Where Federal CARES Act Falls Short, Grant Programs Step Up to Help
Everyone has had to dig deep as a result of the current COVID-19 pandemic. It is clear that despite most states starting to reopen in earnest, the economy is going to take much longer to fully recover. At the end of March, Congress passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act in an effort to provide immediate economic assistance. This $2 trillion package delivered financial aid to small businesses, workers, and families that have been impacted by the devastating effects of the virus. However, despite the massive relief package, the money was stretched thin and other organizations have been forced to step up with additional grants to fill in the gaps.
Details of CARES Act
One of the primary aims of the CARES Act was to provide assistance for small businesses. These organizations were not able to withstand the economic shutdown as easily as the big corporations with deep pockets and investors. The Paycheck Protection Program (PPP) delivered $349 billion in aid offered as loans through the U.S. Small Business Administrations (SBA) network.
These SBA PPP loans are designed to give small business owners the help that they need to cover up to eight weeks of payroll. Included in this figure is the money needed to keep employee benefits in place. This money can also be used to pay for rent and utility costs. The SBA PPP loans will be forgiven in their entirety if they are used for these purposes and if at least 75% of the money is used to cover payroll costs.
While the goal of the CARES Act was noble, unfortunately, the money ran out quickly and many small business owners have been struggling to find the funds needed to weather this unprecedented economic storm.
Funding from State and Local Governments
State and local governments have been instrumental in providing grants and other types of funding to struggling businesses in their communities. While this is not an exhaustive list by any means, here are just a few of the innovative programs that have come as a result of the pandemic.
- Colorado - The Denver Small Business Emergency Relief program is providing $4 million in cash grants of up to $7,500 per company.
- California - Both San Francisco and Los Angeles have launched loan programs to help their local businesses trying to make ends meet. The San Francisco Hardship Emergency Loan Program (SF HELP) is providing offering zero-interest loans while the Los Angeles Small Business Emergency Microloan Program is offering loans ranging in scope between $5,000 and $20,000.
- Washington - The Washington Small Business Emergency Grant program has $5 million in funding to provide grants in amounts up to $10,000.
Assistance from Charitable Grants
Some of the most significant contributions in the relief efforts have come from grants awarded by a wide range of charitable programs. Here are just a few of the options that small business owners may find helpful.
- Facebook Small Business Grant Program — Social media giant Facebook is offering $100 million in cash grants as well as ad credits. This program is expected to reach up to $30,000 businesses all over the world.
- Red Back Pack Fund — Female entrepreneurs are already benefitting from the Red Back Pack Fund, hosted by The Spanx. This grant program is estimated to provide $5 million divided into 1,000 grants of $5,000 each.
- Amazon Neighborhood Small Business Relief Fund — e-Commerce leader Amazon has set aside $5 million in cash grants to help small businesses located in its corporate headquarters of Seattle.
- Southern Smoke’s Emergency Relief Program — This nonprofit program is set up to offer financial aid to restaurant and bar owners and their employees and suppliers adversely affected as a result of the shutdown.
As the global pandemic continues, it is clear that there will be more grants and other forms of financial assistance offered to those in need. If you are a small business owner still in need of assistance, be sure to check out all of these generous grant programs designed to keep you on your feet during this challenging economic time. There are new programs being created every week, making it important that you stay on top of the latest aid available to you.
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