Rawlings-Blake to focus State of the City speech on small businesses

Baltimore Mayor Rawlings-Blake plans to set aside $1M for innovative small businesses.

Mayor Stephanie Rawlings-Blake plans to make bolstering small business a focus of Monday's State of the City speech, pledging more funding for the city's Small Business Resource Center and $1 million for an "innovation fund" to help small firms acquire the latest technologies.

"It is very clear that small business is the backbone for a growing economy," Rawlings-Blake said.

The mayor's speech will be accompanied by the release of a "strategic plan" aimed at growing small businesses and entrepreneurship. Money from the planned innovation fund would go to businesses who want to buy, for example, 3-D printers or other equipment to expand their firms.

Under the plan, the budget for the Small Business Resource Center will double from $233,000 to $466,000, which will allow for the hiring of a Spanish-speaking translator.

The mayor also is calling for the creation of a website, called Econ View, that will allow residents and entrepreneurs to get updates on development projects in their communities.

Benn Ray, president of the Hampden Village Merchants Association, said he was glad to hear the mayor planned increased focus on small businesses — though he argued as much money should be spent on small businesses as larger ones. In recent years, city and state officials have approved millions in subsidies for some big businesses, he noted.

"At least equal, if not greater, effort should be made for nurturing Baltimore's local small businesses," Ray said. "If you're giving tens of millions in tax breaks to a business like Amazon, there should the same amount for small business to grow. I'd rather have Baltimore build its own Amazon instead of a corporate behemoth being lured here."

In 2013, state and city officials said they were able to lure Amazon.com to build a new warehouse in Southeast Baltimore by promising more than $43 million in tax credits. The company pledged to employ 1,000 people at its 1 million-square-foot distribution center in Baltimore.

City officials say Monday's plan represents an increased effort to help small businesses, and noted recent actions to bolster smaller firms.

In the past three years, city officials have given out $450,000 in so-called "micro-loans" to 21 businesses, including the software company Mindgrub Technologies in Locust Point and the popular ice cream shop, the Charmery in Hampden. Those loans led to the creation of 106 new jobs, city officials say. In January, the mayor announced she was reducing or eliminating dozens of fees that have bothered small businesses for years — including charges for having outdoor security cameras, lights and bike racks.

In recent years, Baltimore's economy has rebounded from the banking and real estate financial crisis of 2008. Since Rawlings-Blake became mayor in 2010, the unemployment rate in Baltimore has dropped from 12.1 percent to 8.2 percent, while the city has added more than 12,000 net jobs in that time. Statewide, the unemployment rate is now 5.3 percent, down from 8.5 percent in 2010.

"We know Baltimore is growing again, both in terms of population and jobs," said William H. Cole IV, the president of the Baltimore Development Corp. "We want to make sure we're doing everything possible to continue to accelerate that growth. We're going to be responsive. We're going to be nimble."

Regina Lansinger, director of the Hamilton Lauraville Main Street organization that represents about 200 small businesses, said she doesn't believe most people realize how tough the economy remains for smaller operations. She praised the city's recent efforts to cut down on fees and provide small loans.

"Even though we think the recession is behind us, many of them are one bad month away from closing," Lansinger said. She added she was worried about the impact of February's snow on such merchants. "We still don't really appreciate just how fragile many small businesses are. They need more support."

City Councilman Carl Stokes, chairman of the economic development committee, pointed out the City Council initially passed a bill in an attempt to cut the so-called "minor privilege" fees that businesses are charged when items, such as awnings and lights, protrude from their stores into what the city deems the public right-of-way. That bill was vetoed by the mayor, who eliminated some fees herself.

"It's a step in the right direction," Stokes said of the mayor's latest plans. "There's a lot more that could be done for small business, including cutting back more of the fees. A general tax cut would go a long away, as opposed to giving a few giant-sized businesses huge tax breaks. We need to do a lot more, a lot sooner."

In recent years, the city's economy has been helped by the influx of tens of thousands of millennials and Spanish-speaking immigrants to Baltimore, city officials say. Cole said having translators at the small business resource center is one way to make sure new Baltimoreans are thriving.

"We're seeing, particularly in the Hispanic community, a tremendous growth in small business," Cole said. "If you've got an idea and you want to start a business, the small business resource center is your one-stop-shop. They provide a wide array of services."

Towson University vice president Daraius Irani, chief economist for the Regional Economic and Studies Institute, said immigrants are known to create start-ups at a faster rate than Americans born in this country. He said the city is right to try to focus more economic efforts on small businesses. But he said concerns about crime, traffic and burdensome fees and regulation need to be addressed at the same time.

"A lot of cities realize this is where their economic engine is going to be," Irani said. "'The city has a lot of attractions for the entrepreneur. It has a lot of vacant, urban cool buildings that might appeal to some of the young tech start-up companies. If I were a young entrepreneur I would definitely be in the city."

In years past, Rawlings-Blake has focused her speech on plans to reduce crime, fix the city's long-term structural deficit and attract new families to Baltimore. She said despite the small business push in Monday's speech, crime-reduction remains the city's top priority.

"If you roll out a jobs program and it's not working the way you want, you can tweak it," she said. "If someone loses their life, there's no do-over."

In Monday's speech, Rawlings-Blake said she also plans to announce a "call to action to end African-American homicides." The city had 211 homicides last year, and 189 of the victims were black males, according the mayor's office.

By the end of March, the mayor said she will ask for community leaders to attend a forum hosted by the Rev. Jamal Harrison Bryant to discuss ways to cut down on the killings of black men. The idea is to recruit more African-American men to act as mentors, tutors and job training coaches, she said.

"So many young African-American men are ending up in graveyards," Rawlings-Blake said. "We cannot afford to fail."

The mayor also plans to call on the City Council to pass a bill she says would raise money for recreation centers. Last year, Rawlings-Blake proposed raising up to $60 million by selling four of the city's downtown parking garages, pledging to use the money for improved recreation centers. The council has yet to take up that matter.

Through a spokesman, City Council President Bernard C. "Jack" Young declined to comment, saying he had not yet seen a copy of the mayor's speech.

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