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Board debates funding options for HUGS greenhouse expansion; item tabled for 30 days
Summary
HUGS Cafe Inc. asked MCDC for $683,467 to expand its greenhouse operations. Speakers debated a $150,000 grant plus loan, an interest-free window, and a forgivable loan that would convert as HUGS meets fundraising milestones; the board voted to table the item for further discussion.
Kit Marshall, a staff member at HUGS Cafe Inc., opened public comments by describing the greenhouse as an employment program: "HUGS greenhouse is a very special place," she said, noting nine individuals work there in meaningful jobs.
Lauren Smith, CEO of HUGS Cafe Inc., told the board the organization had raised most of its funding privately and asked the board to approve the full expansion amount. "Please grant our request for the entire amount today," she said, adding that HUGS had raised roughly $19 million since inception and that any city contribution historically represented less than 7% of their funding.
During the formal agenda item, board members weighed alternatives to a full grant. One member proposed a $150,000 grant combined with a multi-year loan; another offered a more aggressive forgivable-loan model that would be interest-free for the first three years and forgiven to the extent HUGS matched the fundraising over a five-year period. The board asked HUGS leadership to clarify which work could be delayed if some allocated elements were not funded immediately; HUGS responded that $113,000 represented needed roadway access and a secured gate and that deferring that work would hinder operations.
HUGS cautioned that carrying debt on the balance sheet could reduce the organization’s ability to attract foundation support. The board’s chair framed the forgivable-loan proposal as a city match: if HUGS raised $X during the loan period, the city would forgive the same amount of loan principal. After extended debate about timelines, fundraising risk, and construction cost inflation, a motion to table the item for 30 days passed so members could further review options.
The discussion combined public comment, staff clarifications and a range of board proposals — from partial grant to interest-bearing loan structures — but stopped short of a final award. The item will return to the board within 30 days for a final vote.
