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Home My WebLink AboutEDC e: economic stabilization for frontline households and businesses, and small business programs - $100,000 Jefferson County Board of County Commissioners – 1820 Jefferson Street, Port Townsend, WA Letter of Interest 2.10.2023 Dear Jefferson County Commissioners, EDC Team Jefferson would like to respond to Jefferson County’s “Last Call” for funding requests for Remaining American Rescue Plan Act (ARPA) Funds with this letter of interest. EDC Team Jefferson, the Economic Development Council of Jefferson County has been following closely the changing demographics of business ownership. We are at a critical inflection point if we desire to retain locally-owned legacy businesses that provide stable jobs and contribute the character of our place. In addition, efforts to recover from COVID can best be supported by business assessments and technical service provision to assist business owners to create consistent profitability. These activities are critical in our recovery. As the EDC remakes itself we would like to position ourselves to provide meaningful and lasting value to our community. This project is based on data and identified business need. We have put together a proposal as a pilot to demonstrate how to meet this need with tangible and practical investment in the foundation of our economy, small locally owned businesses. Thank you for this opportunity. Best, Cindy Cindy Brooks Executive Director EDC Team Jefferson 385 Benedict St. 2A Port Townsend WA 98368 EDC Team Jefferson would like to respond to Jefferson County’s “Last Call” for funding requests for Remaining American Rescue Plan Act (ARPA) Funds with this letter of interest. One of the intended uses for ARPA funding is economic stabilization for frontline households and businesses, and small business programs are called out. The EDC strongly suggests allocating ARPA funding to provide technical assistance for small business owners who are nearing retirement. The Problem: The timing of this programming is critical as 62% of small business with employees in Jefferson County are owned by people over the age of 55. Using a combination of census data, data reported by Dun and Bradstreet, and the brokerage platform Biz Buy Sell, we can see that statewide  Four out of five small businesses intending to sell do not have a succession plan  Seven out of ten family businesses are not transferring ownership  Four out of five small businesses intending to sell do not have a succession plan  Four out of five businesses with employees will likely liquidate or just close their doors. Whatcom Community Foundation funded a statewide study of the need for planning by county. The study was provided by Project Equity and the results are on their website. See infographic describing Jefferson County pre- Covid below. The Opportunity: The EDC has the opportunity to provide a timely program addressing locally owned business retention and employee/job retention, reducing the likelihood of the loss of existing and legacy businesses currently operated by baby boomer owners. Through a pilot program offered Sept 2023-Dec 2024, providing business assessments and improvements to stabilize businesses prior to sale, and succession planning services, including exposure to employee ownership as a transition option, we can reduce loss and strengthen /grow existing businesses looking toward the future with new local ownership. Improving businesses and retaining local ownership increases the multiplier effect of dollars circulating within a local economy, rather profits leaving when earned by a firm with headquarters out of the area. We are in a critical moment with an important step to take toward the goal of resilience that our community continually calls out. Who does what: The program the EDC plans on developing, “Take the Torch”, would provide in house business assessments, and technical service support for improvements prior to sale. Once the business has been stabilized, we can work with partners to plan succession and in some cases lay the groundwork for employee ownership. Employee ownership roots independently owned local businesses preserving jobs, and preserving the economic vitality of regions over the long term. The goal is transitional stability locally and the retention of living wage jobs in these sectors; construction, maritime and manufacturing for businesses with greater than 6 employees. Assuming the grant funding is available in Sept 2023 and the ARPA spend down needs to be completed by 2025 we have a 15-month window to offer a pilot project consisting of tiered services based on business readiness. Webinars to provide basic information, an application process and assessment to identify extent of work required and prioritization and allocation of services. With the results of this pilot we expect to be able to approach philanthropic funders supportive of economic development to continue the work. In summary, we propose providing assessments, support business stabilization improvements, exit strategy and succession planning development by pairing our in house advising with external exit planning consultants, and providing worker ownership education and feasibility with partners Northwest Coop Development Center and/or Project Equity. Budget Activity Cost Match Outcome Businesses Estimate Served Increase EDC staffing from $24K Increase admin assistant 2.5 to 3 from 20 hours to 40 hours/month Program planning and $15K We estimate 15% management over 15 operational cost for months program admin Outreach $ 1K Marketing and materials 100 Workshops and 1:1 0 $ 5K Provided by in house 30 EDC advisor delivery Business assessments and 0 $35K Match provided by in 15 suggested improvement. house EDC advisor Exit strategy/succession plan $30K Led by external partner 7 consultant Execution – consultant $30K Led by external partner 2 Total $100K $40K