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HomeMy WebLinkAboutCouncil Provided Information - 9/9/2025COUNCIL STAFF REPORT CITY COUNCIL of SALT LAKE CITY tinyurl.com/SLCFY26 TO:Council Members FROM: Lehua Weaver, Jennifer Bruno, Sylvia Richards, Kate Werrett Budget and Policy Analysts DATE:September 9, 2025 RE: Budget Amendment No. 1 of Fiscal Year (FY) 2026 Work Session Briefing Notes On September 2nd, the Council held a briefing on the proposed assistance programs for property owners, businesses, and employees affected by the August fire on Main Street. Council Members discussed the goals of the business loans and rental assistance proposals, and took a straw poll to support the request for pedestrian safety barricades. A companion proposal from the CRA for property owner loans will be briefed at the September 9th CRA meeting. Council Members provided the following feedback on the business loans and rental assistance: Council Members were supportive of making the business loan funds available to other businesses that had direct impacts due to the fire, including replacing food that was lost or making needed repairs. In order to motivate other vacant storefronts to find tenants and contribute to the vibrancy of Main Street, a request was made to consider higher boarded building fees within the Central Business District (CBD). o In 2022, the City Council requested that the Administration review and propose a change in boarded building fees to capture the full City cost of both monitoring/boarding and emergency services of dangerous/boarded buildings. The City’s Finance Department conducted a cost analysis and found that each boarded building permit costs the City $15,551 annually. The Fee Study recommended a maximum proposed fee increase to be $14,000 due to small claims collections requirements. o The current fee schedule (adopted in 2024) charges an annual fee to non-residential structures of $6,000 in years 1-2; $9,000 in years 3-5; and $14,000 for years 6 or more. Council Members also asked for a recommendation on criteria so that the public can anticipate what types of events would trigger these types of financial support programs to be available from the City. o This request would apply to all three proposals: business loans, rental assistance, and the CRA property owner loans. Project Timeline: Consent: Sept. 2, 2025 1st Briefing: Sept. 2, 2025 Public Hearing: September 9, 2025 Potential Adoption: Sept. 9 or October 7, 2025 o The criteria or conditions may also address City factors that could limit the ability to make funding available. Council Members asked for a recommendation on how to ensure the Emergency Loan Program benefits Main Street and the CBD as much as possible. It is not practical to require the businesses to eventually relocate at the same place once the buildings are re-opened, but the Administration may have a recommendation for whether to have other eligibility requirements or use restrictions for the loans, for example: is there a preferred location for the businesses re-opening, whether funds can be used for “pop- ups,” upgrades or other uses, etc. At the conclusion of the public hearing, the Council may consider taking action on Item A-3 Public Right-of-Way Safety to formalize the September 2nd straw poll. The other two amendment items could be voted on as well, or be held until a future meeting. See attached motion sheet for draft language. Information below this line was provided for the September 2nd Work Session: All Budget Amendment items included in this transmittal are related to the City’s response to the Commercial Fire on the 300 South Block of Main Street In the aftermath of the August 11th fire on Main Street, the Administration has been actively exploring ways the City can support the property owners, business owners, and individual employees. Following are the requests which have a Council role. In addition to the proposals below from the General Fund, the Council – acting as the CRA Board of Directors – will also consider a new Disaster Loan Program and loan proposal during the September 9th CRA Meeting. Some summary information on this is provided below as “Additional Info” to give as much context to the proposals as possible. Budget Amendment Number One includes three proposed amendments. The amendment proposes changes in two funds. With the adoption of Budget Amendment #1, the available fund balance will be 12.89 percent of the FY 2026 Adopted Budget. If the items are adopted as proposed, then Fund Balance would be $580,933 below the minimum target. The Administration indicates a revenue update and projection will be provided with the second budget amendment of FY26. No updates or modifications from the FY26 Adopted Budget are proposed at this time. UPDATED Fund Balance Chart The table below presents updated