City Council, at it's April 26 meeting discussed potential investments for the City's share of American Recovery Plan Act (ARPA) funding.  Local business assistance was identified as one of the general priorities among the Council.

It has been very obvious that the Leisure & Hospitality industry has been the most negatively impacted by COVID-19 business restrictions.  However, many of the business assistance programs through the State and Federal Government have been very broad/blunt instruments, such as Paycheck Protection Program (PPP Loans), and Economic Injury Disaster Loans (EIDL); largely open to all businesses.  Local assistance programs have been equally blunt to-date.  The City, throughout 2020, partnered with Umatilla County on several rounds of direct grant funding to businesses, leveraging CARES Act funding.  In the Summer round of funding, there were actually fewer applications for the Hermiston area's allocation than there was available funding.  Therefore, all 110 qualifying applicants from the Hermiston area were awarded $5,000 grants, and 11 $5,000 grants were therefore allowed to be released to be used elsewhere in the County; mainly Pendleton.

Based on the relatively tepid demand for the summer assistance program, all of those grants were funded with Umatilla County funding, and that allowed the City to direct City funds to the two largest private-sector recreational businesses in the community; Hermiston Cinema, and Desert Lanes Bowling Alley.  The bulk of that assistance took the form of a mass purchase of gift certificates.  This allowed those businesses an immediate infusion of cash, and created an incentive for customers to get back in to those businesses, take additional customers with them, and make additional purchases (i.e. popcorn, drinks, etc.) while they're there.  Those gift certificates have been getting pushed out to the community through the Parks & Rec and Library programs, and the overall arrangement has been well received by the participating businesses.

Meanwhile, the Federal Small Business Administration has also pivoted to become more targeted in it's assistance moving forward.  The SBA recently opened the application portal on May 3 for it's Restaurant Revitalization Fund (RRF).  That program offers $28.6 Billion in funds for grants, with amounts available for up to $10 million per business, authorized through the recent American Rescue Plan.  For the first 3 weeks, small businesses owned by women, veterans, and, 'the socially and economically disadvantaged,' will have priority in application processing.  This is in addition to a recent announcement that the very lucrative PPP program has been extended through May 31, but only through, 'lenders who serve underserved communities.'  Finally, the Oregon Business Development Department continues to heavily advertise it's Commercial Rent Assistance program for the funds they have earmarked for Eastern Oregon, but due to very low participation, it is likely that at least some of those funds are likely to be diverted elsewhere in the state.

Therefore, due to the very significant amount of financial assistance available in response to the COVID-19 pandemic, staff is recommending a narrowly-focused business assistance program targeted only at restaurants.  Specifically, this program would focus on assisting restaurants with driving customers back in their doors, and should not be interpreted as on-par with the financial assistance available through other programs.  Preliminary conversations have been had with the Greater Hermiston Chamber of Commerce to partner with them to manage and administer the program, and this sounds like a viable option.  Attached to this report is a conceptual level outline of a $50,000 investment in a mass gift card purchase program.  However, since a partnership arrangement with the Chamber has not yet been finalized, the exact details are likely to shift some, based on their feedback and feedback from participating businesses.  So please treat the attached as a concept.