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Ashland city council considers options for struggling businesses

Ashland City Council began its meeting Tuesday by saying goodbye to longtime Public Works Director Paula Brown and ended it by examining the possibility of funneling Transient Occupancy Tax funds to desperate local businesses.

The meeting, held via Zoom, centered on the fallout of COVID-19.

Submitted public testimony, all emailed to the council ahead of time as per Ashland’s coronavirus-altered meeting rules, might have summed up the city’s predicament best. Three of those statements addressed the growing concern surrounding local businesses and their ability to weather the economic storm.

Nyki and Chris Keefe announced that their business, Bestow & Bloom, 149 N. Pioneer St., closed its doors for good soon after celebrating its third anniversary, and Oberon’s Restaurant owner Andy Card detailed the measured steps he’s taken to survive a typical economic downturn before explaining how the federal government’s aid packages and the “murky” rules by which that money is earmarked might add more complications than answers.

“We are not optimistic about Phase 1 opening either,” said Card’s letter, referring to Oregon’s planned multi-phase stairstep reopening, a few details of which were announced Thursday.

“Tables 6 feet apart? No bar seating? Closed by 10 p.m.? Having to take the information of each customer that dines? We would have to hire someone specifically to do just that. We can’t justify that labor cost. It may not even be worth it until Phase 2 or 3, but we do not know how long it will take to reach each of the subsequent phases.

“The city has offered deferral on utilities and food/beverage tax. It’s helpful for now from a cashflow perspective, but it does not solve the problem. That money is still owed, but we still have not generated any revenue. Every month our bank account is less, so how are we expected to pay the owed utilities and food/bev tax? How are we expected to pay rent? How are we expected to survive the winter when that survival relies on tourist revenue from the summer?”

The council spent much of the evening grappling with those questions, as most of the items on the jam-packed agenda — the meeting lasted two-and-a-half hours — either dealt directly with how to help small business owners cope or touched on that subject.

The final item on the agenda, a “consideration” of small business grants offered by the city, began as an explanation by interim City Administrator Adam Hanks of why tax funds can’t be diverted from their voted-upon purposes to struggling business owners.

The item, placed on the agenda by Councilor Julie Akins, appeared somewhat dead in the water before Councilor Rich Rosenthal presented a possible solution.

“I’ve been researching this for quite a while now,” he said. “The only path forward that I see in terms of a potential fund source that would be meaningful enough potentially is the restricted (Transient Occupancy Tax) funds for future parking supply.”

The good news, Hanks confirmed, is that the $475,000 has already been collected and the local restrictions can be undone “relatively easily” by the council. The bad news: freeing the cash from the tangled vines of government restrictions will take considerable hacking and might prove futile.

“The restrictions in Oregon Revised Statutes dictate what that can be used for, and currently that does not include any direct award or assistance to any private entity,” Hanks said. “It has to be used for tourism, promotion and marketing. In a related piece to earlier in the evening, that is a pot of money that can be used for some re-energizing and reinvesting in the tourism foundationally, not to an individual business.”

Hanks said he’s been working with Sen. Jeff Golden and Rep. Pam Marsh in an attempt to “loosen” the statutes and free up that money.

“I think there is possibly some energy toward that,” he said. “Whether that would be expanded by a legislator to include a direct award to private business, I don’t know. The idea that I’ve heard for the loosening for those restrictions is more for economic recovery, strategic planning and implementation of economic recovery, as an expansion beyond the more narrow terms of promotion that’s currently there. So it’s a state restriction; hard to do.”

With its scheduled time running out, the council voted to look into loosening TOT restrictions during its May 19 meeting. The vote effectively ended the meeting, roughly 20 minutes after Councilor Stephen Jensen explained why even if the city does find another funding source, it will likely be a hollow victory unless it’s quite large. Otherwise, he noted, the city will be saddled with the impossible task of deciding who gets what.

“I think there would be a big, big equity issue in terms of a singular effort to support a singular population,” Jensen said. “There are hospitals on the ropes, seniors, low income, students, SOU is super on the ropes, OSF actors, elder care facility workers. There’s a whole host of folks out there that certainly could use some assistance, and if we single out in a little bit of a self-serving way, because it benefits the city to support businesses, I think that’d be a tall mountain to climb from an equity standpoint.”

Also Tuesday, the council reviewed recommendations from the Cost Review Ad-Hoc Committee, discussed the Economic, Cultural, Tourism and Sustainability Grants and bid farewell to Brown, who was hired as public works director in 1997, left in 2008 to serve in the military, and returned to take the same job in 2016.

Among the cost review committee’s recommendations was a request to “consider” outsourcing services, and it was that bullet point that attracted most of the council’s attention.

Regarding Ashland’s emergency services, Councilor Stefani Seffinger said that’s one area in which quality should take precedent over cost.

“For me, this is not just a cost decision,” she said. “It’s also a decision of the quality of service. Having two paramedics is important to me. Being able to respond to all 911 calls as we do now rather than not responding to some of the calls is an important thing for the council to know. I think that there are circumstances now that would affect lives of seniors in the amount of time it took to get them to the help they needed. And I do think if we’re going to do this, there really needs to be public input and senior input before this decision is made.”

The council decided to revisit the discussion during its next meeting.

Joe Zavala can be reached at 541-821-0829 or jzavala@rosebudmedia.com.

All events are cancelled at the Ashland Shakespeare Festival.{ }(Jaimie Lusch / Ashland Tidings)
Jamie Lusch / Ashland Tidings Outback In The Temple Of Venus one of many businesses closed down in Ashland.