County finishes handing out $21M in grants to businesses, nonprofits

County finishes handing out $21M in grants to businesses, nonprofits

Awardees given up to $12,500; initially, maximum was set at $75,000

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This story was updated at 5:22 p.m. on June 30, 2020, to include more information about the awardees.

When Montgomery County established a $25 million relief fund in the spring for struggling businesses and nonprofits, the maximum award was capped at $75,000.

But of the more than 2,300 businesses to get grants through the program since then, none received more than $12,500 to help them recover revenue from having to shut down during the pandemic.

The $12,500 included a $2,500 telework grant to help cover costs of employees working remotely.

Excluding telework grants, the County Council and County Executive Marc Elrich agreed to change the grant cap to $10,000 to help as many businesses as possible, according to Jerome Fletcher, assistant chief administrative officer for the county.

“This process was used to exhaust all the funding not set aside for restaurants and retail,” Fletcher wrote in an email on Tuesday morning.

Of the $25 million in the county’s relief fund, $10 million was dedicated to restaurants and retail shops. However, $4 million of that $10 million was left over and might be used for a reopening grant program.

Fletcher wrote that the $4 million was not awarded because all qualified restaurants and retail shops were already given the amounts they were eligible for.

Of the 6,756 businesses and nonprofits that applied to the county’s $25 million relief program, 2,322 were approved for grants totaling $20.68 million.

Only 104 were awarded a grant of $12,000 or more. Thirteen of the awardees received grants of the less than $1,000. The three smallest grants were given to 9Fiber Inc. ($100), Federal Cultural Foundation Inc. ($140) and US NewGenzyme Inc. ($182).

The full list of recipients is here.

The industries and amounts provided to businesses and nonprofits included:
● Retail: $4 million
● Professional, scientific, technical: $3.3 million
● Restaurant: $2.6 million
● Construction: $1.5 million
● Arts, entertainment, recreation: $1.2 million
● Finance, insurance, real estate: $0.9 million
● Education services: $0.8 million
● Information services/technology: $0.6 million
● Hospitality: $0.5 million
● Manufacturing: $0.3 million
● Agriculture: $0.1 million

The largest category was “other.” The grants awarded to those businesses totaled $4.9 million.

The locations and number of businesses and nonprofits that were awardees included:
● Rockville: 360
● Silver Spring: 294
● Gaithersburg: 253
● Bethesda: 140
● Potomac: 62
● Germantown: 48
● Chevy Chase: 35
● Kensington: 31
● Takoma Park: 24
● Wheaton: 24
● Olney: 23
● North Potomac: 21
● Clarksburg: 17
● North Bethesda: 16
● Montgomery Village: 13
● Boyds: 10
● Damascus: 10
● Derwood: 9
● Burtonsville: 8
● Sandy Spring: 7
● Poolesville: 6
● Brookeville: 5
● Dickerson: 5
● Garrett Park: 4
● Ashton: 3
● Cabin John: 3
● Laytonsville: 3
● Darnestown: 2
● Washington Grove: 2
● Barnesville: 1
● Spencerville: 1

The remaining 13 awardees are outside Montgomery County. Businesses and nonprofits that aren’t located in the county could qualify if more than 50% of the employees work in the county or more than 50% of the gross sales are in the county.

The types and number of entities that received grants included:
● LLC: 608
● corporation: 576
● sole proprietor: 227
● nonprofit: 127
● partnership: 6

The remaining 36 were listed as “other.”

Business perspectives

Christine Chuke, co-owner of event design and furniture rental business Posh & Luxe Companies in Rockville, said the county’s $12,500 grant helped, but wasn’t nearly enough to cover the revenue lost from the busiest season.

The business usually provides décor and furniture for up to 15 events a month between March and June. It’s only had two in the last three months.

Chuke said she applied for the grant 30 minutes after it was released on April 15. Posh & Luxe received approval for $12,500 on April 24 and received the money on May 8.

“We were actually expecting to receive more money. … But at the same time, I know that there are so many other businesses that were going through the same thing and it was a $25 million fund,” she said. “So when you divide that, I could understand why it was just $12,500. It was really helpful, but we needed more.”

A portion of the grant, $2,500, was used for covering telework expenses. The remaining $10,000 was spent in outstanding bills.

“[The county wasn’t] very transparent at all about how things were being determined or calculated,” Chuke said. “There was no way for you to provide feedback with that. All we had to do was attach financial statements and a brief reason for what the funds would be used for.”

“I don’t know how they arrived at that figure,” she said.

Unlike a restaurant that can receive carryout and delivery orders, an event business is out of luck, Chuke said. All her events were canceled and deposits to be reimbursed to clients.

She hasn’t yet calculated how much money her company has lost.

“It’s so daunting and depressing. We have actually sat down to calculate it all,” she said. “I don’t think my mental health can accept the loss. We literally went to zero. We earned nothing.”

Besides Chuke and her partner, the people who work for the business are independent contractors, not employees, leaving the business ineligible for financial assistance programs that require a minimum number of employees.

Chuke said the county needs to help companies with “zero options” for revenue or let them reopen so they can go back to normal operations.

“We should have an opportunity to have access to more funds. We have no other options. … The rules are what they are and there’s nothing we could do about it and there’s no way to mitigate our damages,” she said.

Carmen Larsen, president and CEO of AQUAS Inc. in Kensington, said she was notified three weeks ago that her business was awarded $12,500. She applied in April and received the payment on June 23.

“Did it take a while? Yes. Did it take a little longer than I hoped? Yes. Do I understand? Yes,” she said.

AQUAS provides services in information technology, data analytics and management consulting.

“Obviously it’s not going to help with everything. It’s just that right now, everything helps,” Larsen said.

It took longer than she expected to get the money, she said, which meant “borrowing from Peter to pay Paul.”

“You’re also trying to recover with your business and to get additional business. So your focus is on working to get this additional business and you’re hoping that this money can help fill the gap,” Larsen said. “That takes a lot of attention from you having to be busy [with] paying your bills.”

Most of the money will cover costs for purchasing personal protective equipment, paying for a cleaning service and teleworking needs.

New contracts coming in for the business have started to slow down. The work that AQUAS does requires the trust of clients who normally want to meet in person, Larsen said.

“Getting new business is really hard because we’re depending on the buyer developing the sense that they can trust us,” she said. “That’s a lot easier to do in person.”

One difficult part of the business’s struggles was a hit to Larsen’s personal credit score.

“The credit card balances are going up. The percent of debt to credit ratio goes up,” she said. “When you’re a small business, you’re putting your name on the line.”

Applicants

Of the businesses and nonprofits that applied for a grant, 21% are from Rockville and 20% are from Silver Spring, followed by Gaithersburg (15%), Bethesda (11%) and Germantown (5%). The remaining 27% are from other parts of the county.

Sole proprietors and nonprofits made up 15% and 6% of the applicants, respectively.

The number of applications from each industry were:
● Professional, scientific, technical: 1,167
● Retail: 882
● Restaurant: 637
● Construction: 462
● Education services: 383
● Arts, entertainment, recreation: 354
● Finance, insurance, real estate: 340
● Information services/technology: 202
● Hospitality: 140
● Manufacturing: 96
● Agriculture: 44
● Not specified: 12
● Recreation: 1
● Other: 2,048

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

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