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BelAir Cantina Wins 100% of City Funding Request

With far less money to go around than applicants wanted, Wauwatosa Economic Development Corp. made sure the hip restaurant group Mojofuco got what it wanted.

Mojofuco Restaurants came away a winner Tuesday when its request for federal funding from the city was endorsed in full.

The Wauwatosa Economic Development Corporation met to divvy up a pie that was a bit smaller than the appetites of three applicants from the food industry.

With about $350,000 left in the Community Development Block Grant kitty for private business development, a new restaurant, an existing restaurant and a food processor forwarded applications totaling $479,000.

All three applicants came away with some funding recommendations, but the hip newcomer to town earned the most.

The newcomer, Mojofuco Restaurants owns the Hi-Hat Lounge, The Garage, Fuel Café, Balzac, Palomino and BelAir Cantina in Milwaukee, and on the southwest corner of West North Avenue and North 68th Street in Wauwatosa. Partner Scott Johnson also owns Comet Cafe separately from the Mojofuco group.

Mojofuco sought $150,000 to help the group complete purchase of the property, the vacant site of the former Aqua Terra tropical fish store.

restaurant owner Michael Feker was seeking $130,000 to make his restaurant at 6913 W. North Ave. more accessible to the disabled and to expand his seating and catering.

Century Automatic Services, 802 N. 109th St., which distributes juice concentrates and vending machine beverages and supplies, was asking for $199,000 to expand operations.

"The building on North is a great building, and we love the neighbors," said Scott Johnson, a partner in Mojofuco. "It's going to make a great space – it's got great bones."

Pete Papageorge, president and sole owner of Century Services, said, "We feel like there's a great opportunity for our business to grow, mainly in coffee service. I've been out on the street selling it, and I can't keep up."

Michael Feker, owner of Il Mito, said he wanted to put to use a patio area that is already approved for outdoor seating and needed funding mainly for code compliance improvements to add up to 42 seats.

"We looked at total project costs as well as the percentage of total project costs in these requests," said city Economic Development Director Paulette Enders. "If you reduce these percentages by any signficant amount, are the businesses able to proceed with their project? Or does it just blow up?"

She pointed out that CDBG requests should not exceed $35,000 per job created. That would automatically limit Century Services to a maximum of $105,000.

Kristian Sydow, commercial real estate broker for Mojofuco Restaurants, said that the BelAir request could not be phased in parts and could not proceed with any significant reduction in its request.

Belair Cantina's request, including a $100,000 revolving loan already approved, amounted to 17 percent of its $1.3 million project and would create 26 jobs.

Century Service's request was for 65 percent of its expansion plan costs, producing three jobs.

Papageorge said that Century could "work around" any reduction, it would just slow implementation of his plans.

Il Mito was asking for 91 percent of the cost of its patio plans, which would add eight jobs.

"We have two great Wauwatosa businesses here, and one that wants to be," said Ald. Dennis McBride.

"Clearly, the bang for the buck is with BelAir Cantina. Not only is it creating more jobs, but it's bringing in a new business to Wauwatosa."

McBride suggested fully funding BelAir Cantina at $150,000 and giving $50,000 to each of the other applicants, leaving about $100,000 in the CDBG coffers for other requests that may come throughout the year.

That was amended to give Il Mito $60,000 after Feker said that he would need that much to do the most critical part of his project — a new and larger kitchen hood.

