In January, Mayor Richard M. Daley announced eight new ordinances that would support business expansion and neighborhood improvement. Almost seven months later, the West Side is set to reap the benefits of a $750,000 Madison Austin Small Business Improvement Fund (SBIF).
The SBIF program uses tax increment financing (TIF) money to help business owners remodel or repair their facilities for their own business or on behalf of tenants. SBIFs are grants given to property owners after remodeling work is completed and all expenses are paid.
Derek Walvoord, director of the SBIF program at SomerCor Inc., said all business owners in the Madison Austin TIF district are eligible for the grants. He added that every business owner who qualifies and applies will receive grant money. The city hired SomerCor Inc. to handle its SBIFs.
“If there are more requests than money available, there will be a lottery at City Hall, and all the winners will be announced and receive the funds; those who don’t win will be put on a waiting list,” he said.
The Madison Austin SBIF, which is in the same TIF district and runs predominantly along Madison Street from Hamlin Avenue to Mason Street is holding its public rollout today at two different public events. Business owners then have 30 days after the rollout to fill out and submit their application.
“On Aug. 18, $500,000 will be released,” said Molly Sullivan, spokesman for the City of Chicago’s Department of Planning and Development. “After the two public events, business owners will have 30 days to file their application. The rollout event is an opportunity for business owners and community members to ask questions and receive more information.”
The SBIF program has been very successful, helping over 380 businesses city-wide in 2010 with more than $20 million in grants, said Sullivan.
“We have created 243 jobs and retained another 208 jobs so far this year,” she said. “The goal has not changed; we want to continue to help businesses by providing them with grant money to cover the cost of major improvements to their buildings that would otherwise not be done or put them in the red.”
“This is money generated in the community that it is going back to,” Sullivan said. “In this case, the money is going towards small businesses, and it will help them continue to operate in the black instead of the red when they make these major repairs. This allows businesses to hire people and retain jobs.”
This is the second time the Madison Austin SBIF has been allocated money. The first SBIF was authorized in 2002 and $750,000 was made available in March 2003. Eight businesses have received 14 SBIF grants from 2004 to 2009.
Some companies received SBIF funds for more than one project, and grant amounts ranged from $3,800 to the maximum amount of $150,000.
A total of $749,671 was used for projects that included lighting, signs, property purchase, office renovations, roof work and masonry, flooring, fire-alarm system renovation, handicap-accessible entrance, bathrooms and HVAC system improvements, Sullivan said.
The money can be used for a wide-range of improvements including sign removal and replacement, new windows or purchase of adjacent property for building expansion or parking.
“Ideally, you have a business that gets fixed up, and once the repairs are complete, it spurs other development in the area,” Walvrood said. “This money doesn’t just help one business; it helps the entire block. The money gives the neighborhood a boost in the arm, and by strengthening one business, you are strengthening all of them.”
Erni King of the Greater Garfield Park Chamber of Commerce, said these grants are always very positive and are a source of income that business owners would otherwise not have to make these “much needed improvements to their buildings.”
“This isn’t new to our area, and the first time around people used all the money,” she said. “Now that it has been replenished we can get a new set of business owners the assistance they need. We have been waiting for the funds to be replenished, and now that they have we want to get more people on board.”
Ald. Ed Smith (28th) and Ald. Deborah Graham (29th) were not available for comment. But a spokeswoman in Graham’s office said it’s a positive program that gives back to the businesses who pay into the TIF fund.
King said the SBIF funds will be great for the Austin and West Side communities.
“It is a positive program. The key is to get the word out and make sure people are aware of the program and how to take advantage of it,” she said.