HomeMy WebLinkAboutCounty of Orange - 2020-12-28 J i
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City of Huntington Beach
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File #: 21-089 MEETING DATE: 2/1/2021
REQUEST FOR CITY COUNCIL ACTION
SUBMITTED TO: Honorable Mayor and City Council Members
SUBMITTED BY: Oliver Chi, City Manager
PREPARED BY: Dahle Bulosan, Chief Financial Officer
Subject:
Approve the COVID-19 Small Business Micro Grant Program
Statement of Issue:
The City of Huntington Beach has received $648,000 in CARES Act funding from the County of
Orange to support small businesses affected by COVID-19. Staff is recommending the approval of
the COVID-19 Small Business Micro Grant Program to provide direct relief to small businesses in
Huntington Beach.
Financial Impact:
The City entered into a subrecipient agreement with the County of Orange to receive $648,000 in
funding to allocate to small businesses within Huntington Beach. Per the subrecipient agreement, up
to 3.5% or $22,680 of the funding may be used to administer the program. No General Fund
appropriations are requested to administer the program.
Recommended Action:
Approve the COVID-19 Small Business Micro Grant Program.
Alternative Action(s):
Do not approve the program as presented, and direct staff accordingly
Analysis:
On December 15, 2020, the Orange County Board of Supervisors approved allocating $648,000 to
provide economic support to small businesses impacted by the COVID-19. Staff is recommending
approval of the COVID-19 Small Business Micro Grant Program outlined below.
This program is designed to supplement other COVID-19 funding sources made available to small
businesses by the State and Federal government. On November 30, 2020, Governor Gavin Newsom
announced that the State of California would provide $500 million in direct relief grants for eligible
small businesses impacted by COVID-19 restrictions, and proposed an additional $575 million in
direct relief on January 5, 2021, as part of the proposed 2021-22 budget, for a total of $1.075 billion.
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The Federal Government also extended the Paycheck Protection Program established by the
CARES Act to provide $659 billion to support small businesses.
The proposed City COVID-19 Small Business Micro Grant Program was modeled after the
successful OneHB Micro Grant program, managed by CIELO, which provides $5,000 in grant funding
to small businesses with 2 to 10 employees in Huntington Beach. Over 7,000, or 70%, of the City's
businesses have less than 10 employees. The proposed grant program would assist these
businesses that make up a significant portion of Huntington Beach's business community.
COVID-19 Small Business Micro Grant Program
The COVID-19 Small Business Micro Grant Program is intended to help support small businesses in
Huntington Beach who need assistance due to adverse economic effects of the Coronavirus (COVID-
19) public health emergency.
Grants will be distributed in the amount of $5,000 as reimbursement for allowable expenses on a first
-come, first-served basis to eligible businesses that provide all necessary documentation. Per the
Subrecipient Agreement with the County of Orange, all expenses are required to be incurred during
the period that begins on December 31, 2020, and ends on June 30, 2021. Grant applications will be
accepted starting April 5, 2021, to allow businesses time to incur expenses within the allowable time
period and compile required documentation.
Eligibility Criteria
To be eligible for the grant program, applicants must be able to meet the following eligibility
requirements:
• Employs no fewer than two (2) and no more than ten (10) full or part-time W-2 employees
• Independently owned and operated with the principal office located in Huntington Beach
• Currently has a valid business license in the City of Huntington Beach
• Has been negatively affected by COVID-19 and will attest by statement to this in the
application
• Businesses that have not yet received any COVID-19 grants from the City of Huntington
Beach will be prioritized
• Does not promote, sell, or advertise any products, ideas, or services that fail to comply with all
applicable laws, acts, regulations, rules and ordinances
• Is not under current governmental investigation, nor currently a party to a civil or criminal
matter, nor has any outstanding violations, citations or other issues that would put them in a
situation other than in good standing with the City
• Is not owned (in whole or in part) or related to any individuals who are currently employees of
the City of Huntington Beach or who are currently an elected or appointed official representing
the City of Huntington Beach
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File #: 21-089 MEETING DATE: 2/1/2021
• Complies with all grant funding requirements included in the Subrecipient Agreement with the
County of Orange
• Per Federal guidelines, eligible businesses are those that meet at least one of the following
criteria:
o Business must have been deemed non-essential and forced to close
o Sales/Revenues must be down more than 25% since the start of the COVID-19
pandemic
o Business must have laid off at least 1 part-time or full-time employee
Allowed use of funds: Rent/lease payment, mortgage interest payment, utilities, personal protective
equipment, and other COVID-19 related operational or safety expenses.
