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Grants Ignite Uproar

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By LAURA KINSLER

lkinsler@tampatrib.com

Published: November 1, 2008

ZEPHYRHILLS - The city's new grant program designed to bring more business downtown is drawing criticism about its fairness and timing.

One business owner said the program helped drive him out of business.

George Hill, owner of Java Delights, closed his coffee shop Thursday, two weeks after the Zephyrhills City Council awarded a grant to a new coffee shop on Fifth Street. Hill said the city gave his competitor, Thanks A Latte Cafe, an unfair advantage when it agreed to subsidize half its rent for a year.

"I was voted best coffeehouse in Pasco this year, and now I'm closing my business," Hill said. "If I'd gotten the same rent subsidy, I could have stayed open."

The city awarded two community redevelopment grants Oct. 6 without a formal application process or criteria for eligibility. Hill met with city officials the following day and requested a similar subsidy, but was denied because his business has been open for more than year.

Todd Vande Berg, the city's development director, said the grants should be available only to new retailers and restaurants to bring more foot traffic to the community redevelopment district. The city has a $500,000 reserve for improvements in the district, money collected from property owners within the redevelopment area.

At the Oct. 6 meeting, Council President Luis Lopez questioned whether is was fair for the city to choose who should be eligible, but Vande Berg said the program was based on similar grant programs in other communities.

Recipient Getting Criticism

Tena Dooling, owner of Thanks A Latte Cafe, said she's sorry to see Java Delights close.

"But I didn't drive him out of business," she said. "I've only been open two months."

And the grant money comes with stipulations, including a provision that Dooling make her business records available for public review. She said she has received a lot of criticism because the details of the program were never presented to city council.
Vande Berg said the grant is a reimbursement for money Dooling spends to advertise or grow her business. The city will reimburse as much as $500 a month for a year, but the money goes to her landlord.

The council also awarded a $7,525 grant to business owner Marcus Price to pay half the cost of a sprinkler system for a Fifth Avenue clothing store. Vande Berg recommended awarding the grant even though he knew nothing about the business, other than who the owner was.

Price isn't a first-time business owner. He's the founder and chief executive officer of Goin' Postal, a mail shipping business that has more than 300 franchises. Each franchisee paid his company a $15,000 start-up fee, and the company brings in about $90,000 a month in royalties.

"This individual can afford to pay for his own sprinkler system," Hill said.

Price and his wife, M.J., own multiple properties in Zephyrhills worth more than $1.2 million. Two of the buildings are inside the city's redevelopment district, but the couple bought them this year so they have never paid into the fund. They did not return phone calls for this story.
Dooling said she still hasn't signed the paperwork for her grant - and she may never.

"All of my marketing plans and financials would become public record," she said. "From a business perspective, that may not be worth $500 a month."

Grants There For The Asking
Vande Berg said he has received complaints about the grants, which are intended to lure retail businesses downtown. They aren't need-based, and the first two recipients were selected for one reason: They asked.

"They approached the city to see if there was any kind of grant or other assistance we could provide," Vande Berg said.

There was precedent, too. The city approved a grant this year for another business in the district, Healing Hands, to install a sprinkler system in its clinic. It never went through with the renovation, so the money was never awarded.

The city already has invested heavily in Price's building.

In 2007, the city spent $55,000 for facade improvements to the Goin' Postal store and neighboring business. Beverly Jones, the city's grant administrator, said the money paid for a new door, paint and a balcony. It was one of six buildings to win facade grants, totaling more than $100,000.

The previous owners, Arthur and Patricia Besinger, applied for the community development block grant in 2001. They received $40,000; the project came in over budget, so the city contributed an additional $15,000 from its CRA account.

The Besingers paid $4,000 in matching funds for the improvements. They sold the building to the Prices a few months after completing the renovations. When the building sold, the new owner was responsible for installing the sprinkler system to meet the city's fire code.

"These investments are made so that the downtown can come back to life," Jones said. "People have a stake in their downtown, whether they realize it or not."

Zephyrhills's CRA district encompasses part of the downtown historic district. It runs for 10 blocks along Seventh Street East, from 11th Avenue to Second Avenue, and is bordered to the west by Zephyr Lake and 10th Street to the east.

Reporter Laura Kinsler can be reached at (813) 865-4844. Keyword: Grants to view a photo gallery.

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