The Bloomington City Council approved using funds from the Food and Beverage Tax Fund to help alleviate some financial effects of the COVID-19 pandemic on local businesses Tuesday. The appropriation was passed 9-0.
The council voted to use $2 million from the Food and Beverage Tax Fund to make loans or provide relief for Bloomington businesses during a videoconference special session. The first phase of dispersing the funds is scheduled to begin April 13.
Bloomington businesses petitioned the city March 22 for disaster funding after Gov. Eric Holcomb ordered restaurants and bars to close.
The Food and Beverage Tax was created in 2017 to fund the Monroe Convention Center’s expansion project. It’s a 1% tax on all food and beverages served or prepared by a retailer.
The $2 million will go into a Bloomington Rapid Response Fund, according to city council documents. Its goal is to help employers pay their employees and themselves while they wait for the next phase of the coronavirus relief bill, and other state and local funding.
“We’re absolutely focused on making sure these funds are being used for things like payroll,” said Alex Crowley, director of the city’s department of Economic and Sustainable Development.
Crowley said the funds from the city won’t jeopardize businesses’ ability to receive federal funds. Not all businesses qualify for the funds. He said if a business has more than 250 full-time employees or doesn’t have a sustainable business model, it may not receive funds.
Similar to the federal relief, the funds will be dispersed in phases, Crowley said. The first phase will be used as an assessment round to find the best way to get the funds to businesses. Those who receive funds and the amount they receive will be public information.
“There will be a level of imperfection,” Crowley said. “We’re trying to limit the scope of that.”
Council President Steve Volan said he believes there will be no problem making up for the money taken out of the convention center’s expansion project.
“The fact a community can have this money to build a convention center means it will still happen in the end,” Volan said.
Crowley said he’s unsure whether there will be an interest rate on the loans, but if there is one it will be low.
Volan ended the meeting by thanking Crowley and other city officials for taking on the fund appropriation so quickly and in unprecedented times.
“We cannot go back to business as usual,” he said. “Everything has changed.”
