The Chelsea City Council has taken another step in helping the City recover from COVID-19 by approving more than $1 million to help small businesses recover from the extended closures and crippling business losses.
City Manager Tom Ambrosino proposed the expenditure after it was recommended by a Council Task Force that had been appointed by Council President Roy Avellaneda in April.
“We’ll start working on the program now in the next couple of weeks,” said Ambrosino.
Avellaneda said the Council did make an amendment, as it was suggested there would be a $250,000 administrative portion, leaving $900,000 left for loans. However, the Council didn’t agree to that and asked that the administration fee be kept to $150,000. That left $1 million for loans. Half of that will be reserved for the Restaurant Recovery Program and the other half will be for a Small Business Relief Program.
“This is the third financial step the City and City Council has taken to relieve the impact of COVID-19 in our community,” he said. “Obviously, the food relief was first and then we moved to shelter with our rental assistance lottery and now we want to concentrate on small business. I want businesses to understand we had to focus on other things first, but I want them to understand we care about them.
“We want to fill in the gaps with this for businesses that didn’t get the federal loans or didn’t qualify for them,” he continued.
Two City Councillors have been tapped to join City departments on the evaluation committee, and they include Councillor Judith Garcia and Councillor Naomi Zabot.
Garcia said she was excited to participate in the evaluation team and on the Council Task Force earlier in the process, particularly because she represents most of the downtown area.
“Small businesses have been vital in our economic growth as a city and this pandemic should not put them out of business,” she said. “This program will be a lifeline for many. I heard from a local barbershop owner that he has spent his life savings these past three months as he was forced to remain closed due to Covid-19. Another business owner informed me her rent increased by $200 as of last month. That’s why I have been very involved in this process of offering up to $20,000 in grants to local businesses. I want to abstain from referring to this monetary assistance as a loan because our goal is for this program to pick up where the CARES Act failed.
“Our small business owners cannot afford to take up any more debt with strings attached,” she continued.
The goal is to offer grant money that business owners do not have to worry about paying back, she said.
“I am personally advocating for an easy and streamlined application process that comes with no strings attached aside from seeing our businesses thrive and remain here,” she said.
Councillor Todd Taylor, a business owner himself, was one of the first Council voices to begin talking about how small businesses in Chelsea were going to be able to weather this storm. He was on the Task Force appointed by Avellaneda and helped to design some of the program.
“This program is just as important as our food or rent assistance program,” he said. “The businesses in Chelsea, especially the ones in the hospitality sector, are having a hard time surviving because they have been closed for months while they still have rent and insurance bills to pay. And our restaurants are especially vulnerable because the Federal programs are not designed for them.”
He said the federal Paycheck Protection Program (PPP) required restaurants to spend 75 percent on payroll, but that was impossible without customers. And after opening in Phase 2, they can only be at 25 percent capacity.
“The most important part of this program must include rent negotiation with landlords much the same as we did with the rent assistance program,” he said. “In order to try to avoid economic disaster, we not only have to have programs like this in Chelsea, we must put pressure on our federal representatives to have additional monies directed toward our hospitality businesses who have largely been left out of relief efforts. People have dedicated their whole lives to their businesses and having been forcibly shut down by the state, I think the state has the responsibility to help these businesses get back to normal as soon as possible.”
The program is being paid out of the City’s Free Cash funds, and more information will be coming soon about applications and how it will work.