The state of Vermont is launching a $20 million grant program to offer businesses a financial lifeline in the immediate aftermath of this month’s devastating flooding.
But at a press conference on Thursday announcing the imminent launch of the grant program, officials quickly added a disclaimer.
“I want to be clear right up front: $20 million will not be enough,” Gov. Phil Scott told reporters. “It won’t even come close to meet the total need, or even reach all impacted businesses.”
State officials, who previewed the program last week, expect applications for the first-come-first-served grants to go live next week.
The grant program is designed for speed — both in administrative setup and in its application and distribution process — to meet the urgency of the moment.
Scott acknowledged on Thursday it “isn’t a perfect or complete solution to the challenges employers face, but we know it’s important to do what we can as soon as possible.” Coupled with hopes for congressional aid, as well as Small Business Administration loans and grassroots fundraising, Scott said the $20 million program is meant to be “a lifeline” so businesses can reopen more quickly.
Each business will be eligible for a grant amounting to 20% of its net documented uncovered damage to its physical property. In most cases, the maximum grant allotment per business will be $20,000. But in limited cases, businesses that sustained more than $1 million in damages may qualify for up to $500,000, depending on their number of employees.
The state grants will help cover financial losses due to physical damage, including to property, equipment, supplies and inventory.
Of the $20 million set aside for the program, $1 million will be directed to agricultural operations. Commissioner of Economic Development Joan Goldstein told reporters on Thursday that the sum will include cannabis growers, who are not eligible for federal disaster aid, since cannabis remains illegal at the federal level. Grants made to cannabis retailers, however, would come from the remaining $19 million.
Both residential and commercial landlords will also qualify for aid under the program.
Goldstein said the state decided to base grant distributions on net physical losses — so, after insurance, loans, separate grants, donations and other aid are taken into account — so as not to duplicate aid. Already, a plethora of GoFundMe campaigns and other grassroots fundraising efforts have taken off to help Vermont businesses survive.
Goldstein said she hopes the state can start getting money out the door in a matter of weeks — “probably somewhere between seven and 10 days” after applications open, she estimated.
Grants will be distributed on a first-come-first-served basis because, in Goldstein’s words, “we’re understanding that there’s an urgency here. And rather than making everybody wait for a period of time, we want to attend to it right away.”
Goldstein said the program’s formula is simple — 20% of damages — and applications will not be weighted based on businesses’ size, age or ownership. She said that the Vermont Professionals of Color Network will be offering outreach to business owners who are Black, Indigenous or people of color, including offering technical assistance, “to make sure that constituency knows exactly about this grant and what it has to offer, and what they need to gather in order to apply.”
As for newly opened businesses, whose first few years on the market are notoriously rocky, Goldstein offered her sympathies.
“It’ll be very, very tough for very small and very new businesses,” she said. “That’s why we’re basing the formula not on revenue, but on the damage. So what is it going to cost for them to start back over again?”
Scott added that the maximum grant allotment of $20,000 in most cases will go further for many small business owners.
Also available to small businesses through the federal government are low-interest loans from the Small Business Administration. Goldstein and others have said that they understand that many businesses are apprehensive about taking on new debt, but on Thursday, she urged business owners to at least apply.
“SBA resources have timelines and deadlines, and we really hope that businesses don’t wait to apply for that,” Goldstein said. “Even though those are loans, you really don’t want anybody to miss an opportunity.
“They can always turn down a loan commitment. They don’t have to accept it,” she continued. “But what’s important is that they get the capability to tap into resources that exist while they’re waiting for, let’s say, this grant program.”