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<br />e <br /> <br />e <br /> <br />e <br /> <br />Jim Clay, 2465 Kincaid Street, said he was the owner of Plain and Fancy Woodworking, <br />1002 West 2nd Avenue. He di scussed the small business assi stance portion of the <br />CDBG economic development progrilll. He said that whil e he favored the goal s of <br />the program, he was opposed to the negative effects of the administration of the <br />program to date. He noted that in April 1982 the council had set aside $250,000 <br />to fund investment in small businesses. He said that requests for proposal shad <br />brought in proposal s from over 40 organizations in the community. He bel ieved <br />hi s group' s proposal was the only one that had been given final funding approval. <br />Mr. C1 ay di stributed written materi a1 s documenting the hi story of hi s proposal, <br />including a letter of confirmation authorizing him to proceed with his project, <br />an eva1ution of the proposals submitted, a letter to former EDD/HCC head Robert <br />Thomas asking that funding be made quickly to allow the roof of the buil ding for <br />which funding was allocated to be repaired before the rainy season, and a letter <br />tell ing him that work perfonned before II fi nal compl etionll of the allocation <br />process was ineligible for CDBG remibursement. He said that the repairs to the <br />building still had not been made and that as a result he had lost his credibility <br />with the landlord, over $1,000 in damage had occurred in the building due to the <br />leaking roof, the building had become a fire and injury hazard, and the existence <br />of the eight organizations in the building had been jeopardized. <br /> <br />Mr. C1 ay said that the Six-Point Economic Diversi fication Pl an adopted in 1981 <br />had cited the importance of small business to the economy of Eugene and the need <br />to provide venture capi tal for such busi ness. He urged the council not to <br />abandon its dedication to economic diversi fication as soon as the economy began <br />to improve. <br /> <br />There being no further testimony, public hearing was closed. <br /> <br />Mr. Byrne acknowledged that Mr. Clay's situation was very frustrating both for <br />Mr. Clay and for staff. He said that disbursement of the CDBG economic develo\1llent <br />funds had been subj ect to serious changes in the Federal regul ations regarding <br />CDSG funds. He said that new regulations still had not been adopted and that <br />the Department of Housing and Urban Development (HUD) had advised the City not <br />to loan funds for the economic development program since HUD would likely ask <br />that the funds be returned. Mr. Byrne said that EDD had received word today <br />that HUD would withhold an additional $32,600 from the FY83-84 allocation to <br />clear the previous audit. Mr. Byrne asked that the council's motion on the <br />application include language authorizing the City Manager to submit the grant <br />application and take other steps, as required, to bring the application into <br />conformance with HUD regulations and guidelines. Mr. Gleason added that staff <br />fel t the council shou1 d not ho1 d hearings on speci fic proposal s for use of the <br />CDBG funds until regul ations are received from HUD. <br /> <br />Councilor Lindberg said he shared Mr. Clay's disappointment and frustration and <br />hoped the City could help Mr. Clay remedy his business position. He felt that <br />the fau1 t 1 ay wi th HUD, not wi th the City sta ff . He reg retted the vi 01 at ion 0 f <br />pub1 ic trust and the inaction on what cou1 d have been and still coul d be a <br />valuable economic development tool. <br /> <br />MINUTES--Eugene City Council <br /> <br />May 9, 1983 <br /> <br />Page 7 <br />