In October, the City of Milpitas wrote a letter informing the Milpitas Chamber of Commerce that it would not be able to provide the Chamber with $200,000 in American Rescue Plan Act (ARPA) funding. The move came in the midst of the Chamber struggling with internal divisions on its Board of Directors.
In 2021, Milpitas was granted $16,736,815 in ARPA funding in the thick of the COVID-19 pandemic. The Milpitas City Council sought to use the funds for 25 programs in the areas of Community Services, Economic Vitality, Infrastructure, Public Safety, and Technology.
Initially, $200,000 in such funds was approved for the Milpitas Chamber of Commerce, in the interest of Economic Vitality.
This past August, however, Council reversed course, directing staff to hit the brakes on the funding process. They required from the Chamber specific deliverables, including financial reports spanning a 12-month period, a work plan for 2023’s Art & Wine Festival, and an overall explanation of how the funds would be used. Said the letter, “The Chamber has submitted multiple, incomplete ARPA grant applications and staff has had to follow up to request additional details on financial position, key performance metrics and deliverables, some of which are still pending.”
Come September 15, the Chamber had provided financial information which showed a net loss of 28% in fiscal year 2021-22; the City then characterized the Chamber’s financial health as unsound. The Chamber attributed its losses to the pandemic while vowing to trim its staff down to one person and work to increase its membership and thus its revenue.
The Chamber also cited general plans for future events and workshops yet did not present any work plan, timeline, or funding info in relation to them. The Chamber did highlight a Job Fair it had held in April 2022, with about 20 businesses participating and 143 job seekers in attendance (though the latter number would be subject to dispute in subsequent follow-ups).
In an email exchange with The Milpitas Beat, new Chamber President Inderjit Mundra wrote, “We are in discussions with the City to release the first $100k tranche as reimbursement of the extensive funds the Chamber has already expended. These discussions included a deep review of our projects, financials, and pertinent information. Board Leadership, Council, and City Hall staff have been deeply involved and we look forward to the release of that initial $100k tranche.”
Asked about the discussions referred to by Mundra, City of Milpitas Economic Development Director Alex Andrade told The Beat, “The documents provided by the Chamber were unable to demonstrate sound financial health nor were they able to provide detailed workplans with key milestones and resources. The City has not received any additional information from the Chamber since the October 19 Info Memo.”