Fund Balance numbers and percentages based on the proposed changes included in Budget Amendment #1. With the complete adoption of Budget Amendment No. 1, the available fund balance will decrease slightly to 12.89%. For context, the fund balance at budget adoption was 12.93 percent. If all the items are adopted as proposed, then Fund Balance would be $580,933 below the minimum target of 13%. Item A-1: Emergency Loan Program ($600,000 combined from Emergency Loan Fund and General Fund Fund Balance) Summary Points: a. Who: Business Owners closed due to fire, adjacent business affected by the fire. b. Why: cover operational costs until the business can re-open somewhere c. Funding Source: $600,000 from the General Fund i. $327,000 from an "Emergency Loan Program" that was set up post-covid ii. $273,000 from the general fund fund balance this would leave fund balance at 12.9% (including GF and FoF) d. How much per business: $100,000 per business dislocated by the fire, the additional funding would be available for others affected, but not dislocated e. Terms: i. 5-year repayment ii. 0% interest iii. option to defer payments up to 2-years f. Loan application & Criteria: similar to other loan programs, especially post-COVID. Item A-2: Item withdrawn Item A-3: Public Right-of-Way Safety ($80,000 from General Fund) The Administration is requesting funding to expedite the placement of barriers for pedestrian safety. The barricades would divert pedestrians from the sidewalk into a protected path in the street. The City would seek reimbursement once development begins, since this is typically a property owner expense. Straw Poll: The Council may consider taking a straw poll on A-3 regarding barricades so that the safety measures are in place as quickly as possible. Item A-4: Rental Assistance ($100,000 from Funding Our Future RAFT Program) Summary Points: a. Who: Individual employees who worked for the businesses closed due to fire b. Why: Ensure they don’t lose housing due to lost income c. Funding Source: $100,000 from Funding our Future – Tenant Displacement funds i. The FOF Funds set aside through CDCU to help with Thriving in Place. ii. $700,000 in the fund, ~$300,000 already allocated to CDCU d. How much per employee: iii. $2,000 or one-month’s rent per full-time employee iv. $1,000 or one-month’s rent per part-time employee e. Terms: none; granted f. Application / Criteria: v. Application through CDCU – quickly processed vi. be an employee at time of the fire, lost income that makes up a quarter of their household income vii. residents of Salt Lake City with valid lease agreement viii. Combined household income of 80% AMI or below ADDITIONAL INFO: CRA Property Owner Loan – create new “Disaster Loan Program” – To be discussed on Sept 9 in the CRA Meeting. Summary Points: a. Who: Property Owners or long-term lease in CRA area b. Why: gap financing to help expedite reconstruction c. Funding Source: $14 m from commercial assistance program that’s come from all CRA project areas. $5m available in the CBD. d. How much per property: $1m each for 4 properties e. Terms: i. 0% and no payments for first 2 years, 2% in year 3 ii. 3 year term extendable to 5 yrs amortized over iii. 5% interest starting at year f. Loan application & Criteria: board approval, active fire insurance claim required. Policy Questions 1. The City has identified the importance of supporting this core block of Main Street to rebuild and re-activate as quickly as possible. Do the proposed funds target that goal and help the City, businesses, and property owners recover in the way they need? a. Are there conditions that could be added to the General Fund loans to the businesses to ensure that they find space nearby so that they are able to continue contributing to the vibrancy of Main Street / Downtown? b. Is there other support that would help ensure more activation on Main Street while these buildings are under construction? 2. The Council may wish to provide feedback about how any of the loans or donations are handled: a. Should the funding be given as a lump sum or as scheduled draws as criteria is met? b. Criteria for building or location to ensure the funding directly benefits Main Street. c. Other criteria or terms? 3. Does the Council want to request regular updates from the Administration on the progress for rebuilding, business recovery, and Main Street activity? 4. Will the Police Department take on more of a role with monitoring the vacant damaged property for trespassing or camping? 5. Council Members may want to request a future briefing with the Administration about the Funding our Future “RAFT” funding usage and outreach opportunities to improve its usage. Section B: Grants for Existing Resources (None) Section C: Grants for New Staff Resources (None) (None) (None) (None) (None) (None)