Dayton considers creating $7M 'first-floor fund' to boost key retail spaces

Sep. 27—Dayton is considering creating a first-floor fund to help entrepreneurs, business owners and developers finance storefront-reactivation projects along "strategic corridors" in the city.

The Dayton City Commission could soon decide whether to give CityWide $7 million of the city's federal rescue funds to put toward a new first-floor fund program. The money would come from the $138 million the city received from the federal American Rescue Plan Act (ARPA).

The program would provide primary loans worth up to $300,000 and forgivable loans worth up to $50,000.

Primary loans cannot exceed 50% of project costs, and forgivable loans cannot be worth more than 20% of project costs, says a memo from Todd Kinskey, Dayton's director of planning, neighborhoods and development.

"The FFF program will go a long way toward providing prompt economic stabilization and access to capital for small retail businesses and will help mitigate COVID-related, systemic funding and economic challenges facing small, women-owned and minority-owned businesses," the memo states.

City staff said they believe the bulk of the loans will be for small retail projects.

The new program is meant to support projects that support growth, vibrancy, walkability and development along some strategic corridors, says a proposed first-floor fund agreement.

The loans are intended to help activate vacant and underused storefront spaces that were impacted by the COVID-19 crisis, the agreement states.

The program also is supposed to have a particular focus on Black businesses located in downtown and disadvantaged neighborhoods.

Under the proposed program, loan funding could be used for building renovations, tenant improvements, equipment or machinery, furniture and fixtures, and permanent working capital.

The target interest rate for the loans is between 2% and 4%.