a minute and clarify for the public why the budget's going up what's in it this year that's not in it last year i agree i agree that's important thank you thanks i'm happy to walk through the the large pieces of the the dollars that change from year to year um the biggest component of that is nine hundred and forty six thousand dollars for the community or an policing grant um in december 2016 uh city council adopted the grant project ordinance for this grant which required um a six hundred thousand dollars match and it funded 15 positions those positions have been uh will be absorbed into the general fund and that again that amount is nine hundred and forty six thousand uh three hundred and thirty one thousand is the additional amount needed to fund the six positions that the council adopted to add to the gain unit not eight hundred and twenty nine thousand of that amount is for the state retirement which is required which we have no control over that number um an additional six hundred and sixty seven thousand is included in grants and you can see the grant amount changing and that is for the CARES grant that the police department received for PPE so the other is a net of reductions and and benefits as reduction in the cost of benefits based on individual employees choices and the additional cost needed to annualize the pay increases in the current fiscal year police officers receive their pay increases on their anniversary date of hire and so in that particular year they may only receive you know um they will receive typically less than 12 months of that increase but the next year you have to full you have to fund a hundred percent of that increase and so those are the major components of of the three million dollars thank you thank you i want to thank uh mayor pro tem for asking the question i also have been hearing completely wild ideas around what the increases were around thank you i would like to point out that those numbers are on the previous page on page um on the subsequent page page 10 those numbers also there as well the only other thing i wanted to add mr. mayor real quick is we had someone at our budget hearing money and i suggest that this budget included um funding for seven new fte's in the police department budget that's why i asked for the specifically for the head count reconciliation that's the bottom of page 10 as you can see that's not accurate um the two from from last year's budget to the current budget um the the head count um increases two because of the what we approved last year but didn't get hired until this year um and the two grant positions and then the six positions that we approved mid-year and so that's how we get up to 681 just wanted to clarify that with everybody thank you council member thanks everybody for your attention to that any other are there any other questions or comments about this item okay thank you well now i'll move to um the next uh there's an attachment on page 11 comparing the the uh race of a department and a staff with the race of uh the people who were furloughed by department any comments or questions on that i just want to say thank you to staff for for making that available thank you council member and then also um there is a breakout uh on page 12 and 13 of the um these are the furloughed employees and their average hours worked kind of by position is that a fair description bertha that's correct any questions or comments about that thank you for that information i have two questions sure just regarding the bus drivers and the facility um i think it's facility attendants all right is anyone like keeping an eye on these facilities now like is there is there no way to bring some of those hours back online just as a matter of like i'm i'm just looking at it like there's there could be something i think i think some of them actually have already been brought online i don't know bow can answer that or anybody else from dpr that may be on the call uh i am i'll need to check with dpr to get an answer on that i believe the facility attendants are only for rental facilities those are really uh positions and i'll correct this if i get this wrong but that are just on site when a rental is taking place they're not necessarily people who tend to the facilities like maintenance technicians or custodial uh so they really are but where we where we have facilities that have open gates locked and unlock those kinds of things those attendants those are those folks are back working like the lakes and some places like that i'm thinking specifically lines part where there's an attendant that has folks sign in and sign out that is a uh not a city employee okay that's a uh um but those types of attendance would be like all the attendance that we have are you're saying are back to work well no we're i'm just saying we're in some cases they are where we have facilities that have opened that have attendance that need to lock and unlock gates and those kinds of things but as as mr. ferks indicated there may be rental facilities that are currently not available for rent so if there is an attendant associated with that facility they would not be back to work yet but once those facilities are available they will be right bo yes and i'll get some clarity from joy and provide that uh after the fact you know my read of this list is it's like first pine lodge and the armory facilities where we only provide staff during the road but i'll clarify it and people peed on Beverly i'll clarify and get an answer back and i just just another just quick question uh i'm a i'm assuming that this is this is including that there's no programming until the july time frame for any of our rental facilities uh that you know unless they are able to operate under the mass gathering restrictions we have right now and that that really rules out all of our facilities so at this