Saint Paul Mayor Chris Coleman on July 20 introduces the Central Corridor Funders Collaborative, an initiative designed to help business owners prepare for light rail transit. He is joined by Metro Council Chair Peter Bell, left, Minneapolis Mayor R.T. Rybak, center, and Mike Hatzistamoulos, business owner. (AAP photo)
AAP staff report
ST. PAUL (July 20, 2010) – Metropolitan Council Chairman Peter Bell, Saint Paul Mayor Chris Coleman and Minneapolis Mayor R.T. Rybak, gathered with area business owners along the Central Corridor Tuesday on University Avenue near Dale Street, to introduce the “Ready for Rail” initiative that they said would help strengthen the small businesses currently operating along the route.
The initiative (www.readyforrail.net) is a coalition of public, private and nonprofit groups that together provide tools to help businesses survive during the construction of the Central Corridor LRT line-and thrive after LRT begins passenger service in 2014.
Its sponsor, the Central Corridor Business Resources Collaborative, brings business organizations, nonprofit community developers, local governments and the Metropolitan Council together to coordinate community-led planning efforts addressing business and economic development.
The Business Resources Collaborative is a coordinating body, and not itself an organization that directly provides services. Partners have created new programs that address marketing and financial challenges that businesses may face during the construction phase. The initiative identifies existing resources and services available and helps help businesses and property owners utilize them to get ready for rail.
“The businesses in this corridor are here today because of the passion and hard work of their owners,” said Coleman. “In the face of this major construction project, they may need help expanding their marketing in order to keep their cash registers full.
“So our immediate focus has been on helping business owners prepare for their construction season – and on reminding the wider community that this is a good time to get to know University Avenue and its many terrific places to eat and shop.”
Highlighted resources and services available are free or low cost business consulting on accounting, bookkeeping, marketing, retail management, merchandising, and business and financial planning.
It is offering financial assistance for working capital, building improvements, energy efficiency measures, and real estate acquisition such as below-market loans and matching grants.
The Small Business Loan Fund program to be administered by the city of St. Paul is intended to help small businesses that prepare for construction but are still adversely affected by it. The plan grew out of initial discussions with the Asian Economic Development Association and input from business groups concerned about surviving the construction period.
The loan fund is created with contributions of $1 million from the Metropolitan Council and $500,000 from the Central Corridor Funders Collaborative. The goal is to provide $6,000 loans to 250 businesses.
The loan program is targeted at small businesses with less than $2 million in annual gross sales. It provides an incentive to prepare by offering a safety net in the form of a zero-interest, delayed loan to qualified businesses.
To qualify an applicant must be an independent, for-profit business that is already operating on the Central Corridor line for one year or more. They must also complete “Ready for Rail” training prior to construction.
“Because they helped create the unique character of the corridor, we want these independent businesses to thrive and enjoy the opportunities that will follow our $1 billion public investment in the Central Corridor Line,” said Bell. “This small business loan program offers a safety net for those owners who did everything they could and are still threatened by a construction-related financial loss.”
Va-Megn Thoj, executive director, AEDA, said the primary role of the nonprofit organization is to serve small businesses. In this role, AEDA staff conduct outreach to corridor businesses about the resources and services available to them.
“AEDA is here for small business and we will go out there to inform businesses about this fund and other business programs available to them right now,” he said.
Thoj said that he would inform businesses about the zero interest loan initiative, along with the Ready for Rail workshop meetings. He is pleased about the loan programs, but said it would be easier to talk to owners about grants and forgivable loans.
“The $1.5 million in loans is a good start, but it is not enough to mitigate losses that they will lose during the construction of LRT,” said Thoj. “It is not enough. It is a drop in the bucket and will not meet the needs of business.”
Some Asian businesses along the corridor are not pleased with the idea of taking on extra debt and the idea of adding to it with loans is not appealing to everyone.
One restaurant owner who did not want to be named said he was going to close prior to construction rather than have to go through all the trouble of trying to keep the business going.
Others say that since LRT is coming, the time has come to try to work and benefit from the new transportation resource.
“We were against it at first, but now that its going to go through we are fine with it,” said Ericka, manager of Ahn’s Hair Stylist at 397 University Avenue. “Whatever programs can help us we would like to be included in because we can’t stop it.”
Ericka said the family owned business started 21 years ago on University and moved to its present location 17 years ago. She said they have customers who take the bus and so hope the train will be another convenient transportation resource – especially since there will be a stop on Western Avenue near their salon.
“Our Biggest concern is the construction part,” she said. “Afterward it will probably be a good thing.”
Ericka credits both AEDA and the Metro Council’s Central Corridor LRT outreach coordinators as people they can call to ask questions and get an accurate reply.
She said that so far, the outreach people have helped them reutilize space in back for a parking lot to replace the street parking that will be lost to LRT.
Hue Pham handles the outreach for the Snelling and Lexington area. She can be reached at 651-602-1559 or [email protected]. Shoua Lee is the outreach coordinator for the Dale, Rice, and Capitol East area and speaks Hmong and English. She can be reached at 651-602-1014 or [email protected].