(The Center Square) — The Michigan Strategic Fund Board (MSF) passed a plan Thursday to provide up to $20 million to support small businesses shut down in response to the novel coronavirus.
That Michigan Small Business Relief Program funding is split evenly between grants and business loans. The Michigan Economic Development Corporation (MEDC) estimates the money will benefit at least 1,100 Michigan businesses.
“We understand small businesses across our state are facing unprecedented challenges as we take every step possible to mitigate the spread of coronavirus,” Gov. Gretchen Whitmer said in a press release.
“Through decisive actions like those taken today by the MSF Board to authorize relief for small businesses throughout Michigan, we are leveraging every resource available to support our businesses, communities and entrepreneurs around the state impacted by this outbreak,” she said.
The program holds $10 million in grant funding. Each qualifying business can request grants up to $10,000.
Businesses eligible for grants must:
- Be in the industry of businesses shut down or show it was impacted by COVID-19
- The company has 50 employees or less;
- The company needs working capital to support payroll expenses, rent, mortgage payments, utility expenses, or other similar expenses that occur in the ordinary course of business; and
- The company is able to demonstrate an income loss as a result of the EO, or the COVID-19 outbreak.
The program allows MEDC to provide up to $10 million in low-interest loans to some small businesses across the state. Those loans must be between $50,000 and $200,000. Businesses eligible for loans must:
- Be in an industry of businesses shuttered or demonstrate it is otherwise affected by the COVID-19 outbreak, or provides goods and services to those companies
- The company has fewer than 100 employees;
- The company needs working capital to support payroll expenses, rent, mortgage payments, utility expenses, or other similar expenses that occur in the ordinary course of business;
- The company can demonstrate that it is unable to access credit through alternative sources;
- The company can demonstrate an income loss as a result of Executive Order 2020-9.
Those funds should be available by April 1, 2020, and can be used for payroll expenses, rent, mortgage payments, and utility expenses.
“With the outbreak of COVID-19, many small businesses are faced with significant economic impacts, including challenges with cash flow and resources to support their workforce,” MEDC CEO Mark A. Burton said in a news release.
“The Michigan Small Business Relief program will provide immediate assistance to the small businesses around the state who are facing revenue loss as a result of tough, but necessary steps that have been taken to mitigate the spread of the virus,” he said.
That $20 million will be reinforced by Economic Injury Disaster Loans issues by the U.S. Small Business Administration.