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Serving Northern St. Louis County, Minnesota

Like everywhere else, economic downturn hits Ely

Keith Vandervort
Posted 5/7/20

ELY – Economic development activity in the city of Ely these days is much like it is across the rest of the nation. “In the first three months of the year, we had normal activity, and …

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Like everywhere else, economic downturn hits Ely

Posted

ELY – Economic development activity in the city of Ely these days is much like it is across the rest of the nation.
“In the first three months of the year, we had normal activity, and then the world changed,” said the city’s economic developer John Fedo.
For only the second time this year, he provided an update to the Ely Economic Development Authority last week and highlighted discussions early in the year with at least three local businesses with expansion projects in mind.
However, in April, economic development changed dramatically.
“Since then we have been helping businesses, for the most part, just survive,” Fedo said. “The activity around Ely is not much different than that around the country.”
Local restaurants and bars have been closed for almost two months, although some curbside food pick-up service is available. Most other retail businesses remain closed as travel is limited due to caution over the coronavirus.
The summer tourist season remains in limbo as the extent of re-opening the state remains unknown. The city’s largest tourist event, the Blueberry/Art Festival, has been shelved this year, in addition to many other warm-weather events and services.
Fedo did not directly answer a query from EEDA commissioner Ryan Callen on how many struggling businesses reached out to Fedo for help.
“Specifically, in terms of what we can do to help, rather than generate access to information (on available state and federal stimulus programs), since we have no access to dollars, rather we encourage them to work with their local lenders. We don’t have any specific money other than our traditional loan program for capital expenditures. The survival monies don’t go through us.”
Fedo indicated that many businesses have qualified for and taken advantage of the federal Paycheck Protection Program.
“We are hopeful over the next few weeks, that dollars being allocated will be more effective to those with the most need, so they can not only survive, but stay in business,” he said.
EEDA president Heidi Omerza defended the city’s economic development arm in not being able to lend more assistance to local entrepreneurs.
“It is my understanding that we were not part of this loop. It has more to do with the businesses and their relationship with their bank,” she said. “And if they (the bank) are not an SBA (Small Business Administration) loan provider, they are at more of a disadvantage.”
She attributed her insight to the fact that she is married to the president of the local Frandsen Bank and Trust, Tom Omerza.
“They are working around the clock trying to help the businesses in Ely, and we don’t talk about that,” she said. “So, I don’t know what’s going on there, other than he’s there a lot to make sure that Ely is being helped, which I’m grateful for, to be perfectly honest. Every day is a new adventure for them and an adventure for us. We all want Ely to open up safely.”
Omerza also requested more information from Fedo on the status of what other economic development organizations are doing for their communities.
“I feel like we are caught in this awkward position. We want to help. We definitely have tools to help. We just don’t know how to use them,” she said.
Fedo informed the authority that there have been “no specific” requests for business loans in Ely in the last month or more. “There was one pending that (involved) a structural issue for a main street program to pair with an IRRR loan but that pretty much shut down when businesses were literally told they could no longer operate,” he said.
City Clerk-Treasurer Harold Langowski indicated that the city of Ely is available to help businesses through the storefront rehabilitation loan program. “We have resources available on our EEDA website,” he said.
“We are trying to be as diligent as possible on what is being sent our way. We want to help our businesses access the various funds. Many are all in the same boat and trying to figure out what is going to happen next. We are here to help We don’t want to operate in a vacuum here,” he said.