time until the mass gathering limits go up we're not anticipating restoring any of our facility rentals thank you bo any more questions or comments on that okay now we'll move to the water management memo which is a separate memo and it's a description of the positions uh the positions related to customer service uh the um positions related to regulatory compliance and then financial information about those positions and also about the rate uh the rate uh the effect on the rate for each of the tiers um and so i'll ask are the questions or comments by members of the council on this um on this item i see mr grily good afternoon your mayor pro 10 members of council don grily water management good afternoon don um council members questions or comments for don at this point council member middleton yeah mr mayor actually i hi don how you doing man good good evening um we um the last the very last phase 14 department of water management vacancies i had asked for that information and it kind of informs my next question what is what is the possibility uh bertha of uh using some of these lines uh for the positions that the water uh management folk want now and then back filling them at some later date is that a possibility um um probably for not all 11 a lot of them are technical in nature and you know certainly as an example we have two engineering positions that have been vacant for an extended period of time and as soon as we got a candidate we would like to to bring those on because those certainly help with our projects and also help with development review um a number of these positions are very technical in nature or fill out crews that we've been trying to shortfall so it would they would affect operations i'm just talking about the money i'm i'm talking about just taking the money from those lines not the not swapping out the actual job descriptions i know that mr mayor when we when we uh uh brought on your assistant amber i believe we used a position from another place in the or chart and then backfilled it uh or will backfill it at some point it may have already been backfilled is that not an option for us um with respect to the positions that water management's asking for now money wise i'm not talking about the job description i'll defer to bertha but overall the when they um budgeting this year they they do budget a certain percentage of vacancy um so our budget is reduced on the personnel side based on the the um vacancy rates that we've participated in but i'll defer to bertha and how we how that's done so we have um unfunded positions but leave the positions authorized and then ask the department we've done that in police and other departments where we asked the departments to come back to us to request those positions to backfill those positions if needed and so that is a possibility we we've done it and we and we can do it where we unfund positions we've done it in planning and inspections and other departments and departments come back to us and make the request and we have them fill the positions based on their prioritization based on the money that's left so if the 11 positions um if they wanted to fill those positions or these positions but we can unfund um or take a sum of money out of the budget so don here's where i am i'm i'm compelled on the three positions that will keep us regular uh in regulatory compliance and i think you made a case for them being mission critical um beyond those three i would be i'd be open uh to considering them using the uh the mechanisms that bertha just described uh perhaps and i you know i'm certainly open to hearing what my colleagues say but that that's where i am on that right now thank you councilmember camayano yeah i was just curious i'm i thought i had sent an email asking prait for prioritization how solid works had provided that and i sent that email on monday night uh just it helps me you know understand out of the 11 i know three are regulatory i understand that there may be need for more out of the 11 uh and so i was just curious if if and maybe i'm just missing it okay in the table on page four yeah um those are in priority order thank you i appreciate that yeah because the top three are regulatory related so they're their first three and just a question i'm sorry is it common practice that when you bring on the staff member they get a new truck um for these those four positions are all field positions related to meter reading and they operate as by themselves so they drive a truck councilmember capi ghetto um and i would so well just to follow up councilmember freeman's question part partly i would think that with covet having folks in their own vehicles is also a priority that um i can imagine right now is is is large and then just out of curiosity the offline research and resolution team there's four uh can you do that with half of those positions instead of four two or is it one of those things where if you're not going to have all four it's just not uh effective um it becomes less effective you know originally the request was for a much larger team that we reduced the four okay so any reductions the team just becomes less effective right so then why spend that money yeah and i'd like to comment on that that's one area that i do have pretty significant concern as we know uh we have been under um no utility turnoff since i think march is that correct don yes and uh that order from the governor has been extended all the way to the end of july now so we will end up with about maybe five months worth of uh um payments that have not been made in many cases the i think we were up to two or three thousand customers uh that are in that in that world 3300 what is it 3300 over 3300 and so and it's growing and when when that changes uh there is going to need to be considerable staff capacity to engage those customers in workout plans we