Thursday, June 11, 2020
The network of 17 community development financial institutions, or CDFIs as they are referred to, that will be accepting applications is still working with the state on the final details on how the program will be structured and the scorecard that will be used to determine grant eligibility.
But this much is known. The money is divided into three pots: $100 million for grants to minority and historically disadvantaged businesses; $100 million for grants to Main Street businesses, and $25 million for CDFIs to offer loan payment relief to businesses or to shore up a CDFI’s financial position due to a high number of loan defaults.
Initially, half of the money in the two grant programs will be distributed equally to the CDFIs so each would receive about $3 million for each of those two grant programs, said community and economic development department spokeswoman Casey Smith. After 60 days, the department will evaluate the grant distribution to ensure the money is being distributed across all 67 counties.
The grants are geared toward helping only businesses that have less than $1 million a year in sales and no more than 25 full-time equivalent employees and might include such establishments as barber shops, hair salons, tattoo shops and other small service businesses.
“The impact on them has been really significant and there really hasn’t been much relief geared to them so this is really geared to them,” Buerger said.
The CDFIs will dole out grants in amounts ranging between $5,000 and $50,000 based on a business’ annual sales, said Daniel Betancourt, president and CEO of Community First Fund. The intention is to issue grants in four rounds that will run through November.
Each round will offer a two-week window to receive applications. Then applications will be ranked and within two weeks of the application window closing, grants will be issued. Businesses that apply and don’t receive a grant will have their application carried over for consideration in the subsequent rounds and will not have to reapply, Betancourt said.
Matt Doherty is co-owner of Empire Tattoo in Oakland, Allegheny County, near the University of Pittsburgh campus. He is hoping to obtain one of these grants to support his business that opened six years ago.
Doherty said the business closure order came down right around of his shop’s busy season. It reopened last Friday when Allegheny County moved into the green phase of Wolf’s reopening plan.
He already received a $5,000 grant to help him pay rent and other bills as well as give some to his four employees. He also took out a $17,000 low-interest loan at the end of May to have some extra on hand in case a need arises but a little more free money would come in handy when his tax bills come due.
“Having more money is always good,” Doherty said. “It would help me personally just to kind of catch up on my bills and to give some out to my employees.”
Buerger said businesses that received other government relief aid would not be disqualified on that basis alone but it could be a criterion in determining the amount of need.
The bottom line, Buerger said, is “we want to get this money out as quickly as possible. It’s a large amount of money and we want to get it.”
Jan Murphy may be reached at jmurphy@pennlive.com. Follow her on Twitter at @JanMurphy.
