Small Business Relief and Recovery Program Proposal
The Community Development Corporation of South Berkshire, as a part of a statewide coalition of community-based organizations, community lenders and advocates have called on state leaders to adopt a Small Business Relief and Recovery Program to address urgent and unmet needs in the small business community.
Seventy-four organizations, including dozens of organizations that work every day at the local level with entrepreneurs impacted by this crisis, made this request in a letter to Governor Charlie Baker, Senate President Karen Spilka, and House Speaker Robert DeLeo. “The foundation of our economic future is the hundreds of small businesses that weave together our regional economy, including very small enterprises that have difficulty accessing federal resources,” said Tim Geller, Executive Director of the CDC of South Berkshire.
“We are heartbroken watching hard working men and women fight to save their business and their families from economic ruin – a situation that has nothing to do with their skills as business owners, but is entirely due to COVID-19, and the public health necessity to close their businesses. They are suffering immense economic harm to help keep all of us safe, so we believe all of us have a shared responsibility through our state government to help keep them in business,” the letter states.
The proposed Small Business Relief and Recovery Program is particularly focused on those small businesses that are most vulnerable during this economic crisis, including those from historically underserved communities, such as African American, Latinx, Asian, people of color, immigrant, and women, as well as businesses located in rural towns, Gateway Cities, and other low-income areas.
The letter recognizes that the federal government is providing significant resources to small businesses through the Payroll Protection Program, but points out that many small businesses, especially very small businesses, and those owned by people of color, are not benefiting equitably from that program. In a survey of nearly 500 small and micro businesses released by the group, 58% reported that the Federal CARES Act would not meet their needs over the next three months. Further, “42% said they were surviving on personal savings, an unsustainable strategy, especially for many people of color who, on average, have significantly less accumulated wealth than their white counterparts.”
The letter calls for a “state-level strategy that is focused on reaching those who continue to be left behind,” to better access federal dollars and to strategically use state resources to plug gaps in the federal response. Segun Idowu, Executive Director of the Black Economic Council of Massachusetts and one of the signatories of the letter, noted “If Washington can’t get it right, our leadership needs to.”
The Coalition includes many organizations from rural communities, which are struggling. “By providing customized technical assistance at the local level, flexible financing, and small grants, we can help more of our rural businesses access federal dollars, survive the shutdown and recover in the months to come,” said Amy Shapiro from Franklin County CDC.
The coalition offers the following recommendations for programs and policies that should be part of the state’s Small Business Relief and Recovery Program:
1. $10 million in funding to support community-based organizations that deliver culturally competent and multilingual technical assistance and coaching to small businesses;
2. $30 Million in emergency relief grants to help businesses cover rent, mortgages, and other fixed costs;
3. $35 million to Community Development Financial Institutions, Community Development Corporations, and other community-based lending programs to help them offer grants, zero/low interest loans, loan deferments, and other assistance to small businesses;
4. $75 million to the Massachusetts Growth Capital Corporation for a revolving loan fund to help businesses unable to access SBA financing, with a focus on communities of color, immigrant communities, rural towns, and Gateway Cities;
5. A statewide Small Business Assistance Task Force charged with ensuring the effective delivery of support to small businesses during the economic shutdown and through the recovery; the task force should have a laser focus on equity and inclusion.
The CDCSB is a nonprofit organization dedicated to creating job opportunities, promoting economic development, and building low-moderate income housing in the southern Berkshires. In collaboration with other local organizations, CDCSB has helped build over 60 affordable housing units, leveraged over $30 million in private and public funding for south Berkshire County and has a current development pipeline of 120 new affordable housing units.
(Information obtained from a press release that was sent to WSBS from CDCSB for online and on air use)