Planning for the Recovery in Marin

handled the health and economic crises of 2020? And how will it recover in the future? From the July 29, 2020, online program “Marin Recovers: Looking Ahead in the North Bay.” This program was supported by the Marin Community Foundation and Relevant Wealth Advisors. Mike Blakeley, CEO, Marin Economic Forum Gabriella Calicchio, Director of Cultural Services, Marin County Omar Carrera, CEO, Canal Alliance Vicki Larson, Lifestyle Editor, Writer, Columnist, Marin Independent Journal— Moderator

VICKI LARSON: It’s nearly the end of July. Along with the rest of the Bay Area, Marin is experiencing an increase in COVID-19 cases. Plans to fully reopen the county have had to be slowed as county leaders try to reduce the transmission of the coronavirus in the area. Of course the entire county, like the rest of the country, has been dealing with this since March and many of our lives—our work, shopping, school—look totally different than they did just a few months ago. The impact on the Marin community has been profound.

We are a different place than we were just a few short months ago. Today we’re going to talk to three community leaders in Marin who are facing the pandemic in different ways. We often talk about case counts, hospitalizations and, sadly, deaths when we’re talking about COVID-19. But today we’re

going to talk about our county and how specific parts of our county’s communities are doing.

Omar, I want to start with you, because I think there can be no discussion about reopening the county or moving forward unless we really address our essential workers, many of whom are Latino and live in the Canal, which has been devastated by the pandemic. Can you tell me a little bit about the Canal Alliance, what you’re seeing in the community and what needs to done? OMAR CARRERA: The Canal Alliance exists to break the generational cycle of poverty for Latino immigrants and their families, by lifting barriers to their success.

We have seen how COVID-19 has disproportionatey affected low-income communities, most of them communities of color. Nonprofit organizations [that] meet the needs of these populations also face historic challenges. The top three challenges our industry is facing are maintaining the financial health of the organization, providing effective support to staff to work successfully in a virtual world—something that many organizations never intended to do due to the nature of their work—and be able to respond to the growth in the demand for services and the rapid change in client needs. Canal Alliance has successfully responded to these three challenges. Our strong financial position that we had before COVID-19 has allowed us to maintain not only all our services available to the community, but also to provide job stability to our workforce during this complex year.

We have being able to transition 90 percent of our programs to a virtual environment. By fall, 100 percent of our programs will be available. Also we have to add new programs to respond to the COVID-19 crisis; that has allowed us to stay relevant to the community needs. For that, we have partnered with the Department of Public Health to launch new programs and services in the community. We are currently supporting the mobile testing site in the Canal. We are coordinating the distribution results. We are coordinating the services for positive cases, and we are providing financial assistance to thousands of people. Very soon we’ll be launching a contact tracing program to support those initiatives.

We have to recognize that the Latino community is the most impacted in Marin County, but that is due to the historical inequities the Marin County always had before COVID-19. So it’s not suddenly that COVID-19 came in so we have issues with digital divide, with housing, with employment and with many other issues. Latinos, as you mentioned, they have been the essential workers before COVID-19, during COVID-19 and most likely post COVID-19. Essential workers have been on the front line since day one. And thanks to them, many of us have been able to work from home successfully. LARSON: The Marin Economic Forum focuses on economic vitality in the county. It’s probably not an easy time right now, Mike. Can you tell us how you are addressing the pandemic? MIKE BLAKELEY: Yes, indeed, these times are very interesting for all of us here. The Marin Economic Forum is a nonprofit public benefit corporation. So we serve the community at large, and unlike a Chamber of Commerce, we’re not member-based and we don’t advocate for specific things. In fact, we operate more like a think tank, and we produce research and data and strategy development for both the public sector and the private sector, really to help guide decision making as it relates to matters of the economy here in Marin.

Like the rest of the world, the Marin economy has suffered drastically from this event. There are some things that are unique to our economy that have made the problems worse, but in some cases we’ve also been able to show some resiliency.

