Coronavirus help is available and planned for Fort Worth businesses
Typically, Sacher Dawson focuses on the future for the 60 at-risk boys enrolled in Fort Worth’s Hope Farms leadership program.
With declining donations, likely because of a coronavirus-related downturn, Dawson, the nonprofit’s executive director, now worries about keeping the lights on and the staff on the payroll. On a bad month, the nonprofit takes in $80,000, used to build Hope Farms’ annual $1.2 million budget for programs for the boys, meals and staff salaries.
But now the donations “just aren’t there,” Dawson said. A charity golf tournament slated for early May that typically shores up the organization’s spring funding has been canceled, and Dawson worries donation pledges from February won’t come through.
“Our employees are getting pretty shaky,” he said. “We don’t know how long this is going to last. We just need a small loan or something to bridge us through this rough patch.”
Hope Farms faces the same crisis as many other North Texas nonprofits and small businesses. In the age of coronavirus, people aren’t spending on donations or nonessential goods because their attention is elsewhere or because businesses are simply shut down.
Small businesses across Tarrant County are in a dire time — nearly half could close within a few months, according to a recent survey
The Fort Worth Chamber of Commerce says that 49% of business owners surveyed can’t sustain their businesses “longer than a few months if the current trend continues.” The chamber reported that one unidentified respondent said “Within a few weeks, we’ll probably have to make some tough decisions if the business world and the market continue to close down and decline.”
Data from a Fort Worth city survey released Monday from 1,200 small business owners shows that the biggest concern is cash flow and revenue, followed by payroll and costs like rent or mortgage payments.
Nearly 80% of the responses came from businesses with fewer than 25 employees. More than half said they don’t have remote work/teleworking policies in place or company leave policies with guidance for a public health crisis.
Hundreds of small businesses, about 47%, say revenue has fallen by at least 60% since March 1. That drop-off is shocking, said Robert Sturns, the city’s director of economic development.
“That’s just a huge number,” Sturns said. “Small businesses don’t have a lot of runway for operations if revenue is not coming in.”
Help is available both federally and locally.
Texas Gov. Greg Abbott requested a disaster declaration March 17 that opened the door for millions of dollars for struggling small businesses. The U.S. Small Business Administration approved the state’s declaration March 20.
The administration offers up to $2 million in loans to cover losses small companies may face during the coronavirus pandemic. Businesses can get a $10,000 loan advance and loans will be forgiven.
Business owners must show they were doing well before the disaster declaration and that revenue has significantly dropped due to coronavirus. The SBA may also do a credit check.
Small businesses and agriculture cooperatives may qualify for loans with interest rates capped at 3.75%. Small private nonprofits can qualify for 2.75% interest rate loans. These disaster relief loans have a 30-year life. There are no fees.
When the Star-Telegram first reported on assistance for small businesses March 19, the Dallas-Fort Worth office of the SBA was receiving 100 to 120 calls a day, director Herb Austin said.
Austin said on Tuesday not much has changed.
He said he was waiting for guidance on the $2 trillion stimulus package, including about $350 billion for a federal small business loan program called the Paycheck Protection Program.
That program encourages businesses to keep employees on the payroll by offering loan forgiveness. These loans have fewer red tape and guidelines than the SBA’s traditional loan programs, The Washington Post reported.
Companies and certain nonprofits with fewer than 500 employees that maintain payrolls during coronavirus can receive assistance. Loans are given up to $10 million, or 2.5 times the average monthly payroll costs, whichever is lesser, according to Forbes. If a business is able to maintain payroll, a portion of the loans used to cover payroll costs, mortgage interest and utilities would be forgiven. The loans carry an interest rate of .5%.
Employers can also delay their portion of 2020 payroll taxes until 2021 and 2022. The law gives laid-off and furloughed workers an extra $600 a week, for four months, and extends existing state benefits by 13 weeks. It also offers jobless benefits to previously ineligible groups, such as freelancers and gig workers.
It’s unclear how long disaster or payment protection loans will take to process.
The Tarrant Small Businesses Development Center has been fielding dozens of calls a day for the past few weeks from business owners attempting to navigate the federal loan programs, said director Rodney Johnson. The center is housed within Tarrant County College and additional staff from other TCC departments will be trained to field calls from small business owners.
To help distill information, the center has partnered with the local SBA office, the Service Corps of Retired Executives and local chambers of commerce to host webinars through Zoom. Most have focused on the federal loan programs, Johnson said. The next webinar is planned for 11 a.m. Wednesday.
Before the virus outbreak, the center had a twofold mission to help people start and expand businesses. The focus has shifted, he said.
“With coronavirus, we’re in the mode of helping people sustain their business,” Johnson said.
For those not wanting to wait for a disaster loan, the city’s small business center has partnered with lenders like People Fund to provide loans with relaxed requirements. Sturns said these loans are typically used during startup and would require a small business to take on debt.”
The Fort Worth Local Development Corporation, which is made up entirely by the City Council, is expected to approve small loan options for businesses looking to fill a gap in revenue within a few weeks, Sturns said.
Details have not been finalized, but he expected loans to be capped at $15,000 and carry no interest for five years. The loans would be funded through the city’s land sales account.
These loans could be used to help pay rent, Sturns said, noting that many small businesses are worried about being evicted. Even though the survey found that is a top fear, he said many small businesses had not yet discussed the issue with landlords.
He encouraged landlords and tenants to work together.
“If there’s no tenant in the space when we come out of this they’re going to have to go back and fill that ,” he said. “I’d think they’d have a vested interest in making this work.”
Nonprofit and other assistance
The United Way of Tarrant County has raised about $400,000 to assistant area nonprofits, but much of that money also goes to food, rent and utility assistance for individuals, president and CEO Leah King said. United Way provided $50,000 in assistance last week, she said.
“That doesn’t go a long way,” King said. “The need is great.”
Nonprofits like Hope Farm looking for help can apply through North Texas Cares, a partnership between DFW-area United Ways and other large charities.
In Tarrant County, United Way is reaching out to nonprofits that received assistance in the past, King said. Restrictions that may have applied before, such as spending grants on utilities or rent, no longer apply.
Following the lead of local musician Rachel Gollay, who established a GoFundMe account for local artists, musicians and other part-time or gig workers, United Way has partnered with Hear Fort Worth and Film Fort Worth to establish the Creative Industry Relief Fund. Visit Fort Worth has a goal of raising $20,000 for $250 to $500 grants for artists and musicians hurt by the coronavirus shut down.
“For artists the crunch happened much more quickly,” King said. “It was light switch on then light switch off.”
Billy Bob’s Texas will host a live stream concert Wednesday to support the fund.
Texas Woman’s University has launched the AssistHer Emergency Relief Grant, which can provide up to $10,000 to existing women-owned businesses in Texas
Sturns said nonprofit-funded grants could be an option for Fort Worth.
“I think most of the foundations are waiting to see what happens federally,” he said.
Ways to help and apply
Business owners interested in the SBA disaster loans can apply online.
Information about the Paycheck Protection Program can be found at the SBA website.
Nonprofits looking for assistance can apply through North Texas Cares, a collaboration between foundations and the United Way.
More information about Fort Worth’s Small Business Assistance Center is available online or by calling 817-392-2622.
Donations can be made to the United Way of Tarrant County online.
More information about ways to support artists can be found at helpftw.com or through Visit Fort Worth.
This story was originally published April 1, 2020 at 6:00 AM.
