June 23, 2024

error page

Business is my step

a $530 million federal grant and financial support for impacted businesses

6 min read

As the COVID-19 pandemic impacted light-rail ridership and squeezed small businesses along the south-central corridor just as light rail construction was beginning, both the project and businesses owners along the route will receive some security.

Valley Metro will receive $530 million in federal money from the Federal Transit Administration to fund the remainder of the approximately $1.35 billion light rail expansion. For business owners, the Phoenix City Council approved a plan to provide direct financial aid to those impacted by light-rail construction.

The local grants should bring some peace of mind to business owners and the federal grant will guarantee the line’s completion after a tumultuous four years prior to construction.

Start the day smarter. Get all the news you need in your inbox each morning.

“This project was very controversial,” Scott Smith, CEO of Valley Metro, said. “We like to say this project had many lives. Because at any time if there would’ve been somebody at the (Federal Transit Administration) or on the local level that said ‘No, we’re not going to move forward,’ this project would’ve been ended and all of the money that had been spent up to date would’ve just been for naught.”

a large orange truck on a city street: Construction work continues on light rail on Dec. 22, 2020, near Central and Southgate avenues in Phoenix.

© Mark Henle/The Republic
Construction work continues on light rail on Dec. 22, 2020, near Central and Southgate avenues in Phoenix.

‘Coming out on top’

Phoenix competed with nearly every major city’s transportation department for about $3 billion in federal funds to obtain its capital investment grant.

The federal funds should be freed up by January after clearing its final hurdles in Washington.

Valley Metro said the $530 million grant is notable because of the intensity of the application process and how common it is for agencies to be dropped from consideration. The funding was never guaranteed. This grant was unlike funds from other programs like the air quality and congestion mitigation grants from the Federal Highway Administration, which are generally given to a region based on a formula and distributed by a local agency.

“There’s a lot of communities and transit agencies applying for those funds that are also very likely worthwhile projects, and ours is coming out on top with a strong level of commitment from FTA,” Hillary Foose, spokesperson for Valley Metro, said.

The funds would make up about 40% of the project’s estimated total cost and would go toward 5.5 miles of track, a downtown hub that would serve as a two-line rail system for high-capacity events like the 2023 Super Bowl and replace infrastructure, such as sidewalks and water lines, as the extension is built.

U.S. Representative Greg Stanton advocated for the federal funds during his time as mayor and as a member of the House Transportation and Infrastructure Committee.

Stanton, in a statement, called it critical federal investment to secure light rail in south Phoenix. 

“Years of work and advocacy have made this massive infrastructure project possible. And when it’s complete, light rail will be a new connection to South Phoenix that opens new economic opportunities,” he said.

Smith said that the funds were added security for south Phoenix because it ensures the disruption caused by light rail construction will not be for nothing, and makes room to try to mediate other problems and will allow them to bring in new jobs as the project moves forward.

“This project will be built,” Smith said. “We can now move ahead and focus on, really, the challenges… so now we can move ahead and fully concentrate on things like business assistance, on actually focusing all of our resources on building the project.”

More help for businesses  

Valley Metro expanded its business-assistance program, which offers free business consultation and items like new point of sale systems and promotion, to help businesses caught between the pandemic and light-rail construction, but recognized direct financial assistance was needed to help local businesses weather the unprecedented storm.

Valley Metro will now, for the first time, administer $2.3 million in direct financial grants for businesses with funding from the nonprofit Phoenix Community Development and Investment Corp and the city of Phoenix.

Businesses in the two-tiered program could receive between $3,000 and $9,000 in the first year. 

Businesses in tier one must be located in areas affected by construction, have fewer than 15 employees and conduct business directly with customers that primarily takes places at a location affected by construction among other rules.

Tier two businesses would have to fall under the same qualifications as well as prove some kind of financial loss.

“Business have a lot of different levels of sophistication and interest,”  Foose said. “We didn’t want it too complicated to limit business participation and to really make it an easy pathway to participate.”

The City Council this month upped the maximum amount of the business grants after hearing from business owners that the original plan was not enough. However, by doing so it would decrease the amount of money available for subsequent years. The city will look into other sources of revenue to help provide more money in the future.

District 7 councilmember Michael Nowakowski said efforts to promote businesses in the area was great, “but they actually needed help to pay the bills.”

A complicated relationship

Whether the south Phoenix light rail line would even happen came into question when residents collected enough signatures to refer it to the ballot. But voters in 2019 rejected a proposition to kill the extension.

Even then, the line has faced opposition.

Four Lanes No Train, a grassroots organizing group, spearheaded a movement to alter or cancel light rail plans over its closure of multiple lanes along South Central Avenue. 

Community leaders eventually settled on some terms with Valley Metro that included a commitment to hire within the community and to feature art from Phoenix artists. Valley Metro also created a field office to serve as a meeting place and for residents to brings questions and concerns directly to Valley Metro.

Its initial expanded business assistance program, which evolved to meet the impact of the pandemic, and the transit center were created to include the community in the process. But some say there’s more to be done.

“Having worked with some of the business before I was on Council, I was hoping we wouldn’t get to the point where we are now, which is a point where we’re not sure what business we’re helping and what businesses we’re not,” District 8 councilmember Carlos Garcia said. “I’m supportive of this and I’m glad staff was able to increase the amount … but I think we can do more.”

Garcia said that it imperative that the cultural hubs, its identity and local businesses are preserved after light rail comes. He suggested the council get more involved in connecting businesses to resources.

Members of the public who spoke at the council meeting earlier this month said that the money going toward helping the approximately 145 businesses affected by construction was not enough, but hoped that Phoenix could learn from other cities and create other programs.

“The business people down there, basically, are going out of business,” community activist Salvador Reza said. “Some people have lost 60% of their business, some 30%, some 40%. It’s something that’s affected their business tremendously. They’ll accept any money right now. . . I urge the city not to stop right here, but to continue.”

Megan Taros covers south Phoenix for The Arizona Republic. Have a tip? Reach her at [email protected] or on Twitter @megataros. Her coverage is supported by Report for America and a grant from the Vitalyst Health Foundation.

This article originally appeared on Arizona Republic: South Phoenix light rail line gets 2 boosts: a $530 million federal grant and financial support for impacted businesses

Continue Reading

error-page.com © All rights reserved. | Newsphere by AF themes.