Program Administration
Staff is currently evaluating consultants to administer the grant program. Per the subrecipient
agreement with the County, up to 3.5%, or $22,680, of the funding may be used for administrative
costs. Staff will select the best qualified consultant to manage the COVID-19 Small Business Micro
Grant Program.
Proposed Program Timeline
In order to distribute these funds to small businesses in our community as quickly as possible, while
ensuring the program is thoroughly marketed to all segments of the business community to maximize
awareness, fairness, and participation, staff is proposing the following program timeline:
Date Action Item
02/01/2021 City Council meeting to consider program
02/08/2021 Select Consultant to Administer the Program
02/16/2021 Online and paper application finalized.
02/22/2021 Consultant and the City will begin marketing the program with
a press release, electronic flyer, social media posts, and
targeted outreach.
03/01/2021 Webinar to introduce the program and answer questions from
the business community, led by Consultant
03/15/2021 2nd Webinar to introduce the program and answer questions
from the business community, led by Consultant
04/05/2021 Application portal opens at 8:00 a.m.
04/09/2021 Application portal closes at 5:00 p.m.
04/12/2021 Consultant begins reviewing applications
04/19/2021 - Ongoing Consultant begins distributing grant awards after final review
and verification by the City. Grants are awarded based on a
first-come, first-served basis to eligible small businesses that
provide all necessary documentation.
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File #: 21-089 MEETING DATE: 2/1/2021
Environmental Status:
Not applicable.
Strategic Plan Goal:
Strengthen long-term financial and economic sustainability
Attachment(s):
1. Subrecipient Agreement Between the County of Orange and the City of Huntington Beach for
Coronavirus Relief Funds for Economic Support Provided by the City
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DocuSign Envelope ID: 1BFA2B23-256A-465E-8533-6CAC6E356511
SUBRECIPIENT AGREEMENT BETWEEN THE COUNTY OF ORANGE
AND THE CITY OF HUNTINGTON BEACH
FOR ECONOMIC SUPPORT PROVIDED BY THE CITY
This Subrecipient Agreement (the "Agreement") is made and entered into by and
between the County of Orange, a political subdivision of the State of California,
hereinafter referred to as "County," and the City of Huntington Beach, a municipal
corporation, hereafter referred to as "Subrecipient," with the County and
Subrecipient referred to as "Party," or collectively as "Parties."
WHEREAS, on February 26, 2020, the County Health Officer declared a local
health emergency based on an imminent and proximate threat to public health from
the introduction of a novel coronavirus (named "COVID-19") in Orange County (the
"COVID-19 Emergency"); and
WHEREAS, on March 2, 2020, the Board of Supervisors adopted Resolution
No. 2020-11 ratifying the local health emergency declared by the County's Health
Officer; and
WHEREAS, on March 4, 2020, the Governor of the State of California
declared a State of Emergency to exist in California as a result of the threat of
COVID-19; and
WHEREAS, the State, like the Nation, continues to record a surge in the
level of community spread of COVID-19 resulting in a Statewide increase in the
number of new hospital admissions from 777 on November 15, to 1,651 on
December 2; and
WHEREAS the rise in cases, if it continues, risks overwhelming the ability of
California hospitals to deliver healthcare to its residents suffering from COVID-19
and from other illnesses requiring hospital care; and
WHEREAS, on December 3, 2020, California health officials announced a
Regional Stay at Home Order that will be triggered if Intensive Care Unit (ICU)
capacity drops below 15 percent in a given region; and
WHERAS, the Regional Stay at Home Order instructs Californians to stay at
home as much as possible to limit mixing with other households that can lead to
COVID-19 spread; and
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WHEREAS, on December 10, 2020, the Southern California region was at 9%
ICU capacity, and the Regional Stay at Home Order remained in effect in the
County of Orange; and
WHEREAS the COVID-19 pandemic and the necessary physical distancing
measures implemented have impacted many businesses, leading to business
closures, loss of employee hours and wages, and layoffs; and
WHEREAS the Orange County Board of Supervisors has allocated $10
million in General Funds equally between the five supervisorial districts for
economic support initiatives for small businesses in response to COVID-19; and
WHEREAS, pursuant to the authority delegated by the Orange County
Board of Supervisors, a total of $2 million will be distributed to Orange County
cities located in the Second District of the Orange County Board of Supervisors (the
"Second District") on a per capita basis based on the 2010 population figures
provided by the United States Census Bureau for the economic support of small
businesses located within the jurisdictional boundaries of each city grant recipient;
and
WHEREAS, in order to provide funds for the Subrecipient to pay
expenditures it has or will incur providing economic support to small businesses in
the Second District due to the COVID-19 public health emergency, the Parties have
agreed that the County shall transfer the grant amount described herein to
Subrecipient.
