HALLOWELL — City councilors gave narrow approval Monday night for a grant program that would allow small business owners to receive up to $3,000 in assistance.

According to Mayor Mark Walker, the program was designed to quickly loan money to businesses that may not qualify for other loan programs.

The vote creating the program passed by a 4-3 margin during a meeting of the City Council via Zoom conference, with Councilors Diano Circo, Kate Dufour and Diana Scully dissenting.

The fund for the grant, dubbed the “Hallowell Business Survival Grant Program,” would be supported by up to $15,000 drawn from unspent TIF funds. Donations from businesses and private citizens will also help fund the program.

Walker said there was a “firm cap” of $15,000 for TIF money, but no cap on the private donations. A number of times during the meeting, a potential one-to-one match was mentioned, estimating about $30,000 in total funding eventually being available.

Eligible businesses must have fewer than five full-time employees and must have operated in Hallowell in 2018 and 2019, according to a draft of guidelines presented at Monday’s meeting.

According to agenda documents, the application process would require the business to state its need for funding, as well as potentially providing its utility bills, rent agreement and payment of personal property taxes to the city. The business must also be “making their best efforts to remain open and viable post-pandemic,” according to agenda documents from Monday.

Hallowell is not the first local community to offer grants for businesses during the pandemic; The Kennebec Valley Downtown Relief Fund, a joint project of the Augusta Downtown Alliance and Gardiner Main Street, began awarding up to $3,000 per applicant in April.

Walker said Hallowell was asked to participate in these the Kennebec Valley Downtown Relief Fund, which has received donations from larger businesses, like Central Maine Power and other larger businesses. He said Hallowell’s trade groups declined to join that group because many of Hallowell’s businesses were not able to contribute to the fund.

Councilors who dissented were wary of how the absence of $15,000 in TIF funds would affect future budget considerations. Scully said she was concerned about the next fiscal year’s budget.

“The 2021 budget is going to be really, really, really tight,” she said. “I would hate to see us spending some money now when it could be needed for staff.”

Councilor Maureen Aucoin said TIF funds were already part of the budget, but not earmarked for anything, adding she thought it was the “perfect use” for that money.

Dufour opposed the program, because it was considered outside of the larger budget. She said the city will have a “wicked tough budget” ahead of it in the the next fiscal year, and difficulty collecting excise and property tax revenues due to the pandemic.

“We don’t know where this pandemic is going to take us,” Dufour said. “I do not have a problem with this program; I think it’s a good program but it has to be discussed in the context of our entire budget.”

Walker said the city had not declared a state of emergency in more than “a dozen years,” giving the city justification for going outside of the normal budget process.

City Manager Nate Rudy said the city had about $83,000 in unspent TIF funds in the budget, but urged the council to retain as much of the general fund budget as possible to potentially be carried forward into next year.

Walker estimated there were about 90 businesses in Hallowell, excluding some home-based businesses, and the majority would not be eligible for the city’s program. He said 30 or 40 businesses could qualify, but some may not need the grant.

The council also voted 4-3 to appoint an independent panel to vet the applications based on those guidelines. The roster for the panel is Roger Pomerleau, Lynn Quirion and Mark Williamson.

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