State establishes $225 million grant fund to help small businesses06/16/2020 12:46PM ● By Richard Gaw
By Richard L. Gaw
For those small businesses in Chester County who are feeling the financial sting of the global pandemic, help will soon be on the way from Harrisburg.
In partnership with the 17-member Community Development Financial Institutions (CDFI) network and lawmakers, Pennsylvania Gov. Tom Wolf recently announced the launching of a $225 million statewide grant program that will go to support small businesses throughout the state that have been impacted by the COVID-19 public health crisis and the subsequent business closure order.
CDFI is a group of 17 Pennsylvania-based community development financial institutions that primarily provide financing options for small businesses.
The fund will be distributed through the recently enacted state budget, which includes $2.6 billion in federal stimulus funds through the Coronavirus Aid, Relief, and Economic Security (CARES) Act -- of which $225 million was earmarked for relief for small businesses.
The Department of Community and Economic Development (DCED) will distribute the funds to the CDFIs, which will then administer the funding to businesses as grants. Under the grant program’s guidelines, eligible businesses will be able to use the grants to cover operating expenses during the shutdown and transition to re-opening, and for technical assistance including training and guidance for business owners as they stabilize and re-launch their businesses.
The funds will be available through three programs:
* $100 million for the Main Street Business Revitalization Program for small businesses that experienced loss as a result of the governor’s March 19, 2020 order relating to the closure of all non-life-sustaining businesses and have or will incur costs to adapt to new business operations related to COVID-19;
* $100 million for the Historically Disadvantaged Business Revitalization Program for small businesses that experienced loss as a result of the business closure order, have or will incur costs to adapt to new business operations related to COVID-19, and in which socially and economically disadvantaged individuals own at least a 51 percent interest and also control management and daily business operations.
* $25 million for the Loan Payment Deferment and Loss Reserve Program, which will allow the CDFIs the opportunity to offer forbearance and payment relief for existing portfolio businesses that are struggling due to the impact of COVID, as well as shore up the financial position of the CDFIs that are experiencing significant increased defaults in their existing loan portfolios.
“As we continue to navigate the COVID-19 pandemic and shift our focus toward reopening our commonwealth, we need to help all Pennsylvanians recover. We need to provide assistance for those who were hurt by the pandemic and the resulting economic downturn,” Gov. Wolf said. “This new program will provide direct support to impacted businesses to cover operating expenses during the shutdown and the transition to reopening.”
“I have spoken with many business owners in my district, and the bottom line is that they want to work, they don’t want assistance, but hopefully this grant program will help bridge expenses,” said Rep. Christina Sappey (D) of the 158th legislative district. “It’s important to note that this is not a huge pot of money. It will go fast so I strongly encourage small business owners to apply.”
“We are certainly appreciative of the Governor’s efforts to continue to offer funding opportunities to our small businesses that have been incredibly impacted by COVID-19,” said Christine Grove, Executive Director, Oxford Area Chamber of Commerce. “To date, our hair salons, gyms and dance academies, to name just a few, have been shuttered for almost three months.
“The Main Street Business Revitalization and Historically Disadvantaged Business Revitalization programs will provide the much needed funding and might just be the difference in a business being able to survive the pandemic. This round of funding will be administered a bit differently in that the Community Development Financial Institutions (CDFIs) will be administering the grants.
“Our small business are looking forward to the opportunity to apply and receive these new grants. These small business owners, who are our friends and neighbors are ready to safely open and welcome customers back to their businesses.”
Those business owners seeking additional information about the program can call Rep. Sappey at 484-200-8264.
To contact Staff Writer Richard L. Gaw, email [email protected].
The Pennsylvania Community Development Financial Institutions (CDFI) Network is a group of 17 Pennsylvania-based community development financial institutions that primarily provide financing options for small businesses. Those CDFIs serving businesses in Chester County are:
Enterprise Center Capital
Neighborhood Progress Fund
West Philadelphia Financial Services Institution
Women’s Opportunities Resource Center