As the COVID-19 pandemic continues to negatively affect businesses, Governor Larry Hogan recently announced the $250 million ‘Maryland Strong: Economic Recovery Initiative.” The new funds will expand some current programs and create new ones to address gaps in assistance.
“This could not come at a better time,” says Cassandra Vanhooser, director of the Talbot County Department of Economic Development and Tourism. “Most of our businesses were able to make it through the summer, but with the end of tourism season, many need a lifeline to get through the holidays.”
Several of the programs announced by the governor were already in existence and this announcement simply expands the number of beneficiaries. Other programs are new, including the Restaurant Relief Fund.
Henry T. Leonard III, CPA and senior manager at BSC Group in Easton, gave an overview of the new state programs during the EOC’s Private-Sector call on October 27. He says an important distinction to be noted when considering any of these resources is the difference between a grant and a loan, as well as tax implications.
“Grants do not need to be repaid,” Leonard explains. “However, they can have tax implications. Loans must be repaid, normally with some amount of interest, and may have tax implications, as well. It’s important for businesses to work with their tax advisors and/or accountants to understand how a grant or loan may affect them come tax time.”
Here is a look at what is available to Talbot County businesses
$50M: Direct Relief for Restaurants
The governor’s initiative will provide direct grant relief to qualifying restaurants across the state. The funding will be allocated through local jurisdictions, including Talbot County, and must be distributed no later than December 31, 2020.
“Our grants task force is meeting this week to craft a plan for distributing these funds,” Vanhooser says. “We will release the guidelines for the program after the Nov. 10 County Council meeting.”
Eligible uses of funds include:
- Working capital, such as rent and purchase of equipment and services to expand outdoor dining through physical improvements including tents, heaters, warmers, and carts
- Sanitization services
- Purchase of PPE
- Technology to support carryout and delivery
- Infrastructure improvements, including HVAC system upgrades
$50M: Expansion of Maryland Small Business COVID-19 Relief Grant Fund
This initiative will provide a third installment of funding to the Maryland Small Business COVID-19 Relief Grant Fund, which awards grants of up to $10,000 to businesses of 50 or fewer employees. Talbot County businesses that have applied and not been funded will still be considered. New applications are not being accepted. The additional funding is to clear a backlog of eligible applications.
$20M: Expansion of COVID-19 Layoff Aversion Fund
The governor’s initiative expands funding to $20 million for the state’s COVID-19 Layoff Aversion Fund, which has helped small businesses with an average of 20 employees stay open and saved nearly 9,000 Maryland jobs. New applications were being accepted as of October 28 and the program will remain open 30 days after the State of Emergency ends or until funding has been exhausted.
The average award size has been $22,738 per business, and has been used for expenditures such as purchasing remote access equipment and software to promote teleworking, assisting with employee training and education, purchasing cleaning supplies and services to maintain an onsite workforce, and taking advantage of the Maryland Department of Labor’s Work Sharing Unemployment Insurance Program by supplementing employee income.
$20M: Direct Relief for Main Street
The governor’s initiative will provide $20 million through the Department of Housing and Community Development to assist hard-hit businesses and local entertainment venues within Main Street Maryland organizations, as well as the Baltimore Main Streets programs.
$5M: Expansion of Small and Minority Business Low-Interest Loans
The governor’s initiative doubles funding available for low-interest loans to small and minority businesses. Administered through the Maryland Small Business Development Financing Authority (MSBDFA), the program provides financing to businesses owned by economically and socially disadvantaged entrepreneurs.
MSBDFA loans can be used for working capital, supplies and materials, machinery and equipment acquisition, land acquisition, or real estate improvements. Five-year term loans ranging from $25,000 to $200,000 will be available with an interest rate of 0% for the first 12 months and 2% for the remaining term of the loan.
$3M: Expansion of Arts Organization Funding
In response to the COVID-19 State of Emergency, MSAC has created special grant opportunities that provide emergency funding to arts organizations and artists for losses sustained because of programming, operations, and events that have been modified or canceled. At the time of writing, application information was not available. Check out the MSAC’s website for more information. (https://msac.org/grants/emergency-grant)
$100M: Emergency Rapid Response Fund for Small Businesses
The governor’s announcement did not contain details, but it notes that $100 million will be set aside to be immediately deployed to areas where the need is greatest. The pandemic continues to affect various sectors and as state and local governments wait for the federal government to take action on additional stimulus relief.
“What this might mean for Talbot County is not known,” adds Vanhooser, “but we are staying on top of new programs and initiatives to assist Talbot County businesses and nonprofits, and bringing that information home.”
Talbot CARES Emergency Relief Small Business Grant
More than 100 Talbot County businesses and nonprofit organizations have already received grants of up to $10,000 from this federally funded program. Round 3 will open on Nov. 1 to disperse the remaining funds. To apply, click here.