CRENSHAW/LAX PILOT BUSINESS SOLUTION CENTER (BSC} and METRO'S PILOT BUSINESS INTERRUPTION FUND (BIF} MONTHLY REPORT

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1 One Gateway Plaza Los Angeles, CA Tel metro. net CONSTRUCTION COMMITTEE EXECUTIVE MANAGEMENT COMMITTEE January 15, 2015 SUBJECT: ACTION: CRENSHAW/LAX PILOT BUSINESS SOLUTION CENTER (BSC} and METRO'S PILOT BUSINESS INTERRUPTION FUND (BIF} MONTHLY REPORT RECEIVE AND FILE STATUS REPORT RECOMMENDATION Receive and file monthly status report on the implementation of the Crenshaw/LAX Transit Project Business Solution Center and Metro's Pilot Business Interruption Fund. ISSUE In July 2014, Metro's Board issued Motion 79 (Attachment A), that authorized the CEO to establish a Pilot Metro Business Solution Center (BSC) along the Crenshaw Corridor (Corridor). Thereafter, the Board of Directors issued Motion 57 (Attachment B) that authorized the CEO to establish a pilot program for a special Business Interruption Fund (BIF) for mom and pop businesses along the Crenshaw Line, Little Tokyo area along the Regional Connector and Phase I of the Purple Line Extension. The motions require monthly updates to the Construction Committee. DISCUSSION Since the adoption of the aforementioned Board motions, staff has completed a series of actions leading to the implementation and "soft" launch of the BSC. Also, procurement activities have been initiated for the execution of a contract with Pacific Coast Regional Small Development Corporation to serve as the BIF fund administrator. (1) Pilot Business Solution Center Update Between November and December, Metro staff worked in collaboration with the BSC Consultant, Del Richardson and Associates (ORA), to implement and complete a series of activities and milestones for the operation and "soft" launch of the BSC within 30 days of the NTP. Overall activities included: formulating, reviewing and finalizing the BSC Operating and Staffing Plan including the Communication and Outreach Plan in addition to identifying necessary activities for the development and implementation of the BSC website, print collateral and branding.

2 In keeping with the schedule of deliverables, the BSC launched and opened Friday, December 19, The opening was "soft" launch that provided the opportunity for the BSC staff to get the doors of the center open and begin to engage and meet the local business community. The opening was marked by a focused communications and outreach strategy that consisted of BSC staff conducting on the ground canvassing and outreach to the business community between the areas of 48th and 60th Streets; such focused efforts included: 1. Communications I Media The Source Metro's CEO Daily Brief E-blast to more than 200 businesses and business resource partners 2. Opening Activities BSC outreach team comprised of 9 representatives Outreach and canvassing between 48th and 60th Focus on intake process; taking business owners through the initial intake process for follow-up and one-on-one assessment appointments within 72 hours (business hrs.) 3. Opening Stats Twenty six (26) businesses completed BSC Intake Forms 6 walk-ins to the BSC (represented area north of 48th Street) 20 visited via canvassing. Over the course the next 30 days, Metro and the Contractor's team will continue to advance efforts, including launch the web-enabled services in preparation for the BSC open house in January (2) Pilot Business Interruption Fund Update In November 2014, Metro Board of Directors approved the approach to outsource fund administration to an external Community Development Financial Institution (CDFI) and authorized the CEO to enter into negotiations for a contract with Pacific Coast Regional Small Business Development Corporation (PCR). Metro staff immediately entered into negotiations with PCR on the required activities and milestones, and a Limited Notice to Proceed was issued to PCR on December 4, As of date, staff continues to work in collaboration with PCR on the draft BIF Administrative Guidelines, the BIF application process including the overall outreach and communication strategy. In addition to advancing efforts with PCR, efforts have been advanced for the retention of the Business Loss Claims Management firm to provide advisory services in the development of the final BIF Administrative Guidelines, in particular to ensure the established program and guidelines do not reduce or waive insurance coverage afforded to Metro by our Design Build Contractors for insurable business interruption Crenshaw/LAX Pilot Business Solution Center and Pilot Business Interruption Fund Update Page 2

