A unique public-private partnership could soon bring some desperately needed relief to the beleaguered merchants of Manitou Springs.
Manitou’s City Council approved a $15,000 grant Tuesday to support a “Business Band-Aid” loan program proposed by the Manitou Springs Creative District, Chamber of Commerce and Vectra Bank.
The partners plan to use the seed money, which will be matched by the chamber, to establish a $30,000 loan fund that would be used to guarantee small loans to help businesses suffering largely from road construction get through the rest of the winter.
Creative District and Manitou Springs Economic Development Director Natalie Johnson said Colorado Publishing House and Business Journal Chairman John Weiss is working on the sidelines to generate additional funding.
Weiss said he would also support a public campaign to raise funds through Colorado Publishing House’s six other publications, which include the Colorado Springs Independent, the Pikes Peak Bulletin and several military newspapers.
Johnson said she anticipates the campaign will raise another $10,000 to $20,000, with a goal of raising $60,000 by March.
Shawn Gullixson, vice president, area retail leader for Vectra’s Colorado Springs market, said he would help the project partners form an advisory committee of finance professionals to review the financials submitted by loan applicants.
“Small businesses are essential to a thriving community,” Gullixson said. “As a bank, we believe it’s our role to support our businesses in any way we can.”
Applicants would be thoroughly vetted by the advisory committee to ensure they have been severely affected by factors beyond their control. The bank would secure the loans and also would consult with recipients to help them better manage their expenses.
Vectra would receive a small percentage of the interest, but it’s more an opportunity to support the business community, Gullixson said.
Other partners in the program are the law firm Alpern Myers Stuart LLC, which will assist with set-up, and Accion Microfinance Bank, which will provide education and mentorship to help affected businesses get back on their feet.
Details of the program are still being worked out, but now that the city of Manitou is on board, Johnson hopes to have it up and running within the next couple of weeks.
Slow summer season
The merchants in Manitou Springs rely on summer sales not just for monthly income, but also to shore up savings for slowdowns after the winter holidays.
That formula usually works, but recent events, beginning with the Waldo Canyon wildfire in 2012 and floods in subsequent years, have cut into peak-season sales.
Even worse for Manitou businesses than these natural disasters have been the obstacles from manmade projects.
Work to improve the area known as No Man’s Land between Manitou and Colorado Springs resulted in lane closures that choked traffic on Colorado and Manitou avenues last spring and summer.
Chamber Executive Director Leslie Lewis said she had talked with a couple of business owners who have locations in Old Colorado City.
“Their customers said they’re not coming to Manitou because of the construction,” Lewis said.
The merchants on Canon Avenue were even more directly affected when repairs began in June on the Park Avenue bridge just down the street from their shops.
Traffic on the loop formed by Canon and Park avenues had to be rerouted during work on the bridge, which is still closed.
As a result, Manitou lost 39 percent of its total on-street parking spaces in the downtown area.
“Take that out of the mix, and of course it’s going to have an impact,” Lewis said.
A forest of orange cones deterred visitors from the shops along Canon Avenue, and proposed work on another bridge on Canon Avenue could prolong the disruption through the end of this year.
Construction impacts add up
The stores on Canon Avenue saw foot traffic dwindle this summer and suffered sales decreases of up to 40 percent compared with the summer of 2016. But the damage was felt throughout Manitou’s downtown shopping district.
According to Johnson, Manitou businesses lost $2.2 million in sales from July through October because of construction impacts.
If the town’s merchants lose another summer, “we’re going to lose a lot of businesses,” said Matt Gray, owner of The Loop restaurant, at a recent meeting of business owners to discuss upcoming work on the Canon Avenue bridge.
The construction-weary merchants got creative last fall and formed a mutual aid group, the Canon Avenue Merchants Association. The group, composed of 10 business owners, came up with Cool Days in Manitou, a series of special promotions, drawings, discounts and events to attract customers.
That helped some, but sales throughout Manitou’s retail sector dropped more than 20 percent in August compared with the same month of 2016.
“We know this is a problem,” Chamber President Gwenn David said. “Downtown is dead.”
At her Manitou Avenue gift shop, The Whickerbill, “we had a $5 day,” David said. “Unless you can find another way to get people here, we’re not going to make it through springtime.”
Johnson said the idea for the loan program grew out of a conversation she had with Weiss, who told her about a similar program he had seen in a small town in Maine.
Next steps will be working with Vectra and the other partners to set up the program, formally called the Short-term Bridge Revolving Loan Fund. That will involve forming the advisory committee, working out the application and disbursement processes and generating loan documents. The Manitou Springs Chamber will sponsor a public meeting and will promote the project.
The loans would average $5,000 but could range as high as $10,000. Applicants will have to demonstrate financial need and show that they can’t qualify for traditional business loans. But the partners’ vision doesn’t end with the loan program. Assistance could be expanded to offer energy efficiency incentives, comprehensive entrepreneurial training and the promotion of Manitou brands, to name a few.
“We are in a bit of a pickle now, but we’re hoping that by next January, things will look very different,” Johnson said.