| ITEM #: 17. DATE: 07/11/2022 AI #:932 |
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CITY COUNCIL ACTION REPORT
| SUBJECT: | GOODYEAR COVID RESPONSE SMALL BUSINESS ASSISTANCE PROGRAMS DISCUSSION |
| STAFF PRESENTER(S): | Darah Mann, Economic Development Project Manager |
OTHER PRESENTER(S):
Lori Gary, Economic Development Director
SUMMARY
Update to Council on the Goodyear COVID Response Small Business Assistance Grant programs and discuss recommended changes to the Relief Grant and Technical Assistance Grant programs.
Recommendation
Approve changes as recommended for the Small Business Relief Grant program and the Small Business Technical Assistance program and approve necessary budget transfers related to the Goodyear COVID Response funds. (Darah Mann, Economic Development Project Manager)
FISCAL IMPACT
The modifications to the COVID response program are intended to increase the participation and impact of the program. Transferring the source of Funding from ARPA to the General Fund will not have a fiscal impact. ARPA funds previously committed to the Technical Assistance Program and all unallocated portions of the Relief Grant Program on 9/30/2022 will be reported under the Revenue Loss category.
BACKGROUND AND PREVIOUS ACTIONS
BACKGROUND AND PREVIOUS ACTIONS:
Staff presented COVID Response recommendations at a Work Session on July 19, 2021. $3M of the total $10.35M was allocated to small business assistance at the Regular Council meeting immediately following the Work Session:
Economic Development staff oversees both programs including marketing to Goodyear’s small business community, direct outreach to businesses and applicants, collaboration with program administrators, and final vetting of applications.
Marketing included a webpage on the Goodyear Economic Development website, social media, e-blasts, e-mails, press releases, InFocus magazine feature, speaking engagements, virtual and in-person launch events, as well as concurrent marketing efforts conducted by Arizona Community Foundation, LocalFirst, and Co+Hoots/Huub on behalf of Goodyear.
1. Goodyear Relief Grant Program
The Relief Grant program launched on November 18, 2021. The Relief Grant reimburses qualifying businesses up to $20,000 for expenses such as mortgage/lease payments, utilities, and COVID-19 related expenses. Eligible businesses included Goodyear brick-and-mortar small businesses with 25 or fewer employees, generating $3 million or less annual gross revenues, and experienced a 25% or greater reduction in revenues due to the COVID-19 pandemic.
2. Goodyear Technical Assistance Program
The Technical Assistance program launched December 1, 2021. The program provides eligible businesses access to online business resources, pre-recorded and live webinars, and up to $4,000 worth of one-on-one technical assistance. Eligible businesses included Goodyear home-based and brick-and-mortar small businesses with 50 or fewer employees, generating $3 million or less annual gross revenues, and experienced a 25% or greater reduction in revenues due to the COVID-19 pandemic.
Staff presented COVID Response recommendations at a Work Session on July 19, 2021. $3M of the total $10.35M was allocated to small business assistance at the Regular Council meeting immediately following the Work Session:
• Goodyear Relief Grant Program - $2M
• Goodyear Technical Assistance Program - $1M
• Goodyear Technical Assistance Program - $1M
Economic Development staff oversees both programs including marketing to Goodyear’s small business community, direct outreach to businesses and applicants, collaboration with program administrators, and final vetting of applications.
Marketing included a webpage on the Goodyear Economic Development website, social media, e-blasts, e-mails, press releases, InFocus magazine feature, speaking engagements, virtual and in-person launch events, as well as concurrent marketing efforts conducted by Arizona Community Foundation, LocalFirst, and Co+Hoots/Huub on behalf of Goodyear.
1. Goodyear Relief Grant Program
The Relief Grant program launched on November 18, 2021. The Relief Grant reimburses qualifying businesses up to $20,000 for expenses such as mortgage/lease payments, utilities, and COVID-19 related expenses. Eligible businesses included Goodyear brick-and-mortar small businesses with 25 or fewer employees, generating $3 million or less annual gross revenues, and experienced a 25% or greater reduction in revenues due to the COVID-19 pandemic.
2. Goodyear Technical Assistance Program
The Technical Assistance program launched December 1, 2021. The program provides eligible businesses access to online business resources, pre-recorded and live webinars, and up to $4,000 worth of one-on-one technical assistance. Eligible businesses included Goodyear home-based and brick-and-mortar small businesses with 50 or fewer employees, generating $3 million or less annual gross revenues, and experienced a 25% or greater reduction in revenues due to the COVID-19 pandemic.