3 losses. Metro staff will continue to advance efforts with PCR including the identified Business Loss Claims Management consultant in preparation for the BIF launch in February Efforts are also underway to hire a Director of the BIF. NEXT STEPS Metro staff will continue to advance efforts in preparation for the Crenshaw/LAX BSC open house in January In addition, ongoing procurement activities will be executed for the BIF with the objective of entering into a formal contract with PCR by January 4, 2015 including finalizing the BIF Administrative Guidelines by mid- January 2015 and launching the BIF program by February ATTACHMENTS A. Motion 79 B. Motion 57 C. BSC Status Report D. BIF Status Report Prepared by: Shalonda Baldwin, Deputy Executive Officer of Project Management Vendor/Contract Management, (213) Crenshaw/LAX Pilot Business Solution Center and Pilot Business Interruption Fund Update Page 3

4 ~-J)..J teijh; Wiggins,~ Executive Director, Vendor/Contract Management ArthurT. Leahy Chief Executive Officer Crenshaw/LAX Pilot Business Solution Center and Pilot Business Interruption Fund Update Page 4

5 ATTACHMENT A Motion by Supervisor Mark Ridley-Thomas, Mayor Eric Garcetti and Director Jacquelyn Dupont-Walker Implementation of a Pilot Business Solution Center for the Crenshaw/LAX Line Relates to Item 79 July 24, 2014 Since construction began on the Crenshaw/LAX Line Project (the Project) earlier this year, doing business on the Crenshaw Corridor (the Corridor) has become more challenging for businesses and patrons. Many businesses are already experiencing significant impacts created by construction activities, specifically at the intersections of Crenshaw Boulevard and Martin Luther King Jr. Boulevard and Exposition Boulevard where work is underway to lay the groundwork for future underground stations. Businesses between 48th Street and 60th Street, where the line will run at-grade, are also anticipated to face significant challenges when construction begins on that segment. Under both Federal and State law, Metro is prevented from providing direct cash subsidies to businesses unless access to the business is denied due to construction impacts. While this has not technically been the case on the Corridor, there is a clear nexus between construction activities and reduced business activity, especially the walk-in traffic that many of the retail businesses rely on. In April 2014, Metro retained a consultant to assess and provide recommendations on how to address the economic impacts of construction activities on small businesses on the Corridor. The consultant's report encourages the development of a pilot Business Solution Center that would provide direct sector-specific technical assistance to businesses along the Corridor to help them through construction activities. Services that could be provided to businesses include financial planning and advice on small business operations as well as dealing with municipal permits and regulations, legal assistance, marketing and grant/loan application management. The consultant

6 specifically suggests that a pilot effort be established to provide proactive and hands-on business assistance to support the over 100 businesses at the at-grade portion of the Project between 48th and 60th Streets, as well as a walk-in location along the Corridor for which businesses along the entire rail alignment can receive information, resources and referrals. The establishment of a Business Solution Center would meaningfully enhance Metro's construction and external relations protocol. While serving as a relatively nominal financial investment for Metro, it would go a long way in helping to build the capacity of small businesses to survive the construction period and ultimately contribute to a vibrant transit corridor upon completion of the Line. If the Metro Board wants to pursue future funding measures to fully build out the system, it will be fundamental that we demonstrate to local small businesses that we are a comm itted partner during construction periods. This pilot Business Solution Center can serve as a model for such an effort, and to do so, it is essential that Metro partner with a capable and well established service provider to roll-out these services as quickly as possible. Furthermore, it is consistent with Metro's Construction Impact Response Program (CIRP) which was developed in response to construction on the Gold and Red Lines in the 1990s. The CIRP program provided various forms of relief for businesses including economic support and rapid response teams. These resources should also be made available for the Crenshaw Corridor. The pilot Business Solution Center would also complement Metro's other ongoing efforts to address business' needs during construction. For example, Metro continues to modify construction signage based on the feedback of surrounding business' to highlight the names of businesses, parking locations and to clarify that businesses are open during construction. In addition, Metro is finalizing a communications strategy to promote an "Eat, Shop and Play Local" campaign during construction. WE THEREFORE MOVE THAT THE BOARD OF DIRECTORS:

