The city of Columbia’s Housing Programs Division will start accepting applications for microenterprise recovery loans online at 8 a.m. Sept. 15.
The city council approved the loans for small businesses in a package of amendments that the Housing Programs Division proposed during the May 4 City Council meeting. The amendments outlined how the city should allocate the $573,473 it received from the Coronavirus Aid, Relief, and Economic Security (CARES) Act for business loans. It provided that the Microenterprise Recovery Loan program receive $175,000 of the funding.
According to a city news release, this program is designed specifically for local businesses with five or fewer employees. It will provide $5,000 loans for 35 businesses. Applicants will have one day — or until the 53 application limit is met — to submit their materials online through the Neighborly System portal.
This is the city’s second effort to provide COVID-19 relief funding to small businesses. The earlier Microenterprise Recovery Loan program, with $90,000 in federal funding, opened April 15. The applications received quickly exhausted the available funding, and many minority-owned businesses did not receive loans.
The application limit typically gets hit pretty early, said Randy Cole, housing programs manager, referring to the application process in April.
“It takes a bit [of time] to go through the application. We ask for a lot of information,” Cole said. “We try to make it exactly what we need to align with our federal regulations, but it’ll probably take most folks an hour or two.”
Cole emphasized that the loans can help keep businesses afloat during this difficult time while also giving owners enough capital to invest in measures to increase their resiliency in the coming months.
Loans will be fully forgiven if they are used towards approved expenses, such as rent, payroll and operating expenses.
Program guidelines and application information can be found on the city’s webpage. City staff expect a two-week turnaround for fund disbursement from the time of application, but this is subject to change.
Nationally and at the local level, governmental aid has been criticized for not being readily accessible to minority-owned businesses. The U.S. Treasury made CARES Act funding available through local banks and having a relationship with a bank is a barrier for some of those businesses, Cole said.
“In our program, we’re trying to prioritize some of those businesses that may have been left behind or either just didn’t have an opportunity to access those funds,” he said.
Applications will be graded on a five-point system:
- One point for minority-owned business enterprises.
- One point for women-owned business enterprises.
- One point for businesses where owners reside in the city.
- One point for businesses that have not yet received PPP, SBA or previous assistance.
- One point for businesses that are investing in adapting to the pandemic.
“We wanted to make sure that minority-owned businesses were well-informed and aware of the program so that they could start to prepare to submit their paperwork,” said James Whitt, director of the city’s supplier diversity program.
This program is open for all microbusiness owners to apply, Whitt said. They just wanted to ensure local minority-owned businesses had knowledge of how they could participate in the program.
“Our hope would be that we not only save businesses but reposition them in our current climate to grow,” Cole said.
The Central Missouri Community Action (CMCA) Women’s Business Center, the city of Columbia’s nonprofit community partner, is available to provide technical support to businesses with the application process. Businesses in need of assistance can contact the center at 818-2980.
For more information about the Microenterprise Recovery Loan Program, businesses can contact Randy Cole at 874-6321 or by email at firstname.lastname@example.org.