Hundreds of Maine companies apply for state emergency relief grants - Press Herald

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Hundreds of small businesses and nonprofits in Maine have applied for grants in the first week of a $200 million economic recovery program introduced last week by Gov. Janet Mills.

The state had received more than 673 grant applications as of Friday, said Department of Economic and Community Development spokeswoman Kate Foye. The number of applications is expected to increase before a Sept. 9 deadline, she added.

“We expect a significant number of applications as the weeks progress,” Foye said, noting that two webinars about the program were attended by more than 1,600 people.

The Maine Economic Recovery grants will provide up to $100,000 each to businesses and nonprofits with 50 or fewer full-time equivalent employees. Grants will be calculated based on business losses resulting from the coronavirus pandemic proportional to overall losses for all applicants.

Applications are not being taken on a first-come, first-served basis in order to allow state agencies to assess need and distribute aid appropriately, Foye said.

“This was purposefully done as part of the design to ensure the inclusion of underrepresented businesses, whether it is in rural communities or minority-owned businesses,” she said. To date, the applications represent a cross-section of Maine’s economy, Foye added.

Grant money can be used for payroll, rent, mortgage, utilities, reopening expenses, equipment and required personal protective equipment. The grants are considered taxable income and subject to audit.

Norman Patry, owner of Summer Feet Cycling in Portland, has seen his business almost entirely disappear since this spring. The company canceled its European and Canadian bike tours and has capped Portland-area day tours to just eight people. Patry said most weekday tours this summer have consisted of four people at most.

“My revenue is down 85 percent from last year,” he said. He employs five workers now, one-third of his typical 15-person summertime workforce.

Patry believes his business will survive, but he’s glad for the grant funding opportunity. He hadn’t applied as of early this week, but said he intends to when he finds the time to put together an application.

“I’m glad it’s not a first-come, first-served program,” Patry said. “If it had been, I probably would have stayed up until 3 a.m. getting an application in on the first day.”

Nonprofits were specifically included in the relief grant program, but it excludes some organizations such as lobbying groups, trade associations and private schools.

“Oftentimes, people forget nonprofits are significant employers in our communities,” said Jennifer Hutchins, executive director of the Maine Association of Nonprofits. Nonprofits employ one in six Mainers and contributed $12 billion to the state economy in 2016, according to a 2019 report by the association.

The pandemic derailed many of the spring in-person fundraisers Maine nonprofits rely on, and some were challenged to access federal assistance such as the Paycheck Protection Program because they did not have the access and experience with banks and other financial institutions, Hutchins said.

Revenue for arts and cultural groups has been demolished during the pandemic, and social service organizations saw demand surge at the same time they were trying to keep staff and clients safe, she said.

The state grants are welcome assistance, but Hutchins said she worries small, volunteer-run groups will be left out because they do not have the necessary financial records to apply. About 62 percent of Maine nonprofits have yearly budgets of less than $50,000 and are not required to file annual financial reports, according to the association.

“While we remain appreciative that the Department of Economic and Community Development recognizes nonprofits as significant employers, we also know there are limitations to this program that will leave some nonprofits out,” Hutchinson said.

The grant program will be paid from a $1.25 billion fund Maine was provided through the federal CARES Act, which Congress passed in March. Grant awards will be announced in late September, with disbursement in October. Last week, the state said more than $800 million of the $1.25 billion had been committed.

Small business and trade groups welcomed the program when it was announced last week, but they warned it would not be enough to repair the economic damage facing many businesses and nonprofits. Some groups, including HospitalityMaine and the Maine Tourism Association, said the 50-employee threshold for eligibility also would exclude some companies facing severe revenue losses.

The Mills administration has acknowledged the program’s limitations and said more aid could become available subject to further Congressional funding.

Big Brothers Big Sisters of Southern Maine applied for one of the grants, but Executive Director Nicole Avery isn’t confident it will be approved. The nonprofit, which serves about 300 kids in York and Cumberland counties, expects to end the fiscal year on budget, but that meant trimming expenses, including laying off one of its eight employees.

Support from individual and corporate donors, pandemic-related grants and a Paycheck Protection Program loan helped get the organization through this year, but Avery expects tough times ahead.

“The coming year will be much more challenging – we built our budget thinking we are going to be under these restrictions for a while and the economy is going to be challenged for a while,” she said.

Her organization spent years building a $1 million endowment for its future, but Avery worries that might disqualify it from state funding. If the nonprofit is expected to burn through its reserves to stay open, that could put it in the same place as businesses and nonprofits that are barely scraping by now, Avery said.

“Some of these grants may be going to organizations that have nothing to fall back on and even with emergency grants may not make it through,” she said. “I think everyone is in need – there is just not enough to go around.”

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