DENVER – Starting Monday, Colorado businesses and nonprofits with fewer than 25 full-time employees that have been affected by the COVID-19 pandemic will be able to apply for up to $35,000 in grant and loan money through a new public-private fund.
The Energize Colorado Gap Fund will start accepting applications Monday. The fund is a product of a bill passed unanimously by the legislature this year to use CARES Act money for small business relief and from private donations, officials said during a news conference Wednesday.
Applicants can apply for a maximum of $15,000 in grant money, which will come from the CARES Act funds, and for up to $20,000 in low-interest loan money if they meet the criteria.
In order the qualify, a business or nonprofit will have to have fewer than 25 full-time employees. LLCs, S-Corps and other business types will be eligible, and nonprofits will qualify if they support economic development, small businesses or tourism, according to Energize Colorado.
They must also show proof of economic hardship caused by the pandemic response through financial records.
Small businesses owned by people of color, women, veterans and rural Coloradans will be prioritized, as will those that have not received federal PPP loans or other government assistance, or who have limited other access to extra capital.
The state and Energize Colorado said $5 million of grant money will be earmarked directly for tourism-related businesses and will be earmarked until Oct. 1.
Interest for the loans would be deferred for up to four months. Rates are 1% for the first 12 months and 1.5% for the next 12 months, with maturity rates of 24 to 36 months.
Kent Thiry, who leads the effort as the Gap Fund’s executive committee fund and helped bring the public side of the package together with the private sector, said the Gap Fund would give these businesses more than $25 million.
Applications and awards will be done in rounds, with the first rounds coming through the end of the year, though Thiry said he expects the program to last through 2021 and be evaluated at the end of next year.
But the federal CARES Act money that funds the grants will have to be spent by the end of the year, according to the original bill passed by the state legislature.
In June, state lawmakers unanimously passed SB20-222, which created the initial program, earmarking $20 million in CARES Act money and directing the Colorado Office of Economic Development to work with the Colorado Housing and Finance Authority to administer and operate the program.
Thiry said he anticipates the first round of awards to be dispersed within 4-6 weeks of applications opening Monday.
Sen. Faith Winter, D-Westminster, was one of the bill’s sponsors and said she and others got the idea from talking with small business owners – many of them people of color and women – who did not receive any PPP loans in the initial rounds and who were struggling to pay their bills and staff without extra funding.
She said the application only takes 15 minutes to complete and is easy to use, though Energize Colorado will have people available to walk applicants through any trouble they have.
Winter said the money would be “a lifeline” to rural, small, women-owned and people-of-color-owned businesses.
Sen. Jeff Bridges, D-Greenwood Village, another sponsor of SB20-222 said he had also heard from small business owners who either did not get enough, or any, extra money to help them.
“This is for Colorado business that need a little help to get through this,” Bridges said Wednesday.
“I’ve heard from so many hardworking Coloradans in Greeley and in Weld County who need just a little help to make it through this crisis,” said Rep. Mary Young, D-Greeley, another sponsor of the bill. “That’s why we worked quickly to pass bipartisan legislation that set aside $20 million to help small businesses that have been left behind, with a focus on women, veteran or minority-owned businesses and those in rural areas. Small business owners who may need assistance should reach out to Energize Colorado for guidance, or to apply for the grant program.”
For more information on the fund and how to apply, click here.