STAFF ANALYSIS
STAFF ANALYSIS:
Both programs were designed to help Goodyear’s smallest, hardest-hit businesses which may not have benefited from funding programs under the 2020 CARES Act federal stimulus. Upon approving the COVID Response Small Business programs, staff was advised to evaluate the program and recommend changes.
1. Goodyear Relief Grant Program
Of the 23 applications received, 10 were approved, for a total amount funded $200,000.
Of the 12 declined, 7 were not Goodyear businesses, 3 were home-based, and 2 did not have a Goodyear Business Registration Permit.
Expanding eligibility to larger small businesses (more employees, higher revenue) and reducing the financial loss threshold allows more Goodyear businesses the opportunity to qualify for grant funding. Staff can guide Goodyear businesses on how to acquire a valid Business Registration Permit and eligible businesses can reapply for funding. Sunsetting this program on September 30, 2022, will ensure proximity between the financial relief and the actual losses experienced due to the COVID pandemic.
2. Goodyear Technical Assistance Program
Of the 53 applications received, 4 were approved, for a total of $16,000.
26 applicants did not complete the application process, and 8 did not respond to requests for required documentation. Of the 15 declined, 7 were not in business in 2019, 5 had no Goodyear Business Registration Permit, 1 located outside of Goodyear, and 1 met all other requirements but did not experience 25% or greater reduction in revenues.
Some small businesses found providing two years of financial information cumbersome and others were not in business long enough to qualify. Once qualified, businesses have been slow to access online benefits and scheduling assistance.
Removing the program from Federal ARPA funding would allow us to open the technical assistance benefits to more Goodyear businesses regardless of their demonstrated COVID economic impact. Providing support through Goodyear’s InnovationHub would help recipients overcome hesitancy to access the online portal.
PROPOSED CHANGES:
To broaden the parameters to benefit a wider segment of Goodyear’s small business community, we are recommending changes to both Small Business Assistance programs:
1. Goodyear Relief Grant Program
Broaden eligibility parameters to assist additional small businesses:
2. Goodyear Technical Assistance Program
Broaden eligibility parameters to assist additional small businesses:
Complement Technical Assistance Program
SUMMARY OF PROPOSED CHANGES:
Broaden Relief Grant eligibility parameters and receive applications through August 31, 2022. Sunset grant program as of September 30, 2022. Remaining funds allocated to COVID Revenue Loss.
Change Technical Assistance program from ARPA funding to general fund, allowing access to a wider segment of Goodyear’s small businesses. Broaden eligibility parameters and complement with in-person programming. Support small business participation through resources at The InnovationHub. ARPA funds to be allocated to COVID Revenue Loss.
Estimated Cost of Programs
Goodyear Relief Grant Program
Goodyear Technical Assistance Program
Both programs were designed to help Goodyear’s smallest, hardest-hit businesses which may not have benefited from funding programs under the 2020 CARES Act federal stimulus. Upon approving the COVID Response Small Business programs, staff was advised to evaluate the program and recommend changes.
1. Goodyear Relief Grant Program
Of the 23 applications received, 10 were approved, for a total amount funded $200,000.
Of the 12 declined, 7 were not Goodyear businesses, 3 were home-based, and 2 did not have a Goodyear Business Registration Permit.
Expanding eligibility to larger small businesses (more employees, higher revenue) and reducing the financial loss threshold allows more Goodyear businesses the opportunity to qualify for grant funding. Staff can guide Goodyear businesses on how to acquire a valid Business Registration Permit and eligible businesses can reapply for funding. Sunsetting this program on September 30, 2022, will ensure proximity between the financial relief and the actual losses experienced due to the COVID pandemic.
2. Goodyear Technical Assistance Program
Of the 53 applications received, 4 were approved, for a total of $16,000.
26 applicants did not complete the application process, and 8 did not respond to requests for required documentation. Of the 15 declined, 7 were not in business in 2019, 5 had no Goodyear Business Registration Permit, 1 located outside of Goodyear, and 1 met all other requirements but did not experience 25% or greater reduction in revenues.
Some small businesses found providing two years of financial information cumbersome and others were not in business long enough to qualify. Once qualified, businesses have been slow to access online benefits and scheduling assistance.
