Up to $1M earmarked for rent assistance for Aspen retailers, restaurants, some small businesses
Eligibility requirements for the city of Aspen’s small business rent relief program:
• Be currently closed by the Pitkin County Public Health Order and unable to operate remotely. Businesses offering take-out food are eligible, as well as businesses that deliver goods or products. Some businesses, like bike repair shops that were closed but can open this week also will be eligible, as well those that have been offering limited services.
• Have 35 or fewer full-time employees.
• Have a physical location in the city of Aspen.
• Possess a current city business license.
• Have a rent payment for the time period of April 1 to July 1, 2020 due to a landlord to whom the business has no ownership interest.
• Be current on all payments to the city, including, but not limited to the filing and remittance of a business license, sales and lodging taxes, water utility payments and electric utility payments.
• Open for business in Aspen on March 1; and have been in business since the beginning of the 2019-20 winter season. Start-up businesses in recent months will be considered on a case-by-case basis.
• Be open at least 32 weeks a year.
Aspen City Council on Monday agreed to a small business rent relief grant program of as much as $1 million that will give local retailers and restaurants as much as $14,000 in response to the COVID-19 crisis.
The offering is equal to one-third the monthly rent of a business for as many as three months and is good from April to July.
The catch is that businesses eligible for rent relief must have a landlord who is willing to also pay a third of the rent, with the tenant paying the remainder.
“We expect the landlord to also take a hit,” Mitch Osur, the city’s director of downtown services and parking, told council Monday during a work session.
He said he’s spoken to two of the three main landlords in town and they are agreeable to the proposition.
Formula businesses, which are defined in the city’s land-use code, as well those that are office in nature — such as law firms, property management or real estate professionals — do not qualify for rent relief.
The program, which is being funded by borrowed money from the Wheeler Opera House fund, is designed to help Aspen businesses that contribute to the municipal government’s sales tax receipts.
“It’s all about striking a balance,” Osur said. “We’re trying to work with the taxpayers, the business owners and landlords, and, of course, the broader public good, so it’s important for us to take care of all of those groups.”
Local retailers and restaurants have taken a massive economic hit because of the public health orders mandating that nonessential businesses close, and limiting establishments to takeout and delivery, in an effort to reduce the spread of the novel coronavirus.
And with an anticipated slow reopening and minimal tourism in the coming months, businesses will continue to teeter on the brink of closing.
The program is designed provide immediate relief.
“We need to stop the bleeding now,” Councilman Skippy Mesirow said. “We need to act now.”
With rents averaging around $22,000 a month, Osur recognized that $14,000 may not be a lot, but granting more reduces the amount of businesses that can get relief.
It’s expected that the program will help close to 100 businesses.
“We know that this money’s not going to go as far as we might hope so we just tried to put some guardrails up,” Osur said.
He also noted that he’s received several emails from business owners saying that the program will save their businesses and thanked the city for providing relief.
Osur pointed out that the program could be counter-productive to the impact that would otherwise likely happen around commercial rental rates and landlords having to lower them as a result of empty storefronts.
City Manager Sara Ott said a small business revolving loan program is currently being developed and she estimated that roughly $1 million would be set aside.
That, along with the rent relief program, is part of a $5.8 million economic relief and stimulus package that City Council passed last week.
Funds are coming from the general fund, which was fueled by a $3.5 million inter-fund advance from the Wheeler, as well as $1.5 million from the housing development fund for rent relief for local residents and $1 million from the Kids’ First fund for child care assistance for area families.
Councilwoman Rachel Richards, who agreed with her colleagues to increase the small business rent relief program to as much as $1 million as opposed to the recommended $600,000, said the city may have to go back and borrow more money from the Wheeler as the economic crisis continues.
Councilman Ward Hauenstein acknowledged that there will be triage on a local economic level in the coming months.
“Some businesses are not going to survive,” he said, adding that he wondered if the rent relief program isn’t just giving relief to the landlords.
Applications will be accepted online soon and will be reviewed by a grant committee set up by Ott. It will be comprised of City Finance Director Pete Strecker, Mayor Torre, a community member at large, a banker, commercial lender or a financial expert, as well as a commercial real estate professional.
The committee will use eligibility criteria in making award decisions, and will consider fully completed applications in the order they are submitted until the award period ends or funding is fully committed.
“There will be opportunity for refinement and to learn as we get applications in,” Torre said about the evolving process.
Rob Ittner, owner of the Cooking School of Aspen who is acting as a consultant for area restaurants in navigating through the crisis, as well as applying for federal and state assistance, said it’s a marathon, not a sprint.
He failed to get council support after his public comment asking that the program be further developed, and provide the relief in the summer after state and federal aid have been utilized and businesses have adjusted to a new normal.
“The question is for the sustainability of the Aspen economy,” he said.
Richards said she doesn’t want to put off the program and watch businesses die in the near future while holding back money.
“We have bad choices in front of us, one way or the other,” she said. “We could move this program forward now, it will help people now … we’re not going to have massive amounts of money to help further in the future. But at the other side of it is to say, ‘well let’s wait until July and see who survived and who dies, and we don’t have to worry about them’ and to not to not do something now is assuring a certain mortality rate among local businesses throughout the community, and I don’t want to wait for them to die off to then grant the remaining winners, some money.”
Councilwoman Ann Mullins said she’s eager, as are local business owners, to get the money into the hands of those who need it.
“It’s important to get going with this,” she said.
Site work for three unbuilt residential chalets being advertised for $25 million each has started in the West End neighborhood as part of a Boston company’s project that also calls for the redevelopment of the Hotel Aspen into a luxury boutique lodge.