Just as the rest of the country was asked to shut down in order to try to control the spread, the businesses here in Marin asked to shut down were significantly affected because they serve primarily the resident population. If you look at the composition of our economy, you’ll find a high number of personal service-type industries, such as salons, yoga studios, restaurants. In fact, those are the businesses that have been most acutely affected, because they’ve not been allowed to serve their regular customer base. So it’s not just the story of those businesses needing to temporarily shut down or struggle through these times, but it’s also their employees. As we know, most of the employees in those service sectors tend to be from the lower economic strata. So they have been even more adversely affected, because they’ve not been allowed to work.

Here in Marin, a number of businesses have been able to access federal assistance, and the different jurisdictions in Marin all acted very quickly with the county to set up other financial assistance programs, small grant funds. So there was a very good response to serving the immediate needs of our small business community and trying to help them survive. But now those funds are starting to run out, and we’re starting to see a resurgence of cases. We’ve had to pull back the reopening of certain sectors, which had been in some cases open for just a day or two.

Obviously the uncertainty of all of this means that it’s difficult for businesses to plan. If there’s anything businesses don’t like, it’s uncertainty. If you unpack that uncertainty, it’s not just, Will we control the spread of the virus? It’s things like, How are consumers going to react? What are their consumption patterns going to look like? Again, the personal services sector that plays such a significant role in the economy has been most adversely affected here. So we’ve got this situation: What is the future of a consumer economy when consumers are behaving totally different than they did before?

All of our small businesses and our main streets are now faced with this uncertainty of whether their customers are going to come back. One of the things that that really brings to light, much like Omar mentioned about preexisting conditions before COVID, we already had a number of our businesses that were facing challenges before. Particularly in the retail sector, there’s been a large shift to e-commerce and to online shopping that was already happening before COVID; that has shifted dramatically in the last three or four months.

That digital shift is going to be permanent. That’s everything from working from home, which means people aren’t buying lunch at our small restaurants. It means working out from home, which means all of our gyms and yoga studios are having to shift online, which is really only bringing in a small percentage of the revenue before. These are the issues that we’re faced with now, although it’s an affluent community. There some areas of resiliency, like home prices have stabilized, there are even some small increases over the last year. Equity markets have stabilized; that’s good for those Marin residents that have savings. But as we know, these pockets of resiliency are really related to the more affluent population. As Omar just described, those most affected by this were most vulnerable in the first place.

So it’s a little bit of a tale of two stories here in Marin. The affluent population, which

The panelists for this online Marin Conversations program. Clockwise from top left: Canal Alliance CEO Omar Carrera; moderator Vicki Larson, lifestyle editor and writer for the Marin Independent Journal; Marin Economic Forum CEO Mike Blakeley; and Marin County Cultural Services director Gabriella Calicchio

also was able to quickly adjust to working from home, is managing okay in this. The small businesses and their employees and our residents that work in those small businesses and rely on them for income, they’re the most adversely affected. LARSON: And now to you Gabriella. I know that as the director of Cultural Services for Marin, you run the Marin County Fair, which we really missed this year. You’ve been trying to promote the arts, and I will say that is something that I absolutely miss. I miss live music, theater, arts festivals. Tell me a little bit about what Cultural Services does and how the pandemic is causing you to pivot a bit? GABRIELLA CALICCHIO: Absolutely. As the director of Cultural Services, our team produces the Marin County Fair, but our main year-round business is serving as a rental facility to hundreds and hundreds of different arts groups, artists, arts organizations, performing arts, visual arts. I’m also the executive director of our nonprofit, Marin Cultural Association. The nonprofit’s mission is to support art and culture in Marin County. It’s pretty basic and simple. Basically we’ve had to repurpose what we do here on the Marin Center campus and pivot to supporting the pandemic. As most people know, we continue to be the point of testing for Marin County, one of the first points of testing and the largest. We also have an alternative care site set up in the exhibit hall, which at any point we are ready to activate. At some point we had what we called the RV village in back of the exhibit hall to host those that were vulnerable in terms of housing and who were either positive or waiting for results as to whether they were positive or not.

A couple of months ago when the county launched marinrecovers.com, I was asked to head up two sectors. One was hotel and hospitality, and the other was the art sector. As we all know, there are many different genres within the arts. I have spent a lot of time talking to those that are running dance studios, running the theater companies that exist here, running the film places where we produce independent films.

