Columbia Launches Business Friendly initiatives to Help Capital City EntrepreneursAug 17, 2022 03:32PM ● By C. Grant Jackson
A revamped city of Columbia business recruitment strategy will focus on “urban economic development” – bringing more restaurants, retail, hospitality, entertainment venues, and business services operations to the city.
Part of a “New Focus on Attracting Investments and Opportunities and Support for Our Small Businesses,” the strategy was laid out by Columbia Mayor Daniel Rickenmann; City Councilman Joe Taylor, who chairs the council’s Economic and Community Development Committee; and other city officials in June as they announced six “Business Friendly Initiatives” to make it easier to establish, build and grow a business in Columbia.
“We are going to recruit urban economic development,” with less emphasis on the traditional “buffalo hunting” or trying to bag large manufacturing operations, said Taylor who was the state’s chief buffalo hunter as S.C. secretary of commerce from 2006 to 2011. “If the county or the state needs the Capital City folks to go to an airshow, we are going to go and support them,” Taylor said, but the city is no longer going to try to bring a manufacturing plant to downtown Columbia.
Columbia is the Midlands center, and while surrounded by other cities and towns, such as Cayce, West Columbia, and Lexington, “we have a large urban core, and we swell during the day,” the mayor said. The city’s revamped economic strategy is designed to take advantage of that urban nature.
Many of the initiatives are aimed directly at making it easier for small business, removing what Taylor calls “the deal breakers.” The city is “removing the disincentives that have built up over time that drive up the cost of building and growing a business in Columbia. Most of these are geared toward small business growth because they are the backbone,” he said.
While business leaders have enthusiastically greeted the initiative, business owners say what is even more heartening is a change of attitude.
Some of the policy changes are great, said Steven Cook, the president of the Five Points Association, “but it is more about the environment for doing business in the city of Columbia. That may be a more important thing.”
Cook, who owns Saluda’s restaurant in Five Points and Il Bucato, a pizza take-out at Beltline Boulevard and Trenholm Road, said that while some smaller Five Points businesses may not need or be affected by any of the specific changes, what they do notice is the attitude change toward helping small business.
Cook sees a more business-friendly environment with the current city council. “I’ve noticed that all the people in Five Points that have opened up in the past couple of years have nothing but glowing things to say about the city.”
The city is definitely “headed in the right direction,” said Chad Elsey, the owner of Cantina 76 restaurant which has locations on Main and Devine streets. Elsey also has restaurants in Greenville, Mount Pleasant, and on Kiawah. “It can be confusing to figure out everything you need to open or renew a business. Navigating the requirements and processes for business licenses, alcohol licenses, business property taxes, hospitality taxes, DHEC, design review boards, and others can be daunting. Finding the consistent correct information on how to process all of them is challenging,” Elsey said.
Some of the things the city is doing will certainly lower start-up expenses, Cook said. “I’m trying to do another restaurant in Five Points right now, and I’m a lot more confident about the ability to open that today than I was two or three years ago.”
As part of the new strategy, the city will add three new positions to the Columbia Economic Development office: a business recruiter, a project manager, and a liaison to work with new businesses to guide them through the process of getting open. “Really a concierge service,” Rickenmann said.
That kind of service, Cook said, has really already started. In the past couple of years, the city has done a tremendous job of reaching out to businesses, he said, “to hold their hands and walk them through the process.” When someone says they want to open a business, “you want city government to say, ‘What can we do to help? Not, here’s what you’ve got to do – jump through these hoops’,” Cook said.
Elsey said that having “a centralized ‘Help Center’ to point business owners in the right direction would be a welcome addition.“
One of the most important things the city needs to do is get the word out about the policy changes and other initiatives, Cook said. He said he has found in conversation with developers, business owners and want-to-be owners, that many of them aren’t aware of the changes the city is making. “I talk to them all the time. They don’t know what is going on. People want to start a business and they don’t know what it entails.”
The business-friendly strategy is intended to amplify the message that Columbia is open for business. “We are just not going to try to play catch any more. We are going to throw the ball,” Taylor said. “We are going to New York, and we are going to Charlotte, and we are going to Charleston,” and actively recruit investment to the city.
Implementing the Business Friendly Initiatives is moving on a parallel track with the city’s efforts to lower taxes on commercial property, that Rickenmann, Taylor, and others say is the biggest impediment to growth.
The city is also considering moving the economic development office from the Capitol Center at Main and Gervais streets into City Hall at the other end of Main. That would put the office footsteps rather than blocks away from the mayor’s office. “I think the mayor’s office has to have a stronger role in economic development,” Rickenmann said. “We need to be out there selling the community, showing that this is from the top. From the bottom to the top and from the top to the bottom.”
Rickenmann also wants to increase tourist traffic in the Capital City and the tourist dollars spent in the city as part of the strategy. “You have to realize that we get 15 million visitors a year, but only 5 million spend the night. So what gets people to stay more? Well, it’s more retail, more restaurants.”
