Grants aim to shore-up businesses hit hardest by the pandemic
Photo by Danielle Rice on Unsplash
With one day left to go before applications close for a $75 million grant program targeting small businesses that were hurt by the COVID-19 pandemic, more than 19,000 business owners have applied for one of 30,000 grants offered by the Wisconsin Economic Development Corporation (WEDC).
The $2,500 grants are being offered to businesses with the equivalent of 20 or fewer full-time employees. Applications are due by midnight Tuesday, June 23.
So far, large numbers of applications for the program, funded by Wisconsin’s allotment under the federal Coronavirus Aid, Relief and Economic Security (CARES) Act, have come from such businesses as bars, restaurants and other food and beverage establishments, WEDC CEO and Secretary-designee Missy Hughes tells the Wisconsin Examiner. Personal-service businesses such as hairstyle salons and barbershops have also accounted for a significant proportion of applicants.
“That’s really the type of businesses that we’ve been targeting,” Hughes says of those categories.
Grants won’t be awarded on a first-come, first-served basis. “We saw the stress that that adds to businesses,” says Hughes. “We saw that with the Small Business Administration program, with websites crashing at 8 o’clock in the morning on Monday morning. We wanted to avoid that.”
Instead, applications will be scored based on a series of criteria, including the applicant’s individual industry classification and the degree of economic distress in the area where an applicant business is located. The agency wants to ensure grant recipients are from throughout the state, Hughes says.
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Sales tax data and credit card data showed that both food and beverage as well as personal services were hit early and hard as public health measures to contain the spread of COVID-19 ratcheted up — first with an order limiting gatherings to 50 or fewer people, then to 10 or fewer, culminating in the state’s Safer at Home order restricting people from gathering or traveling about extensively except for grocery shopping or other essential errands.
“For those businesses that had gatherings and an inability to social distance, they were really impacted first in the process, and kind of the longest,” says Hughes, so businesses identified by those industrial codes will be scored highest.
“We’re also seeking to target businesses that didn’t necessarily fall into the sweet spot of PPP” — the Paycheck Protection Program administered by the federal Small Business Administration — “so we wanted to try to fill the gap for some businesses that weren’t able to access those bigger federal programs.”
To qualify, applicant businesses must have been in operation before the year started and must have still been operating as of February 2020. They also must submit a series of documents identified on the WEDC’s web page for the program.
Other than that and the scoring criteria, however, “there’s really no strings attached with these funds,” says Hughes. Individual applicants do not have to demonstrate a specific need or impact from the pandemic — “we’re assuming impact based on the type of business they are.”
At $2,500 each, “We recognize that this dollar amount is not going to save a business,” Hughes says. But by providing grants instead of loans, “we felt like this would help the business with some of the unexpected expenses, whether it is PPE [personal protective equipment] or having to restock inventory — some of those expenses that businesses continue to face as they’re reopening.”
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Practicing safe sales
Business that receive the loans are also being asked to sign on to WEDC’s “We’re All In” campaign to encourage business to follow health and safety protocols recommended by federal and state officials to combat the spread of the virus. That’s essentially on an honor system — but one that Hughes is confident that business owners will be willing to adhere to. They already are, she says.
“What I’m really trying to do is to celebrate the businesses that are doing what they can to protect their employees and protect their customers,” Hughes says. “And by and large what I’m seeing is that businesses are stepping up. They know that their customers and their employees want to feel safe when they come into a place of business. [They] know that their customers want to feel taken care of.”
Hughes is urging customers to give businesses that follow the protocols positive reinforcement.
“I want to get the customers to be thanking the businesses — thank you for doing it right, thank you for protecting me and thank you for protecting your employees,” she says. “And so we’re going to create a community of businesses that are thinking about their customers, their employees and their community — their stakeholders.”
Hughes says she’s “seen and heard from many, many businesses that want to make sure they’re protecting their reputation and they’re protecting their customers.”
Every little bit helps
WEDC has posted guidelines for businesses of all different categories on how they can better ensure customer and employee safety from the virus. Hughes says those have been updated with checklists to make it even easier for businesses to follow them. “I’ve heard from lots of businesses that are using those guidelines.”
The agency isn’t taking a stance for or against legislative proposals at either the federal or state level to grant businesses immunity from legal action in the event employees or customers get the virus from potential exposure on their premises. “It’s all theoretical at this point,” Hughes says. “What we’ve tried to do is just provide the best information to businesses that we have right now.”
And while there aren’t other programs on the immediate horizon, Hughes says, “we hope to learn about needs and learn about the application process” through the We’re All In grants, “and then hopefully we will continue to find more resources that we can deploy to businesses around the state.”
Support for small businesses — and encouraging them to continue safe practices — are both critical to making sure the state weathers the economic toll of the pandemic and avoids a new surge of the disease, she adds.
“Small businesses in Wisconsin have been incredibly impacted by this whole pandemic,” says Hughes. “The small businesses are the businesses that really didn’t have much of a safety net going into this, so it’s almost like … a paycheck to paycheck moment” for them.
And as the state reopens and helps business owners who were hurt, “it’s incredibly important that we do two things,” she continues. “One is that we do everything that we can to protect each other from the spread of the virus, because we can’t afford to go backwards in our reopening process, we can’t afford to lose confidence.”
In addition, “we also need to be thinking about how to support these small businesses,” Hughes says — “So if we can do takeout, if we can buy a gift card — every little bit that we can do to help these businesses get back on their feet is going to be really important, because they’re so critical to our quality of life, they’re so critical to our communities.
“Our heart has to be open to them because of the pain that they’ve endured over the last three or four months. We really need to support the small businesses and do what can to keep the curve flattened so we can keep regaining momentum in the economy.”
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