Council approves $20 million relief fund to give small businesses, nonprofits grants

Council approves $20 million relief fund to give small businesses, nonprofits grants

Separate $6 million will help families, nonprofits

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Montgomery County will provide $20 million in grants for small businesses and nonprofits that have been significantly harmed by the coronavirus pandemic.

In addition, $6 million will go to the county’s Health and Human Services Department that will use $5 million of the funds to help families with necessities such as rent and food. The remaining $1 million will be distributed to nonprofits for meal distribution, homeless services, and other safety-net services.

The council on Tuesday approved an expedited bill to provide the funds and establish a Public Health Emergency Grant Program. Council Member Craig Rice abstained because his wife owns a small business and she could benefit from the funds.

Businesses and nonprofits with up to 100 employees can apply for a maximum grant of $75,000, which can be used to cover employee wages and benefits, taxes, debt, rent, or other operating expenses. The principal place of business must be in the county.

Sole proprietorships are eligible, as well. Those would include self-employed individuals such as house cleaners, wedding photographers and barbers.

Business owners must show their financial losses.

In addition, mini grants of up to $2,500 help cover the cost of purchasing technology equipment and software to allow employees to work remotely.

Twenty-five percent, or $5 million, will be specifically reserved for restaurants and retail storefronts.

County Executive Marc Elrich told Bethesda Beat Tuesday evening that his staff is writing the criteria for the grants. He hopes the county grants will supplement amounts that businesses receive from the state and federal governments.

He said the rules for the grants are expected to be done by next week.

“[Businesses] should expect a movement toward being able to apply pretty soon,” he said. “We’re trying to get this done in the next week.”

Council Member Nancy Navarro said she supported dedicating 25% of the funds for restaurants and retail storefronts, but more might be needed. The rest of the funds are still available to those businesses.

“It’s difficult to figure out exactly what the percentage should be. I believe this is, again, a start,” she said. “I definitely would like to work with colleagues to entertain perhaps additional dollars that we could target specifically to the sector that has been hit very significantly and are so important for the diversity of our communities.”

Council Member Evan Glass had concerns about businesses that couldn’t access the program fast enough.

“Twenty million, we know, is not enough, at this point in time, to sustain everybody, which is why we need our state and federal partners,” he said. “My concern remains that there are some well-connected businesses that follow these council sessions and have the ability to complete the paperwork the minute that it is online.”

Setting aside funds would give mom-and-pop business owners time to apply because large businesses might apply more quickly, he said.

Council Vice President Tom Hucker said he’s been in touch with several businesses in need of “real relief” instead of more loans they must pay back. He felt that the portion of money set aside for restaurants and retail storefronts needed to be more around 40%.

“They’re terrified right now. They’re giving up on dreams they’ve had for their whole life,” he said. “They don’t know how they’re going to keep their business open or ever reopen.”

There will be a supply-and-demand issue with the grants though, Council Member Gabe Albornoz said.

“There’s a lot more demand for support than there will be supply available, but in partnership with the federal and state governments, obviously, our hope is to expand the reach as much as possible,” he said.

Council Member Hans Riemer echoed Albornoz’s concerns.

“We’re putting out a significant amount of funding. We know it won’t come close to meeting the need,” he said. “There are hundreds, perhaps thousands, of businesses that are facing significant impacts from this and it’s not going to be possible for us to throw a lifeline to every single business, but we’re going to do what we can. This is going to be a work in progress.”

An outreach coordinator will contact businesses that might not know about the grants, such as businesses owned by immigrants. This outreach will include assistance in applying for the grant.

Council Member Will Jawando said outreach is important to make sure anyone who needs help know it’s available.

“That’s going to be a really important thing here, so it’s not just the ‘usual suspects’ and we give everyone a fair shot,” he said.

Without the help of local government, many small businesses will fail because business owners often have their life savings tied up in it, Council President Sidney Katz said.

“Do I think $20 million is going to save every small business in Montgomery County? I do not,” he said. “I believe we’re going to have to have this conversation again and perhaps again after that.”

Riemer said he would like to see the county’s finance department publish data as they are awarded so there is a real-time record of them.

“I think there will be a lot of scrutiny as to how this funding is provided. I think to be as transparent as possible will help us a lot,” he said. “I think a lot of the businesses will not be able to secure funding and they’re going to want to know why to the extent that they can figure that out.”

Elrich said in an interview that he was glad the council approved the funds.

He originally announced on March 20 an effort to bring financial support to small businesses and nonprofits on March 20. His staff and the council’s staff worked together with Council Member Andrew Friedson to draft the bill.

“If [a business owner] is afraid that someone is going to show up and say, ‘You owe me three months’ back rent,’ they may choose to not open again,” Elrich said.

Briana Adhikusuma can be reached at briana.adhikusuma@bethesdamagazine.com.

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