Everybody is really, really hurting. Most of the organizations that had any kind of real budget over a million dollars have had to lay off the vast majority of their staff. Across the country, nobody knows when mass gatherings will be allowed again, when we will once again be able to gather in a venue like the Marin Veterans Memorial Auditorium. When we are allowed to reopen, it will be with a minimum number of audience members so that we can be socially distanced. If you look at a venue like ours, we have 2,001 seats. And right now, [Marin County Public Health Officer Dr. Matt] Willis is saying when and if we’re allowed to [reopen] it will be with 500 people. Nobody can produce any kind of event in a 2,001-seat theater with 500 people and break even.

That’s what I’m hearing from the artists and the arts organizations surrounding us. We haven’t figured out a way out of this yet, and what it’s going to look like on the other end. Just as a reminder, we did an art and culture plan that was adopted by the board in May of 2019. In that plan, we worked with Americans for the Arts, and we did an economic survey on the impact of the arts in Marin County. In 2018 alone, the arts contributed $76.4 million to the economy in Marin County. So we’re not just talking about all of the other things that the arts bring to our community and the value there, but we are also talking about economics when it comes to the art sector. LARSON: Yes, it seems so dire with, as Mike was saying, so much uncertainty businesses can’t plan, consumers can’t plan. I don’t know about other people, but I’m very cautious with my money now, because as a consumer, I’m not quite sure what my livelihood is going to be, whether it’s going to continue with the

same salary. I depended on Airbnb income to “We have an eviction support myself. That is moratorium. It’s gone. Mike, I heard that helpful, but all it something like 30 to 80 percent of restaurants are does is postpone going to be gone. I spoke to a restaurateur who is the problem to a worried once weather later day.” changes and we can’t do outside dining, if there’s —OMAR CARRERA no inside dining, he’s not going to be able to make it. I hear that over and over. What do you see ahead? BLAKELEY: Restaurants have really had a tough go of this. They have been forced to pivot their operations, which has not only involved expense but has also involved downsizing.

There are no real winners on the restaurant where opinions vary, but the reality is that scene out of all of this. Even though some there are certain signals that consumers organizations were already focused on will respond to in terms of how they feel takeout-only, you can say they’ve been able comfortable getting back out there. to sustain, but they’re certainly not winning. As most people have tried to say, once a One of the sad things about the restaurants vaccine is available, that will go a long way from a data perspective is that all the major psychologically to making people feel more financial institutions have been analyzing the comfortable about getting out. But there was transactions of their credit cards and their actually a poll done by the strategy company debit cards. What they have been finding McKinsey that asked people to rank in order is that where spending on those credit cards what signs they needed to see that would has gone up for restaurants also correlates make them feel comfortable going out and to where cases of the virus have gone up. resuming their consumption, getting into Unfortunately they put out this data in a stores, going to restaurants. The number one very big way, which scared off people from thing was not a vaccine, but it was when a restaurants, even though the restaurants are public health official comes out and publicly doing all that they can to try to make sure says, “It’s safe to do this.” that it’s a safe environment. We haven’t really seen very much of that

So we have a lot of restaurants in Marin here in Marin County. What we’ve seen is the County. I hear from those owners frequently. Marin Recovers effort that Gabriela alluded They’re very concerned about their future. to, [which] is trying to be very public and Even some of the beloved places in Marin trying to do a very good job of informing the County have had to close down. Maybe public of what’s open, what’s not and what’s not just restaurants, but there’s the famous safe to participate in. The businesses are story of Three Twins Ice Cream, which is following very closely what Marin Recovers a beloved brand; it had to actually go out is advising. So we’re all trying to convey that of business. message of confidence to consumers, but it’s

The food industry and the restaurant a great unknown. industry are extremely hard hit. What The other more important part is the we’re watching very carefully though are behavior of consumers, because that is where two things on the demand side, and that is the money is actually being spent. What consumer sentiment and consumer behavior. we’ve seen there is this shift to digital. That is So from the sentiment perspective, this is going to have a huge effect, because some of

you may have seen in the last three months, the level of online consumption has matched the growth of the last 10 years.