Another target is leveraging the area’s six universities and colleges to take advantage of a combined 60,000 students and their alumni. “Think about where a former alumnus is today in the business world 20 years out of school, 10 years out of school, five years out of school. They could be in a C-suite, and if their college experience here was great, why couldn’t they help us bring one of their subsidiaries here,” Rickenmann said.
“We are looking at really branching out,” the mayor said. While Columbia isn’t likely to get a manufacturing plant downtown, “it doesn’t mean we can’t get a cyber unit, doesn’t mean we can’t get an operations unit, doesn’t mean we can’t get a biotech company,” he said.
And as Columbia grows, the city needs to “think urban,” with such things as improved lighting and streetscaping, said Matt Kennell, president and CEO of the Main Street District, the downtown development and marketing organization. “We know there is a huge return, look at the difference between the Statehouse end of the Main Street District and the 1800 to 2000 blocks for example,” which do not have those kind of improvements. “We may also want to consider enhanced public spaces, more parklets, more drop-off spaces for Ubers, etc.,” Kennell said.
The refocused recruitment strategy and five other Business Friendly Initiatives were launched at a media event at The War Mouth restaurant in the Noma Trestle business district as part of an effort to show that steps are being taken to help businesses all across Columbia, not just in better-known commercial districts like Main Street, the Vista, and Devine Street.
In addition to the revamped economic development strategy, the other Initiatives, as outlined by Taylor, include:
Eliminating water and sewer change fees
When a commercial property is redeveloped for a different use, this fee can often amount to as much as $35,000 to $45,000, Taylor said. “I can tell you from a personal perspective that I have watched people walk away from hospitality opportunities because of this.”
Under the new policy, building owners will no longer be charged a capacity fee when a commercial property is redeveloped for a different use if the meter size is under four inches. On changes larger than four inches, credits for existing service will be given.
Simplifying new business license applications and renewals
The city’s effort follows changes made by the state in 2020 with passage of the Business License Tax Standardization Act to create a more uniform process across taxing jurisdictions.
In a major change, the city will no longer require applicants to show personal or business income tax returns to obtain or renew a business license, something that businesses had pushed back on. “So now we are trusting you. But if we audit you, the penalty is painful. It is very painful,“ Taylor said.
Elsey said getting a business license “can be confusing especially when you are opening your first business, and the calculations for the fees due when renewing your business license are unnecessarily complex.”
Putting the entire business application and renewal process online, which officials said should be done by the fourth quarter of this year, should help, he said.
Providing flexibility and financial assistance for grease capture costs
Grease capture is one of the major costs for new restaurant development, and the city is pledging to work to approve the best option, not the most expensive, for a project’s needs.
“We have a history of requiring grease traps that sometimes can cost as much as $75,000 to $100,000,” Taylor said. “That is a deal stopper for small businesses.” In addition, the city will offer a reimbursable loan program to offset up to 50 percent of grease capture costs up to $10,000.
Grease traps play a prominent role in the decision making and negotiation for a new restaurant, Elsey said. Many older spaces require tremendous modifications to accommodate the current requirement, and in some cases that may not be possible, he said. “The costs can obviously be a deal breaker for some small businesses and landlords, so any financial assistance would help.”
Eliminating on-site parking requirements
Dropping the on-site parking requirement for commercial or retail buildings up to 75,000 square feet drew applause at the press conference from the assemblage of business owners, city officials, and economic developers. Taylor proclaimed that Columbia could “cease to be a city of parking lots.”
Right now, the two most important corners in the city of Columbia are parking lots at Gervais and Assembly streets, opposite the Statehouse, Rickenmann said.
Making renovations and remodeling of existing buildings simpler
Businesses will no longer need to meet current landscape requirements for redevelopment, which in the past has meant sometimes removing existing parking spaces.
City Manager Teresa Wilson lauded elected officials and city employees for their common-sense and practical approach to ensuring that conditions are right for businesses to grow.
District 1 City Council member Tia Herbert, who worked with Taylor and District 3 Councilman Will Brennan on developing the initiatives, said startup costs can sometimes be “a complete barrier” or often delay a project, especially for small minority- and women-owned businesses. The measures the city is implementing hopefully will allow more of those types of businesses to open, said Herbert, who is the former executive director of the city’s Office of Business Opportunities and also created the Columbia Disadvantaged Business Enterprise Program.
But launching the Business Friendly Initiatives is just a beginning. “We’re not done yet,” Rickenmann said. “We want to encourage more economic growth. We want to have more people living in the city center,” he said, noting that while Greenville and Charleston have 9,000 to 10,000 people living downtown, Columbia has about 3,000. “This is step one, and we are going to continue to work.”
Rickenmann praised the efforts of the Economic and Community Development Committee in formulating the Business Friendly Initiatives for “coming out with a pathway and helping push things forward.” He noted that “city council is really engaged, every conversation is not about my district, it has been about the city as a whole. I really appreciate that because everybody really wants Columbia to be the best that it can.”