Removing the program from Federal ARPA funding would allow us to open the technical assistance benefits to more Goodyear businesses regardless of their demonstrated COVID economic impact. Providing support through Goodyear’s InnovationHub would help recipients overcome hesitancy to access the online portal.
PROPOSED CHANGES:
To broaden the parameters to benefit a wider segment of Goodyear’s small business community, we are recommending changes to both Small Business Assistance programs:
1. Goodyear Relief Grant Program
Broaden eligibility parameters to assist additional small businesses:
o Increase eligible businesses from 25 FTE to 250 FTE
o Increase eligible businesses from $3M gross revenue to $5M gross revenue
o Reduce revenue loss from 25% or greater to 15% or greater
o Increase grant amount from lesser amount of actual loss or $20,000 to the following scale, based upon gross revenue:
o Increase eligible businesses from $3M gross revenue to $5M gross revenue
o Reduce revenue loss from 25% or greater to 15% or greater
o Increase grant amount from lesser amount of actual loss or $20,000 to the following scale, based upon gross revenue:
| Gross Annual Revenue | Lesser amount of actual loss or |
| Up to $3M | $20,000 |
| $3,000,001 to $4M | $27,000 |
| $4,000,001 to $5M | $33,000 |
o Add: “Businesses which have already received grant awards under Goodyear COVID Response Small Business Relief Grant program are not eligible to apply and will not be considered to receive additional relief grant funds.”
o Accept Applications through August 31, 2022
o Complete vetting and funding by September 30, 2022
o Close Program, with remaining funds allocated to COVID Revenue Loss
o Complete vetting and funding by September 30, 2022
o Close Program, with remaining funds allocated to COVID Revenue Loss
2. Goodyear Technical Assistance Program
Broaden eligibility parameters to assist additional small businesses:
o Increase eligible businesses from 25 FTE to 250 FTE
o Increase eligible businesses from $3M gross revenue to $5M gross revenue
o Remove requirement for businesses to have experienced significant loss of revenue due to COVID-19 by utilizing city general funds as opposed to federal ARPA funds
o Add: “Businesses which have already received grant awards under Goodyear COVID Response Small Business Relief Grant program are not eligible to apply and will not be considered to receive additional technical assistance funds.”
o Increase eligible businesses from $3M gross revenue to $5M gross revenue
o Remove requirement for businesses to have experienced significant loss of revenue due to COVID-19 by utilizing city general funds as opposed to federal ARPA funds
o Add: “Businesses which have already received grant awards under Goodyear COVID Response Small Business Relief Grant program are not eligible to apply and will not be considered to receive additional technical assistance funds.”
Complement Technical Assistance Program
o Utilize InnovationHub to encourage and support Technical Assistance participation, including in-person events
o Guest-Speaker Series
o ASBA membership (2-year membership), which offers:
o Guest-Speaker Series
o ASBA membership (2-year membership), which offers:
o Access to capital
o Insurance broker support (Group/Individual Health, Business)
o Credit Card processing services
o Discounted shipping, digital marketing services and more
o Insurance broker support (Group/Individual Health, Business)
o Credit Card processing services
o Discounted shipping, digital marketing services and more
SUMMARY OF PROPOSED CHANGES:
Broaden Relief Grant eligibility parameters and receive applications through August 31, 2022. Sunset grant program as of September 30, 2022. Remaining funds allocated to COVID Revenue Loss.
Change Technical Assistance program from ARPA funding to general fund, allowing access to a wider segment of Goodyear’s small businesses. Broaden eligibility parameters and complement with in-person programming. Support small business participation through resources at The InnovationHub. ARPA funds to be allocated to COVID Revenue Loss.
Estimated Cost of Programs
Goodyear Relief Grant Program
| Goodyear COVID Response funds allocated | $2,000,000 |
| Funds obligated to-date $248K Estimated additional relief grant awards (10 businesses @ $20K) $260K |
$508,000 |
| Estimated remaining balance upon close of program on 9/30/2022. To be allocated to COVID Revenue Loss. | $1,492,000 |
Goodyear Technical Assistance Program
| Goodyear COVID Response funds allocated | $1,000,000 |
| Obligated to-date $353,250K Estimated / reserve for grant awards and programs Grant Awards (75 businesses @ $4K) $300K ASBA 2-Year Membership $6K Speaker Series (20 @ $1K est) $20K |
$679,250 |
| Remaining Balance | $320,750 |