“I know I have the right to sign up to $99,000 but quite frankly, as the Mayor, that’s uncomfortable. That’s a lot of money. There better be a good reason to do that, but I can’t find one. I’ll leave it to Council to decide how much that will be,” Mesquite Mayor Mark said as he and the Redevelopment Agency Board discussed three options presented to them Tuesday, May 22 for spending funds on business projects.

The RDA Board, essentially the same as the Mesquite City Council, discussed the program that awards RDA funds to businesses to make permanent improvements to properties located within the RDA tax district, primarily located on Mesquite and Sandhill Blvds.

Based on changes made by the RDA Board in 2009, City Staff is currently charged with approving requests for RDA funds in four areas: building, remodeling and rehabilitation up to $99,999; façade rehabilitation up to $50,000; sign replacement up to $15,000; and city-related fees up to $30,000.

Those changes were made to decrease approval times applicants experienced when applying for RDA funds. Previously, all requests were made to the full RDA Board.

"Based on feedback, Staff is seeking direction regarding the current administrative and approval processes for the programs," says the background material for the agenda item. "The feedback can be reduced down to two overarching themes-trust and control. Does the RDA Board trust the current process? Does the RDA Board need greater control over the approvals?"

See Mesquite Citizen Journal story RDA Board to Review Funding Approval Process for an explanation of the three options presented to the RDA Board.

Aaron Baker, Interim Economic Development Officer, reported that the Staff committee who approves the applications includes the City Manager, the Director and Associate from the Planning Department, and the Finance Director.

“The RDA applications are funded out of the tax increment and not RDA bond money. We are not currently processing applications because of previous commitments for the proposed sports center. If we do take applications, the amount of funds available for the sports center funding could be diminished,” Baker explained.

It was earlier revealed that then-Interim City Manager Kurt Sawyer had made a decision not to process applications for RDA grants to businesses wanting to use the funds for permanent improvements, rather holding the money to help fund the proposed Indoor Sports/Events Center.

Councilman Kraig Hafen asked Baker, “Has there been a commitment from the RDA Board to fund that thing?”

“No, there hasn’t been any hard commitment. That’s why we’re coming to you today to ask for that commitment one way or another. Do you want us to hold the funds or do you want us to begin processing applications [for business grants]?”

“Have people been told there’s been a commitment made on that money,” Hafen queried Baker.

“Yes, there’s probably been five or six inquiries,” Baker replied.

Councilman George Rapson continued the

line of questioning, asking “how many actual applications have been filed?”

“None have actually been turned,” Baker said.

“If they were told you’re not taking applications, it’s hard to know whether they would have filed one,” Hafen commented.

Councilman Geno Withelder asked Baker to provide him with a list of those who had made inquiries into the RDA grant program.

Hafen turned the line of questioning to another facet of the redevelopment agency program that involved spending bond money on projects around the City. Previously, Sawyer had stated that the City had to spend approximately $500,000 from the RDA bond money by the middle of June to comply with rules and requirements of the bond issuance.

“There are no time constraints for spending money out of the bond proceeds. Is that correct,” Hafen asked.

“That’s correct. There were some constraints, but those are gone. The obligations have been met,” Baker answered.

Returning to the discussion regarding RDA grants to businesses, Councilman Al Litman said, “the guidelines placed the emphasis on spending in the downtown corridor but we’re still talking about the whole redevelopment zone. Is that the way we’re going?”

Baker explained that “the guidelines have never changed. They do provide greater emphasis on the downtown area with a 75 percent reimbursement rate versus 50 percent for other areas.”

“RDA funds have been spent on the north side of I-15 but not under these programs. An example of that is the Police Station,” Baker added.

When asked, he stated that $135,000 is budgeted for the business grant program in the upcoming fiscal year. “The most that’s been spent in one fiscal year, 2010, was $54,495.”

Councilman George Rapson added to the discussion about taking applications for the grant program versus holding the funds for the proposed sports/events center.

“I’ve said before that I’m a big proponent of the indoor sports facility. I’ve also said that if all we’ve given out [in one year] is $50,000, if that’s the straw that breaks that camel’s back, we shouldn’t be doing it. We need to continue helping emerging and existing businesses with this program.”

In regards to the three options presented to the RDA Board, Rapson was in favor of keeping the option that decreased application approval times. “I’m confident that Staff has the ability to make these decisions. I’m okay with Option 1.”

“We need to open the application process back up today,” Hafen remarked.

“But the public has a right to know where the money is going. We need to have a process to let them know that,” Hafen added.

City Attorney Cheryl Hunt suggested the RDA Board reset the Staff approval levels for applications at $25,000 to match the approval levels for purchase orders. “That might be the threshold for you on this.”

Councilman Karl Gustaveson suggested setting the Staff approval levels at $50,000 while Hafen suggested a threshold of $25,000.

The Board ultimately voted 4-1 to keep the current application approval process but lowered the cap to $50,000. Hafen was the lone nay vote.