you know we obviously there there are a lot of touches are required to work through payment plans with customers unlike just a typical water turnoff or turn on or some bill dispute that these these individuals might be working with on a routine basis we know that there is going to be a considerable workload that is going to have to be required at some point when the you know that that directive is discontinued and i am concerned that if we just rely on temporary employees to to do that or don't have any employees to do that there's there's going to be a significant increase in hold time wait time backlog and in essence you know we don't want to be just discontinuing service for non-payment if we haven't had the time to to work through payment plans with customers and i don't know if you want to have any more comment about that or comment about how that that number appears to be growing and and what that revenue side looks like but it isn't something that we can just write that revenue off no i think uh your comments were we're right on the mark i mean currently out of the uh we're out 973 thousand dollars right now in revenue um 35 percent of that is uh non-residential um so out of the uh 3300 accounts uh 2,900 over 2,900 a residential account so they account for almost 89 of the customers that will have to deal with our residential customers thank you i appreciate you all clarifying that for me uh and then i have one last question when i'm looking at that same table what is the it's the AMR collection staff and includes is that is those are those the meter positions you were discussing earlier with the trucks is that the same uh well there's two positions that actually do the turn on the turn offs the meter data collection that's the billing field staff um and then the the AMR collection staff is related more to the back billing issues to make sure that we collect um all of our meter readings so we don't do any bill estimation thank you thanks thank you for your good questions mayor pro tem thank you mr mayor um i feel comfortable with adding these 11 positions the increase you know the difference in the increase in the rate is pretty small in terms of what people actually have to pay um but i am concerned about the the issues that we're going to face when the disconnection moratorium is um is suspended and wanted to um get some legal advice from our city attorney about what our options are um with regard to like payment plans and the length of time we can give people to pay and how long we can you know can we not disconnect water indefinitely even if people don't pay um kim can you give us some general guidelines my goal is everyone gets water so like how can we what what are what are ways we can act within our legal constraints to get to that place right so this kind of goes back to a conversation we had about a year ago um so you know we can't just wave all of the back charges um we can implement payment plans for folks um historically we have um but in terms of this special circumstance of coming out of the moratorium this is new territory for us and so i would mayor pro tem like to do some research on that specifically i don't believe that the various orders and in any you know directives that have been passed recently address exactly how cities can get kind of back on um solid footing and keep utilities on for folks and not ever burden the system but i'd like to have some time to research that issue specifically and perhaps get back to you all with some more specific um thoughts on that that would be great thank you i will do that i would like to add you know we do have the hardship fund that will assist with customers in the past when we've had um on very unusual situations we've been very lenient with our payment plans um you know typically we try to very short you know anywhere from two to four months at most but considering the circumstances and we're going to work with our customers to um you know keep them in water extend it out um as long as we can come to a reasonable um uh decision or agreement that we can move forward is as uh mr scott mentioned earlier with the um history marks during that housing authority discussions um you know we want to work with our customers and we want to make sure that we can keep them in water and have terms that work well for them and work for us as well thank you um yeah that's a priority for me i think it's a priority for all of us especially given that the pandemic is still ongoing and the you know it's unlikely that the shutoff moratoriums are going to last until the end of the pandemic but it's still really important that people be able to access water you know it's important all the time but it's especially important now um so i appreciate y'all prioritizing um keeping folks water on thank you thank you councilmember freeman and then councilmember race thank you i was having fun with my hand disappearing i'm sorry i got you i see the pencil you're good i i i appreciate um mayor pro tem's question and i long those lines i was going to ask about i know we talked to him talked about not looking at other areas that we could have impact with the covid funding that we put aside and if you it would be nice to know if there was a number around those 3300 customers um that currently for residential um it's six hundred residential it's six hundred and twenty eight thousand dollars a little over that and for non-residential it's uh three hundred and forty five thousand dollars rounding off three hundred and forty three hundred and forty five thousand so about nine sixty eight about a million dollars is what you're saying yeah it says short of a million dollars and just just acknowledging that if it were if it were something that we could look at as we have future conversations around uh what other assistance we're willing to offer i would be willing