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Franklin commission authorizes city sponsorship for EDA grant to convert Literacy Council building into nonprofit hub
Summary
The commission unanimously authorized city sponsorship and the mayor’s signature for an Economic Development Administration grant application that would let the city acquire the Literacy Council’s 3,187 sq ft building to create a shared, subsidized nonprofit incubator; city staff will return if the Literacy Council accepts an outside sale offer.
Josh, speaking for the Literacy Council, proposed that the city sponsor an Economic Development Administration (EDA) grant to buy the council’s 3,187-square-foot building and convert it into a nonprofit incubator and shared-services hub. He said the plan could transfer ownership to the city “with no cost to the taxpayers” if the EDA grant covered the purchase and capital improvements and the Literacy Council managed day-to-day operations. "There's an expectation, not an expectation, there's a possibility I suppose that the EDA grant ... could fully cover the purchase cost of the building," Josh said.
City staff and commissioners pressed for details on timing, cash flow and long-term operating costs. Scott (staff) cautioned that the city cannot use taxpayer funds to provide ongoing subsidies to unaffiliated 501(c)(3) organizations without a mechanism to recoup costs for insurance, utilities or capital expenditures. Josh said nonprofits could cover utilities and suggested a rental fee could build a CapEx reserve; he also said the EDA grant could include funds for capital improvements.
After discussion about the risk that the Literacy Council might accept a private offer during the grant process, the commission approved a motion to sponsor the EDA grant, authorize the mayor to sign application documents, and allow the Literacy Council to revoke the sponsorship if it accepts a sale offer it finds acceptable. Commissioner McQueary moved to authorize the grant writing and sponsorship; Commissioner Powell seconded. The motion carried unanimously.
What happens next: staff will accept the authorization to prepare and submit the EDA application and Josh will begin writing the grant on behalf of the city. The commission’s approval is subject to revocation by the Literacy Council if it secures a private sale; no city purchase will occur unless the grant is approved or other funding is identified.
Provenance: Topic introduced SEG 629; discussion and motion through SEG 1030.
