By Miriam Raftery
November 6, 2022 (Lemon Grove) – Small businesses are struggling to recover from pandemic shutdowns, while consumers are feeling a financial pinch from inflation. So on November 1, Lemon Grove’s City Council voted to address both problems. The city will use federal relief funds to match residents’ purchase of gift cards up to $150 for local businesses – so $150 spent by a resident will be doubled, to a $300 value.
City Manager Lydia Romero called the buy-one, get-one-free gift card program a “win for the city, a win for the shops, a win for folks that are using the gift cards.”
The City aims to roll out the program in time for Small Business Saturday on November 26, a date when consumers nationally are encouraged to shop locally.
City staff is reaching out to businesses including retailers, restaurants, and providers of services such as hairdressers and fitness studios.
There are some limitations. Gift cards will only be available for small local and independently owned businesses in Lemon Grove, not corporate chains or multi-franchise owned. Businesses must have a physical storefront location, a valid city business license, and no pending code enforcement actions. Before you make plans to party hearty, be aware that purchase of alcohol, tobacco or cannabis products with the gift cards will be prohibited.
The Shop Local Digital Gift Card Program is paid for through $150,000 of funds allocated to Lemon Grove from the federal American Rescue Plan Act (ARPA). In addition, up to $12,500 will go to HdL Companies, a consulting company, as well as for marketing costs overseen by the East County Chamber of Commerce and fees collected by Yiftee, the company that will run the program.
The vote was 4-1, with Councilmember Liana LeBaron opposed due to concerns over the consulting company.
The gift card program is being used in several other cities including Murrieta, Hawthorne, San Leandro and South Gate in California, among others.
“Small businesses in Lemon Grove continue to struggle two years after the pandemic began and are now dealing with rising inflation,” a staff report on the program states. According to the report, small businesses account for a super majority of businesses in Lemon Grove. But nationwide, over 200,000 small businesses closed permanently in 2020 due to the COVID-19 pandemic and others continue to struggle amid labor shortages, supply chain issues and rising costs.
So the city is hoping that its new gift card stimulus program will help put some much needed jingle into Lemon Grove businesses’ cash registers in time for this holiday season – money that also helps provide sales tax revenues to fund city services.