CBIA and a dozen other organizations are calling for a $70 million state grant program to help small businesses struggling through the coronavirus pandemic.
CBIA president and CEO Chris DiPentima and other leaders this week urged the state to set aside a fraction of Connecticut's $1.4 billion federal coronavirus relief funding to help small businesses.
“The creation of a new small business grant program with $70 million in funding (approximately 5% of Connecticut’s total stimulus funding) would send a lifeline to thousands of local businesses that are struggling to remain open right now,” the business leaders wrote in an Oct. 15 letter to Gov. Ned Lamont and state legislative leaders.
"These businesses cannot wait for additional action from Congress—they need access to available federal funding, and they need it now."
The letter notes the huge impact that pandemic-driven restrictions have had on Connecticut's smaller employers, who account for 99% of all firms in the state and employ 49% of the the workforce.
“Across every sector, employers have operated under extreme uncertainty for more than seven months, finding new ways to operate while also keeping their employees and customers safe,” the letter read.
“These efforts have been particularly difficult for Connecticut’s many small businesses, who last year collectively employed 730,000 people in our state.”
The letter points out that Rhode Island set aside $60 million of its federal coronavirus relief funds to help small businesses that have seen at least a 30% drop in revenues, and that New Jersey recently announced a similar $100 million program.
“Connecticut does not need to mimic any specific model, but there are key elements that should be part of our program,” the letter said.
“For instance, both Rhode Island and New Jersey use an appropriate ceiling of 50 full‐time employees in their criteria; a cap that is any lower than 50 would leave far too many businesses out in the cold.
“Additionally, both states find ways to acknowledge that the hospitality industry has been harmed by COVID, offering some additional help to these businesses while still keeping the program open to all sectors.”
They end the letter by commending Lamont and lawmakers for helping Connecticut become a national leader in fighting the coronavirus while never losing sight of the economy.
“We can continue to be leaders in these areas now by creating a new grant program to aid small businesses in need,” the letter concluded.
The letter comes amid widespread frustration with the deadlock between the White House and Congress over a new round of COVID-19 emergency relief funding.
More than 60,000 Connecticut small businesses used federal Paycheck Protection Program loans earlier this year to keep employees on the books.
However, most firms have exhausted that funding and now face an uncertain future as the pandemic continues to disrupt consumer behavior and business operations.
A spokesperson for the governor's office told the Hartford Courant the administration has been working on a new small business relief program.
More than 2,000 small businesses also received COVID-19 assistance through the Connecticut Recovery Bridge Loan Program.
The state Department of Economic and Community Development closed applications for that program within a day of its launch in March amid overwhelming demand.
DECD doubled the program's funding to $50 million, with an average low-interest loan of $20,000.
Connecticut's GDP shrank 31.1.% in the second quarter of 2020, driven by troubling declines across most sectors, particularly healthcare, accommodation and food services, manufacturing, and retail.
All 50 states saw GDP declines for the quarter, with the New England region declining 32.3% and the U.S. economy contracting 31.4%.
The letter was also signed by the heads of the Connecticut Convention & Sports Bureau, Connecticut Event Industry Coalition, Connecticut Food Association, Connecticut Lodging Association, Connecticut Restaurant Association, Connecticut Retail Merchants Association, Connecticut Tourism Coalition, National Federal of Independent Businesses, Middlesex County Chamber of Commerce, Hartford Chamber of Commerce, Chamber of Commerce of Eastern Connecticut, and the Connecticut River Valley Chamber of Commerce.