That’s an astounding figure. This is data supplied by the Bureau of Labor Statistics. The Bureau also projected that if the online consumption patterns that existed the last three months continue for the next three months, that would be equal to almost $150 billion of business that would have gone to brick and mortar businesses that will have shifted online. So for those small retail stores here that have been able to develop e-commerce, that’s okay, but that doesn’t nearly tap into the online behavior consumption behavior that we’re seeing occur, and it is likely to continue. LARSON: Let’s assume that a number of our small businesses are not going to be able to make it. What happens to our towns? What happens to San Anselmo and Mill Valley, which have very vibrant downtowns, if there’s nothing that’s going to bring people downtown—no music venues, no shops. It’s very hard to imagine what a future is going to look like. BLAKELEY: That is the question. From our perspective, we believe that really needs to be a community-driven process. So we’ve been talking with the county and other stakeholders from the business community about the need for a longer-term economic strategy for Marin County. We have never

really had one of those in the past, and that would be the perfect place to bring the community together and to decide for ourselves what we want the Marin County economy to look like, because we are going to have to deal with these repercussions from this, just like the county has had to deal with the Great Recession.

This has to be a community discussion, because economies are much more than just the businesses or the jobs. They’re the higher education system. They’re the social sector. We need to make sure that any kind of recovery that happens in Marin is equitable and inclusive, but we also need to make sure that it recognizes that times have changed. The Bay Area is a hyper-competitive marketplace. So what Marin is going to do with its economy really needs to be discussed and debated. LARSON: Omar, because a lot of the Latino community works in restaurants and some in the service industries that are struggling, does the Canal Alliance have a plan to maybe help train people in new things? What are you doing to help the community with the unemployment that’s hitting so hard? CARRERA: If I may just [give] you some context about the topic Mike was talking about. There’s a lot of the businesses that are not going to be able to come back at all. In the restaurant industry, we are seeing already that the impact that those businesses now I think one of the weakest things in the county around reopening the economy and dealing with this crisis is at the policy level. I will say respectfully with [regard to] Marin Recovers, their structure was focusing primarily on the business side. They forgot one of the most important things that any business has, which is “Even before the the workforce. Cities need the sales taxes the businesses pandemic, . . . provide, and businesses need the talent to be able to be artists were exiting successful. Marin County; The opportunity for us in this moment is in they can’t afford to public health. So we are just launching a contact live here.” investigator program in partnership with the public —GABRIELLA CALICCHIO health department and have that implemented health protocols, right? Now they had to provide PPO; there is a decrease in the customer base similar to what Gabriella was sharing. We are seeing this. So we add cost to small businesses, right? These health protocols cost money. At the same time, the customer base went UCSF. We are training people to get certifications in that field and provide support to the county. And [it] is crucial to make sure that we have a successful isolation strategy in place, because if people continue to be infected and they live in overcrowded environments and they don’t get all the down. So [not] all of the people working for support that they need—let me tell you, those businesses came back. Right? We were there’s no reopening the economy at all unless close to 2 percent unemployment rate before we deal with that. COVID-19. LARSON: Gabriela, are any of the arts

Now the essential workers didn’t go back organizations looking at doing outside to work in the same way that they were doing venues? Like the restaurants have pivoted to before COVID-19. These are the people dining outside? [who] need their daily income to survive. CALICCHIO: One of the issues even That has created other social issues and before the pandemic is that the arts were in problems. They are invisible to us now, but trouble. Artists were exiting Marin County, they are coming our way. because they couldn’t afford to live here. They

One of them is the housing crisis. We have couldn’t afford to create their art here. debt accumulation, growing every single day, And going back to the racial inequities and we have not created policies that help us around Marin County, particularly by park fight that. We have right now an eviction artists, they can’t afford to live here. They’ve moratorium; I mean, it’s helpful, but all it been coming in from other communities in does is postpone the problem to a later day the Bay Area to perform here. So we already for us to talk about. And then it’s going to had a major issue. be bigger and unmanageable. This is one of the few wealthy counties [We should be] discussing things [such in the country that doesn’t have a dedicated as], how can we focus on particular census funding source for the arts. Prior to the tracks with low-income communities? What pandemic, we were working on the idea of can we do to protect them? And what can we a dedicated tax of some sort to support the do to support all the work that we are doing arts. All of that has kind of been put on hold, with the public health department and other but it’s time for us to rethink how we get this nonprofits or the ground level? started again.