Memorandum

City of Lawrence

City Manager’s Office

TO:              David L. Corliss, City Manager

CC:               Cynthia Boecker, Assistant City Manager

                   Diane Stoddard, Assistant City Manager

FROM:          Roger Zalneraitis, Economic Development Coordinator/Planner

DATE:           June 12, 2009

RE:               EDA Grant Application for Sewer and Water Service at Airport

As part of the American Recovery and Reinvestment Act (ARRA), Congress made available $150 million for the Economic Development Administration (EDA) to invest in economic development projects throughout the country.  EDA has recently distributed these funds to their six regional offices.  Lawrence is within the Denver regional office of EDA.  This office received a little over $9 million of the funds to distribute throughout the 10 state region that it covers.

The EDA funding can be used for public works infrastructure projects; to support technology-led growth; take advantage of opportunities created by free trade; and to accelerate new business development.  The primary focus of the grants will be on job creation. 

While EDA intends to favor regions that have been hit especially hard by the current recession, any “distressed area” as defined by EDA will be eligible for this stimulus funding.  A distressed area is an area that has either unemployment greater than one percent above the national average, or median income that is less than 80% of the national median income.

Historically, Lawrence has not been eligible for EDA funding because Douglas County has not been defined as a distressed area.  However, EDA classified Douglas County as distressed in December of 2008 because the County’s median income was less than 80% of the national median income.  As a result, Lawrence and Douglas County are now eligible to apply for and receive grant funding from EDA.

Staff is currently preparing a grant submission for stimulus funding from EDA to assist with the waterline and sewer project to the airport.  EDA typically awards between $5,000 and $10,000 for every job created or saved by a project.  Based on statements from DAR regarding their potential growth, as well as other possible employment opportunities in the area, City Staff would recommend applying for $500,000 of EDA assistance for the project.  If the City’s request is awarded, this could potentially reduce project costs by 15% or more.

Applying for a grant does not commit the City of Lawrence to undertake the infrastructure project.  Based on our previous experience with grants, the City is not obligated to undertake a project until the grant is awarded and an agreement signed between the granting agency and the City.  If Lawrence opts not to extend water or provide additional sewer services at the airport, and the grant has not been awarded, the application can be cancelled. 

Also, Staff has stressed in the application that the final sewer service is currently being studied.  We noted that the sewer service may be either a traditional forcemain or an alternative on-site green system, pending City Commission decision upon completion of the study.  Thus the application does not seek EDA funding for a particular type of sewer service, but rather a sewer system that will meet the needs for employment uses at the Municipal Airport.

Staff is currently finalizing the application for EDA funds and would like to submit the funding request shortly.    A copy of the draft application is available for Commission review.

ACTION: Authorize staff to submit the EDA Grant request for $500,000 to assist in the development of a waterline and sewer service at the airport.