Repost from the Buffalo News
About $19 million worth of checks are in the mail to small businesses in Erie County chosen for grants from a Covid-19 relief program.
The “Back to Business” program has started notifying 1,366 businesses that their money is coming. The recipients are among 5,000 small businesses that applied for grants and were chosen after a review process administered by the county’s partner, 43North. The funds came from the federal CARES Act.
Small businesses will receive grants in one of seven different dollar amounts, from $2,500 to $45,000. That was a switch from the initial plan to provide grants in just three increments. Program organizers decided some of the smallest recipients didn’t require as much as $10,000 – originally the smallest grant size – and that more businesses could be helped by spreading out the grant amounts.
About 3,000 of the 5,000 applicants to Back to Business made it to the program’s final review. The rest were ineligible for a host of reasons, including being based outside of the county, exceeding the 50-employee limit or not recording any financial losses.
Some applicants had incomplete documentation; 43North tried to follow up with as many of them as possible to collect missing data, said Lauren Baynes, 43North’s vice president of portfolio management and selection.
Baynes said the applicants shared the serious struggles they are going through.
The county expects to start distributing funds from the “Back to Business” program next week, said County Executive Mark Poloncarz.
“Just to be able to provide some assistance to these businesses has been such a rewarding effort,” she said. “While we can’t fund all of them, we think that through the multilayered review process, we did get to the most severe need from the applicant pool, in a very expedited fashion.”
In awarding grants, Back to Business emphasized applicants located in distressed ZIP codes, businesses that were unable to open during the pandemic and businesses owned by disabled veterans. Also considered were factors such as total revenue lost, businesses that didn’t receive Paycheck Protection Program loans or businesses that had lost more revenue than aid they had received.
“We addressed the significant needs of businesses that are in distress,” said County Executive Mark Poloncarz. “We didn’t just hand out cash to companies that are doing well.”
Poloncarz said he didn’t even know the names of the businesses chosen for grants, since 43North handled the process independently.
Restaurants, salons and retailers accounted for the most applications. The largest number of approved grants went to restaurants.
About 40% of the grant recipients had received either negligible or no previous Covid-19 relief aid. Thirty-three percent of grant recipients had lost more than half of their annual income.
“Most of the applications that were eligible that did not receive funding most likely had received some other Covid relief earlier in the year,” Baynes said.
Fifty-two percent of the grant recipients are in “distressed” and “highly distressed” ZIP codes. Forty-eight percent of the grants are going to businesses within the city of Buffalo. Thirty percent of the grant recipients are minority-owned businesses, and 60% are women-owned businesses.
About $1 million of the $20 million Back to Business program went toward the program’s operating costs and advertising expenses, Poloncarz said.
Poloncarz said he believes a new round of federal stimulus will come after President-elect Biden takes office, and that Back to Business can be a stopgap for small businesses until then.
“I believe this will allow a number of businesses that were otherwise teetering on the edge of going under to continue,” he said.