Investment

Little Rock transfers funds from business loans to ease rent and utility bills for residents

In April, the city of Little Rock announced it would provide $ 500,000 in forgivable loans to struggling small businesses during the pandemic, but city officials now plan to reallocate half of that federal funds to residents who have struggling to pay their rent and utilities.

The program called the Small Business Emergency Assistance Program has provided loans of $ 5,000 to nearly four dozen mom and pop businesses in Little Rock.

Several business owners described the grants as minimal, but added that they had helped through a difficult time.

Now, nine months after the start of the covid-19 pandemic, city leaders have seen a growing need for these funds elsewhere.

“We took a portion of that and reallocated that money – 250,000 – to help the people who were being evicted, the people who couldn’t pay their utility costs and everything in between,” said Kevin Howard, director. of Housing and Neighborhood Programs for the Town of Little Rock. “So we saw a need in that since we had pretty much gone through and had two rounds of funding under the Small Business Emergency Assistance Program.”

Little Rock has so far made 44 loans to small businesses in the city, Howard said. The loans, paid for with money donated to the city through the Coronavirus Aid, Relief and Economic Security Act passed by Congress in March, were originally intended for businesses in Little Rock.

In April, Howard said the program was put in place to help small businesses that have been hit hard by the covid-19 pandemic and may not have had access to federal help.

The funds are loans, but they are repayable without interest if companies can show that jobs have been created, restored or retained after one year. So far, the city has provided $ 212,000 in small business loans, Howard said.

To be eligible, businesses had to have 20 or fewer employees and have previously been a registered business within the city of Little Rock.

Allicia Talbert, co-owner of Talbert Lawn Service, said she spent the $ 5,000 loan on many bills her business racked up during the pandemic, such as its storage and utility costs.

“I couldn’t have asked for more. It was what we needed, I’ll be very honest, it was what we needed,” said Talbert. “Sure, we could have done better with more, but, you know, you have to make lemonade with lemons.”

As a result of the pandemic, Talbert said her business’s income fell by 80%, which meant she had to lay off her five seasonal workers and forgo her pay.

“Mowing your lawn is like a luxury. It is not something that comes to mind when you have a light bill overdue, need groceries for your child, or daycare. is due, or you have an emergency medical bill – – it’s not at the forefront of your mind, “Talbert said.

Jamesia Givan, owner of JLG Consulting, said that while the loan she received from the city was helpful, she felt that $ 5,000 was not enough for some businesses in need.

“More would be great, but I think $ 5,000 was a small amount, but an amount that was better than nothing,” Givan said.

Congress passed the CARES Act in March with $ 2 trillion in stimulus money paid to taxpayers, businesses and communities battling the economic downturn caused by the covid-19 pandemic. Arkansas received $ 1.25 billion in funding from the CARES Act.

For businesses, Congress has implemented the Paycheck Protection Program, a federal loan option that allows struggling businesses to pay their employees’ salaries. With Little Rock businesses still potentially having access to state and federal loans, Howard said the city did not want to give loans to businesses that already received them from the federal or state.

“We’re trying to make sure that we haven’t, you know, allocated funding twice to companies that have already received this type of funding,” Howard said.

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