Posted on 06/08/2007 7:19:31 AM PDT by Cat loving Texan
Council approves, tweaks restaurant loan Provisions added to Las Manitas loan.
By Sarah Coppola AMERICAN-STATESMAN STAFF Thursday, June 07, 2007
The Austin City Council approved a proposed $750,000 forgivable loan for Las Manitas restaurant, but tweaked the loan to respond to citizen complaints.
City officials proposed the loan to help Las Manitas owners Lidia and Cynthia Perez relocate to and renovate 227 Congress Ave., a historic building the sisters own nearby. The home of Las Manitas and other businesses, 221 Congress Ave., will be redeveloped into a $185 million Marriott hotel complex.
The issue drew only a handful of residents to City Hall this morning, even though e-mails and phone calls about the idea have been pouring into Council offices all week.
The Council voted 5-2 to approve the loan, which will last for 20 years and have a 6 percent interest rate. The Perez sisters will have to pay $4,500 a month for the first five years. After that, if they've met conditions such as retaining 15 full-time employees, they won't have to pay off the remaining balance.
Council Member Mike Martinez added a provision that says if the Perez sisters sell the business or the business folds between years 5 and 20, the sisters will have to pay back an adjusted balance on the loan for those years.
That will provide an extra level of security for the city's investment, Martinez said.
The money will come from a Business Retention and Enhancement program the Council created to attract and keep stores, restaurants, art galleries and entertainment venues along Congress Avenue and East Sixth Street, areas some council members say are overloaded with bars and dilapidated, underused buildings.
Council Members Sheryl Cole and Lee Leffingwell voted against the loan, saying they didn't think it should be forgiven.
"They will still owe the city about $700,000" at the end of the first five years, Cole said. "I think that's too much money to be forgiven."
She said she is also concerned that the boundaries of the Business Retention program do not extend into East Austin.
Leffingwell said he likes the Business Retention program but didn't want to forgive this loan because the forgiven money could be used to help other small, locally owned businesses.
Sue Edwards, the director of the Economic Growth and Development Services office, said her office spent eight weeks and several meetings vetting the Perez sisters' loan application. The sisters had to submit a detailed business plan and financial records, she said.
The $270,000 the Perez sisters pay during the first five years of the loan will go back into the Business Retention fund, she said.
Council Member Jennifer Kim said it made sense to forgive the loan after five years because the value of the kitchen equipment the Perez sisters would buy with the money would depreciate during that time. The sisters have said it will cost at least $844,000 to add a commercial kitchen to the building, which currently houses an art gallery that will move into the Marriott complex.
"The restaurant is a tough business," Kim said. "I don't believe (the Perez sisters) are running this business just to become wealthy. They share their net profits with their employees, they take care of their employees' medical expenses when they need to, and they do a number of things in terms of charitable contributions."
She said she wants to keep Las Manitas downtown because that's where they've developed their loyal clientele.
Mayor Will Wynn said the Marriott hotel complex would bring tax base, 600 new jobs and tourist business to downtown. But such new development will also displace small businesses, and the Retention Fund will help those small businesses stay, he said.
The fund has $766,000 right now. But at least five projects are in the works for Congress Avenue and Sixth Street that will pay fees into the Business Retention fund, Wynn said.
"Yes, the majority of funds we have right now is proposed to go to Las Manitas," he said. "But the fund is also going to grow with unbudgeted non-tax dollars that will help this community have the vitality, the spectrum of businesses large and small, where we want them."
Council Member Betty Dunkerley noted that numerous city studies have cited the need to encourage more diverse, vibrant businesses downtown.
"I have heard people say this program will only help Las Manitas and that's not true," she said.
Güero's restaurant owner Rob Lippincott, one of five speakers who addressed the Council this morning, said that giving the Perez sisters a forgivable loan would put other restaurants at a disadvantage.
"Do you all think (the Perez sisters) will lower their prices or keep them artificially low, or do you think they will pass the savings on to their employees or just put the money in their pocket?" he said. "If either of the first two happen, it will be unfair competition for my daughters in our business."
Malcolm Greenstein, another speaker, said Las Manitas deserves the loan because it's a haven for regular, working-class people among increasingly pricey downtown eateries.
"The high-end condos are attracting rich people; the restaurants are attracting those people, too," he said. "Las Manitas will be the sole place in this area for diversity. This is the only place where Karl Rove, Karen Hughes and a homeless person will be eating in the same place."
scoppola@statesman.com; 912-2939
How can I get one of these loans?
I’m listening to KLBJ and their discussion on this issue. I’ve never eaten at Las Manitas before, but I will never set foot in that place now. The comments by Cynthia Perez - who basically pulled the race card - really ticked me off.
I am so glad I no longer live in the San Fran/Austin/cisco and their horrible silly council. The voters should recall that entire bunch of give-away jokers. That all started with the hippie mayor Jeff Friedman (I know he just died yesterday).
I would certainly like to see a picture of that.
(After that, if they’ve met conditions such as retaining 15 full-time employees, they won’t have to pay off the remaining balance.)
