The Clearfield County board of commissioners on Thursday responded to a recent letter to the editor from Robb Brown, president of Clearfield Equipment Co. Inc. The complete statement is published below.
The commissioners “read with interest the letter submitted by Mr. Robb Brown. We note that it contains a great many inaccuracies, which we will detail below.
“First of all, despite what Mr. Brown says, we have not ‘withheld’ over 75 percent of our CARES allocation. As of this writing, we have allocated approximately 50 percent of the $7.1 million, and we have not yet determined how we will allocate the rest.
“It is highly likely that there will be a second round of grants for local businesses and non-profits; we are deliberating on that issue, and expect to have an announcement at our Oct. 27 meeting.
“Of the approximately $3.6 million we have already allocated, we’ve given $600,000-plus to our local municipalities; another $600,000-plus to local non-profit organizations; and about $1,442,000 thus far in 95 awarded small-business grants. That’s over 70 percent of the allocated funds put back into the community.
“Yes, we do have some allocation for county projects. These are by and large long-overdue upgrades, such as technology or minor jail upgrades, that are eligible for CARES funding. Our thought is that every dollar used via CARES funding is a dollar we don’t have to find in local real-estate tax revenue.
“But let’s get to the heart of the matter: Mr. Brown feels he was treated unfairly because we used net income rather than gross income for our business grants. We strongly disagree.
“For example, if business A sells $100 worth of inventory and has $90 in expenses, it makes $10 in net profit. Business B sells $50 in inventory but has $30 in expenses, it makes $20 in net profit. Gross income is a misleading indicator of profit.
“If we used gross sales, you’d see the larger businesses getting very large grants compared to the smaller businesses. That would be against the intent of these grants.
“Many local businesses ended up with very small (or in some cases, zero) net losses from March-July 2020 compared to the same timeframe in 2019. Many of those businesses also received a forgivable PPP loan from the government.
“We have been directed to count that loan as income, because in most cases it is forgiven and becomes a grant. If we did not count such a grant, then the business would essentially be ‘double-dipping’ and enriching themselves, rather than simply offsetting a net loss.
“The PPP program, while frustrating at times, clearly did its job and helped a lot of our local businesses this summer.
“We note that Mr. Brown’s business received a PPP grant, which definitely impacted our ability to award his business a grant.
“In addition, we used only the accounting numbers given to us by the applicant. In no case did we alter those figures, or make any exceptions.
“If the spreadsheets showed a net loss after PPP or other grants, we made an award. If the numbers did not show a net loss, we were compelled to deny the request.
“We have worked with DCED and with our consultants – who have been advising 25-plus Pennsylvania counties on this process – and we have been told that our process is both proper and fair.
“We understand that anyone who is denied a grant may be upset. Our No. 1 goal through this process has been to get the funds to the businesses that need it the most, as quickly as possible.
“But our No. 2 goal has been to do that fairly. We are glad that some businesses did not suffer large net losses from 2019 to 2020, and we applaud the leadership of those businesses for successfully weathering such difficult times.
“However, many businesses – for a variety of reasons – were not as fortunate, and our grants were specifically targeted for businesses hurt the most year over year.
“We hope that this helps our citizens understand the process. We are always available to answer questions, and we intend to keep this process transparent throughout the rest of the year.”
Sincerely,
Tony Scotto
John Sobel
Dave Glass
Clearfield County Commissioners