A new grant program has been announced by Governor Pritzker and DCEO. Below are some highlights to help you determine if your business is eligible to apply, and if so, the main items that will be required:
Grant name: Downstate Small Business Stabilization Program
Link for grant information, application, and guidelines can be found here.
Who is Eligible?
Macon County businesses that exist outside of Decatur city limits. Businesses must have 50 employees or less (including the owner). Private for-profit small retail and service businesses, or businesses considered non-essential by the Governor’s Executive Order without the ability for employees to work remotely. Business must have been in operation for three fiscal years.
Ineligible Businesses?
Businesses within the Decatur city limits are not currently eligible for this grant. However, the City of Decatur is examining whether they can repurpose some of their CDBG allocation to be used for short-term assistance for businesses inside city limits impacted by COVID-19. The City will make an announcement soon, after obtaining clearance from the federal government.
Grant Summary
To support small businesses in downstate and rural counties across Illinois, DCEO is repurposing $20 million in Community Development Block Grants (CDBG) funds to stand up the Downstate Small Business Stabilization Program. This Fund will offer small businesses of up to 50 employees the opportunity to partner with their local governments (Macon County) to obtain grants of up to $25,000 in working capital. These grants will be offered on a rolling basis.
What can grants be used for?
- CDBG Economic Development funds may be used to assist private for-profit small retail and service businesses, or businesses considered non-essential by the Governor’s Executive Order without the ability for employees to work remotely.
- The program component makes funds available for 60 days of verifiable working capital up to a grant ceiling of $25,000 and is available for businesses that employ 50 people or less. Number of employees includes the business owner(s).
- The amount of CDBG grant assistance provided to a business will be limited to the amount, with appropriate terms and conditions, sufficient to allow continuity of the business for 60 days or the grant ceiling, whichever is less, without substituting CDBG funds for available private debt or cash equity.
- Only applicants that can demonstrate an Urgent Need in relation to the COVID-19 emergency will be funded. Projects should have solid commitments to retain permanent jobs.
- Costs incurred prior to the date of grant award are not reimbursable under this grant program.
How much money is available?
Grants of up to $25,000 per business will be available. This is an ongoing program until the funds run out. There is no deadline, but the sooner a business/local government submits that application the better.
How soon will businesses receive funds?
DCEO’s goal is to execute grants within 30 days of application receipt, after which funds will be accessible.
Requirement Highlights (After reading through this, please see the guidebook and read through ALL guidelines to make certain your business is eligible.)
- The business must identify their net income for the last three fiscal years ending December 31, 2019.
- A copy of the most current bank statement for the business.
- A financial review will be conducted to ensure that CDBG funds are not being substituted for available private debt financing or equity capital.
- A Certificate of Good Standing from the Illinois Secretary of State and the Illinois Department of Revenue must accompany the application.
- If available, other forms of documentation to demonstrate the lack of permanent working capital in support of operating expenses. Such evidence may include shutoff utility notices, delinquent bills, denied loan applications, etc.
- Project Need – Project need is defined as the inability of the company to maintain sufficient permanent funding to sustain normal operating working capital needs. Describe in sufficient detail the need for the assistance and the specific role of CDBG funding, including any other options which have been pursued.
- Evidence of need is demonstrated through a well-developed justification for public financing demonstrating a financial gap argument. The discussion should also address why other financing options could not be obtained or are not feasible and repercussions if funding is denied.
- Financial Feasibility – Determination must be made as to how CDBG funds can address the company’s need to provide adequate permanent working capital in addressing current and future working capital needs, like payroll, operating needs and short-term liabilities. A comparison must be provided as to the existing payroll that existed prior to the outbreak of the COVID-19 virus in January and current payroll. In addition to payroll, the effect of the COVID-19 virus on current and long- term liabilities.
- Commitments for Job Retention – Provide firm assurances from the borrower (employer) regarding the number of permanent jobs to be retained for low-to-moderate income persons, types of positions, not to exceed 12 months.
- National Objective – Urgent Need: The Urgent Need National Objective is defined as assistance to a business designed to alleviate existing conditions. The grant recipient certifies that such conditions pose a serious and immediate threat to the health or welfare of the community, they are of recent origin or recently became urgent, the grant recipient is unable to finance the activity on its own, and other sources of funds are not available. Applicant must demonstrate through information in the Project Summary, financial documentation and employee status that they meet this objective.
Grant Reporting:
This will include but is not limited to quarterly financial and performance reports, closeout report, and documentation of the project’s impact including job creation.
Application Process:
Macon County will apply on behalf of a business after the business has completed all of the necessary items on the attached guidebook. The business and Macon County will sign a participating agreement. If that business is awarded grant dollars, the County will receive the funds and then pass them to the business. Please contact Nicole Bateman by email at nbateman@decaturedc.com if you would like to complete the application.