Connecticut recently set aside $50 million of its federal coronavirus relief funds to provide $5,000 grants to help 10,000 small businesses manage some of the pandemic’s impact.
But when the state closed the grant application process last week, 18,000 small businesses and nonprofits applied, showing just how devastating the virus has been.
The state Department of Economic and Community Development designed the program for the smallest of businesses—those with fewer than 20 employees or a 2019 payroll of less than $1.5 million.
State officials said they saw it as a temporary fix while waiting for Congress to approve another relief package that includes help for small businesses.
It would take $90 million to accommodate all 18,000 applicants.
CBIA and dozens of other business organizations called for $70 million in emergency small business funding before the Lamont administration announced the $50 million program.
New Jersey budgeted $100 million of its coronavirus relief funds for small businesses while Rhode Island set aside $60 million.
“This was really targeted to our smallest of small businesses,” deputy DECD commissioner Glendowlyn Thames told reporters.
“We recognize that the amount in its totality might not seem like a lot of money—but ... when you are looking at these small businesses, that $5,000 might really matter.”
Small businesses that receive a $5,000 grant can use it for payroll, rent, utilities, inventory, costs associated with reopening under the state’s sector rules, or new equipment or machinery.
Gov. Ned Lamont directed that half the funds—$25 million—go to small businesses and nonprofits located in cities and towns designated as fiscally and economically distressed.
Thames said she expects small businesses will begin receiving the grants in mid-December.
Earlier this year, 2,123 small businesses received a total of $41 million in bridge loans from the state, an average of about $20,000 each.