Author: Rachel Barnhart
When a celebrity chef announced plans to open a restaurant in Rochester, I warned the public that it would likely get taxpayer help. That’s because the city and county have a history of assisting such ventures. The city’s grants and loans are awarded largely in secret.
Redd will get property and sales tax breaks from the county’s industrial development agency, COMIDA. Another notable COMIDA restaurant deal involved Greece Ridge Mall. I have long argued that restaurants are not economic development. New restaurants don’t create new wealth. They shift our spending habits from old restaurants to new ones. Heaping tax dollars on new ventures is picking winners and losers.
At least COMIDA must publicize its largesse through meeting notices and hearings. The city’s business assistance program is far more opaque, its awards only accessible via open records requests and the fine print of annual publications buried deep on the city website.
The city’s standard small business matching grant award is $8,000. That means a restaurant must show it invested that amount in order to receive the grant. Many restaurants get this grant. More than a few of the businesses that received the grant are now closed. Restaurants are extraordinarily risky and this may not be the best use of tax dollars to encourage the city’s revitalization. In other words, $8,000 isn’t going to save a failing business.
The larger awards are much more problematic, particularly because they never get a public airing. City Council doesn’t have to vote.
Here’s are some examples:
- $1,000,000 loan and $100,000 grant to the developers of the Hyatt, Morgan and Christa, to build out a Morton’s Steakhouse and Starbucks Coffee.
- $75,000 grant to Morgan and Christa for a rooftop bar and event space at the Strathallan.
- $25,000 grant and $25,000 loan to the Cub Room.
- $160,000 loan and $40,000 grant to Radio Social.
- $10,000 grant to Mad Hatter.
- $35,000 to Fifth Frame Brewing.
- $20,000 to El Pilon Criollo.
- $27,000 grant to Funk ‘N Waffles, which has since closed.
- $30,000 loan and $15,000 grant to Joe Bean Coffee, which has since closed.
We shouldn’t be surprised if Redd lines up for some of this cash. We should, however, demand a public hearing before the money goes out the door.