Published in Small Business

Michigan lawmakers advance spending bill with $58M in small business, venue relief

BY Saturday, December 19, 2020 12:28pm

Final passage could come as early as Monday on a $465.1 million state aid package that would provide “survival” grants to ailing small businesses and entertainment venues that were closed or had their operations limited by state orders during the COVID-19 pandemic. 

The state Senate on Friday night passed Senate Bill 748 on a 35-2 vote, which includes $55 million for small business grants through the Michigan Strategic Fund (MSF), working with 15 local and nonprofit economic development corporations in the state.

Another $3.5 million in grants through the MSF would go to eligible entertainment venues.

“The governor’s continued shuttering of certain sectors of our economy puts many of our local businesses in danger of permanent closure and forces people out of their jobs during the holidays,” bill sponsor Sen. Jim Stamas, R-Midland, said in a statement. “This important funding bill will send available state and federal dollars where they are needed most, to our workers and business owners struggling to stay afloat.”

The Senate passed the bill hours after the Whitmer administration revised statewide COVID-19 orders that continue a ban on indoor dining until Jan. 15 but begin to reopen various entertainment facilities based on positive public health trends.

The Senate-passed bill — which now goes to the House for consideration — also includes $222 million to extend unemployment benefits to 26 from 20 weeks between Jan. 1 and April 1, 2021, plus $79.1 million for coronavirus testing and vaccine distribution and $115 million for hospitals and nursing homes to address staff shortages.

Business relief

The small business survival grants are for “eligible businesses that have realized a significant financial hardship due to the gatherings and face mask order issued by the Department of Health and Human Services in November 2020 and extended in December 2020,” according to a Senate Fiscal Agency analysis.

Grants would go to small businesses with up to 100 employees that need working capital to cover business related expenses or demonstrate an income loss from the state orders. Working capital includes payroll, rent, mortgages, utilities and reopening costs. The legislation allows for grants of up to $20,000 for businesses that were closed and $15,000 for businesses that were partially closed.

Economic development agencies would administer the program and approve grants using a process similar to state relief initiatives this year.

In the other grant program, entertainment venues could get up to $40,000 per venue to use for working capital.

Eligible venues include those that generated at least 33 percent of 2019 gross revenue from live music or ticket sales or at least 70 percent of earned revenues through cover charges, ticket sales, production fees, nonprofit educational initiatives, or sale of beverages, food, and merchandise at events, and had revenue in the second quarter of 2020 that was no more than 10 percent of the second quarter of 2019.

The venue operator must not have majority ownership by an issuer of securities listed on a national security exchange, or own venues in more than one country, in more than two states, or employ more than 30 individuals on a full time, according to the Senate Fiscal Agency analysis.

“Yes!!! It still needs to pass the house on Monday and get the governor’s signature but we feel hope today!!,” Seven Steps Up, a Spring Lake listening venue that has been closed throughout the pandemic, wrote in a Saturday morning Facebook post.

The bill also allocates $5 million for the state to reimburse local governments should the governor sign separate legislation that passed days ago to waive fines, fees and interest for businesses that defer summer 2020 property tax payments, as MiBiz reported Friday.

Read 15872 times Last modified on Saturday, 19 December 2020 13:03