Pennsylvania Gov. Tom Wolf on Monday said $225 million in government money will be available to small businesses hurt by the coronavirus crisis and subsequent business closure orders.
“This new program will provide direct support to impacted businesses to cover operating expenses during the shutdown and the transition to reopening,” Wolf said in a statement.
The money comes originally from the federal government, as one part of the $2.6 billion in spending under the CARES Act to respond to COVID-19. The state Department of Community and Economic Development will pass the money first to community-development lenders, nonprofits that help small-business owners. These lenders will then administer the grants.
“It’s a huge deal,” said Maura Shenker, director of Temple University’s Small Business Development Center. “I think it’s going to be a combination grant and loan with technical assistance, which is ideal.”
Eligible businesses will be able to use the money to cover operating expenses during the shutdown and transition to reopening. The funds will also pay to train and advise business owners as they relaunch their businesses, the governor’s office said.
The funds will be made available through three programs:
$100 million for the Main Street Business Revitalization Program for small businesses that lost money due to the governor’s March 19 order that closed most firms or had to spend to alter their operations.
$100 million for the Historically Disadvantaged Business Revitalization Program for small businesses owned by “socially and economically disadvantaged individuals.”
$25 million for the Loan Payment Deferment and Loss Reserve Program, to allow the community-development lenders to give businesses hit hard by the virus more time or money to pay debts. Some money would go to help the community lenders themselves to cover loan losses.
Who is eligible
Any business with less than $1 million in sales or less than 25 employees can apply for help, said Daniel Betancourt, chief executive officer of Community First Fund.
Grants are expected to be $5,000 to $50,000 per business, which must be based in Pennsylvania and be current on all taxes at least through 2018.
The community organizations hope to have a standard website up for applications by the end of June. Grants should start to flow within a few weeks.
“The grants will be given out in batches, and we expect the window for applications to be open for two weeks,” said Lynn Cutler, head of Women’s Opportunity Resource Center, another community-based lender.
She said business people can approach those lenders for help applying. A list of Pennsylvania’s community lenders can be found at https://ofn.org/cdfi-locator.
Philadelphia-based organizations include:
Community First Fund & FINANTA
PIDC Community Capital
Impact Loan Fund
Enterprise Center Capital
The Pennsylvania $225 million grant program is separate from the federal Paycheck Protection Program, set up this spring to supplement lost wages for workers. PPP rules were just made more lenient for business owners who borrow money through the program and then seek to have the debt forgiven.