Lincoln City Councilors decided to put a list of priorities created last year on hold during Monday’s video conference meeting in favor of addressing the COVID-19 situation and what they could do to help beleaguered businesses.
The City of Lincoln City discussed a means test where businesses could show how the coronavirus pandemic has impacted them so the City could gather information on how to best proceed with a relief program to be further discussed and possibly voted on April 27.
Stories of businesses struggling to survive are circulating throughout Lincoln City with some adapting to the global emergency with online ordering and makeshift drive-thrus. Businesses who once never dreamed of delivering food are now forced to figure out the logistics of such an operation that has become the norm.
With the government shutdown of most businesses in Oregon, coastal proprietors have done about all they can without outside help. Help is being deployed by the federal government by way of the Paycheck Protection Program, Economic Impact Payments and the CARES Act.
Lincoln City officials discussed means testing, where business owners could tell the City how they have been affected by the government shutdown and what they need to survive. No word was given on how this would play out and some officials suggested applications or online forms. A sub-committee will be created — which may include Lincoln City Chamber of Commerce Executive Director Lori Arce-Torres — and will come back April 27 with more information and details.
Arce-Torres sent a letter to City Manager Ron Chandler, who included the letter in the council’s agenda packet. In the letter, Arce-Torres showed how the City of Beaverton created an Emergency Business Assistance Program which is giving applicants grants up to $2,500 per establishment to help with commercial rent or mortgage payments.
From Arce-Torres’ letter:
Dear Mayor Anderson and Members of the City Council,
Thank you for your time and consideration,
The Lincoln City Chamber has been writing letters and sending personal stories of how COVID-19 has affected local businesses here in Lincoln City. The letters and personal stories have been sent to the Coronavirus Economic Advisory Committee organized by Gov. Brown. The information has been requested to help determine the need, and I don’t want our businesses to be forgotten in the process. I feel like it is making a difference as they have responded to my emails and are keeping me up-to-date as the committees meets and needs additional information. I’ve also attached the letter sent from the Chamber as a collective voice.
The Chamber has been actively working to organize a much needed Take/Out Delivery list which also includes Retail Businesses that are remaining open for business. Our social media platforms have been very active in sharing this information reaching a vast number of users. We’ve also added a COVID-19 link to our website that is updated daily.
The Chamber office will remain open as long as possible to offer the much needed “Visitor Center” information as well as fielding the many phone calls from our locals and tourists with a variety of questions and needs. Rest assured that we are diligently cleaning the office to try and keep everyone safe.
I know you are all working hard to find solutions locally for our businesses but I wanted to speak to you directly on behalf of our business community whether they are Chamber Members or not.
Buying Gift Cards with TRT money to support local businesses is a short term fix, however if we don’t offer immediate assistance, those businesses will NOT be open to honor the gift cards in the future.
As I know you are aware, the situation that we find ourselves in is a dire one. I’m hearing from businesses that they either cannot pay their bills, or in one case, had already paid his bills and now his account is in a deficit. They need help and they need it now!
We are in unprecedented times and need to take action to ensure our local businesses and economy can recover from this crisis. I’m asking you to consider an Emergency Business Assistance Program similar to the one recently implemented by the city of Beaverton referenced below:
From the official council communication in the city council agenda packet:
COVID-19 Potential Aid
The City has received one or more request for financial assistance in the following areas. Grants or loans to businesses through an emergency business assistance program.
Beaverton provides up to $2,500 and uses a means test of 50 employees or less. The business must be directly affected by the mandatory service changes and national chains are excluded. Lincoln City has issued 2,618 occupational tax permits. 2,604 have 50 employees or less. It is unknown how many are directly affected by the COVID-19 emergency. Using the Beaverton model, the potential financial impact = $6,510,000.
Implement a “non-shutoff” policy for Lincoln City utility bills during emergency.
This is in place
Waive late fees for delinquent Lincoln City utility bills during the emergency.
This is in place.
Defer or waive City utility bills.
During the summer the average, monthly water & sewer revenue is approximately $725,000. The average monthly water & sewer revenue for the year is approximately $656,000. The fund balance in the water and sewer funds is insufficient to carry this cost and still meet cash flow. Using general fund balance would be necessary to cover this cost.
Estimated monthly deferred or waived revenue = $725,000
Defer or waive payments for City property that is leased.
The City leases seven properties – the Lincoln City Cultural Center, Career Tech, BFEY, Mckay’s Markets, Salmon Drift Creek Watershed Council, North Pacific (Mo’s land lease) and the Lincoln City Glass Center. The estimated monthly revenue from all leases is approximately $21,515.
Estimated monthly deferred or waived revenue = $21,515.
Defer or waive Urban Renewal improvement loans.
Urban Renewal has twelve outstanding Urban Renewal loans with a total outstanding, balance of $422,994. The total monthly payment for all loans is approximately = $7,400.
Estimated monthly deferred or waived revenue = $7,400
Defer or waive the TRT quarterly tax payment.
The next quarterly tax payment is due on April 15th. The City was asked to defer, delay or waive the TRT payment. This would improve cash flow due to the loss of revenue from spring break. The estimated monthly TRT revenue is approximately $635,000.
Estimated monthly deferred or waived revenue = $635,000
Reallocation of grant funds to support non-profit organizations. Cultural Center – use of grant funds.
Included is a letter of request from the Lincoln City Cultural Center. The City budgeted $200,000.
Estimated monthly deferred or waived revenue = $200,000.
Recovery loans – childcare.
Federal Assistance for childcare. The federal legislation provides $3.5 billion in emergency funding to child care providers. These funds can be used for payroll, healthcare, emergency, and sanitation.
It’s unknown the extent of financial commitment requested of the City.
City’s Financial Condition
The City is losing an estimated $635,000 in TRT revenue for each month the hotels, motels & VRDs are closed. The staff delayed or cut approximately $1,800,000 in the FY 2020 budget to offset the loss of revenue if the lodging industry remain closed for this quarter.
The Community Center is losing approximately $35,000 for each month it is closed.
The daily water and sewer processing is down by approximately 40%. We won’t know the full financial impact of this reduction until after the next billing cycle.
The fund balance for the general fund is $2,000,000 contingency and $6,059,630 unappropriated. The City used $300,460 of the GF contingency for the PERS pay down program. The $350,000 rehabilitation loan for 3454 NE Hwy 101 will come from the GF contingency. The City requires approximately $3,000,000 in reserve for cash flow due to the timing of property tax revenue.