Great, another make-job program. We all know how well those work when they are mandated by the government. The sisters will have the restaurant and have the loan forgiven no matter how bad their service is. Or they can reduce their prices, while their competitors, who actually pay market rate for their rent, cannot follow suit! Great idea guys and girls of the Austin Council!
If a business cannot do business, then they close. It’s the American way. Want to see more of this taxpayer funding nonsense? Vote democrat and support amnesty. These people spend half their time whining and the other half sticking a knife into your back
KLBJ is talking about the Austin silly council is also wanting to set money aside to combat “gorebull warming” now.
HA!! HA!! HA!! HA!!
Have your business operating in a building that is being redeveloped into a $185 million Marriott hotel complex. Interesting this story doesn’t make it clear whether the sisters own the building they are currently operating in, or if they rent. I’ve eaten there and the food was pretty good, if not the best in Austin.
Are you listening to this idiot on the phone now? Juan is one of those gimmie - gimmie - gimmie your money people.
Yup. Going to get some valium now.
http://www.statesman.com/news/content/news/stories/local/06/08/8kelso.html
COMMENTARY: JOHN KELSO
$750,000 is too much to spend on a Tex-Mex hash house
People who love Las Manitas ought to be down there helping do the remodel.
Friday, June 08, 2007
It shouldn’t cost three-quarters of a million bucks to move a taco joint a couple doors up the street and remodel it into another Tex-Mex restaurant.
That’s the first thing that came to mind when I heard the City of Austin was planning to give the owners of Las Manitas, at 211 Congress Ave., a “forgivable” loan of $750,000 to move their place up to the corner building at Third and Congress and redo that space to serve Mexican food.
Why does this cost $750,000? We’re not putting together Six Flags Over Migas here. We’re talking about re-creating a little Mexican food place big enough to pump out the No. 1 Dinner. At those remodel rates, I was starting to think Las Manitas means “the Handouts” in Spanish.
The reason the City Council was fixing to loan the Perez sisters, Las Manitas’ owners, the money is that Las Manitas is considered an “iconic” business. I’ll buy that. I’d rather have Las Manitas around than the $185 million Marriott hotel complex that’s going in on the block. At least Las Manitas maintains some local culture. Goodie.
On the other hand, why the special treatment for Las Manitas? Spamarama, the legendary 29-year-old Austin event where people actually cook and eat Spam on purpose, just lost its sponsor, Disability Assistance of Central Texas. And you won’t see City Manager Toby Futrell saving the day by driving up with an 18-wheeler full of $750,000 worth of potted pork parts.
This is a disturbing case of skewed priorities. The food is more memorable at Spamarama than it is at Las Manitas. (It’s hard to get those Spam-Alama Ding-Dongs out of your head, let alone your throat.) And you don’t go to Las Manitas for the food. You go to Las Manitas to have your liberal aura poofed, and to get your Aulde Austin credentials stamped.
This is where you go to remind the California jerk sitting next to you at the counter that, yes, you smoked a fatty at Soap Creek, and he did not.
But in all the years that Las Manitas has been around, I’ve never heard anyone talk about how great the food is. Not once. When people talk about their wonderful Las Manitas dining experience, they’ll tell you stuff like, “I saw Lyle Lovett eating there.”
So what? He’s skinny.
See, the thing is, the reason Las Manitas is being catered to by the city is that every political wing nut in town left of Timothy Leary who has any clout eats in this place. Look up the word “iconic” in the Austin dictionary and you’ll see the definition is “City Council eats here.”
If these lefties think this highly of the place, they ought to be down there with dollies helping the Perez sisters move their silverware up the street. Certainly somebody in this crowd can come up with a pickup truck or five.
Haven’t these people who love Las Manitas so much ever heard the old Peter, Paul and Petunia song “If I Had a Hammer”? If they have a hammer, they ought to be down there helping Las Manitas do the remodel.
Certainly somebody in this liberal bunch has a saw, a tool belt and a sander.
John Kelso’s column appears on Sundays, Tuesdays and Fridays. Contact him at 445-3606 or jkelso@statesman.com.
Look up the word “iconic” in the Austin dictionary and you’ll see the definition is “City Council eats here.”
That is the pertinent fact left out of the original story, if I read it correctly. Why do taxpayers then, have to fork over for them to move into a building they already own? Sounds like the Boulder crowd has completely taken over Austin City government, not that I’m surprised. Maybe everybody on city council could just spend the weekend helping them move and buy some used restaurant equipment. Does the equipment they’re using now not belong to them?
The KLBJ substitute guy on the radio singled out former mayor Kirk Watson and former mayor pro-tem Gus Garcia as being the supporters pushing this loan. Figgers.
This is Austin’s liberal ruling class giving money to their serfs and expecting the money to be funneled back to them which it no doubt will be.
If any of you want to really screw them up, go capture a Barton Creek Salamander, put it at the new location, photograph it and then call the EPA (and some local tv stations). Then watch all the environazis backpedal on how necessary it is to upset the salamander’s habitat in order to placate the City Council and La Raza.
Austin voted for this liberal redistribution of wealth silly council and don't b**** to me about this.
That is so funny. There is a lot of truth in that too. I remember the people with the john/john signs in their yards always had lawn service or unkept lawns.
There is only one liberal in my neighborhood who actually has a decent and well kept lawn.
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