Paul Erickson knows two things about the struggles businesses are facing during the COVID-19 crisis: Local business owners didn’t cause the problem and, he feels, they need support to “bridge them to the other side” of the pandemic.
That’s why Erickson, who owns Royal Oak Financial Advisors, appreciated it when Oakland County Executive David Coulter and county Board of Commissioners Chairman Dave Woodward announced plans to create a $3 million small business stabilization fund to provide immediate help for small businesses impacted by the COVID-19 pandemic.
“So many small businesses have small margins and don’t have a lot of financial reserves to weather a storm like the one we are in with COVID-19,” Erickson said. “I am optimistic that we will get through this tough time and pray we don’t lose too many small businesses to this pandemic.”
Coulter made the announcement the day after the county was notified of an award of a $1.15 million grant from the Michigan Economic Development Corp., and its Michigan Small Business Relief Program. The state grant will assist qualifying small businesses with up to $10,000 to help offset losses or expenses resulting from the coronavirus emergency. The state is expected to distribute the money to the county by April 1.
“We are grateful for the state’s support and it is a great first step but more needs to be done,” Coulter said. “Shuttered businesses are driving unemployment increases at unprecedented rates. Oakland County saw nearly 16,000 more individuals apply for unemployment last week.
“We know small businesses are desperate and need immediate assistance. The board and I are taking swift action to help our small businesses. We want to get this money in their hands as soon as possible. They are the life blood of the economy and we know they have been seriously impacted by this public health emergency. We are grateful for the state’s support.”
Coulter said $700,000 of the stabilization fund will be used to encourage companies to shift their manufacturing capabilities to the manufacture of personal protective equipment for hospitals and health care workers such as face mask, gowns and other needed items.
Coulter said the county’s manufacturing base is well-equipped to transition from their current products to needed protective health care supplies.
“We have over 500 businesses that are clothing and sewing manufacturers, plastics and 3D printing and automotive and paint suppliers,” Coulter said. “We need to lean in and lead now for the safety and welfare of those that are fighting on the front-lines of this virus.”
Oakland County represents 21% of the state’s gross domestic product. Coulter said the county is in contact with local banks to ask them to contribute to the small business relief effort.
In order to qualify for grant support, businesses must meet the following criteria:
- The company is in an industry outlined in Executive Order 2020-20 or any subsequent Executive Order of similar intent (“EO”), or demonstrates it is otherwise affected by the COVID-19 outbreak, as well as meeting additional criteria.
- The company has 50 employees or fewer.
- The company needs working capital to support payroll expenses, rent, mortgage payments, utility expenses, or other similar expenses that occur in the ordinary course of business.
- The company can demonstrate an income loss as a result of the EO, or the COVID-19 outbreak.
Grants may be used for working capital to support payroll expenses, rent, mortgage payments, utility expenses, or other similar expenses that occur in the ordinary course of business.
Jill Gleba of Troy-based Gleba & Associates welcomed the news.
“It is an excellent idea to ask companies to adapt their capabilities to manufacture personal protective equipment and other lifesaving products for hospitals and healthcare workers on the frontlines of this unprecedented challenge,” Gleba said. “It can be very hard for small companies to change direction quickly and enter new sectors of business they didn’t plan on, but it can boost their businesses and simultaneously serve our citizens for the greater good.
Applications for grant consideration are available next week online at OakGov.com/COVID. Coulter said a panel is being formed from downtown development authorities, local communities and area chambers of commerce to review grant applications and make recommendations to the county. “We believe this is the first phase of support for our businesses,” Coulter said. “We need to keep their doors open first and foremost.”
