Bare bones council awards $210k loan to Grass Valley restaurant |

Bare bones council awards $210k loan to Grass Valley restaurant

Christopher Rosacker
Staff Writer

With three of its five members having ties to downtown Grass Valley businesses, those conflicted representatives had to draw straws to see who would not abstain from consideration of a $210,000 business loan to the owners of Sergio's Cafe in order to have a quorum.

Councilwoman Lisa Swarthout, who otherwise would have to abstain because of her ownership of Mill Street Clothing Company, drew the odd straw to remain and vote.

Mayor Dan Miller, owns downtown baby store with his wife, who manages it, and Councilman Howard Levine, former executive director of the Downtown Association, recused themselves from the discussion and voting by de facto.

With Swarthout joining Councilwoman Jan Arbuckle and Vice Mayor Jason Fouyer, the three-member council unanimously approved the $210,000 loan to Sergio and Elena Martignago to expand their restaurant, moving from 154 Mill St. to 109 Mill St., formerly Karma Coffee.

As part of their expansion, Sergio's owners contend they will generate the equivalent of seven full-time positions, a requirement of the loan.

Monies for the city's Program Income Business Revolving Loan Account come from California's Department of Housing and Community Development's Community Development Block Grant program, city staff said.

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As recipients repay the loan, the money is recycled into other loans.

"These funds aren't being taken away from other opportunities before the city," said Patti Ingram-Spencer, a former councilwoman and member of the Grass Valley Chamber of Commerce, who spoke as a member of the public.

On March 18, the city's Loan Advisory Board unanimously approved the loan.

As a previous recipient, Swarthout touted the merits of the loan program.

"I am a firm believer in this type of program," Swarthout said. "When I moved my business, I was only able to do so because of this loan."

The council also reviewed its mid-year budget, discussed upcoming transportation projects and finalized an updated agreement with Nevada Irrigation District for raw water, which Public Works Director Tim Kiser said essentially matched its current agreement except for a few minor updates.

To contact Staff Writer Christopher Rosacker, email or call 530-477-4236.

Clarification: An earlier version of this story inadvertently omitted that Miller also owns Future Generations with his wife.

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