Modesto to give RAD Program $650K once it knows it can use its pandemic dollars
The Modesto City Council on Tuesday night approved allocating $650,000 in matching funds for the RAD Card program, which doubles consumers’ spending power and has helped restaurants and other small, locally owned businesses survive the economic havoc caused by the pandemic.
But there is a catch.
The city won’t release the money until it knows for sure it can pay itself back from the federal funding it expects to receive in mid to late May from the $1.9 trillion American Rescue Plan, the federal government’s latest pandemic relief effort.
Modesto will receive $47.3 million along with complete guidance on how it can spend the money, though advocates for the RAD Card program are confident it more than meets one of the American Rescue Plan’s purposes, helping local governments and their communities recover financially from the pandemic.
The Relief Across Downtown card lets someone buy up to $100 in a universal digital purchase card and then matches that amount, doubling the value of the RAD Card. The card can be used at participating locally owned downtown businesses. About 45 participate, many of them restaurants, but the businesses include boutiques, a cigar lounge and other retailers.
The nonprofit Downtown Modesto Partnership launched the program with $150,000 in private funds in August. The program’s funding was quickly exhausted. Stanislaus County then provided $1 million in September and another $1 million in November for the program with the condition that it be expanded to the downtowns in the county’s eight other cities as well as the downtowns in its unincorporated communities.
Will cards be out of money soon?
Modesto’s downtown received $650,000 of the county funding. That is $1.3 million in RAD Card spending for participating businesses. City officials say there is about $400,000 left from that $1.3 million and that is on track to be spent within a couple of months.
The City Council approved providing $650,000 for the RAD Cards as well as $58,500 to cover administrative costs, for a total of $708,500. Stanislaus County also covered the administrative costs for the $2 million it contributed to the cards, according to the city. The county’s funding came from the $96 million it received from the CARES Act, the federal government’s first pandemic relief effort from March 2020.
The City Council voted 5-2 to approve the $708,500. The vote included having the Downtown Modesto Partnership look into expanding its program citywide.
The vote came after a more than two-hour discussion that was confusing at times. Mayor Sue Zwahlen, who took office in late February, remarked at one point: “We just didn’t get all the information we needed.”
City needs to look at big picture
Councilmen Bill Zoslocki and David Wright voted against the funding, which initially would come from reserves from the city’s general fund, with the fund being reimbursed from the city’s American Rescue Plan money. City officials have said the general fund, which primarily pays for public safety, has been stressed by the pandemic.
Zoslocki supports the RAD Card program but not how the decision to fund it was made. Modesto officials had decided to gather ideas and let staff vet them before making decisions on how to spend the $47.3 million. City officials would report back during council budget workshops, which start the week of April 19, with spending proposals.
Zoslocki said it was important to take a comprehensive look at how the money should be spent, given all of the city’s and community’s needs and worthy projects. He said following a good process would lead to good decisions and not in any way jeopardize the RAD Card program, which has roughly two months left in funding.
He said if the council followed a good process he expected the entire council would support spending the $708,500.
The City Council’s Economic Development Committee at a special meeting in late March recommended the council contribute $650,000 to the RAD Card program. (The amount was increased to $708,500 because city officials did not know then about the administrative costs.)
Councilmen defend process on funding
Councilmen and EDC Committee members Chris Ricci and Tony Madrigal defended the process used to reach Tuesday’s council decision. Ricci also said the city has a history of being too focused on itself and not supporting the larger community.
Downtown Modesto Partnership board members and downtown business owners talked about how much the RAD Card program has meant. They said while the federal government has provided programs to help businesses during the pandemic, the RAD Card program actually brings in revenue for business.
They said the program is easy for customers and businesses to use and helps promote businesses. They said the money the program has brought in has made a huge difference and still is needed even as more of the economy is poised to reopen.
This story was originally published April 7, 2021 at 6:40 AM.
