Economic Development Authority - Erik Thorvig, Community Development Director
Title
Title
Fresh Picked Pizza Assistance Request
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Executive Summary
Consider options to assist Fresh Picked Pizza with an additional $11,600 in project expenses.
Background
In 2019, Fresh Picked Pizza received approvals to construct a new pizza restaurant at 8683 Central Avenue. The property was a redevelopment site and the development included demolition of dilapidated nursery building. The owner received a loan from the EDA in 2020 to assist with the building demolition. The loan amount was $29,359.
The business owner has persevered through the pandemic and volatile construction market and is planning on opening the restaurant sometime in October or November.
The project incurred a cost overrun of $11,600 related to installation of a new water line for the fire suppression system. Initially the contractor thought the existing domestic water line in 87th Avenue was sized to accommodate the fire suppression system; however, it was determined that a new water line had to be run to the service in the frontage road which is a larger line and can accommodate the fire suppression needs.
The business owner has exhausted all other funding options for other project cost overruns including bank financing, personal finances, and contributions. He is asking if the EDA can assist to fund the $11,600 overrun related to the fire suppression line.
There are several options the EDA can consider:
1. The EDA could increase the loan amount to $40,959.
2. The EDA could grant the $11,600 by reducing the current loan amount to $17,759.
3. The EDA could grant the entire $11,600 by utilizing funds in the fire suppression grant program. This program has an annual allocation from the EDA general levy of $75,000. No applications have been received for this program in 2022 so there are sufficient funds.
4. The applicant could apply for a grant through the fire suppression grant program; however, the grant program requires a 50% match. Therefore, the applicant would still be responsible for $5,800.
Financial Impact
The financial impact of each option is outlined above.
Staff Recommendation
Consider the four options provided by staff and adopt a resolution based on the preferred option.
Body
WHEREAS, Fresh Picked Pizza is constructing a new pizza restaurant at 8683 Central Avenue; and
WHEREAS, Fresh Picked Pizza received a loan from the EDA in 2020 for demolition of the building that existed on the site; and
WHEREAS, the project incurred a cost overrun of $11,600 related installation of the fire suppression system; and
WHEREAS, the business owner has requested the EDA to assist in the cost overrun.
NOW THEREFORE, BE IT RESOLVED, that the Blaine Economic Development Authority hereby approves granting $11,600 to the business owner utilizing funds in the Fire Suppression Grant Program.
PASSED by the Blaine Economic Development Authority this 3rd day of October, 2022.