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Prairie Lights' grant shows good, bad in city's economic policy

BY DI EDITORIAL BOARD | JUNE 13, 2012 6:30 AM

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Last week, city officials decided to award Prairie Lights a $27,500 grant — a decision highlighting both the strengths and weaknesses of the city's policies in making economic decisions for our future.

The problems in this process begin to arise when this information reaches the Iowa City City Council's decision-making process. The Economic Policy Committee can either review the grant or, because of a recent change in policy, the city manager can bypass the committee and award the grant himself.

Wendy Ford, Iowa City's economic-development coordinator, said that in order to receive the grant, Prairie Lights had to apply, stating its purpose for the money while submitting its accounting records to a private third-party council in order to determine financial need. The third party, the National Development Council, is used to keep the business's information private, and Prairie Lights received its approval.

Ford said that Prairie Lights went the long route, requesting to be viewed by the committee, not just merely passing the desk of City Manager Tom Markus.

"The manager has the authority to extend a grant up to $50,000," Markus said. "We went beyond the policy and sent it to the Economic Policy Committee and had a public meeting as well."

One might say that bypassing the Economic Policy Committee might speed things up for businesses such as Prairie Lights, enabling it to acquire funding faster. This is true, but bypassing checks and balances, while being a way to gain convenience, increases the power from one source that isn't a conglomerate think tank concerned with the proper processes of economic development in Iowa City.

What kinds of problems, you ask, could there possibly be in our process that we may need the Economic Policy Committee to find?

Outside of the approval from the National Development Council, the requirements of these businesses receiving grants could be heightened to more accurately benefit the members of the community according to the federal standard.

Ford said that the city has given similar funds to such businesses as Oasis and the Wedge that were provided by the federal government and require their businesses to hire low- to moderate-income employees and to target a low- to moderate-income customer base.

According to U.S. Census Bureau's QuickFacts, Iowa City's median household income is just $40,716 (roughly $8,000 under the state's median), and the city's policy, even if just held to target low- to moderate-income customers, could help provide citizens with quality products that are priced accurately to their community.

Ford said that the Press-Citizen was given this type of grant to enable it to move to Brewery Square, but just so that it could afford its employees places to park. Its presence on the North Side is beneficial to the city's news coverage, but it is not beneficial to the average Iowa City resident's economic position.

I'd like to thank Prairie Lights, though, for exposing this process while receiving this grant and actually becoming an example of its possible success.

According to an interview with the Press-Citizen, Jan Weissmiller, a Prairie Lights co-owner, said the grant will be used to expand the business's capabilities to enter the growing market of eBooks as well as expanding its café and inventory of children's products.

Ford said that many business owners downtown supported the grant because Prairie Lights is a draw to downtown and that their establishments receive more business by its attraction.

Ford and Markus agreed that the bookstore as a great asset to our community and a prominent example of a success in the grant process.

Given some restrictions, these grants could be beneficial to Iowa City residents and Iowa City business owners. And given that Markus said he was "confident that many businesses downtown will see grants like this in the near future," we need to watch that they are distributed fairly.

And, if approved and distributed properly, they could seriously benefit our city.


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