Random Blog Commenter July 24, 2012 at 08:52 PM
Also, Most of the businesses I mentioned have owners who live right in Tosa and plow their money right back into Tosa. The owners of Alterra and Mofofuco are are different animal. I think anyone should be able to open a business and where they live doesn't matter and if they destroy their local competition then that is life, but if we are going to "invest in Tosa", why are we using tax dollars to subsidize people who don't live in Tosa compete against those who do live here, especially, if they have had the means to open other locations without assistance. I am not an absolutist on this. If a property needs environmental remediation to make it useful, then CDBG is a great vehicle. If there is only one of something -- like GE Medical HQ -- then perhaps you bite the bullet and sweeten the pot to get them here because the payoff and prestige is so great. However, catering to an affluent citizenry's penchant to eating out shouldn't be that high on the priority list.
Bobby Pantuso July 24, 2012 at 08:54 PM
One of the owners of Mojofuco lives in East Tosa.
Random Blog Commenter July 24, 2012 at 08:57 PM
I stand partially corrected.
Taoist Crocodile July 24, 2012 at 09:13 PM
So, Random, your position is that renovating an eyesore and opening a proven restaurant immediately next to the neighborhood's only entertainment venue (soon to reopen itself) isn't worth $150,000 in federal block grants? If so, then please - let's hear your suggestions for how to accomplish the above desirable ends at lower cost, in a reasonable time frame. I also have to take issue with your belief that the presence of a restaurant offering unique cuisine (for the neighborhood) is more of a drag on its competitors than a complementary component of a combined dining and theater-going district. This will be a win-win-win for Mojofuco, the neighborhood and the nearby businesses. You may have a bone to pick with the "affluent citizenry" but I fail to see what would be a better fit for that space, or for East Tosa in general.
LH July 24, 2012 at 09:15 PM
Thanks for clarifying Jim! I've been confused about this ever since word about the new restaurant came out.
Random Blog Commenter July 24, 2012 at 09:32 PM
"So, Random, your position is that renovating an eyesore and opening a proven restaurant immediately next to the neighborhood's only entertainment venue (soon to reopen itself) isn't worth $150,000 in federal block grants?" Do I believe that the ownership group could find some way to bridge 10 percent of the total cost through refining their plan or obtaining alternative financing? Yes. This group was smart enough to build several very successful businesses presumably without federal money, I am optimistic that they retain those smarts. Lots of smart people also grab all the free money they can get, even if they many not really need it. "I also have to take issue with your belief that the presence of a restaurant offering unique cuisine (for the neighborhood) is more of a drag on its competitors than a complementary component of a combined dining and theater-going district. This will be a win-win-win for Mojofuco, the neighborhood and the nearby businesses." Only if it succeeds in bringing large numbers of new people to the area. If the place is to rely only on me and my neighbors who are already spending our dining dollars on the avenue then my decision to eat tacos or hamburgers does make them direct competitors....now if the competitors suck, then they should rightfully lose business. No bone to pick with affluent citizenry, but I think they can handle things just fine without subsidized culinary opportunities.
Geoff Trenholme July 25, 2012 at 04:35 AM
As the co-owner of Rocket Baby Bakery, I take exception to the characterization of businesses that have benefited from public investment as "subsidized". Starting a new business is notoriously risky and the failure rate is high. The major reason that even the most promising new businesses fail is lack of sufficient working capital to get over the "hump" when fixed costs are high, income is low, and financial resources are depleted by the investment necessary to launch a new business. My wife Shannon and I (who are Wauwatosa residents) have put everything we have on the line to make our dream a reality. The loan we received through the City's Revolving Loan Fund is part of a financing package together with a loan from Tri-City National Bank and our personal investment. The one-time CDBG grant we received (the same program which awarded $150k for the Bel Air project) helped to cover a third of our bakery equipment purchases, freeing up valuable working capital to make it through our start-up phase. The CDBG grant and RLF loan are tied to the creation of five jobs within a year: four months after opening, we have five full-time employees, including a head pastry chef who is decidedly not a minimum wage employee, and part-time staff equivalent to about three full-timers, all of whom make above minimum wage, and we continue to add staff. Judge for yourself based on the facts, not lazy labels.
Jim Price July 25, 2012 at 05:00 AM
You are correct, Harold. CDBG funds are federal dollars (tax dollars, to be sure) returned to local governments for economic development initiatives. It costs the city nothing, outright. The city just distributes the money. Portions must be spent on certain things, like community service (the senior center), and this portion is allocated for private enterprise investment. There are some rules, such as the one mentioned in the article – there must be a new job created for every $35,000 granted. Other than that and some other guidelines, it's mostly up to the local gov't to decide what is best for the community.
Ms. Esther Meyers July 25, 2012 at 01:20 PM
well said young man! the neighborhood backs you and your business!
EmJay July 25, 2012 at 02:36 PM
