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December 8, 2004'Cool' initiative stalled pending Plan BBut the state has not written off the projectByRecord-Eagle staff writer
Other Cool Cities
TRAVERSE CITY - Local organizers say there's no Plan B for salvaging a state-funded Cool Cities project now that the state has nixed spending the bulk of the $100,000 grant on rent and other overhead at the Traverse City Area Chamber of Commerce building.Other cities around Michigan with Cool Cities start-up grants include: ALPENA - to develop a pedestrian-oriented walkway through downtown on both sides of Thunder Bay River linking the downtown area to public and private development projects on the river. MARQUETTE - the Marquette Commons Project will create a refrigerated "ice plaza" with a skating rink, warming hut and non-motorized trail on the site of an old parking lot and railroad trestle. SAUGATUCK - renovating an old pie factory into an arts center and doing streetscape improvements downtown. SAULT STE. MARIE - restoring the Soo Theatre complex to its 1930s appearance as part of a downtown revitalization project. Chamber executive director Doug Luciani said there's "no back-up plan" for housing the proposed "entrepreneurial institute" elsewhere, though it may be considered if there's no agreement on a way to keep the project at chamber headquarters. "If it can't, we'll look for a Plan B," Luciani said. A conference call was scheduled for this morning between state officials, city representatives and other locals to discuss the project, designed to assist small business interests in the region. It was thrown into limbo last week after state officials learned more than 75 percent of the state grant was targeted for overhead costs, equipment and furnishings at the two-year-old, $2.4 million chamber building on Grandview Parkway. The state said the grant couldn't be used for rent and utility costs for the vacant 4,000-square-foot second floor that was to host the institute - where local organizers planned on spending $40,000 of the grant money. City officials said they were caught off-guard by the state's position, and aren't sure how the Cool Cities initiative can proceed. "We'll have to figure out what's next," city manager Richard Lewis said. "The idea is still a good idea, but maybe it's not going to happen." State officials said a misunderstanding apparently occurred with local organizers over what "physical infrastructure" costs could be eligible for the grant. They say it was to cover "bricks and mortar" and other hard costs but not to lease private space or pay utility bills. "We went to great lengths to explain (to grant recipients) what we would cover with the Cool Cities funding," said Bob Johnson, acting assistant executive director of the state Department of Labor and Economic Growth. Johnson said a representative of his office contacted the city's Downtown Development Authority office on Friday to relay the state's concerns in response to a Record-Eagle reporter's questions. No state money has been released so far, he said. The local project's preliminary business plan committed $40,000 of the grant for rent and utility expenses at the chamber, plus $10,000 for finish construction, $15,000 for furnishings and $10,000 for equipment and technology purchases. Johnson said some of the proposed overhead costs like equipment purchases and furnishings could be paid by the grant - but only if they remain with the project. He said the state expects at least a three- to five-year commitment from local partners to programs created with Cool Cities funding. Luciani said the disputed grant funds were included in the organization's approximately $1 million operating budget for 2005, but losing those funds won't create a budget problem. "We lose that revenue but we would also lose those expenses (for running the facility)," Luciani said. "It was never something that was going to be a big contribution to the chamber's bottom line." Other city officials also expressed surprise at the state's position, believing local partners were clear from the start about where the state funds were headed. Mayor Linda Smyka said she felt a "sense almost of bewilderment" when learning of the state's objections. "This is what (the state) wanted compared to all the other projects which are just bricks and mortar," Smyka said at Monday's city commission meeting. State officials say they haven't written off the project. "Our intent would be to figure out how to make this work," said Maura Campbell, a spokesperson for the Department of Labor and Economic Growth. "This is one of those things where all the parties need to sit down and roll up their sleeves and work on this."
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