On Monday, October 11, Sara Pletcher, Economic Development and Community Engagement Coordinator for the City of Milford, provided City Council with a request from Downtown Milford Inc. (DMI) regarding an annual funding agreement approved by council during the budget process. According to Pletcher, the city approved $45,860 in funding for DMI during the budget process.
“The agreement signed by the city requires DMI’s performance to be reviewed each spring by April 30 and funds approved distributed by October 1,” Pletcher said. “Although the $45,860 was approved in the budget process, a vote to distribute those funds was never made. The organization does qualify for American Rescue Plan Spending (ARPA) funding.”
In a memo provided to council, Pletcher stated that then-DMI Director Cat Perfetti and President Peggy Schmidt presented the annual review on March 8. A balance sheet as well as a profit and loss statement were provided to council as well.
“We are simply trying to get clarification on these funds,” Yanelle Powell, current DMI President, said. “There has been a gap in time.”
Councilman Jason James asked if council had actually approved $45,860 and City Manager Mark Whitfield explained that DMI had requested $45,860 plus an additional amount to cover rent. Council had not approved the funding for rent but did approve the $45,860.
“We have been having a lot of discussions about this,” Councilman James said. “Sara did state that one of the discussions that came up during their presentation was that there was ARPA funding for DMI to lessen the amount requested from the city. I am curious whether DMI applied for this funding and if they received it.”
City Finance Director Lou Vitola explained that when the budget was passed, there was limited information on ARPA eligibility. At that time, Vitola explained to council that there was a possibility that funding for community organizations like DMI could be covered by ARPA funding.
“In the case of DMI, based on their April 21 presentation, they indicated that in previous years, they used funding for council for personnel,” Vitola said. “They are short staffed, so ARPA funding can be used to bring their staff back to what it was before. So, yes, DMI could use ARPA funding for that. They do not have access to those funds directly, so they would need to apply through the city or county.” Councilman James clarified his question, stating that he had confused ARPA funding with the Paycheck Protection Program (PPP). Powell stated that DMI had applied for the second round of PPP funding, but she believed the request was denied.
Councilman Todd Culotta pointed out that it appeared DMI was requesting funding for both personnel and rent. Pletcher stated that they did initially request about $8,000 for rent but council denied that request and that the $45,860 was the amount DMI had received over the past few years.
“One of the conversations we have had, and this is not pro or con DMI is our funding and how we would treat this umbrella once we hired an economic development director,” Councilman James said. “We have discussed ways we would fund that department and one of those things was hiring a director and phasing out funding for groups like DMI.”
Councilman Culotta reminded council that they had simply discussed creating the department with funds normally directed toward both DMI and Kent County, but they had not officially decided on that method to cover the cost of the new economic development department. He also pointed out that even if DMI qualifies for ARPA funding, council should be conservative with those funds.
Councilman James asked Powell about assets and project investments that were included on the financial documents. Powell stated that she was not sure what those were and that the treasurer of DMI was supposed to be in attendance at the meeting. At this point, Councilman James suggested tabling the discussion until the treasurer was present.
“DMI provides a valuable service to downtown, but there are a lot of questions to be answered,” Councilman Culotta said. “There has been a lot of turnover at DMI so it might be a good idea, even though I understand they need the money.” Councilman Andy Fulton agreed that the discussion be tabled until the treasurer could be present to answer questions.
Lorraine Dion, who is acting as the interim director of DMI, spoke to council.
“I have had 20 years’ experience with Main Street and was the DMI Director here in 2009. I have worked with Dover, Middletown and Rehoboth on their Main Street projects,” Dion said. “For DMI right now, I have been helping them with their director search. The service DMI is providing through the Main Street program cannot exist if one of the stakeholders is not the municipality. The municipality must assist in some way. It can be cash or in-kind and it cannot exceed half the DMI budget. The board is responsible for funding the rest of the budget. If they do not get funding from the municipality, they will have to dissolve the organization as they will not meet Main Street requirements. I would hate to think that something that was approved in April and put in the budget could derail the search for the director. Delaying this any longer will make it difficult to hire someone if they suspect we cannot pay them.”
Councilman Fulton explained that, although DMI provides a valuable service to the town, the public places trust in council to be good stewards of their money. He stated that the issue is not DMI’s contribution, but that council has questions about a report provided by the treasurer, but the treasurer was not present to answer those questions.
“Thank you for the information you provided,” Councilman James said. “We are fully aware of the facts you presented. It has been explained to us numerous times. When we did the budgeting, we had a lot of conversation about that being a placeholder so we could have additional conversations. The comments have not been to provide no funding to DMI, but it is the amount of funding and where it is earmarked. In order to fully understand this, we must speak to the person who put these financials together.”
Councilman Mike Boyle also pointed out that council was well aware of the benefits DMI provided to the city.
“However, there has been a great deal of turnover,” Councilman Boyle said. “Quite frankly, we don’t know who is in charge. We would like to see the officers here so we can see it is still a viable organization and we would like to see a plan to continue the good work they have done going forward.”
Council voted unanimously to table the decision until all DMI board members can be present before them.
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