NOW, THEREFORE, the Parties mutually agree as follows:
1. TERM OF AGREEMENT. The term of this Agreement begins on the
date when fully executed by the Parties, and terminates on July 31, 2021, or when
all of the Parties' obligations under this Agreement are fully satisfied, whichever
occurs earlier.
2. USE OF GRANT AMOUNT.
a. Subrecipient shall use the grant amount provided under this
Agreement to pay for Eligible Expenses that: (1) are necessary expenditures
incurred due to the public health emergency with respect to COVID-19; and
(2) were incurred during the period that begins on December 31, 2020 and
ends on June 30, 2021.
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b. The term "Eligible Expenses," as used in this Agreement, shall
mean expenses incurred and paid for by Subrecipient for the provision of
economic support to Small Businesses located in the Second District in
connection with the COVID-19 public health emergency, including
expenditures related to the provision of grants to Small Businesses to
reimburse the costs of business interruption caused by required closures and
unemployment insurance costs related to the COVID-19 public health
emergency if such costs will not otherwise be reimbursed by the federal
government.
C. The term "Small Business," as used in this Agreement, shall
mean an independently owned and operated business that is not dominant in
its field of operation, the principal office of which is located within the
jurisdictional boundaries of Subrecipient, at least one officer of which is
domiciled in Orange County, California, and which, together with affiliates,
has 100 or fewer employees, and average annual gross receipts of fifteen
million dollars ($15,000,000) or less over the previous three years, or is a
manufacturer with 100 or fewer employees.
d. The following is a nonexclusive list of expenditures that shall
not constitute Eligible Expenses payable from the grant amount:
(1) Subrecipient administrative costs that exceed 3.5 percent
of the grant amount set forth in Paragraph 3(a) of this Agreement.
(2) Damages covered by insurance.
(3) Expenses that have been or will be reimbursed under any
federal program, such as the reimbursement by the federal
government pursuant to the CARES Act of contributions by States to
State unemployment funds.
(4) Reimbursement to donors for donated items or services.
(5) Workforce bonuses other than hazard pay or overtime.
(6) Severance pay.
(7) Legal settlements.
e. Subrecipient must utilize the grant amount in accordance with
all Federal and State laws.
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3. PAYMENT OF GRANT AMOUNT
a. The County shall pay Subrecipient a grant amount of $648,000
within 10 business days of the full execution of this Agreement. All of
Subrecipient's expenditures of the grant amount must be for costs as
described in Paragraph 2 of this Agreement. The grant amount represents
the amount allocated to Subrecipient based on population pursuant to the
authority delegated by the Board of Supervisors to the County Executive
Officer on December 15, 2020.
b. It is understood that the County makes no commitment to fund
this Agreement beyond the terms set forth herein:
C. If Subrecipient has not spent any portion of the grant amount it
has received under this Agreement to cover Eligible Expenses by June 30,
2021, Subrecipient shall return to the County by July 31, 2021 the amount
remaining unspent as of June 30, 2021.
