$115 Million Grant Program Will Help Small Businesses Re-open
On Wednesday, June 17, the Michigan Legislature unanimously passed SB 690. The bill appropriates $880.1 million in federal dollars granted to the state for COVID-19 relief.
NFIB had recommended the expansion of a previous grant program back in March of this year, and on June 3, the House Appropriations Committee added section 503 to a supplemental appropriation bill (Senate Bill 690) that sought to restart the program with $200 million in federal COVID-19 relief funding. The final bill reduced the funding to $115 million.
The $115 million is appropriated to the Michigan Strategic Fund, housed within the Michigan Economic Development Corporation (MEDC), to create and operate a small business restart grant program to provide relief to eligible small businesses that have realized a significant financial hardship due to the COVID-19 emergency.
Grants would be available to businesses with 50 or fewer employees and the maximum amount of the grant would be $20,000. The grants could be used only for working capital to support payroll expenses, rent, mortgage payments, utility expenses, costs to re-open business, or any other authorized use under the Federal CARES Act. Businesses must demonstrate they have been affected by the COVID-19 emergency and that they need capital to support expenses. They must also document an income loss because of the COVID-19 emergency. Businesses that received a grant under the prior Michigan Small Business Relief Program created in March of this year are not eligible for a grant under this new program. The new program would also set aside at least 30% of the funds to be awarded to women, minority, and veteran-owned eligible businesses.
The appropriation language directs the Strategic Fund to grant $52.5 million of the appropriation to the 15 local and nonprofit Economic Development Organizations (EDOs) that participated in the prior Michigan Small Business Relief Program to distribute within their regions. The Strategic Fund is required to develop a “fair method” of distributing the remaining funds.
The Governor is expected to sign the bill and NFIB will provide more information on how to apply for the grants when the program details are available, and the online application process is established.