The city of Shakopee will pass about $200,000 in federal relief funds onto small businesses, the city council decided Tuesday night.
The Coronavirus Aid, Relief and Economic Security Act, which passes federal money onto states to cover coronavirus-related expenses, was signed into law in March. Nationwide, CARES spending included individual stimulus checks, a significant boost to unemployment programs, corporate aid, small business loans and $339.8 billion to state and local governments.
Since funds allocated to local government cannot be used to cover lost municipal revenues, some cities have considered passing the funds onto local businesses that continue to struggle under COVID-19 restrictions.
The Shakopee City Council July 14 passed a resolution establishing an emergency small business relief program that will provide provide one-time forgivable loans of up to $15,000 to small businesses that have suffered loss due to COVID-19. Funds can be used for operating expenses, including rent or mortgage payments, utilities, payments to suppliers or other critical non-payroll business expenses.
“I think this is a great opportunity for our local businesses and a great option out of this CARES money,” Mayor Bill Mars said.
Eligible businesses must be locally owned and operated and have existed for at least one year prior to March 25, 2020. Applicants must also demonstrate a significant loss in revenue since March 25.
Applications will be accepted July 20-24. Applicants will be notified of their status by the end of the month. If the city receives applications in excess of available funding, a lottery will be used to determine fund distribution.