4. STATUTES AND REGULATIONS APPLICABLE TO GRANT.
Subrecipient must comply with all applicable requirements of State, Federal, and
County of Orange laws, executive orders, regulations, program and administrative
requirements, policies and any other requirements governing this Agreement.
Subrecipient must comply with applicable State and Federal laws and regulations
pertaining to labor, wages, hours, and other conditions of employment. Subrecipient
must comply with new, amended, or revised laws, regulations, and/or procedures that
apply to the performance of this Agreement. These requirements include, but are not
limited to:
a. Office of Management and Budget (OMB) Circulars.
Subrecipient must comply with OMB Circulars, as applicable: OMB Circular
A-21 (Cost Principles for Educational Institutions); OMB Circular A-87 (Cost
Principles for State, Local, and Indian Tribal Governments); OMB Circular
A-102 (Grants and Cooperative Agreements with State and Local
Governments); Common Rule, Subpart C for public agencies or OMB Circular
A-110 (Uniform Administrative Requirements for Grants and Other
Agreements with. Institutions of Higher Education, Hospitals and Other Non-
Profit Organizations); OMB Circular A-122 (Cost Principles for Non-Profit
Organizations); OMB Circular A-133 (Audits of States, Local Governments,
and Non-Profit Organizations.
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b. Political Activity Prohibited. None of the funds, materials,
property, or services provided directly or indirectly under this Agreement
may be used for any partisan political activity, or to further the election or
defeat of any candidate for public office. Funds provided under this
Agreement may not be used for any purpose designed to support or defeat
any pending legislation or administrative regulation.
C. Tax Reporting. Subrecipient is responsible for any tax reporting
requirements that arise from Subrecipient's distribution of economic support
to Small Businesses, including the filing of any required tax forms with the
IRS and the issuance of any required tax forms to recipients of economic
support from the Subrecipient.
5. REPORTS.
a. Progress Report. On March 15, 2021, Subrecipient shall provide
a report to the County that shall: (1) identify the Eligible Expenses paid from
the grant amount; (2) identify the name and location of each Small Business
receiving economic support funded by the grant amount and the amounts
paid to each Small Business; (3) demonstrate how Subrecipient used the
grant amount consistent with the use requirements of Paragraph 2; and (4)
identify the balance of the grant amount that Subrecipient has not spent.
b. Final Report. Upon the earlier of Subrecipient's expenditure of
the balance of the grant amount or July 15, 2021, Subrecipient shall provide
a report to the County that shall: (1) identify the Eligible Expenses paid from
the grant amount; (2) identify the name and location of each Small Business
receiving economic support funded by the grant amount and the amounts
paid to each Small Business; (3) demonstrate how Subrecipient used the
grant amount consistent with the use requirements of Paragraph 2; and (3)
identify the balance of the grant amount that Subrecipient has not spent, if
any.
C. The Subrecipient shall provide a certification signed by its chief
executive officer with each report required under this Paragraph 5 that the
statements contained in the report are true and that the expenditures
described in the report comply with the uses permitted under Paragraph 2.
d. Subrecipient shall maintain supporting documentation for the
reports required by this Paragraph 5 consistent with the requirements of
Paragraph 6.
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6. RECORDS MAINTENANCE. Records, in their original form, must be
maintained in accordance with requirements prescribed by the County with respect
to all matters specified in this Agreement. Original forms are to be maintained on file
for all documents specified in this Agreement. Such records must be retained for a
period four (4) years after termination of this Agreement and after final disposition
of all pending matters. "Pending matters" include, but are not limited to, an audit,
litigation or other actions involving records. Records, in their original form pertaining
to matters covered by this Agreement, must at all times be retained within the
County of Orange unless authorization to remove them is granted in writing by the
County.
