By Shereen Siewert
Control of more than 70 percent of Wausau’s funding from the Coronavirus Aid, Relief, and Economic Security (CARES) Act could go to MCDEVCO, a request members of the Wausau City Council will review on Tuesday.
Wausau in April was awarded $371,608 in CARES Act funding, money intended to assist the city’s small businesses and households hardest hit by the pandemic. An additional $100,000 was reallocated from the city’s homeowner rehabilitation revolving loan funds for the initiative.
MCDEVCO, a nonprofit with a mission of promoting civic and social improvements in Marathon County, initially requested $330,000 for distribution to businesses with 20 or fewer employees that apply for the funds. The city’s finance committee is recommending $336,804 for MCDEVCO, which will also receive a portion of the $70,000 allocated to Community Development for “administrative costs.”
Dist. 3 Alderman Tom Kilian said he is concerned that smaller businesses – some that are hurting the most – could be left out, given that the employee cap is set at 20. Several other municipalities in Wisconsin including Sheboygan, for example, have targeted businesses with five or fewer employees.
Mayor Katie Rosenberg said Kilian’s concern is an important one.
“We have a lot of microbusinesses in Wausau and a grants like this could be a real boost,” Rosenberg said. “The council will have the opportunity to talk through those concerns tonight and possibly change the criteria.”
MCDEVCO would use the money for micro-grants and forgivable loans. During an April 30 Community Development Citizens Advisory Committee meeting, MCDEVCO Executive Director Vicki Resch said 70 businesses could apply for $1,500 grants, while the forgivable loan fund would allow businesses to apply for loans of up to $20,000. The loans would be forgiven if one low- to moderate-income full-time employee was hired or reinstated for every $5,000 received.
The organization already has a spreadsheet of 70 businesses that will contacted MCDEVCO for funding assistance, MCDEVCO’s application stated. Those businesses would be contacted when funding becomes available, according to the city documents.
Kilian said he is deeply concerned that eligible Wausau businesses may be left out of the process altogether if MCDEVCO issues the funds on a first-come, first-served basis, as originally proposed.
Kilian suggested MCDEVCO use a lottery system instead.
Rosenberg said MCDEVCO could move to a lottery system, which is possible from a legal standpoint and a strategy other organizations have adopted.
“It will cause a delay in the release of funds but if the policy body would rather see a lottery system, they can have that debate and amend the program,” Rosenberg said.
Kilian is also questioning why $70,000 of the funding is necessary for administrative fees – money that will be shared with MCDEVCO for operation of the grant and loan program.
During the city’s May 14 Finance Committee Meeting, Lisa Rasmussen, who represents Dist. 7, also questioned the administrative fees, asking why any of the funding would be allocated to administration when the 2020 staffing budget is already taken care of. During the meeting, Rasmussen said she felt all the money should flow to the community.
But Wausau Community Development Manager Tammy Stratz told Rasmussen said that the department would see costs related to advertising and running the program. The amount requested is 18.8 percent of the overall allocation, under the 20 percent limit allowed, Stratz said. That funding will be shared with MCDEVCO for overhead and advertising.
Rosenberg said she would like to explore programs in other communities if given the opportunity.
“I especially like Green Bay’s conservation corps concept and Madison’s farmers and food pantries partnership,” Rosenberg said. “We will have more opportunities to think creatively and transformationally about CDBG funding. I know that council members, staff members, and the community are up for the challenge.”
MCDEVCO has been the city’s loan administrator for CDBG funds for more than 40 years, the organization noted.
Also under consideration: funding for the North Central Community Action Program, which would receive $68,804, if the proposal is approved on Tuesday. The organization had initially applied for $58,000 for rent and mortgage payments to help low income residents threatened with eviction because of losing employment during the COVID-19 pandemic. The estimated number of clients served with the initial request was 48 households.
The City Council will discuss the requests during the group’s regularly scheduled meeting at 6:30 p.m. Tuesday, May 26 at City Hall, 407 Grant St., Wausau. Members of the public can attend in person, subject to social distancing rules of maintaining at least 6 feet apart from other attendees, or by calling 1-408-418-9388. The Access Code is 963 405 089. Password: EfMf4MgPf33
Find the full meeting packet here.