Vermont businesses that have not received state or federal COVID-19 relief funds will go to the front of the line when the state starts handing out $30 million in relief grants next week.
They'll be given priority for the first 30 days of the new Economic Recovery Bridge Program, which will give them first crack at $10 million of the program's funds and will provide grants of up to $150,000 per business.
“It seems hard to believe, but in 2020 there was a group that wasn’t eligible for our grants, and they were essentially out of luck,” said state Economic Development Commissioner Joan Goldstein. They includes businesses that, because they opened in 2020, couldn’t demonstrate a loss compared to a prior year. “We want them to stay in business. We don’t want them to just close up shop,” she said.
After 30 days, businesses that have already received assistance but are still suffering losses can apply for the additional $20 million in program funds, plus any cash left over from the first $10 million.
The money was appropriated by the legislature and comes from the state’s share of federal American Rescue Plan Act funding.
To be eligible, Vermont-based businesses must demonstrate that they experienced a net tax loss in 2020 that exceeds any net loss they reported in 2019. Lower profits do not qualify a business for grant funds.
Applicants in the second round will have to demonstrate they suffered net losses even after the earlier assistance. New businesses are eligible, as are businesses that have closed — if owners can explain how the funds would help them reopen.
Grants must be used for “normal or traditional purposes of business” and not for personal expenses, according to the program guidelines. Businesses can be made to return the funds if the Agency of Commerce and Community Development finds fraud or misrepresentation.
The limit for grants in previous rounds was $300,000 per business, so this program is less generous. The majority of applicants are likely to be small businesses that won’t qualify for the entire $150,000, Goldstein said. The program rules limit grants to three months’ worth of fixed expenses, which will keep payouts modest for most small businesses, she said.
There are nevertheless more types of government relief programs available today than there were at the beginning of the pandemic, including federal funds specifically intended for restaurants and special-event venues, she said.
Some of those programs just haven’t been accessible for many Vermont businesses. About 385 restaurants in the state received a total of $77 million from the federal Restaurant Revitalization grant program, said Austin Davis, government affairs manager for the Lake Champlain Chamber.
The pandemic has left significant "economic scarring" on some businesses that are still standing, Davis said. "They may look great, but under the surface you don't know what they did to keep the lights on," Davis said.