News

Gateway fund almost expended for the year

By Scott Wagar

05/15/2012

During Bottineau’s city council meeting on May 7, the majority of the council favored in almost depleting the Gateway fund, leaving only a small amount of money left in its fund for the remainder of 2012.

The event, which lead up to the vote, came when the EDC office requested $61,800 loan from the Gateway fund to assist the new NAPA store on Highway 5 in its start up cost.

The request brought Penny Nostdahl, Bottineau’s city auditor, to the table stating the Gateway fund for 2012 had little money left in it due to the amount of money that has already been given out since January of this year. She added that the fund would almost be expended if they approved the NAPA request.    

With that information, the council voted 4-to-1 in favor of allowing NAPA to have the money. Ben Aufforth, Greg Bernstein, Jeff Hall and Troy Marsden voted in favor of NAPA, while Harley Getzlaff voted against the motion.

Geztlaff stated he voted against NAPA’s request because the money just wasn’t in the present Gateway fund.

“I don’t want people to think that I am against a new business coming into town,” Getzlaff said. “But, the Gateway fund couldn’t afford such a big loan request like NAPA’s. Over the years, the requests for the Gateway fund are getting bigger and bigger. This needs to stop and we have to find a better way of giving out money, like offering smaller amounts of funding each time.”

Getzlaff added that the council should also be considering local businesses in their requests for future funding. He pointed out that the EDC board recently voted against granting Fred Kainz of Premier Enterprise a Gateway loan to assist him with his recent purchase of the former Ace Hardware building, but voted in favor of NAPA.

“I just don’t get it,” Getzlaff said. “Fred is local and is attempting to bring a business to downtown Bottineau and is rejected by the EDC board, but the same board grants NAPA money, and NAPA isn’t even using local banks for their funding.”

Bernstein said that he made the decision to vote in favor of the NAPA request because he felt it was significant for Bottineau’s economy.

“I voted in favor of the NAPA request because I think it will be an asset to the community,” Bernstein said. “And, because I want to continue to promote new business growth in Bottineau.”

GATEWAY FUND

The Gateway fund was established to assist new businesses in start ups, expansions and locating, which provides a low interest rate with an extended payment plan.
The loan receives its funding through 40 percent of a one percent sale tax in the community.

Each year, the city legally has to budget for the Gateway fund. In 2012, the city estimated that the Gateway would receive around $273,500 in revenue from the sales tax, with $150,000 budgeted for the Gateway fund and the remainder for EDC salaries and office expenses.

The Gateway fund is controlled by three different entities, which includes the EDC Board, Gateway committee and Bottineau’s city council members. All three entities must vote in favor for the money to be appropriated, with the EDC conducting the first vote, then the Gateway committee with the final vote by the city council.  

With $127,500 of the Gateway fund spent in the first four months of 2012, it leaves $22,500 for the remaining eight months of this year.

Nostdahl stated that it is expected that more businesses will request money from the Gateway, but with so little money left, individuals will either be granted a smaller amount of funding or no money at all.

There is talk that the individuals who control the Gateway fund will be going into discussions to see if they can find the money to increase the fund for future requests in 2012.