Grand Rapids Opportunities for Women and the Community Foundation for Muskegon County have teamed up for a new aid fund for small businesses directly affected by the COVID-19 pandemic.
Recovery loans of $1,000 to $10,000 are available for small businesses in Muskegon County with no more than 25 employees and which can demonstrate they had positive cash flow prior to the pandemic. The businesses also need to have been established prior to Sept. 1 last year, and can show liability insurance coverage.
Loan recipients can repay the debt over six to 24 months at an annual interest rate of 4 percent, and can begin repayment up to 90 days after the loan is received.
“This program will provide critical, flexible funds to those small businesses impacted by COVID-19,” said Todd Jacobs, president and CEO of the Community Foundation for Muskegon County. “The program is designed to keep small businesses afloat and to reopen with confidence.”
GROW and the Community Foundation expect the loan program to aid a cross-section of small businesses — from retail and daycare providers to manufacturers and restaurants. The program will give consideration to small employers disproportionately affected by COVID-19 and the state’s executive orders, plus those in rural, underserved, low-moderate income areas of Muskegon County, and women- and minority-owned businesses.
Support for the loan program came through $350,000 from the Brad and Janice Hilleary Family Fund, the Leonard & Catherine Buitendorp Charitable Fund, the SPX Community Development Fund, and the B.A. Westgate Fund of the Community Foundation for Muskegon County. GROW received a $45,000 grant from the foundation to administer the loan program and to fund a loan-loss reserve.
The initiative is the latest to provide aid to small businesses in the wake of the pandemic and its economic fallout. In Kent County, a new $25 million grant fund formed in partnership with the Grand Rapids Area Chamber of Commerce launches at 8 a.m. Monday.
Much more aid appears on the way through a supplemental appropriations bill state lawmakers approved this week for the rest of the fiscal year that runs through Sept. 30.
The $880.1 million bill allocates $100 million for the Michigan Strategic Fund to offer another round of Small Business Restart Grants for small businesses and non-profit organizations statewide that “have realized a significant financial hardship due to the COVID-19 emergency,” according to a bill analysis.
The Strategic Fund earlier created a $10 million relief fund that worked through 15 economic development organizations across the state to review and award grants. The Michigan Economic Development Corp. earlier this month awarded the $4.35 million in relief grants to 74 small businesses in 74 counties.
Under the supplemental appropriations bill, the MEDC would work through the same economic development organizations, which would receive a minimum of $3.5 million each. Any proceeds not used by Sept. 30 would go back to the Strategic Fund to distribute to other economic development organizations.
Small businesses and nonprofits receiving a grant of up to $20,000 could use the money for working capital: payroll expenses, rent, mortgage payments and utility expenses. Companies that previously got money from the state’s Small Business Relief Program cannot seek further aid from the new program.
The legislation requires that at least 30 percent of the $100 million to go to eligible businesses owned by women, minorities and veterans. The bill defines eligible businesses or nonprofits “that demonstrate they have been affected by the COVID-19 emergency, that need capital to support expenses, and that demonstrate an income loss as a result of the COVID-19 emergency.”