The big picture is what is important... property values are what ultimately keep the neighborhood vibrant and desirable. There is a whole new generation of young professionals coming up who need decent affordable housing for their growing families in safe districts & East Tosa fits the bill. Give them a reason to live here (i.e. options to socialize with their friends and neighbors at walkable destinations such as restaurants, coffee shops, libraries, parks, etc.) and decent schools for their kids & they will stay. Revitalization via any source available makes sense in an area loaded with potential like east Tosa.
John T. Pokrandt July 25, 2012 at 02:46 PM
The CDBG grant money is an investment in our community. I would say that BelAir Cantina in all ways was the best bang for the buck. Great things are happening on North Avenue and the addition of a new business where there is currently a blighted building is welcome.
John T. Pokrandt July 25, 2012 at 02:48 PM
Geoff, well said and I must say my wife and I love your bakery.
sparky July 25, 2012 at 02:51 PM
" That was amended to give Il Mito $60,000 after Feker said that he would need that much to do the most critical part of his project — a new and larger kitchen hood." So making it more accessible to handicapped customers was a ruse, figuring if its listed on the application it has a better chance of being accepted.
Jim Price July 25, 2012 at 03:11 PM
sparky, Feker had a long list of items that in sum amounted to expansion of his business, particularly into a large patio area, but also his kitchen to accommodate cooking for more customers. Opening up the patio will involve costs to bring it into code compliance for accessibility. But being offered less than half the grant money he had requested, he said he would have to approach the project in stages. The first phase, for him, will have to be enlarging and updating his kitchen, as he can't put the money toward more seating than he can serve. When he does expand seating, accessibility code compliance will be a requirement – not a "ruse."
Seiche Sanders July 25, 2012 at 03:34 PM
Agreed. My property value is (hopefully) on the rise with all the "coolness" coming in. Go to Ono Kindz and Cosmos, too. Both are wonderful and run by great people.
Greatest Generation July 25, 2012 at 04:07 PM
From today's paper---page 2---- Forty-one years ago, Carol Schneider, 75, and a neighbor founded Seek Careers/Staffing of Grafton. Schneider said she eventually became a sole operator in 1980 and for several years didn't take a salary. The firm now employs 60. She said Obama's comment "was, for lack of a better word, a dumb thing to say." "It got my ire up," said Schneider, who added that she puts in an 80-hour workweek. "Nobody helped me, absolutely nobody," she said. "Not the government. Not the bankers."
Ms. Esther Meyers July 25, 2012 at 04:28 PM
"Nobody"- put her through public schooling, university. "Nobody" built roads and freeways. "Nobody" built the utility lines. "Nobody" defended her country, protected waterways, provided protection from fire and anarchy. The omnipotent Carol Schnieder of Grafton, Wisconsin developed an alternate universe to be a middle-woman advertising agent for real job creators here on earth. Interesting.
joe July 25, 2012 at 04:35 PM
Simmer down Geoff. What you received from the city is certainly a subsidy, it is a grant right? Do you pay it back? and the loan you received is at what interest rate? is this the same that anyone can get? Don't be so defensive and just say 'thanks'.
Random Blog Commenter July 25, 2012 at 06:19 PM
I am glad your business is successful and I don't underestimate how hard it is to make a go of it. However, money is fungible and the CDBG grant freed up money for you to do other things -- the real question that needs to be asked are such projects the best use of federal funds? This issue won't be solved in Tosa, but people need to starting thinking this way. Best of luck and when you get mega succesful I hope you find a way to voluntarily contribute the grant amount to some worthy charity or community project. I have no problem with the city's revolving loan fund.
Random Blog Commenter July 25, 2012 at 07:06 PM
I suggest that teachers, roadbuilders, policemen, military members, etc. did not "help" Ms. Schneider build her business, but rather, such people were paid to perform jobs that created a basis for all of the Ms. Schneiders of the nation to build a business. They are a constant, not a benevolent gift. They do create a foundation for the rest of us to go out there and earn a living....and then we pay our taxes to pay for those services. We don't get them for free. Their efforts are indeed required and valued, but should not be escalated to the point to where Ms. Schneider's initiative and sacrifice is diminished. While Mr. Trenholm may have received a bit of gov't cash to get his business going. He still built it. I didn't. Ms. Meyers didn't. Ald. Pantuso didn't. The three of us had the same roads, access to public schools, drank the same clean water and enjoyed police services as Mr. Trenholm, but we didn't cobble together the funding and will to take a risk and build a bakery that many of us enjoy. He built it and deserves all the credit and benefit. We have a society where the Schneiders of the world can build some great things. However, that person still built it and to take that away from that through such banal statements of "You didn't build that" is disrespectful and does not contribute to the solution of any problem.
joe July 25, 2012 at 07:36 PM
Ms Schneider did not receive any grants that I am aware of. The roads and other services she paid for, most like 10x more than you paid for the exact same services. Enjoy your handouts.
joe July 25, 2012 at 07:39 PM
Edison invented the light bulb. So where did the electricity come from to turn on the lights? Well, Edison developed that too and provided the first electric power and distribution company. Ford came out with the model T and suddenly more people than ever had an automobile. Did government make this possible by providing paved roads ahead of time? NO! The roads were miserable. It's because of the model T that road improvements were made. And did the automobile become popular for long distance travel because the government built transcontinental highways? NO! People wanted to travel long distance first, Then private auto clubs started publishing guidebooks of roads and destinations. Only later did government highways come into existence. And the Internet was just a set of transmission ptotocols and a few servers when the military started ARPAnet. Then with HTML and web pages, private industry took over. There's almost none of the internet now that is government provided..
