Aid coming to small business through city program

By: Chloe LeValley - May 31, 2020
Source: Walla Walla Union-Bulletin

The Walla Walla Small Business Relief Program will provide more than $114,000 in small business emergency grants to 29 local businesses affected by the COVID-19 pandemic.

The program was organized by the city of Walla Walla and funded by a grant from the city’s Community Development Block Grant program, with additional funding from the city of College Place and Walla Walla County.

The money puts funds from the Coronavirus Aid, Relief and Economic Security act, commonly known as CARES, into the hands of business owners

 

Mercy Corps Northwest is administering the grants, which total $114,311.

A second application round has opened for Walla Walla Valley businesses that are also interested in Small Business Resilience Loans up to $50,000.

The loan program is administered by Craft3. Three business owners have applied for that. Business operators are encouraged to come forward for loans.

 

They committee considered business history, length of operation, profitability and intended use of the funding.

For the second application round, details are still being worked out, Olson said.

He said job retention and longer term viability of the businesses will be among the primary criteria.

New grant applications will not be accepted, according to the release. The local review committee will re-review applications that were previously submitted.

“It is not necessary for these business owners to express interest in being considered for the second round of funding,” according to a release. “Criteria for the second round of grants will be different than that of the first round, and due to funding limitations, not every business that applied will receive assistance.”

Craft3, a community development financial institution, created a loan fund of about $450,000 that businesses can borrow from, and the city has set the guidance on what businesses are qualified to apply for a loan, said its CEO Adam Zimmerman.

The operation is accepting loan applications from Walla Walla Valley businesses, and the city is still open to receiving requests for eligibility. They have about $400,000 left to lend under the program.

Businesses are eligible for a loan if they have been open for at least two years, reported a profit in 2019 and have a credit score of at least 640.

The committee will screen applicants, and if the business meets eligibility requirements, they will be invited by Craft3 to apply, according to the city website.

Small Business Resilience Loans can be up to $50,000.

Screening applications are available at wallawallawa.gov/SBRP/.

Businesses that have received Paycheck Protection Program or Economic Injury Disaster loans are eligible to apply.

“Across the region in the different places that we’ve been working in, we’ve approved about $2 million worth of these loans,” Zimmerman said.

“Most businesses right now are lacking the cash flow that they need to pay the basics. So insurance, rent, utilities and then basic critical staff salaries,” he said.

“Some are pivoted to things like we have distilleries in our portfolio, so some have pivoted and started to make hand sanitizer. Which requires then, in their case, they had to go buy new different supplies to do that and that required cash they had to go to a vendor and buy bottles that they didn’t have.”

Carl Seip, the marketing and external affairs director for Craft3, said the loans are designed with as few strings attached as possible, giving businesses the flexibility for whatever their capital needs are, whether it’s paying rent and hunkering down or restarting and reopening.

The emergency grants drew 181 applicants.

“We knew from the offset that we weren’t going to have enough money to meet all of the needs or even close to all of the needs. It just wasn’t there,” Deputy City Manager Byron Olson said. “We’re trying to get as much help as we can to local small businesses, recognizing that the city doesn’t have a whole lot of free resources.”

Having been a small business owner, Olson said he knows how frustrating it can be for those who weren’t successful in this round of funding or searching for other avenues of funding.

He said the problems created from the pandemic are, for the most part, so far beyond anything that a small business owner can control.

“It is heartbreaking how difficult it is to see some folks not get funding,” he said.

That is why organizers want to have a couple of rounds of funding, he said.

He said a second round funded by different federal dollars will change the qualifications with less emphasis on low-income operators and more focus on business sustainability and keeping employees at work.

During the first round of grants, some criteria for qualifications included operational costs, location, access to resources, susceptibility to being adversely affected by COVID-19 restrictions, previous funding received, minority status, family situation, language challenges and more, according to a release.

“The significant criteria was because of the nature of it being Community Development Block Grant funding and the requirement for that funding is to benefit, primarily, those who are low-income and in minority status,” Olson said.

The requirement was that at least 51% of the funds had to go to those parties.

Each application was reviewed and assigned a score. A review committee of local economic development leaders determined the criteria the scores were based on, the release explained.