I sent a note to the Mayor and all all Austin City Council Members regarding the Las Manitas loan. I’m including their unedited response below. I will post other responses as I get them. Your comments are welcome.
Sent: Tuesday, June 05, 2007 5:51 PM
To: CityPio, Pio; McCracken, Brewster; Kim, Jennifer; Martinez, Mike [Council Member]; Leffingwell, Lee; Dunkerley, Betty; Wynn, Will; Cole, Sheryl
Subject: Submitted from City Council web site – Las Manitas
Date/Time Submitted: 1750 hours
Subject: Las Manitas
Comments:
I am concerned about the city basically gifting $750,000 to Las Manitas. I have run my own business within the city limits for over 18 years. I have had to compete on an even footing with all other businesses. I lease my space, and trust me my lease costs are tremendous. I have moved my business multiple times in the last few years as landlords have changed, buildings have been repurposed or a landlord has decided to use his/her building for some other purpose. I have always done so at my cost. Can you please explain the rationale for gifting that much money to a restaurant? Restaraunts do not provide high paying jobs; there is no hope that we will ever recover the money based on additional tax base. Just a few months ago the city council and the city manager were telling us that there is a $24 million dollar deficit in the budget. There are roads within the city limits that need to be fixed. There are improvements that need to be made to our schools. Wouldn’t that be a better use of our money?
As much as I like their food, this is just a restaurant; this is not a vital community service like a hospital, a school, or a road. I strongly oppose this gift.
From : Dunkerley, Betty <Betty.Dunkerley@ci.austin.tx.us>
Sent : Wednesday, June 6, 2007 4:41 PM
Subject : RE: Submitted from City Council web site – Las Manitas
The money used for the program is coming from some of the unbudgeted fees paid by the owners of the very tall new buildings downtown. These funds will continue to accumulate from other high rise buildings as well as the interest and principal payments from this loan so that other retail businesses on Congress and 6th Street who meet the criteria can use the funds. If you are a retail business in the 6th and Congress area, you may be eligible. This program resulted from studies done in this area that showed the need for assistance to increase and maintain retail, since many buildings in the area are historic and very difficult and expensive to update. We have enough bars in the area. Additionally, the City will have a first lien on this property and if owners do not meet strict monthly guidelines, the loan will not be forgiven. bd
Jennifer Kim’s Response – Recieved 6/18/2007
Thank you for your recent letter expressing your opposition to the loan for Las Manitas.
I understand your frustration regarding this action, and I want to explain to you my thought process in reaching my decision. I believe that small business is the backbone of Austin, and that we, as a city, must take action to preserve the small businesses that are a vital part of our community. As a previous small business owner, I understand some of the challenges faced by these businesses.
While I do understand that citizen’s opinions about this loan vary widely, I believe that it is important for the City to help small businesses to remain on Congress Avenue. The Council created a revolving loan fund for small businesses. The funding for this loan program is from private developer’s fees from projects on Congress Avenue, including the Marriott hotel, and not from taxpayer dollars. The repayments from the Las Manitas loan will total $269,000 over the next five years, paid in monthly installments of $4500 – that amount is not forgivable. I specifically pushed for the repayments and to ensure that accumulated funds would be accessible to other small businesses in the future.
Another consideration was the alley access that the owners of Las Manitas had, but that was needed by the developers of the Marriott hotel. Without the City stepping in to help save Las Manitas, the builders of the Marriott may not have gotten the alley right-of-way that they need to develop the hotel. The hotel will help Austin to win bigger and more profitable conventions. This generates jobs, more sales tax and more hotel tax for arts funding. I was looking for a win-win, and I believe this compromise accomplishes that.
Your feedback is important to me and helps me to serve you better as your council member. Please do not hesitate to contact me or my office if I can be of further assistance.
