Hundreds of Connecticut companies aided by pandemic loans | Covid-19

When a big swath of Connecticut was compelled to close down throughout the early days of the coronavirus pandemic, state officers rapidly created an emergency mortgage program from scratch, hoping to assist small companies — from pizza retailers to yoga studios — climate the financial disaster.

Months later, data obtained by The Associated Press via a Freedom of Information Act request present the fledgling Connecticut Recovery Bridge Loan Program finally funded 2,123 one-year, no-interest loans, averaging $19,705 a bit. Because of the huge flood of purposes, officers determined to cap mortgage quantities at $37,500 — half of the $75,000 initially promised when this system was launched in March — to assist twice the variety of companies.

The change was made after officers needed to cease accepting purposes the day after this system was introduced and determined to double the $25 million funding to $50 million, underwritten by the state’s enterprise capital group.

“I think we made the right decision, and I still to this day think it was the right one. We wanted to touch as many businesses as possible,” mentioned David Lehman, commissioner of the Department of Economic and Community Development.

Ashley Krauss, proprietor of A Little Something White bridal salon in Darien, mentioned the $33,330 mortgage she obtained from the state, coupled with a forgivable federal mortgage, helped maintain her seven staff working throughout the two months when there have been no gross sales.

“I didn’t furlough one person, let go anybody,” she mentioned. “I’m proud that I was able to do that. I’m appreciative of the money I received because that was literally the thing that kept me up at night while this was going on.”

Connecticut was not alone in providing struggling small companies no- or low-interest loans, or in some circumstances, grants. Florida, Louisiana, Minnesota, New Jersey, New Mexico, Washington, Utah and Pennsylvania got here up with applications after the pandemic hit, whereas many cities, together with San Francisco, Denver and Chicago, additionally provided loans to native companies. Amounts have ranged from $3,000 to $100,000.

In Connecticut, data present 15.4% of the state’s loans went to minority-owned companies and 27.6% had been issued to women-owned companies. Full reimbursement is required one 12 months after receipt of the funds, however candidates can request a six-month extension.

While Lehman considers Connecticut’s program a hit, it seems unlikely it will likely be resurrected, regardless of requires extra assist. He contends small companies would profit way more from one other spherical of funding for the federal Paycheck Protection Program, a forgivable mortgage program that was within the early phases of improvement when Connecticut introduced its bridge mortgage program.

Lehman mentioned Connecticut companies fared properly within the first PPP spherical, with 64,629 receiving a complete of $6.7 billion in forgivable loans, as long as they meet sure standards, averaging $104,000 per mortgage. Additionally, 20,000 companies obtained $1.4 billion in Economic Injury Disaster Loans provided by the Small Business Administration.

“So when you compare that to the financial wherewithal of the state,” Lehman mentioned, “our view is, this is not a Connecticut issue. This is a nationwide issue. And the federal government has the ability to print money and they’ve got the fiscal bazooka.”

Roughly 80% of the Connecticut companies that obtained cash from the state’s bridge mortgage program additionally obtained PPP funds, mentioned Lehman, who didn’t rule out the state arising with different methods to assist small companies.

Scott Dolch, government director of the Connecticut Restaurant Association, mentioned he’d like Connecticut to make use of about $60 million of the $1.4 billion the state has obtained in federal coronavirus support below the CARES Act to create a grant program for small companies. He mentioned many Connecticut eating places can’t afford to tackle extra debt.

He famous that Rhode Island final month started doling out grants averaging $15,000 to small companies that may show they’ve skilled a monetary hardship as a result of pandemic. Two hundred eating places have already obtained funds.

“Obviously our restaurants are going to need it into the fall and winter when we lose outdoor dining and what’s that going to mean,” Dolch mentioned.

Andrew Markowski, Connecticut state director of the National Federation of Independent Businesses, mentioned members additionally like the concept of a grant program, in addition to the continued leisure of state rules.

Dolch has been discussing with Lehman methods to probably alter present restrictions on eating places, reminiscent of swapping the present 50% capability limits on indoor eating with 6-foot (2-meter) distances between tables. He advised the state may additionally contemplate paying off the bridge loans with among the federal cash.

Democratic Gov. Ned Lamont, a former businessman, mentioned final week he understands the constraints dealing with eating places. However, he mentioned he frequently hears pleas from many competing pursuits for a share of the federal funds Connecticut has obtained.

But Dolch mentioned this is a chance for Connecticut to be a frontrunner in an effort that “will pay dividends for everybody.”

“We understand schools need it, we understand hospitals need it, we understand that,” Dolch mentioned. “But we also understand that our small businesses are going to matter when we get through this pandemic, when we get to 2021 and 2022.”

Source hyperlink

Leave a Reply

Your email address will not be published.