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OKC approves $5.5M relief package for businesses
Small businesses in Oklahoma City may receive financial assistance by the last week of April from the $5.5 million OKC Small Business Continuity Fund program approved by the Oklahoma City Council on Tuesday. An online application portal will be made available for businesses to apply beginning April 6.
“We’re hoping that it’s as simple as possible and that (businesses) can just check the boxes and upload documents and get through it pretty quickly,” Cathy O’Connor, president of the Alliance for Economic Development of Oklahoma City, told members of the Oklahoma City Council who met by teleconference on Tuesday.
“We totally understand that this may not solve everybody’s problem – this is not enough money to do that,” O’Connor said when questioned by council members regarding how far the funds will go toward helping small businesses for which revenues have greatly decreased or completely dried up due to the COVID-19 pandemic.
The program – devised as a joint effort by the city, the Alliance and the Greater Oklahoma City Chamber – is pretty generous compared to what other communities across the country are doing, she noted.
“We were trying to find something that we felt was impactful enough to make a difference for these businesses,” said O’Connor. “I think we just have to be realistic about how many people we can help and try to help maybe the ones that need it the most.”
Council members unanimously approved the $5.5 million assistance package that will provide incentive payments, grants, loans and technical assistance to businesses with 50 or fewer employees that have lost at least half of their revenues due to the COVID-19 pandemic.
The program designates $3 million for loans for businesses with fewer than 50 employees. The loan program offers 10-year, no-interest loans of up to $50,000, which could be forgiven in three years if the business meets certain long-term employee retention goals and other criteria. Ten-year, low-interest loans of between $50,000 and $100,000 are also available.
Another $1.5 million would be offered as cash incentives, reimbursing businesses with fewer than 15 full-time equivalent employees for up to $10,000 in retained employee payroll.
Independent contractors and sole proprietors are also eligible to apply for assistance, said O’Connor, as are businesses that hire independent contractors. Decisions regarding eligibility will be made on a case-by-case basis. The council will receive regular reports on how the program is progressing, and businesses that are turned down for assistance will be informed as to why they did not meet the criteria.
Business owners may also request technical assistance with the application process for Small Business Administration loans or other federal, state or local programs; request help with developing a platform for online sales or a system enabling employees work remotely; or ask for legal advice navigating employment law with regard to COVID-19. The program makes available $500,000 program administrators will use to pay certified local experts for their services on behalf of the businesses that qualify for the assistance.
“Our plan is to issue a request for proposals or a request for qualifications and develop a list of qualified vendors that we can then match businesses to and have some control over the scope of services,” said O’Connor.
City Manager Craig Freeman is authorized to create a committee to evaluate applications and disburse funds to businesses. The committee will likely include O’Connor, Oklahoma City Finance Director Brent Bryant and city Economic Development Program Manager Joanna McSpadden, as well as someone with experience in the banking or finance industry. Other candidates to serve on the committee would ideally represent all parts of the city and varied experience, said O’Connor.
Council members JoBeth Hamon, Ward 6, and Nikki Nice, Ward 7, expressed their concern that minority-owned and women-owned businesses, as well as businesses in truly low-income areas, might fall through the cracks in the application process.
Though 25% of the funds made available through the program are targeted to business in low-to-moderate census tracts, Hamon noted that, like with the opportunity zones, some census tracts in Ward 6 might have been classified as low- to moderate-income when the last census was taken but are now much more affluent than other parts of the city.
Still, O’Connor said the city should rely on the census data as the best way to determine which businesses are in disadvantaged areas.
“I do think that we have to find something that is objectively measured by a third party to do this or we open ourselves up for a lot of criticism,” said O’Connor. “And we’re going to get a lot of criticism anyway, because we won’t have enough money to go around. So we’ll try to do the best that we can.”
Another $50,000 authorized as part of the package will pay for administrative costs of implementing the program, including development of the online application portal, staff time and marketing expenses. A bank that is yet unnamed has stepped forward offering to provide underwriting and servicing of the program for free; once the agreement is finalized, the bank can be acknowledged and thanked for its assistance, said O’Connor.
Freeman also has authority to move money between the different programs if demand for one benefit far outpaces that for the other programs.
The assistance comes none-too-soon for businesses owners like Larry Coleman, who has operated Legitimate Look barbershop and hair salon for 17 years at 6051 N. Brookline Ave., providing mentorship for high school children, haircuts for the homeless and other services to his local community.
Coleman was in the midst of an expansion, moving into a new spot at 12600 N. Pennsylvania Ave. that would allow him to increase the number of stylists who rent booths in his establishment from eight to 13, when COVID-19 brought the entire businesses to a halt. In addition to the stylists who look to him to have a place to earn their living, the contractors he hired to build out the new space are also looking to him for their livelihood at this time.
“I don’t like people doing work for me and having to owe them, I don’t like them having to wait on their money,” said Coleman. “It’s beautiful about Oklahomans, we all understand we have to work together, we’ve got to help each other, so they’re being understanding. But at the same time, they’ve got to feed their families as well.”
Technical assistance with applying for whatever loan programs are available to help business owners like himself make mortgage and rent payments appealed to Coleman.
“That’s what I need,” said Coleman. “This is all new to me.”