County expediting bill with $20M in emergency grants for small businesses, nonprofits

County expediting bill with $20M in emergency grants for small businesses, nonprofits

Grants of up to $75,000 would be available; for companies with up to 100 employees

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The Montgomery County Council will discuss a bill that would provide $20 million in grants to small businesses struggling during the public health crisis.

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This story and headline were updated at 11:30 a.m. March 24, 2020, to clarify who can receive grants.

Small businesses and nonprofits in Montgomery County could soon get some financial relief in the midst of a coronavirus pandemic.

An expedited bill, to be introduced at Tuesday’s County Council session, calls for emergency action to establish a Public Health Emergency Grant Program.

A fund with $20 million would be used for grants to help small businesses and nonprofits affected by the economic fallout of coronavirus.

The legislation matches what County Executive Marc Elrich announced Friday — a special allocation of $20 million for small business relief, as well as $5 million for individuals for food, rent and other necessary assistance.

The total of $25 million would be taken from the county’s rainy day fund.

Businesses would have to employ 100 or fewer full-time-equivalent employees and have their principal operations in the county. Both for-profit and nonprofit entities could apply.

Grants of up to $75,000 would be awarded for financial losses caused by a public health emergency. Business owners would be required to demonstrate their financial losses.

Mini grants of up to $2,500 would also be awarded for costs associated with purchasing technology equipment and software to let employees telework during the public health emergency.

Gov. Larry Hogan announced Monday that all nonessential businesses were required to close by 5 p.m.

He also announced a $175 million relief program that includes grants and loans for small businesses and Maryland workers. Grants will be for up to $10,000, and low-interest loans will be for up to $50,000. The interest on the loans will be 0% for the first 12 months.

Elrich said he heard Friday that the council was drafting a bill on an emergency fund before his announcement the same day. He said he went ahead and announced his plans to request an allocation from the council since the press conference was already scheduled.

Elrich said his staff and the council members’ staffs worked on the legislation together over the weekend.

He said he was glad to hear of the state’s assistance for small businesses.

“Hopefully, we will continue to tailor what we do with what the state’s doing,” he said. “Frankly, I expect them to come back with more money. I don’t see how they avoid that. I think that’s where all this goes.”

Many businesses are concerned about whether they can keep revenue coming in or if they can reopen once the public health crisis is over.

“Some people told me that if all they get is loans, they may just bag it,” Elrich said. “We want to try to assure people and work with the state to assure small businesses that if they open, things aren’t going to happen immediately that would make them shut down again.”

Council Member Andrew Friedson said he took the lead of drafting the bill early last week. The legislation was finalized on Monday.

“We recognize we still need more. We need more in terms of regulatory relief and significant actions,” he said.

As far as whether additional money would be added to the grant funds, Friedson said, “Just like anything else, we’ll have to determine where things are as we move forward.”

Council Vice President Tom Hucker said grants instead of loans were an important need for the business community.

“We need to be able to get money on the street quickly, so people can pay their April rents and their other operating expenses and remain open,” he said.

Hucker said Hogan’s action on making small business grants available was good, but he hopes it will be expanded since $10,000 “doesn’t go very far.”

“This may go to their rent and utility payment, but not much farther,” he said. “The county has stepped forward with timely and necessary support for our small businesses at such a difficult time.”

Council Member Will Jawando said he specifically requested that the bill include language that a county employee would be assigned to specific outreach concerning the grant program.

“There are a ton of immigrants and communities of color that are business owners in the county, but they often don’t know the county bureaucracy and that these things are available,” he said. “It’s important that there’s a strong effort to get this out there.”

Council Member Hans Riemer said businesses are suffering and laying off employees to stay afloat.

“There is a chain reaction that is exploding and it starts with businesses that have to shut down and lay off their employees,” he said. “It goes up the ladder through failure to make rent payments and defaulting on loans. It is a very serious situation that we need to try to do anything we can to help our businesses avoid that.”

Council President Sidney Katz echoed Riemer’s concerns.

“We don’t know how long this crisis will continue, so we need to be helping them as best as we can,” he said. He added that he hopes businesses can apply immediately after the public hearing and the council’s votes on the bill and allocation on March 31.

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

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