7 1. Receive and file the "Recommendations for a Pilot Metro Business Solution Center"; 2. Authorize the CEO to immediately solicit proposals to establish a Pilot Metro Business Services Center along the Crenshaw Corridor that includes a physical presence with consistent staffing hours for the duration of the construction of the Crenshaw/LAX Line, as well as a Business Solutions Outreach Strategy for the atgrade portion of the alignment on Crenshaw between 48th and 60th Streets and other locations that are determined to be significantly impacted by construction activities, and authorize the CEO to execute a contract with the most responsive and qualified bidder, with the objective of beginning operations by October 2014; 3. Direct the CEO to identify up to $250,000 and amend the current budget to fund the initial year activities, with an overall project budget expected to be approximately $1,000,000, to be included in future budgets for fiscal year 2016, 2017 and 2018 at $250,000 per year; 4. Direct the CEO to report back in September on a plan to utilize existing Full-Time Equivalent position(s) to staff the Business Solutions Center. 5. Direct the CEO to incorporate the following elements into the Pilot Business Solution Center Program: a. A single point-of-contact or case management approach for each business; and b. A 72 hour quick response plan. 6. Direct the CEO to establish an additional mitigation menu and criteria based on MTA's previous Construction Impact Response Program that includes: a. Marketing campaigns for impacted businesses; b. Rent and mortgage subsidies to businesses; c. A low-interest loan fund that is accessible to small and micro-businesses; d. Report back to the Board in September with funding recommendations; 7. Direct the CEO to report back on a Post-Construction Fac;ade Improvement Program in conjunction with the approved Design-Build Contract for the Crenshaw/LAX Transit Line;

8 8. Direct the CEO to report back on the feasibility of establishing Memorandums of Understanding with local business and community stakeholder groups, as has been done in Denver, Colorado, to ensure that we are maximizing community involvement and engagement as it relates to construction activities; 9. Direct the Diversity and Economic Opportunity Department to manage and oversee the Business Solution Center Project; and 10. Provide quarterly updates to the Executive Management and Construction Committees on the Pilot Business Solution Center and the "Eat, Shop and Play Local" campaign beginning in September 2014.

9 Amendment to Item 57 ATTACHMENT B Motion by Directors Molina, Dupont-Walker, Ridley-Thomas and Garcetti Business Interruption Fund September 18, 2014 WE, THEREFORE, MOVE that the Board direct the Chief Executive Officer to: 1. Establish a pilot program for a special Business Interruption Fund for mom and pop businesses located along the Crenshaw Line, within the Little Tokyo area along the Regional Connector, and Phase I of the Purple Line Extension immediately. 2. Define mom and pop businesses as those meeting the following criteria: a. Having 25 employees or fewer, b. A minimal operational history of two years; c. Being in good standing with local, state and federal tax requirements; and d. Able to produce financial records (i.e. gross receipts. business license information, pay roll taxes and other pertinent financial information) demonstrating the- loss of business revenue directly related to the period of construction disruption. 3. Conduct a baseline survey of all businesses within the project areas.

10 4. Identify and designate $10,000,000 of Metro funds annually to be used for the implementation of the Business Interruption Fund. Funds shall be distributed through the projecfs administration and/or respective Business Solution Center. 5. Each business should be eligible for a maximum of $50,000 annually, not to exceed 60 percent of their annual business revenue loss. 6. Participation in the program would release MTA and the general contractor from further liability claims for business loss unrelated to specific incidents of damage and would be voluntary. 7. Direct the Chief Executive Officer to work with Los Angeles County and local cities to seek all appropriate legislation that would temporarily reduce or waive taxes and fees imposed on impacted businesses during transit-related construction activities and work with the Los Angeles Countv Assessor's Office to immediately initiate outreach activities to businesses impacted by transit-related construction activities in order to inform them of the Assessor's Office Proposition 8/Decline-in-Value Review process. s. Report back to Construction Committee monthly, beginning in October, with an implementation plan and report back to the Board of Directors in September 2015 with an evaluation of the program including utitization levels and recommendations for program modification.

