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CC 06-16-20 #22 Small Business Emergency Relief Grant Program_Staff PresentationAngela Tsui, Economic Development ManagerJune 16, 2020Item 22: Cupertino Small Business Emergency Relief Grant ProgramCC 06-16-20 Item No. 22 CARES-CV Funding and HUD Guidelines:●The City is scheduled to receive $229,017 in CARES Act supplemental funding from HUD. ●This is a special allocation of CDBG funds to be used to prevent, prepare for, and respond to COVID-19.●Funds can be used to provide short-term working capital assistance to small businesses to enable retention of jobs held by low- and moderate-income persons. 2 Proposed Small Business Emergency Relief Grant Program●On May 19 City Council approved allocating Cupertino’s $229,017 CARES Act funds toward the creation of a small business relief/assistance program to provide $5,000 grants to eligible Cupertino businesses. ●Breakdown of the funding allocation:CARES Act Allocation Budget FY 20-21Entitlement Amount$229,017.00 Estimated Program Administration by City staff for compliance and auditing (up to 20%)$45,803.40(maximum) Total Available for Programs $183,213.60 3 •Provide one-time emergency relief grants of $5,000 to qualifying small businesses of 2 to 25 employees, based on the number of employees at time of initial Shelter-in-Place order.•Grants to be used for payroll, rent, or utilities for the specified business location.•Grant funds are aimed to help fill gaps or bridge funding while waiting for other financial assistance programs, including Paycheck Protection Program (PPP) and Economic Injury Disaster Loans (EIDLs).•Per HUD requirements, the business must (re)hire or retain at least one employee from a low-moderate income household (80% or below AMI). Grant Program Objectives4 •Operate a permanent physical commercial storefront location within Cupertino and open to the public (home-based businesses do not qualify)•Be a for-profit business in good standing and have a current Cupertino business license•Have demonstrable financial impact stemming from the COVID-19 pandemic•Commit to (re)hiring or retaining employees from low-income households•Have been in business for at least one (1) year (based on its Cupertino business license)•Had between 2 and 25 employees (full or part time) on payroll (including business owner(s)) at Cupertino business locations when SIP went into effect•Had gross receipts under $5 million across all business locations in the past 12 months prior to SIP order •Have a maximum of 3 business locations in Santa Clara County •Be a business that is not otherwise prohibited or restricted in the City•Agree to utilize the free services and resources of Silicon Valley SBDC; AND •Agree to provide a status update after three months. Recommended Eligibility Requirements5 There are different methods being used by cities to evaluate applications:•First-come, First-served•Lottery•Point SystemEvaluation Criteria6 Staff recommends using a Point System to ensure fairness for all applicants and transparency on how award eligibility was determined. Points can be awarded on following possible criteria:•Non-Essential Designation:Businesses unable to operate due to SIP. •Job Creation/Preservation:Points for retention or creation of a low-moderate income job.•Nature of Business:Public/customer serving.•Ownership Status:Business is veteran-, woman-, or minority-owned.•Other Funding:If business has not yet received other federal funding, such as Paycheck Protection Program (PPP) or SBA Economic Injury Disaster Loan (EIDL).Each criterion has a point value. In cases where there are multiple applicants with the same score, the tie-breaker is length of time the business has operated in Cupertino (determined by business tax history).Recommended Evaluation Criteria7 Cupertino Small Business Emergency Relief Grant Program Application Process (draft)Conduct public outreach to promote grant program and application process in advance of the application periodApplication period open for seven (7) daysBusiness owner submits application online and attaches supporting eligibility documentationProgram Administrator staff reviews applications to confirm accuracy and completenessAdditional required documentation is requested from top scoring applicantsFinal review of documents and funds are disbursed8 Questions?