Northlight and Aux will get ARPA millions
The Evanston City Council voted Monday night to award $2 million in American Rescue Plan Act funds to the Northlight Theater and $1 million to The Aux, a minority business incubator.
The approvals came after a long debate over whether the city should include “clawback” provisions in the agreements that would attempt to recover funds if the projects failed.
Aldus. Clare Kelly (1st) pushed this idea. She complained about the lack of clawback provisions for two previous city grants – one to the owners of a chicken and waffle restaurant which ultimately failed, the other to the owners of the Evanston Plaza shopping center – which eventually made a big profit selling the center.
(The city had structured the restaurant aid as a second mortgage, but that security was largely wiped out when the closed restaurant was sold for less than the full debt on the property.)
Aldus. Peter Braithwaite (2nd) said the two grants ultimately achieved the city’s goals – that the restaurant was taken over by a new operator still in business and the mall was successfully relaunched.
He also objected to changing the terms of the deal at the last minute. “This is the worst exercise in local government I’ve seen so far,” fumed Braithwaite, “you don’t move the goal line with seconds left in the game.”
City staff, including acting city manager Kelley Gandurski, society attorney Nicholas Cummings and director of housing and grants Sarah Flax, said that given the way the federal government has structured Under the ARPA program, it is likely that any money recovered by the city from a recovery provision would have to be returned to the federal government and the city would have to spend its own money to sue in court to recover the funds.
Gandurski said the city could simply use an approach it has taken in the past and negotiate the deals like forgivable loans, which would be retired by the end of the ARPA program in 2016.
The $2 million paid to Northlight represents about 7.7% of the estimated $26 million cost of building a new home for the theater company on property it owns at 1012-1016 Church St.
The million dollars paid to The Aux represents approximately 13.7% of the estimated $7.3 million cost of redevelopment of the former EZ Spuds warehouse at 2223 Washington St. to house a collection of minority-owned businesses and to women focused on “community well-being and racial equity”.
Of the eight board members present at Monday night’s meeting, only Ald. Devon Reid (8th) voted against Northlight’s proposal, saying Northlight is a well-connected, well-funded nonprofit and the donor class supporting the theater hasn’t seen a reduction in wealth during the pandemic .
But Ald. Melissa Wynne (3rd) said the theater group was among a class of businesses that have been hardest hit by the pandemic – having to close operations due to restrictions on public gatherings.
The Aux funding proposal was approved without any votes.