It appears the city still is identifying recipients of its COVID-19 forgivable loan program, and as that process has played out, some unexpected developments have occurred.
The launch of the city’s Kokomo StrongER forgivable loan program was met with an overwhelming response from the community, with applications far outpacing the available funding. According to city officials, the economic development department is nearly done identifying the 200 businesses who will receive $5,000 of the $1 million in available economic development income tax (EDIT) funding, but as that’s occurred, some businesses actually have opted out of their loans, instead removing themselves from the running so other struggling businesses can have a shot at being granted a city loan.
“As they start to reopen or look at where they’re at financially and what they’re able to do, we’ve had some say, ‘Hey, you know what, we’re reading some things or I’ve heard my barber or stylist has applied, and man, they need it worse than I do. So, we’re going to go ahead and withdraw our application so you can send that money to someone else.’ I’m like, holy cow, this is great,” said Mayor Tyler Moore.
According to Moore, about two dozen businesses have contacted the city after approval of their Kokomo StrongER loan applications and opted out, deferring the funds to other businesses. Some also removed themselves from the program after receiving federal assistance.
Meanwhile, the city is continuing to work its way through roughly 350 applications from local small businesses.
To this point, Moore said about 190 applications have been approved, which necessitates businesses submit supporting expense reports to the city in order to receive a monthly $1,000 portion of the loan. About 150 businesses have had contracts executed and returned, in full, with the city.
According to Kokomo Corporation Counsel TJ Rethlake, the final tally of approved businesses has fluctuated for several reasons, such as those who opted out of the program, and others who were slower to respond to documentation requests from the city also delayed portions of the process.
The city also had to vet each application, with some being turned down for failing to meet certain criteria, such as not being part of a national franchise.
“The development department has done a tremendous job and has been working long hours around the clock to try to make this happen so we could get the checks out as quickly as possible,” said Rethlake. “Some businesses have been extremely receptive and have responded very quickly. Others, I wouldn’t say have dragged their feet, but have been a bit slower to respond. And that’s fine. That’s where the process has been bogged down …. The ones that complied quickly are getting the funding, and I think those are the businesses that need it the most to keep the doors open.”
In addition to the EDIT funds made available by the city for 200 businesses, Moore also noted that an engineering firm, Commonwealth Engineering, offered to provide $5,000 to the program to sponsor one more business. The engineering firm has done work with the city in the past, said Moore, and opted to provide the funding when it learned of the program, bringing the total number of businesses that will receive funding to 201.
“The talk has always been what’s essential and what’s non-essential, but small businesses in our community have been the essential fabric of our local economy,” said Moore. “There are a lot of entrepreneurs, a lot of folks who have taken advantage of that, and the community has supported it. With the importance of businesses throughout the community being to continue to thrive and be supported, it just makes sense for us to have made this program available during these times.”