PROVIDENCE – If you own a small business in North Smithfield or Burrillville that was impacted by Covid-19, you may be eligible for a grant of $5,000.
But your town won’t take advantage of the program unless you let them know you’re interested.
Towns in northern Rhode Island are eligible for Community Development Block Grants to award money to qualifying small businesses, and officials in both communities are now assessing if they should opt in to the program.
The funds, provided by the R. I. Office of Housing and Community Development and the U.S. Department of Housing and Urban Development, could be used to award working capital grants to microenterprises adversely impacted by the virus.
A “microenterprise,” is defined as a commercial enterprise that has five or fewer employees, one or more of whom owns the enterprise.
To be eligible, the microenterprise must be owned by a low or moderate-income person, with a gross annual family income that does not exceed the applicable threshold.
For a single individual, that family income limit is $48,750, and for a two-person household the amount is $55,700. Limits for families with three or more people are listed below.
3 People: $62,650
4 People: $69,600
5 People: $75,200
6 People: $80,750
7 People: $86,350
8 People: $91,900
In order to qualify, business owners must meet both the income limit and the definition of a microenterprise. The business must be a for-profit entity such as a sole proprietorship, partnership, corporation, or LLC and have a physical establishment in the city/town of application.
The business must provide goods or services to multiple clients or customers and be in good standing with the state and town. That means the business must be current on all taxes due through March 1, 2020, have active and valid state licenses and registrations, if applicable. The business also must not be a party to litigation involving the state or town.
Qualifying businesses must have annual gross revenues greater than $25,000 and need to have been established prior to January 1, 2019.
The owner must also be able to document a loss of income of at least $1,000 due to COVID-19.
Notices sent out in both Burrillville and North Smithfield also listed several types of businesses excluded from the program. They include cannabis-related businesses; real estate rentals/sales businesses; home-based businesses with no employees; businesses owned by persons under age 18; businesses that are franchises or chains; liquor stores; weapons/firearms dealers; lobbyists; persons operating as independent consultants or contractors and providing services to a single entity; and home-based businesses that are restricted to patrons below the age of 18.
Microenterprises owned by students age 18+ are generally ineligible, unless the student owner is the sole means of financial support for other family members.
Applicants must submit all application forms, and supporting documents, including copies of tax returns, payrolls and receipts from the period when the business was impacted.
Approved eligible microenterprises will be awarded a single lump-sum payment of $5,000. The funds may be used for working capital to cover business costs, such as rent, staffing, and utilities.
MicroEnterprise funds may not be used for major equipment purchases, purchase of real property, construction activities, business expansion, or lobbying.
Both towns in northern Rhode Island are currently assessing their need to opt into the grant program and if enough business owners express interest, officials will begin collecting applications this month.
Qualifying businesses in need of the funding are asked to contact their Planning Departments as soon as possible.