Estacada urban renewal agency delays decision on $300,000 loan request for Ant Farm café remodel

The Estacada Urban Renewal Agency on an unspecified date postponed a vote on a requested $300,000 loan to Ant Farm to finish remodeling the Harmony Café & Bakery at 221 Southwest Wade, directing staff to collect a second contractor bid and for Ant Farm to provide additional financial documents before the agency votes on the request.

The decision came after a presentation by Ant Farm representatives and a citizen comment that asked for clearer financial information. Ant Farm representatives said the organization began a full gut-and-remodel in 2023 after buying the property in November 2022, encountered foundation and accessibility work needs and expanded the building footprint. Neil Hatley, director of workforce development at Ant Farm, said the group has completed sheathing, roofing and window installation and now needs licensed tradespeople to finish plumbing, HVAC and electrical work.

"A lot of the funding...just goes through us and on into citizens," Hatley said, describing how public COVID-era funding temporarily changed the nonprofit's revenue and program mix. Sierra Miller, director of the café and bakery, said the Sandy cafe model the group is replicating "truly has become like a community hub" and that Ant Farm plans to offer cultural arts and an access learning center in the Estacada space.

During public comment, resident John Dolezal said he reviewed Ant Farm's publicly available Form 990 filings and could not find recent financial statements in the packet; he asked how revenue trends would affect the organization's ability to carry loan payments. "I didn't see any financials," Dolezal said. Ant Farm told the agency it has financial statements for 2022 and 2023 and a statement of activity through June and that it can provide a pro forma and additional documentation.

Board members questioned repayment capacity and loan terms. Ant Farm proposed a five-year payback schedule and said it expects Clackamas County operational funding and a Boeing equipment grant to cover part of repayment and project costs. Hatley said the $300,000 requested, together with a Boeing equipment grant, would cover the remaining construction costs, which Ant Farm estimated at about $342,000.

Agency staff and board members also flagged a potential procurement concern: the contractor who prepared Ant Farm's estimate is related to the project, and the board asked for a second, independent bid. Agency staff described how prior loans issued by the agency have been structured as program loans and explained that repaid loan funds can be reused as program income under the urban renewal program's limits on indebtedness.

Rather than vote, the board directed staff to return the item at the agency's December 9 meeting with: a second contractor bid, Ant Farm's detailed financial statements and the pro forma covering repayment assumptions. Members also discussed interest rate policy: staff said the agency currently offers a 3 percent SDC-style loan rate and that a recent prior loan had a 2.5 percent rate.

A separate, routine consent agenda for the meeting passed by voice vote earlier in the session. No formal loan approval or binding agreement was made at the meeting; the board left the matter to a future meeting pending the additional information it requested.

Next steps: staff will obtain a second contractor estimate and Ant Farm will provide the requested financial documentation for the December 9 agenda so the full board can consider loan terms and conditions.