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CLEARWATER — Clearwater is looking to join some other Pinellas County cities seeking to throw small businesses affected by the COVID-19 pandemic a lifeline in the form of a grant.

Denise Sanderson, director of the city’s Economic Development and Housing Department, laid out the broad strokes of a $4 million program that would provide as many as 700 eligible small businesses with an immediate $2,500 grant. Unlike some other cities’ programs, however, Clearwater’s would also offer another $2,500 later to those who participate in a program that matches them up with professional services firms, such as attorneys and accountants, in an effort to keep them afloat moving forward. Those professional services firms would also be paid up to $900 for their services.

The program would also provide a 10% administrative fee to select agencies, such as the city’s chamber of commerce, Amplify Clearwater, which would partner small businesses with the professional service firms and oversee their arrangement.

“It (the program) would provide these small businesses with the funds needed for overhead expenses,” Sanderson told city councilors April 16. “It would provide them with the professional guidance and support necessary to mitigate the long-term impacts of COVID-19, would generate economic activity for service providers and would provide funding for partner agencies who are expected to have operating budget impacts as a result of the pandemic.”

Who’s eligible?

Sanderson said only businesses with 25 or fewer employees would qualify.

Also, they must demonstrate a loss of income due to COVID-19, have a business tax receipt, and be locally and independently operated, so no corporate-run franchises would qualify.

Eligible types of businesses would include: restaurants, bars, retail or personal service businesses, such as hair and beauty salons, spas, tattoo parlors; personal care services, such as child, disabled or elderly care services or funeral services; laundry services; cleaning services, pet care services, personal and household goods repairs and maintenance; fitness centers and gyms; event spaces and services; and travel agencies.

They would also have to establish a professional services agreement with an attorney or CPA, who would help with legal and financial matters, and with a web design professional or marketing professional, who would assist with their online presence or development of marketing campaigns.

Such an agreement would be orchestrated and managed by Amplify Clearwater, Tampa Bay Black Business Investment Corp., or Prospera Florida, an economic development nonprofit organization specialized in providing bilingual assistance to Hispanic entrepreneurs.

Each member of the council agreed that they liked the framework of the program, but they wanted to learn more about funding sources before giving it the green light.

“I like the foundation of this program, but the devil is going to be in choosing the paint color and window decorations,” Council member Hoyt Hamilton said. “How are we going to fund it and exactly who’s going to be eligible for it?”

Sanderson said there were several possible funding sources, which include Community Development Block Grants, Downtown Development Board funds, or Community Redevelopment Agency funds.

She said the city received $492,000 in CDBG funds through the CARES Act, but they could only be used for the administrative fees to agencies and providers.

All of that, however, only totals $800,000.

“There’s a $3.2 million funding gap that needs to be resolved before a program such as this could be adopted,” she said.

Mayor Frank Hibbard said the shortfall is something that has to be factored into the council’s decision-making, pointing out that the city can’t just print more money like the federal government.

“I think the other thing that we always have to remember is when we pay for one thing, it means we are not paying for something else,” he said.

New Council member Mark Bunker also liked the program, but said $2,500 is a drop in the bucket. What isn’t a small sum, he said, is the more than $64 million the city has slated for its Imagine Clearwater redevelopment plan.

“Can’t some of that money be used to help our businesses and our unemployed workers make it through this rough patch?” he said. “And we downsize the park a little bit or delay, because we don’t need to have that opened immediately. We need to get business back up on its feet when it’s possible.”

None of his fellow councilors answered his question, but they did agree that $2,500 might not make a difference.

“If this $2,500 is going to be the difference between being able to reopen or stay open and not, I’m not sure of the longevity of that business anyhow,” Hamilton said.

Hibbard echoed that concern.

“My concern also is that we give $2,500 to a company that is ... going to fail regardless,” he said. “I want to make certain that we’re keeping people who are on the cusp still going.”

Hibbard said he would like to see the program refined, but hopes the council will make a final decision at its next meeting May 7.

By that time, he said he hopes the city will have more information about state and federal money coming to the county and whether it will trickle down to cities.

“We know our needs better than the county or the state or certainly the federal government,” he said.

City Attorney Pam Akin said there was one concern that could stall the program.

“I think that many local government attorneys when talking about programs like this are going to have some concerns about the Florida Constitution and our ability to spend money or to give money to private businesses. So that’s something that we are looking at,” she said, adding that she has reached out to the St. Petersburg city attorney but hasn’t heard back yet.

Corrected to state that professional service firms would be paid up to $900, not $2,500.