11 Los Angeles County Metropolitan Transportation Authority One Gateway Plaza Los Angeles, CA Tel metro. net Metro Business Solution Center (BSC) Status Report As of December 22, 2014 ATTACHMENT C Metro's BSC "soft" launch Friday, December 19, CONSULTANT TEAM Del Richardson & Associates, Inc. (DRA) was awarded a 2 year with 2 one-year options contract in October 2014 to operate the Metro pilot BSC for the Crenshaw/LAX Transit Corridor. 1 The team includes Vermont Slauson Economic Development Corporation, Los Angeles Urban League, and Turning Point Communication. 2.0 BSC DESCRIPTION/SCOPE A team of five Case Management and three Outreach staff will provide hands-on case management services and business assistance to small businesses along the Crenshaw Corridor between 48th and 60th Street. Small businesses not immediately within the area of 48th and 60th Street of the Corridor will also have access to the BSC for business and technical assistance. Small businesses located between 48th and 60th Street will receive case management services through the BSC case management staff, while those located beyond 48th and 60th Street will receive case management services through referral of BSC case management staff to a BSC Business Development Partner. DRA, has established a network of business development partners that are committed to providing supplemental business and technical support and assistance to small businesses referred through Metro's BSC. BSC Access- Business owners will be able to access the BSC via walk-in locations and web: The BSC main office will be co-located at the LA Urban League at 3450 Mount Vernon Drive, Los Angeles The BSC satellite office will be at 510 South La Brea Avenue, Inglewood Website access will also be available at metro.net/crenshaw (under development) 3.0 BSC LAUNCH/OPENING ACTIVITIES A. Opening Activities BSC outreach team comprised of 9 representatives Outreach and canvassing between 48th and 60th Focus on intake process; taking business owners through the initial intake B. Opening Stats process for follow-up and one-on-one assessment appointments within 72 hours Twenty six (26} businesses have completed BSC Intake Forms 6 walk-ins to the BSC 20 via canvassing 1 Contract is a not to exceed amount of $996,144 ($646,462 for the 2 year base period and $349,682 for the 2 one-year options).

12 4.0 MILESTONES COMPLETED Notice to Proceed Issued- November 5, 2014 Project Kick-off Meeting- November 12, 2014 BSC Launch/Opening- December 19, UPCOMING MILESTONES BSC Soft Opening (walk-in locations only)- December 19, 2014 BSC Open House (web access available)- January 2015 (date TBD}

13 Los Angeles County Metropolitan Transportation Authority One Ga teway Plaza Los Angeles, CA Tel metro.net Metro Business Interruption Fund (BIF) Status Report As of December 22, 2014 ATIACHMENTD Metro's BIF project team continues to work on the start-up activities for the implementation of the BIF scheduled for February 15, CONSULTANT TEAM Pacific Coast Regional Small Business Development Corporation (PCR) was awarded a 2 year with 2 one-year options contract in November 2014 to administer the Metro pilot BIF for the Crenshaw/LAX Transit Corridor, Little Tokyo section of the Regional Connector, and the Purple Line Extension Phase 1 Projects BIF DESCRIPTION/SCOPE Metro wants mom and pop small businesses to continue to thrive throughout the construction period. The establishment of the pilot BIF provides financial assistance to impacted businesses through grants to cover operating expenses. PCR will provide grant administration in alignment with Metro's BIF Administrative Guidelines. Serving as the BIF administrator PCR will perform services such as: process BIF grant applications; determine business eligibility; develop process and timeline for evaluation, selection and disbursement of grant funds; and provide performance reports to Metro. BIF Access- Business owners will be able to access the BIF via walk-in locations and web: The BIF main office will be at PCR's location: 3255 Wilshire Blvd, Suite 1051, Los Angeles Website access will also be available at pcrcorp.org (under development) Satellite support- General information and intake forms will also be readily available at the designated Business Solutions Centers (i.e. Crenshaw/LAX, Little Tokyo) 3.0 MILESTONES COMPLETED Introductory Meeting- November 17, 2014 Business Loss Claim Management Consultant RFP Issued- December 3, 2014 The consultant is needed to ensure the 8/F administration guidelines do not remove any contractual liability by the design/build contractors. Limited Notice to Proceed Issued to PCR- December 4, 2014 Business Loss Claim Consultant RFP Response Date- December 18, UPCOMING MILESTONES Director, BIF (A Metro Position) Announcement Posted- December 29, 2014 Business Loss Claim Consultant Proposal Evaluations- January 2, 2015 PCR Contract Execution (complete formal audit, final negotiations) -January 4, 2015 Finalize BIF Administrative Guidelines -January 15, 2015 BIF Launch- February 15, Contract is a not to exceed amount of $1,800,000 ($900,000 for the 2 year base period and $900,000 for the 2 one-year options).