Business assistance is an indirect way for governments and non-profits to provide affordable commercial space. This business assistance comes in many different forms and through various different public and non-profit agencies. Although there are many other ways not covered in this site, here are four ways in which the government and non-profits provide business assistance to help locally-owned and culturally-appropriate businesses succeed, even in the face of rising costs for commercial space:
- Access to Capital
Nonprofit development entities navigate a complex process in their quest to keep commercial spaces affordable for local businesses. Typical community real estate projects require a Project Finance mix of tax credits, bridge loans, state- or federally-backed financing, as well as private capital from both for- and non-profit lending institutions. On the small business front, micro- and small-business owners in gentrifying neighborhoods may decide to expand, adapt, or relocate. Many of these shifts require additional capital. To look deeper into these issues, click here.
- New Market Tax Credits (NMTC)
New Market Tax Credits are one way that governments provide access to capital to businesses in distressed areas. This relatively new tax incentive creates affordable commercial space in distressed neighborhoods by making capital more accessible to businesses and organizations in specified census tracts. To learn more about how the tax credit system works, click here.
- Commercial Rent Control (CRC)
Commercial rent control is a legislative tool that municipalities can apply to impose limits on landlords when it comes to the lease renewal process for existing businesses. This may be implemented in the form of rent increase restrictions, property tax rebates to tenants, eviction protections, and mandatory lease negotiation and arbitration requirements. Due to the highly controversial and questionably legal nature of this tool, there are no cases in which CRC’s are in effect in the United States as of 2015. To learn more about commercial rent control, click here.
- Technical Assistance/Outreach
While financial instruments like subsidized loans or reduced rent are beneficial to any local business, providing business owners with the tools to address legal, human resource, and accounting issues can be just as important. For immigrant-owned and family businesses, overcoming language and cultural barriers and understanding the regulations that apply to businesses can make the difference between success and failure. To learn more about how technical assistance and outreach support businesses, click here.