NEW EMERGENCY LOAN PROGRAM TO BOOST SMALL BUSINESSES
New Emergency loan program to boost small businesses
BY TIA CAROL JONES
To give small businesses and their employees a boost and lessen the financial challenge during COVID-19, city of Chicago Treasurer Melissa Conyears-Ervin and Mayor Lori Lightfoot have partnered to create a new Emergency Loan Program, with money from the Chicago Catalyst Fund, the City of Chicago and private sponsors.
Chicago Catalyst Fund will contribute 50 percent, $50 million to the $100 million Chicago Small Business Resiliency Fund. The city of Chicago will contribute $25 million and the other $25 million will come from other private entities.
Conyears-Ervin said she has been an advocate for small businesses since she took office in May 2019. Throughout the time, she has been on a listening tour to find out how the city treasurer’s office could help small businesses.
Conyears-Ervin said as the chairman of the Catalyst Fund, she has been working with Mayor Lightfoot. “And so, it was a no-brainer with the treasurer’s office with us being a true advocate for small businesses, working to help develop them and to truly help with the health of small businesses. It was a no-brainer for us to partner with the Resiliency Fund on this,” she said.
Conyears-Ervin said she wants to reassure residents that the city treasurer’s office is working to protect jobs.
“So, with this fund, in order to qualify to receive funding from this program, small businesses have to dedicate up to 50 percent of the fund to payroll. Because that means we are investing in jobs,” she said.
Conyears-Ervin said from her background, she knows what it means to live check-to-check and the importance of a parent having a job.
“Because three out of five residents are hourly, that means that they need their jobs,” she said. “So, we are making certain with this investment, that the Chicago Catalyst Fund is doing, with me as the chairman of the board of the Catalyst Fund, we are making certain this investment to the Resiliency Fund will protect employees, which leads to protecting working families.”
The fund is for small businesses with between 1 and 50 employees. It will also be for small businesses in underserved and under-resourced communities.
“We’re making certain when we say we’re helping small businesses, we mean that,” she said. “And then also with this fund, we’re making certain up to 50 percent of the fund will be loaned to businesses in underserved areas. This is great for our communities that are underserved because this will help them, it’s being dedicated to help them.”
Conyears-Ervin said underserved and under-resourced communities include the South and West sides of Chicago, where neighborhoods suffer from years of disinvestment. The parameters of the program are still being built, she said, adding what makes this a low-interest loan is that for the first six months, the interest rate will be 0. She said the Resiliency Fund will rely on Community Development Financial Institutions (CDFIs) such as Accion, Chicago Community Loan Fund and the microfinance group of Chicago Neighborhood Initiative, to underwrite and administer the loans.
“This is important because our small businesses are the backbone of Chicago’s economy. Over the last few weeks, we’ve seen it, we’ve seen how COVID-19 has crippled our local businesses. And really, we as residents, we rely on those local businesses,” she said.
“So, this is so very important, these last few weeks, there’s been a lot of focus on the safety of individuals, and now we’re able to also say, we want to focus on the health and vitality of our local businesses. When we support small businesses, we support their workers, which in turn, helps our working families.”
Conyears-Ervin said each business that applies could receive up to $50,000, out of the $100,000 from the Resiliency Fund.
“You look at $100 million and up to $50, 000 means that we could potentially help more than 2,000 small business owners,” she said. “We could potentially help up to 2,000 small businesses in Chicago and one to 50 employees, that could be a real true save to our working families.”
Conyears-Ervin said small businesses can go to www.chicagocatalystfund.com or www.cityofchicago.org/coronavirus to get more information and to apply. They also can express interest via those websites.
“The hope will be over the next couple of weeks that everything will be worked out and the CDFIs will be up and ready to go to start the formal application process with the small business owners, but they should start expressing their interest now,” she said.
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