Warmest Regards,
Jennifer L. Kim
Austin City Council Member, Place 3
How many other businesses qualify? Was it written in such a narrow manner as to help Las Manitas? Don’t take my comment wrong, I love the place. I do, however, feel that loaning a business money to improve on their own building is fine – I certainly don’t fele that the loan should be forgivable. I would even be cool with a no interest loan that needed to be repaid. I feel sure the new facilites will accommodate more people in a better situation (does it get any worse than having to walk through the center of a kitchen to get to your table?) and this should increase revenues for the restaurant. BTW – there are several wonderful restaurants with varied menus in the area – it’s not like Las Manitas demise would mean business people working downtown would have to get in their cars to have a meal…
Councilmember Dunkerley responds to almost everything – she takes her responsibility to the citizens very seriously. I’ve rarely gotten responses from anybody else.
Even though I oppose the loan, she makes a decent case here for why it isn’t a horrible idea (rather than just hand-wringing over iconic-ness, which makes me ill).
___
Editor’s Note: Thanks for the comment. So far she is the only council member who has responded (including council member’s I know personally).
According to the Statesman, Two Council members changed their positions–Lee Leffingwell and Sheryl Cole.
Is opposition building? Sammy and Bob talked almost exclusively about this in their morning show.
I wonder if businesses that aren’t frequented by council members get the same treatment? This is a prime example of corruption; kudos to AroundAustin.com for finding this.
(P.S. Submitted to digg.)
I won’t be going to the new restaurant. I actually quit going to the current one about four years ago. I was disgusted by the way I saw the owners treating their staff. In Spanish they were screaming, “Run! RUN! Hurry UP!” to the staff, who were already literally running. It was a scene out of a sweatshop. Not to mention that they are holding about 1.3 million dollars in assets now–they don'[t need any help. This entire situation may have been good intentioned, but it smacks of shady favoritism to an undeserving recipient. And the food isn’t even that great any more.
Our taxpayer $$’s have been used like THIS and then Ms. Perez is ungrateful for such a “HUGE GIFT”?? How very unacceptable in ALL senses!
If my tax payer dollars are being used, then it is my civil right to have a vote on WHAT those dollars are being used for! THIS COUNCIL SHOULD BE IMPEACHED – they have spent our taxes inappropriately before (the thousands of $$ for City parties) and we citizens have done nothing? IT IS TIME TO TAKE ACTION and boot their UNETHICAL butts out of office!!
Without a doubt, I WILL boycott this sleazy establishment!!!!!!!
The next city election is May 08. Get out and vote…we need folks in office not so eager to hand out city cash. Austin needs sidewalks, parks and road repair. How does giving $750,000 to Las Manitas help the average Austinite? I think its time of a change at the top and a new city council!
I will, at the next election, work diligently to replace the 5 members of the council who voted the “ayes” to fund the Las Manitas loan.
In the meantime, if a recall option occurs, I will help elicit signatures.
This is amazing! Today Las Manitas and Paris Hilton are the headlines…Holy Cow!
I would like to know EXACTLY-
1. What are the boundaries of this Congress and 6th Street area that qualifies for a forgivable loan.
2. What are the EXACT definitions of the “iconic” status that qualifies such business’ for free money.
3. Define “unbudgeted fees.” From my perspective, these are general fund monies like many others. Is the logic that unbudgeted fees can be given away? How about some accounting on all “unbudgeted fees?”
I believe that the council members will come to regret this decision. Small business owners already chafe at the regulations the City of Austin imposes upon them. This favoritism will solidify feelings that the city has different rules for different folks. The backlash will be felt at every level. We are all going to be asking for the “Las Manitas treatment” when dealing with endless headaches that are involved with running a business. It is not that small and local business shouldn’t be helped and encourged in Austin but it has to be fair and equitable. I would like to know the principals and standards of this giveaway.
I heard a rumor that the Perez sisters are related to Henry Cisneros. Could this have had anything to do with the favoritism?
The issue is do we want another gigantic building in downtown Austin? The City wants to pay to get Las Manitas out of the way because they want growth at any cost. Forget about Las Manitas–we’re going to end up with huge partially empty buildings obscuring downtown Austin.