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City proposes $1.2 million in construction mitigation grants for downtown corridors; committee forwards program to B session
Summary
Economic and Workforce Development staff outlined a three‑part construction mitigation grant program — active‑construction grants, a preconstruction pilot and a postconstruction pilot — and the committee voted to send the proposal to a B session for council consideration.
City staff presented a three‑track construction mitigation grant program on Feb. 25 aimed at helping small businesses affected by long‑running city construction projects; the Economic and Workforce Development Committee voted to forward the proposal to a B session for council consideration.
Margaret Toscano, a manager in the Economic Development Department, said the City Council approved $1,400,000 in general funds for the 2025 program and that the proposal includes three separate grant types: active‑construction grants (to support businesses during construction), a preconstruction pilot (to help businesses prepare marketing and outreach), and a postconstruction pilot (to support minor interior/exterior improvements after projects end). Toscano described prior rounds of assistance and outreach and said the 2025 program builds on lessons learned.
Key elements presented by staff include:
- Active‑construction grants: $1,000,000 budget; awards up to $35,000 per business; intended to help about 40 small businesses; eligible corridors are being targeted with Public Works to focus on projects with construction durations of 12 months or more — the presentation named Zona Cultural Street and South Alamo Street as eligible corridors. Eligible businesses must have been in their current location as of Jan. 1, 2023, show at least $10,000 in gross sales in 2023 and a minimum $5,000 reduction in net revenue in 2024 compared with 2023; applicants must be retail or service businesses dependent on foot traffic, meet SBA size standards, not be in bankruptcy at application and be majority‑owned by the applicant. Toscano said the active grants will not be first‑come, first‑served but will be scored according to assessed need (project duration, prior assistance received, net revenue loss and the Equity Atlas income‑only score).
- Preconstruction pilot: $80,000 budget; grants of $2,000 intended to support up to 40 businesses with marketing, social media, signage and consulting to prepare for upcoming construction impacts. Staff identified Marbach Road area street and drainage as a targeted preconstruction corridor, with outreach and application timing in the fall of 2025.
- Postconstruction pilot: staff budgeted $120,000 to support businesses as construction completes; the presentation described the grant as intended for minor interior/exterior improvements and listed recently completed corridors that would be eligible for the pilot (including Bulverde Road and Bynum Avenue phase 2). The presentation did not specify the exact number of postconstruction awards.
Toscano said LiftFund (recommended as program administrator) would administer the grants and receive an administrative fee of $185,000 for application review, outreach, follow‑up and disbursement. Committee members asked about that fee and whether it could be negotiated; staff said the fee was higher than prior rounds but reflected add‑on pilot work and follow‑up site visits.
Council members pressed staff on several operational and equity questions. Councilmember White urged greater emphasis on net revenue loss in scoring so that the businesses losing the most revenue are prioritized; he also criticized long construction durations and urged the city to improve contractor performance. Councilwoman Rocha Garcia and others asked whether the program budget and the pilot sizes are sufficient for districts with many small businesses and whether non‑digital outreach (postcards, in‑person application days) would reach cash‑only customers who do not use delivery or digital platforms.
Staff noted past outreach: three full‑time business outreach specialists who performed roughly 4,500 site visits in fiscal year 2024 and earlier, and plans for two information sessions and two in‑person application days for technical assistance. The proposed timeline calls for outreach in April–May, application open days May 1–30 for active/postconstruction grants, a June 2–3 preconstruction application window, grant reviews by LiftFund in summer and disbursement by September.
The committee voted unanimously to forward the program to a B session; staff will present the proposed agreement with LiftFund and the final program documents to council for consideration.