7. RECORDS INSPECTION. At any time during normal business hours
and as often as either the County or the Auditor General of the State of California
may deem necessary, Subrecipient must make available for examination all of its
records with respect to all matters covered by this Agreement. The County and the
Auditor General of the State of California each have the authority to audit, examine
and make excerpts or transcripts from records, including all Subrecipient's invoices,
materials, payrolls, records of personnel, conditions of employment and other data
relating to all matters covered by this Agreement. Subrecipient agrees to provide any
reports requested by the County regarding performance of this Agreement. With
respect to inspection of Subrecipient's records, the County may require that
Subrecipient provide supporting documentation to substantiate Subrecipient's
expenses with respect to the Subrecipient's use or expenditure of the grant amount.
8. INDEPENDENT CONTRACTOR. The Subrecipient shall be considered
an independent contractor and neither the Subrecipient, its employees, nor anyone
working under the Subrecipient shall be considered an agent or an employee of
County. Neither the Subrecipient, its employees nor anyone working under the
Subrecipient shall qualify for workers' compensation or other fringe benefits of any
kind through County.
9. PERMITS, LICENSES, APPROVALS, AND LEGAL OBLIGATIONS.
Subrecipient shall be responsible for obtaining any and all permits, licenses, and
approvals required for performing any work under this Agreement. Subrecipient
shall be responsible for observing and complying with any applicable Federal, State,
or local laws, or rules or regulations affecting any such work. Subrecipient shall
provide copies of permits and approvals to the County upon request.
10. INDEMNITY. The Subrecipient agrees to indemnify, defend with
counsel approved in writing by County, and hold County, its elected and appointed
officials, officers, employees and agents and those special districts and agencies which
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County's Board of Supervisors acts as the governing Board harmless from any claims,
demands or liability of any kind or nature, including but not limited to personal injury
or property damage, arising from or related to the Subrecipient's receipt, distribution
or expenditure of the grant amount under this Agreement. The provisions of this
paragraph shall survive the termination of this Agreement.
11. NOTICES. Any and all notices, requests, demands and other
communications contemplated, called for, permitted, or required to be given
hereunder shall be in writing. Any written communications shall be deemed to have
been duly given upon actual in-person delivery, if delivery is by direct hand, or upon
delivery on the actual day of receipt or no greater than four (4) calendar days after
being mailed by US certified or registered mail, return receipt requested, postage
prepaid, whichever occurs first. The date of mailing shall count as the first day. All
communications shall be addressed to the appropriate party at the address stated
herein or such other address as the parties hereto may designate by written notice
from time to time in the manner aforesaid.
Subrecipient:
Oliver Chi
City Manager
City of Huntington Beach
2000 Main Avenue
Huntington Beach, CA 92648
County:
Denis Bilodeau
County of Orange
County Executive Office
333 W. Santa Ana Blvd., 3rd Floor
Santa Ana, CA 92701
12. DEFAULTS. Should either Party fail for any reason to comply with the
contractual obligations of this Agreement within the time specified by this
Agreement, the non-breaching Party reserves the right to terminate the Agreement,
reserving all rights under State and Federal law.
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13. ATTORNEY FEES. In any action or proceeding to enforce or interpret
any provision of this Agreement, each Party shall bear its own attorney's fees, costs,
and expenses.
14. ENTIRE CONTRACT: This Agreement contains the entire contract
between the Parties with respect to the matters herein, and there are no restrictions,
promises, warranties or undertakings other than those set forth herein or referred to
herein. No exceptions, alternatives, substitutes, or revisions are valid or binding on
the parties unless authorized by the Parties in writing.
15. AMENDMENTS. No alteration or variation of the terms of this
Agreement shall be valid unless made in writing and signed by the parties; no oral
understanding or agreement not incorporated herein shall be binding on either of the
Parties; and no exceptions, alternatives, substitutes, or revisions are valid or binding
on County unless authorized by County in writing.
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement
on the day and year dated below.
CITY OF HUNTINGTON BEACH COUNTY OF ORANGE
A California Municipal Corporation A political subdivision of the State of
California
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DocuSigned by: •••••-•DocuSigned by:
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By: By:
City Vanager Chief Executive Officer
Date: 12/28/2020 Date: 12/28/2020
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cuSigned by: DocuSigned by:
By: c(~cul . Gatcs By: lit a 5c vw�n e
City Attorney Supervising Deputy County Counsel
Date: 12/28/2020 Date: 12/24/2020
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