Published in Small Business

New loan, grant funds set up to aid smaller businesses

BY Wednesday, May 13, 2020 03:10pm

New grant funds by the state and in Kalamazoo, as well as a loan fund in Grand Haven, are the latest efforts to provide relief to small businesses hit hard by the COVID-19 pandemic.

The relief initiatives offer aid to the smallest of small businesses that are most vulnerable from the economic hardship brought on by the pandemic.

Joy Gaasch, the president of The Chamber of Commerce for Grand Haven, Spring Lake, and Ferrysburg COURTESY PHOTO

“It’s a very particular set of our business economy that functions on a shoestring,” said Joy Gaasch, the president of The Chamber of Commerce for Grand Haven, Spring Lake, and Ferrysburg.

After seeing the success and high demand for grant and loan funds totaling $10 million each that the Michigan Economic Development Corp. created in April, Gaasch started talking to Grand Haven city leaders about creating a fund to support small businesses locally.

The result was a $100,000 loan fund that will provide zero-interest, five-year loans of $5,000 to service-based small businesses in the City of Grand Haven. The loans will go to sole proprietors and small businesses that have five or fewer full-time employees, have experienced a loss from the pandemic, and have been unable to secure any other financial assistance, whether through a bank loan, the MEDC’s programs, or the U.S. Small Business Administration’s Paycheck Protection Program or Economic Injury Disaster Loans.

“We wanted to make sure we were reaching out to people who didn’t have access to the other funds,” Gaasch said. “They’re the most vulnerable and we felt we had to reach out.”

The relief fund in Grand Haven is supported by a $100,000 allocation from the city’s Economic Development Corp./Brownfield Redevelopment Authority. Applications are due by 12 p.m. this Saturday. More information on the fund is available at the Chamber’s website.

The fund in Grand Haven is among a number of initiatives that have come together across Michigan — both at the state level, and in communities ranging from Muskegon to Holland and Grand Rapids, to Kalamazoo and Battle Creek — to aid small businesses that were forced to close or limit operations during the pandemic.

Statewide, the MEDC has partnered with Detroit-based Michigan Women Forward for the $1.5 million Michigan Entrepreneur Resilience Fund to help entrepreneurs and small business owners.

The MEDC and Michigan Women Forward each provided $500,000. Another $500,000 toward the $1.5 million fund came from partners that include the Consumers Energy Foundation, the New Economy Initiative in Detroit, General Motors Corp., Fifth Third Bank and Comerica Bank.

According to a statement this week, Michigan Women Forward “is also working with other potential funding partners to provide additional opportunities for grants and loans through the Michigan Entrepreneur Resilience Fund.”

The Michigan Entrepreneur Resilience Fund offers recovery grants of $1,000 to $5,000, and microloans of $5,000 to $10,000. Backers of the fund hope to aid 150 small businesses statewide.

Small business awarded funding through the program can use the money to manage expenses through the recovery phase, including paying rent, payroll and inventory. The fund also can support business growth by providing working capital “to assist with increased product or service demand in response to COVID-19, to allow a company to revamp their business virtually through a strengthened online presence, or to start up a company to meet a new demand as a result of COVID-19,” according to the announcement from the MEDC and Michigan Women Forward.

“At Michigan Woman Forward, we are dedicating ourselves to doing everything we possibly can to help Michigan’s small businesses re-open and recover from this crisis,” Michigan Women Forward President and CEO Carolyn Cassin said. “Funding is just the beginning. We will also pair our entrepreneurs with experts to help answer questions and guide their decision making at this critical time.” 

The Michigan Entrepreneur Resilience Fund will evaluate applicants “on a rolling basis until funds are exhausted,” according to the announcement from Michigan Women Forward. Priority will go to applicants based on demonstrated need that includes:

  • They’re located in a disadvantaged area within a SBA designated HubZone or Opportunity Zone;
  • Demonstrating status as a low- to moderate-income borrower; and
  • Qualifying as a diverse business that can demonstrate ownership by underrepresented groups such as veterans, minorities and low-income men and women. 

Small businesses can apply to the Michigan Entrepreneur Resilience Fund here.

In Kalamazoo, the City of Kalamazoo and United Way of the Battle Creek and Kalamazoo Region created a $500,000 grant program that will award $5,000 to eligible microbusinesses within the city limits — generally those with 10 or fewer employees. Funding for the Kalamazoo Micro-Enterprise Grants comes from $200,000 provided by the Consumers Energy Foundation and $300,000 from the City of Kalamazoo’s Foundation For Excellence, which is pending Kalamazoo City Commission approval.

The city and United Way also partnered on a small business loans fund that so far has provided more than $1.2 million to 69 local businesses.

“This new grant initiative shows again how the power of partnership makes a difference,” said Chris Sargent, president and CEO of United Way of the Battle Creek and Kalamazoo Region.

Grants will go to microbusinesses affected by the pandemic and state stay-at-home orders that are:

  • Located in the City of Kalamazoo;
  • Have 10 employees or fewer;
  • Have annual revenue of $1 million or less
  • Have been in business for at least a year;
  • Need working capital for payroll expenses, rent, mortgage payments, utility or similar expenses; and
  • Demonstrate an income loss as a result of the executive orders or the COVID-19 outbreak.

Microbusinesses in Kalamazoo can apply for the Kalamazoo Micro-Enterprise Grants here.

Applications are due by 5 p.m. May 27. A review committee that includes United Way staff and representatives from business, financial and community groups review applications and make funding decisions by June 1.

Read 2606 times Last modified on Thursday, 14 May 2020 08:37
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