Grant for relative of Peel backer questioned
By Jon Hawley
Friday, June 16, 2017
Elizabeth City City Council voted Monday to advance a grant that, while small, would go to a business belonging to the daughter of a strong supporter of Mayor Joe Peel.
Council voted 4-2 to call a public hearing on June 26 to consider a Downtown Improvement Grant Program for The Bridal Lounge, a four-year-old business owned by Sandra Sutton. Sutton is the daughter of Bishop Ernest Sutton, who co-chaired Peel's re-election campaign in 2015.
Sandra Sutton is asking for $1,924 in DIG funds toward an $8,623 renovation of the business's former location, 501 Cardwell Street. A city memo states she's had to relocate her business to 407 McArthur Drive “due to repair issues that may have been hazardous to her customers and employees.”
Though Sutton's business is not located downtown, she's eligible to apply for second-round DIG funds available for businesses citywide. The DIG Program disburses $80,000 a year to help businesses make lasting building improvements. Any funding not awarded downtown is open to citywide businesses in the spring. The goal is to help create jobs while keeping buildings from slipping into blight.
Sutton’s requested repairs are allowed under DIG guidelines and she's proposing to create two part-time jobs once the work is done. She's also meeting the city's matching requirements by putting $6,700 in personal funds into the project. The DIG Program requires a dollar-for-dollar match, meaning it will fund up to half a project costing $40,000 or less. The maximum grant amount is $20,000.
Despite meeting the program’s criteria, Councilors Johnnie Walton, Darius Horton and Michael Brooks nonetheless appeared to question Sutton’s request. They raised concerns about DIG guidelines and how second-round funding is handled.
Brooks asked City Manager Rich Olson if other businesses knew about and applied for DIG funding.
Olson responded that two businesses expressed interest in the funding, but only Sutton applied for funding. He said in a followup interview that the other applicant, Bonita Jones, apparently had a larger project and decided to wait for more grant funds to become available.
Olson and Assistant City Manager Angela Cole also both noted to councilors that it's public knowledge when non-downtown businesses may apply for DIG funding, and city staff advise businesses the program is available to them.
Brooks nonetheless said he felt the city has more than two businesses that would benefit from DIG funding. He called for the city to better promote the program.
In a followup interview Thursday, Brooks also said it “looks suspicious” that the daughter of a Peel campaign official may receive a grant — though he said he didn't know if there was anything wrong with it.
Walton and Horton also expressed concerns that businesses didn't apply because the DIG Program has a minimum grant requirement of $2,500. Council will have to waive that requirement to award Sutton funding, city staff reported.
Notably, the city only has $1,924 remaining in DIG funds this year, meaning Sutton could not ask for more, absent council appropriating more money to the program.
That led Walton to question why the city even has rules if “we change them for whomever we want to.”
Walton also called for the city to allow additional applications for consideration.
Councilor Ray Donnelly, who moved to proceed with Sutton's grant, opposed allowing a friendly amendment to that effect.
However, councilors did agree to discuss changes to DIG Program guidelines to address some of the concerns raised by Brooks, Walton and Horton, including how to better market the program and how to make funds more easily available to businesses citywide. Brooks explained he was concerned non-downtown businesses were only eligible for the “scraps” remaining in second-round DIG funding.
Brooks also suggested the city set aside $10,000 of the city's $80,000 in annual DIG funding for non-downtown businesses, and allow them to apply earlier in the fiscal year for that funding.
Sutton could not be reached for comment Thursday, but Peel said he “had nothing to do with” her application. Her father, Ernest Sutton’s involvement in his campaign — she was not part of his campaign, he added — doesn't mean she has to forfeit rights as a citizen, he said.
Peel also said it's widely known that DIG funding is available, and that businesses who do basic networking would know about the program. Various groups that support businesses also make entrepreneurs aware of the program, he noted.
However, Peel said he agreed with Brooks' suggestion to set aside some DIG funding for non-downtown businesses. He suggested setting aside $20,000 for the businesses.