Fort Worth approves $10M small business grant program, but one councilman’s against it
Fort Worth will devote more money to a coronavirus relief grant program for small businesses rather than fund microloans that could be forgiven.
The city had originally planned to use part of its $158 million federal stimulus funding to establish a $2.5 million grant option while devoting $12.5 million to loans, but questions arose about whether the loans would be valid after the end of the year, when the federal stimulus bill requires cities to have spent their allotment.
Instead, $10 million will be devoted to grants with a maximum of $50,000 available for Fort Worth small businesses affected by the COVID-19 outbreak. The program is being called “Preserve the Fort.”
Fort Worth will work with United Way of Tarrant County to administer the grants. Applications will be open May 26 through June 8. An online application portal is currently being developed.
Businesses can apply for up to $50,000, based on the number of employees, to cover rent, payroll, equipment or capital, said Robert Sturns, the city’s economic development director. At least $2.5 million will be set aside for minority- and women-owned businesses and $2.5 million for businesses in areas the city has designated as investment zones.
Fort Worth has just under 40,000 small businesses, Sturns said, but he wasn’t sure how many would apply for the grants. The program will prioritize businesses that have not received other assistance. Most qualifying businesses are on the city’s south and east sides.
Beyond the $10 million, additional money may become available if the need is great. The city has about $5 million left over from the original stimulus program for small business assistance, and Mayor Betsy Price said she anticipated her private sector task force, Fort Worth Now, finding philanthropic dollars.
Not everyone was happy with the grant system.
Councilman Cary Moon, who voted against the grant program, called it “a free-for-all.”
Grant dollars should be tied to how much a business contributes to the city sales and property tax revenue, he said. Businesses should also be required to stay open for a set period of time if they receive help, he said. Since the city is not allowed to use stimulus money to replace lost revenue, he said shoring up small businesses also boosts the city’s finances at the same time.
“These are taxpayer dollars we’re talking about,” Moon said. “I just think this is very loose.”
Sturns said there was no legal guidance from the U.S. Treasury Department about tying grants to taxes. He surmised that companies that contribute more taxes to the city are often larger, so such a requirement may leave small businesses without help. While Sturns said he was aware of conversations in other cities about requiring businesses to stay open for six months to a year, he said he wasn’t sure the city should put itself in a position to have to “claw back dollars” if a business goes under.
Councilwoman Kelly Allen Gray agreed with Sturns. Chiming in from a video call, Gray said she was glad her mic was on mute because she would have been “screaming at the screen.”
If Fort Worth is worried about revenue loss, council members should talk to the city’s congressional delegation about federal relief for cities, she said.
The point of this program, she said, is to ensure Fort Worth small businesses survive, not to stabilize the city’s coffers.
“That needs to come from the federal level not on the backs of our businesses,” she said.
As originally set up, the program would prioritize brick and mortar businesses that have rent or mortgage obligations. Gray said she worried that would unfairly put in-home day cares at a disadvantage.
Fort Worth Housing Assistance
The city also established a more than $15 million housing assistance program designed to help residents pay for rent, mortgage, utilities, food or health care. About $7 million of that came from the federal stimulus package.
Applications began last week through an online portal, neighborhood services director Victor Turner said. So far 875 people have applied for assistance with most looking for rental help, he said.
Councilman Carlos Flores voiced concern that a language barrier was preventing some from accessing help. He urged the city to provide information in Spanish and Vietnamese as well as English.
“I find myself frequently translating them,” Flores said.
This story was originally published May 19, 2020 at 2:47 PM.
