MACDC has partnered with community-based organizations, community lenders and advocates to form a statewide Small Business Coalition, which is calling on state leaders to adopt a Small Business Relief and Recovery Program to address urgent and unmet needs in the small business community.
Seventy-nine organizations, including dozens of organizations that work every day at the local level with entrepreneurs impacted by this crisis, made this request in a letter to Governor Charlie Baker, Senate President Karen Spilka, and House Speaker Robert DeLeo.
MACDC has been convening weekly discussions with community-based organizations that work with small businesses from across the commonwealth on strategies and best practices to support small businesses in this time of crisis, as well as collaborating on advocacy for state policies that would help these businesses weather the pandemic.
“We are heartbroken watching hard working men and women fight to save their business and their families from economic ruin – a situation that has nothing to do with their skills as business owners, but is entirely due to COVID-19, and the public health necessity to close their businesses. They are suffering immense economic harm to help keep all of us safe, so we believe all of us have a shared responsibility through our state government to help keep them in business,” the letter states.
The proposed Small Business Relief and Recovery Program is particularly focused on those small businesses that are most vulnerable during this economic crisis, including those from historically underserved communities, such as African American, Latinx, Asian, people of color, immigrant, and women, as well as businesses located in rural towns, Gateway Cities, and other low-income areas.
The letter recognizes that the federal government is providing significant resources to small businesses through the Payroll Protection Program, but points out that many small businesses, especially very small business, and those owned by people of color, are not benefiting equitably from that program. In a survey of nearly 500 small and micro businesses released by the groups with the letter, 58% said they did not think the Federal CARES Act would meet their needs over the next three months. Further, “42% said they were surviving on personal savings, an unsustainable strategy, especially for many people of color who, on average, have significantly less accumulated wealth than their white counterparts”.
The letter calls for a “state-level strategy that is focused on reaching those who continue to be left behind” both to better access federal dollars and to strategically use state resources to plug gaps in the federal response. Segun Idowu, Executive Director of the Black Economic Council of Massachusetts and one of the signatories of the letter, noted “If Washington can’t get it right, our leadership needs to.”
The Coalition includes many organizations from rural communities, which are struggling. “Our economy is built on small businesses, including many very small enterprises, that have trouble accessing federal resources,” said Amy Shapiro from Franklin County CDC. “By providing customized technical assistance at the local level, flexible financing, and small grants, we can help more of our rural businesses access federal dollars, survive the shutdown and recover in the months to come.”
The coalition offers the following recommendations for programs and policies that should be part of the state’s Small Business Relief and Recovery Program:
- $10 million in funding to support community-based organizations that deliver culturally competent and multi-lingual technical assistance and coaching to small businesses;
- $30 Million in emergency relief grants to help businesses cover rent, mortgages, and other fixed costs;
- $35 million to Community Development Financial Institutions, Community Development Corporations, and other community-based lending programs to help them offer grants, zero/low interest loans, loan deferments, and other assistance to small businesses;
- $75 million to the Massachusetts Growth Capital Corporation for a revolving loan fund to help businesses unable to access SBA financing, with a focus on communities of color, immigrant communities, rural towns, and Gateway Cities;
- A statewide Small Business Assistance Task Force charged with ensuring the effective delivery of support to small businesses during the economic shutdown and through the recovery; the task force should have a laser focus on equity and inclusion.