CH is using new tools to attract new businesses
In 2017 and 2018, Cleveland Heights welcomed 95 new businesses to the city. From law firms to doggy daycare, from craft breweries to art galleries, many small businesses are choosing Cleveland Heights as their home. With more than 500 small businesses, Cleveland Heights is an epicenter of small, locally owned businesses in Northeast Ohio.
The city has expanded the tools and incentives it uses to attract and retain businesses, helping to make Cleveland Heights a desirable location for entrepreneurs. The Economic Development Toolbox that Cleveland Heights offers can help meet the financing needs of the business community, including loan financing, grants, rebates and tax incentives.
The city’s Commercial Loan Program provides gap financing on a project, in conjunction with a bank loan and owner equity. In order to receive funding, projects must create at least one low- to moderate-income job for every $35,000 lent. The Commercial Loan Program assisted with financing Boss Dog Brewery’s brewing equipment when it opened on Lee Road in 2017, helping launch that new business.
In 2018, the city added a new Small Business Administration (SBA) Grant Program, in partnership with funding from Cuyahoga County. This program provides a forgivable loan/grant (up to 15 percent, or $50,000) to a business as part of a project involving an SBA loan. The grant serves as an equity infusion to make the project more attractive to banks offering SBA loans, and allows the business to keep more cash on hand for operating expenses. This program was instrumental in helping Paws CLE and Blank Canvas CLE open locations on Lee Road.
For projects that don’t easily fit into either of the above programs, the city also has an Economic Development Fund. This fund provides more flexibility than some of the other programs for high-impact projects the city wants to support.
An Economic Development Fund loan was used to help facilitate evoDOMUS’s acquisition and renovation of its Taylor Road office and showroom.
Last fall, as part of the new citywide Community Reinvestment Area (CRA) designation, commercial properties became eligible for property tax abatements. Whether a project will be granted a tax abatement, and the terms of the abatement, are negotiated on a case-by-case basis and must be approved by both the city and CH-UH City School District before the start of the project.
In order to support small business startups and entrepreneurs, the city has a Microenterprise Loan Fund. Microenterprises are defined as small businesses with five or fewer employees, one of whom is the owner. The program is targeted toward entrepreneurs and startups that may not yet be able to access traditional bank financing.
The city’s Storefront Rehabilitation Program is targeted toward transformative exterior improvements of buildings in commercial districts. It combines rebates of up to $25,000 and no-interest loans of up to $100,000, and also includes free design services from consultants contracted by the city. Among the businesses that have utilized this program are Quintana’s Barber & Dream Spa and Speakeasy on Taylor Road, and AV Remodeling on Noble Road.
Brian Anderson is the business development manager for the city of Cleveland Heights.