joe July 25, 2012 at 07:39 PM
This is the inherent problem with democracy - ignorant people like getting free money from the government and will vote for the person who promises to give them the most free money - somehow, we need to educate people that the free money will never get you anywhere but a great job will. The best social program is a decent job with a decent wage so you can enjoy life, support a family and save a little for later.
Happy Resident July 25, 2012 at 11:43 PM
My wife and I are young (Late Twenties), I would consider us affluent (95k+ household income), are landlords in East Tosa (Duplex), and I am a founder of a Milwaukee company that used federal grants to get started, so perhaps my opinions are biased. We frequent most of the restaurants and businesses on North Ave. When we are bored with our options we tend to venture to east Milwaukee for more choices. I believe having more choices in the area encourages people like myself to spend our money locally, which I hope will in turn attract more businesses. People whom we know see our wonderful neighborhood and the wonderful businesses and venture here to go to our restaurants, bars and (in the past and soon again) the Rosebud. We even have friends who are interested in purchasing homes in the area after seeing all it has to offer. The more it has to offer, the more people will be drawn to it. I have nothing but respect for the hard working individuals who had the ability to start from scratch, but I think it was a good choice to bring in BelAir Cantina and I am glad to welcome new businesses and opportunities into the east Tosa area. I am sorry that some prefer to call something a "handout" that I would call an investment in our neighborhood. I wish best of luck to all the East Tosa businesses owners, old and new. Sincerely, A Happy Resident
Tom Gaertner July 26, 2012 at 02:53 AM
Ahem. Third most senior individual in a small business that employs 30 full-time employees so I think I know something about the subject. This is a fascinating discussion on so many levels. O'Reilly's comes in to take over an empty box with a long term lease and provide family supporting jobs and doesn't ask for a nickle of public subsidy. Some individuals get their nose out of joint. In my neighborhood Alterra is going to (hopefully sometime soon) demolish the rotting and abandoned Aurora Clinic on 68th and Wells. An eyesore that's been festering for more than a decade. Anyway, Alterra received CDBG funds. A company that sold its distribution rights to multinational Mars, Inc. Imagine that. It's a crazy mixed-up world we live in for sure. I noticed today that The Rosebud was getting fresh paint. It's looking good. Nice to see things picking-up in my old 'hood' lately. Bon chance to all the small businesses in Tosa. Success can breed more success.
Nancy Hall July 26, 2012 at 10:24 PM
"jessica"...is that what you're calling yourself these days, townie? Wait staff and even bussers generally do quite well at successful; sit-down restaurants.
Nancy Hall July 27, 2012 at 12:19 AM
Rocket Baby got a grant of about $75,000 for equipment. Unlike many of the businesses you've mentioned, they had to start from scratch with a run-down building that was equipped for offices and turn it into something completely different. They also put up about $800,000 of their own for the project. The granite counter tops and "hardwood trims" were likely drops in the bucket. Most of the cost would have been in the installation regardless of materials used. Given that they had to install counter tops and "trims" anyway, what difference does it make what materials they chose? They went with something longer lasting, which might be more economical in the long run. Mojofuco is funding most of the renovations to the old Aqua Terra building. I believe they're putting up more than a million to renovate a building that's in dreadful shape. Without their investment, the building would have continued to deteriorate until it became a safety hazard. Again..this is very different from moving into a usable space and finishing it to suit. In both instances, the new businesses have provided or will provide jobs and they've increased, or will increase, the tax base by increasing the value of the properties in question. This is well worth the investment of federal funds that have been awarded to the businesses as it will come back to community in the form of increased tax revenue.
Nancy Hall July 27, 2012 at 12:20 AM
I'd also like to point out the possibility that some of the other businesses you've listed have had CDBG money or other public funding in the past. For example, Cranky Al's got a grant last year to buy the property at 68th and North...don't know where the grant money went or how that award figures into current plans. I tried searching the city database to see where other grants have gone in the past. I couldn't find CDBG Committee minutes earlier than 2010.
Nancy Hall July 27, 2012 at 12:35 AM
What about all the nobodies who have worked for her all those years? Did she get any help from family or friends? She didn't come up with the idea of operating a temp/employment agency on her own, so what about all those others who paved the way and maybe even advised her as she was starting her business? I think Schneider's comment is arrogant, short sighted and "a dumb thing to say."
Nancy Hall July 27, 2012 at 12:42 AM
What a ridiculous statement. You have no idea whether or not Ms. Schneider has benefited from grants or any other breaks courtesy of taxpayers. For all you know, she could have been gobbling up government money for the entire 40+ years she's been in business. I wouldn't expect anyone arrogant enough to believe that she did it all on her own to acknowledge help of any kind.

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