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HomeMy WebLinkAboutMINUTES - 03222011 - C.42RECOMMENDATION(S): 1. APPROVE West Contra Costa Business Development Center's request to change the location of the proposed Culinary Business Center Incubator Project, which was allocated $100,000 of FY 2008/09 Community Development Block Grant-Recovery (CDBG-R) funds, from a building located in the City of Richmond to a building located at 812 San Pablo Avenue, in Pinole. 2. APPROVE the CDBG-R Substantial Amendment to the Contra Costa County FY 2008/09 CDBG Action Plan and AUTHORIZE the Deputy Director-Redevelopment to submit the amendment to the U.S. Department of Housing and Urban Development (HUD). 3. AUTHORIZE the Conservation and Development Director, or designee, to enter into a contract with the West Contra Costa Business Development Center, in the amount of $100,000 for the build-out/rehabilitation of the building located at 812 San Pablo Avenue, Pinole for the Culinary Business Center Incubator, with the term of April 1, 2011 to December 31, 2011. APPROVE OTHER RECOMMENDATION OF CNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE Action of Board On: 03/22/2011 APPROVED AS RECOMMENDED OTHER Clerks Notes: VOTE OF SUPERVISORS AYE:John Gioia, District I Supervisor Gayle B. Uilkema, District II Supervisor Mary N. Piepho, District III Supervisor Karen Mitchoff, District IV Supervisor Federal D. Glover, District V Supervisor Contact: Gabriel Lemus (925) 335-7229 I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the Board of Supervisors on the date shown. ATTESTED: March 22, 2011 David J. Twa, County Administrator and Clerk of the Board of Supervisors By: , Deputy cc: C.42 To:Board of Supervisors From:Catherine Kutsuris, Conservation & Development Director Date:March 22, 2011 Contra Costa County Subject:Substantial Amendement to CDBG Action Plan - Change in Location for West Contra Costa Business Development Center's Culinary Business Incubator FISCAL IMPACT: No General Fund impact. All funds are provided to the County on a formula basis through the U.S. Department of Housing and Urban Development (HUD). The CDBG-R funds are part of the stimulus package approved by the federal government under the American Recovery and Reinvestment Act of 2009. CFDA# 14.253 (CDBG-R Program) BACKGROUND: In June 2009, the County received a special supplemental allocation of $929,719 in Community Development Block Grant (CDBG) funds under the American Recovery and Reinvestment Act of 2009 (CDBG-R). The Board of Supervisors (Board) approved allocating these funds to 14 projects, including awarding $100,000 to the West Contra Costa Business Development Center (WCC BDC) to support the build-out/rehabilitation of a building for a Culinary Business Center Incubator (CBC Incubator). The WCC BDC is a nonprofit corporation that assists in fostering entrepreneurship opportunities for low-income persons. The WCC BDC’s goal is to help businesses grow, create job opportunities, and generate a renewed sense of economic activity in the communities of west Contra Costa County. As part of their overall goal of fostering entrepreneurship opportunities, the WCC BDC proposes to create the CBC Incubator to assist low-income persons create or expand their culinary businesses and to create jobs for low-income persons. The CBC Incubator will be a shared-used commercial kitchen where caterers and specialty food producers can prepare, cook, and package their food products for sale in a fully equipped and certified kitchen. Originally, the WCC BDC proposed to build-out/rehabilitate an existing building located in the City of San Pablo for the CBC Incubator. Due to site challenges, the WCC BDC decided on another site for the CBC Incubator located in the City of Richmond. On May 18, 2010 the Board approved the request to change the CBC Incubator location to the City of Richmond. However, upon further review by Richmond staff, the proposed Richmond site could not house the proposed project. Therefore, the WCC BDC renewed its search for potential sites throughout west Contra Costa County and found a new site located on 812 San Pablo Avenue in the City of Pinole. The new site is currently a vacant building of approximately 15,500 square feet, of which 3,243 square feet will be for the CBC Incubator. The WCC BDC and the building's property owner entered into a 5-year lease agreement with the the term beginning March 15, 2011. The WCC BDC has obtained the necessary conditional use permit from the City of Pinole and is waiting to receive the necessary health permit from the County. Once the health permit has been issued, the WCC BDC will apply for the building permit from the City of Pinole to build out the space. The WCC BDC expects to have the health and building permits by March 31, 2011. As operator of the CBC Incubator, the WCC BDC will provide active business assistance to those who utilize the CBC Incubator. WCC BDC will provide business counseling, assistance with product development, recipe development, instruction on safe and sanitary production, assistance with labeling regulations, product pricing, marketing, and distribution. The WCC BDC will hire an on-site manager with food-industry and marketing backgrounds to oversee the daily operation of the CBC Incubator and to provide direct assistance to business tenants. The year-to-year operation of the CBC Incubator will be funded primarily with rent revenue collected from the businesses utilizing the CBC Incubator. Depending on the level of usage, the rent for business tenants will range from $15 to $22 per hour. Approximately 8 to 10 construction jobs will be created to rehabilitate the building to create the CBC Incubator. According to the WCC BDC, during the first year of operation, at least 15 new businesses will be served, of which 50 percent will be Urban County clients. Each subsequent year, 3 to 5 new companies will to be added. With each new CBC Incubator business, at least 2 to 3 new jobs will be created during the incubation phase. Consequently, during the first year of operation, at least 30 new jobs will be created, with 30 additional new jobs created on average per year during the subsequent years. The total estimated budget to create the CBC Incubator is $247,200. The County's $100,000 of CDBG-R funds will be used for construction costs to renovate the designated space and be provided to WCC BDC in the form of a conditional grant that will be forgiven over a period of five years dependent on the successful job and business creation for Urban County clients. For example, if WCC BDC documents that 10 new jobs/businesses were created in the first year, $20,000 will be forgiven from the total $100,000 awarded. Sources & Uses Site Plans & Permit Fees: $11,200 ($11,200 from Private sources) Construction/Build-out: $93,900 ($59,500 from County CDBG-R; $34,400 from Private sources) Refrigeration & Hood System: $40,500 (from County CDBG-R) Equipment & Furnishings: $41600 ($26,600 from Private sources; $15,000 from Foundations) Contingency: $60,000 ($35,000 from Private sources; $25,000 from Foundations) TOTAL: $247,200 CONSEQUENCE OF NEGATIVE ACTION: Not approving the request will result in further delays in completing the project because the West Contra Costa Business Development Center would have to find another location to continue the project, or secure other financing to complete the proposed project. CHILDREN'S IMPACT STATEMENT: The WCC BDC and the CBC Incubator furthers the Children's report card outcome of The WCC BDC and the CBC Incubator furthers the Children's report card outcome of "helping families be safe, stable, and nurturing through economic self-sufficiency."