City Approves Small Business COVID Recovery Grant Program
Feb 09, 2022 12:00AM ● By Story by Shaunna BoydCITRUS HEIGHTS, CA (MPG) - At the January 27 meeting, the Citrus Heights City Council considered allocating $323,763 of the federal American Rescue Plan Act (ARPA) funds to the proposed Small Business COVID Recovery Grant Program.
The City’s total ARPA funding award is $15.6 million. After the first installment of $7.8 million was received in May 2021, $5.3 million was allocated to restore staffing at the Citrus Heights Police Department. The final $7.8 million installment is expected in May 2022.
Megan Huber, Economic Development and Communications Manager for Citrus Heights, explained that the ARPA Final Guidelines allow for $10 million to be allocated under an extremely flexible revenue loss category. The remaining $323,763 is restricted to COVID recovery with fewer eligible uses. The City Council will hold a special Study Session in the coming months to discuss all possible options for the flexible $10 million, while allocating all of the available restricted dollars to the Small Business COVID Recovery Grant Program.
The grant program is for small businesses only, so those with no more than 20-full time employees and that earned $3 million or less in annual revenue in 2019. To be eligible, they must be a physical commercial business located and licensed in Citrus Heights; operational as of March 1, 2020; and still currently operating with the intention to remain open. To prove eligibility, the business must provide documents showing net revenue loss of at least 25% in either 2020 or 2021 compared to 2019.
Grants will be awarded based on a tiered system: Businesses that made between $1,000 and $100,000 in 2019 will be eligible for a $2,000 grant; those that made between $100,000 and $1 million will get $10,000 in grant funds; and businesses that made between $1 million and $3 million will be eligible for $15,000.
In order to provide as much help as possible to businesses, the list of eligible expenses is quite flexible: the grant funding can be used for general business expenses, including payroll and supplier payments; rent, lease, or mortgage payments; façade or outdoor improvements; personal protective equipment (PPE) or sanitation supplies; business planning needs; and COVID compliance efforts.
Staff is working to create a streamlined and expedited application process for the program, with businesses submitting online applications with the required documents. The program will be promoted through email, social media, and other media, as well through local business associations and the Citrus Heights Chamber of Commerce.
The initial application period will last 30 days, and Huber said subsequent rounds will be initiated if funds aren’t exhausted in the first round. City staff will review the applications for eligibility, with the possibility of a discretionary review process if the available funds won’t meet the number the applications.
Huber said, “This is an initial program, and we will be assessing further ARPA funding allocations with City Council in a study session in the coming months, so we’ll be really excited to present data on how this program was received, by whom, if it would be undersubscribed or oversubscribed, so Council can take that into account for the strategic planning and forecasting of these one-time pivotal funds.”
Councilmember Jeannie Bruins said, “The funds we are approving tonight are an immediate approval for going forward with this new business recovery program. … When we have our strategic planning session, further support of the business community could very well come out of that as well. So, this is not the only opportunity we’re going to look at to provide funding. So once we have the comprehensive session, we’ll take a look at that again, and we’ll fortunately have data … to show what the initial response has been and that will help guide our actions as we go forward.”
Vice Mayor Tim Schaefer expressed concern about businesses that might not want to provide their tax documents to the City since they would become public record, so he asked if there were alternative ways for businesses to receive funding.
Interim Administrative Services Director Bill Zenoni explained that providing tax documents is the normal procedure in this situation, and the City will need to have that documentation available if the federal government were to audit this grant program. City Attorney Ryan Jones said that Tax Identification Numbers and Social Security Numbers would be redacted, but the income sections would be subject to the Public Information Act.
Councilmember Bret Daniels said he hoped to see some flexibility in the eligibility requirements, stating that a business that lost 24% of their revenue wouldn’t meet the 25% threshold but would still be struggling and in need of help.
Huber said that staff will be working to identify businesses falling through the cracks so they can suggest alternative ways to provide assistance.
The Council voted unanimously to approve the Small Business COVID Recovery Grant Program.