Hollee Ho, owner of Divine Nail Spa on Glebe Road in Arlington, was eager to apply to Arlington County’s Small Business Emergency GRANT program in May 2020 after shutting down her business for almost three months because of COVID-19 restrictions.
The county created and launched the program in just two months after the pandemic hit to help struggling small businesses.
Ho applied and received $7,500 to cover rent and payroll.
Nineteen months later and still hurting from the pandemic, Ho was ready to apply again when she heard the county was launching round two of the program.
But this time, she was ineligible because she had received federal COVID-19 relief funds.
“You don’t see an ending in sight to this,” she said. “You don’t know when is it going to stop or when is it going to be back to normal.”
Arlington County launched a second round of the small business grant program this month to provide direct assistance to businesses still facing impacts from the COVID-19 pandemic.
The Small Business GRANT 2.0 program will distribute $2 million to the hardest hit businesses using funds from the county’s allotment of the American Rescue Plan Act.
The program will provide 200 grants of $10,000 each to eligible businesses with 50 or fewer employees. Businesses will be selected for grants by a lottery.
Arlington County Economic Development Deputy Director Cynthia Richmond said the Small Business GRANT 2.0 program targets businesses from the hardest hit industry sectors of personal service, arts and entertainment, retail, restaurants, hotels and childcare.
But the 2.0 program disqualifies businesses that received state or federal funds to specifically target businesses that did not receive prior relief, she said.
“I hope we are going to be able to really give the money where it’s needed most in these industries that were most hurt that didn’t have the benefit of other kinds of federal and state funds,” Richmond said.
Richmond said the program also aims to provide funds for businesses that may have launched during the pandemic and missed deadlines to apply for funding.
“I hope we’re going to get a different kind of group this time,” she said.
Arlington County Economic Development Deputy Director Cynthia Richmond says 2.0 program targets ‘hard-to-reach’ small businesses
The county board unanimously voted to approve the program.
Arlington County Commission Chair Matt de Ferranti said small businesses are still hurting and feeling the challenges of dealing with the COVID-19 delta variant.
“I still have had conversations even within the last two weeks where small business owners will look at me and say, ‘Yeah, it’s still a real struggle,’” he said. “Their expressions and their care for their employees really is clear from the conversations that I’ve been having.”
First round of funding boosts businesses at start of pandemic
Richmond said the first iteration of the program received 1,117 applicants. The county distributed funds to 393 businesses.
She said the county surveyed businesses when the pandemic started in March to determine the impacts of the COVID-19 shutdowns.
“That gave us enough information to know that people were scared,” she said.
The first program held in May 2020 established criteria and used an algorithm to distribute funds to the hardest hit businesses, according to Richmond. She said an outside group blindly reviewed the applications and distributed scores based on criteria met.
The county distributed funds ranging from $1,200 to $10,000 to businesses that received the top scores and worked down the list until all funds had been distributed.
According to Richmond, 96% of businesses that received funding last year are still operating today.
Second round of grant funds targets hardest hit industry sectors
The 393 businesses that received funds in May 2020 are eligible to reapply to the county’s 2.0 program — unless they have received federal or state COVID-19 relief funds. Richmond said as of Oct. 15, the 2.0 program has received more than 300 applications.
Many business owners, including Divine Nail Spa Owner Ho, did not apply because they already received federal or state relief.
Ho received loans from the Small Business Administration to cover rent and payroll expenses. Her business has sustained only 25% of sales during COVID-19, according to Ho.
“I highly doubt that a lot of businesses qualify for that 2.0 program,” she said.
She now faces new challenges including a rising cost of supplies needed to run her salon because of a worldwide shortage of products ranging from acetones to gloves, pedicure liners and sugar scrubs.
“We’re just hoping to be able to maintain and carry on until the spring,” she said.
New program raises concerns over eligibility requirements
Richmond said her one concern with the 2.0 program is that there will not be enough applicants who are eligible because many businesses received federal or state money in the last year.
“Which on the one hand is a good problem to have,” she said. “But on the other hand, we’re really trying to reach the hard-to-reach.”
The county increased marketing and outreach efforts, placing yard signs in both English and Spanish throughout the county as well as making in-person visits to encourage business owners to apply.
Doug Frantzen, owner of E60 Fitness on Clarendon Boulevard, received $10,000 from the county’s program in 2020.
He is not eligible to apply to the 2.0 program because he received a small Paycheck Protection Program loan through the Small Business Administration. Frantzen said if his business was eligible, he would be reapplying.
The SBA loan, combined with the grant from the county, covered less than 10% of his losses throughout the pandemic, he said.
“We can use every little bit of help we can get because we’re still trying to recoup and it’s not like we’ve really had an opportunity where we can make a bunch of profit and pay back those losses because we’re still going through the pandemic,” he said.
Robert Steele owns Town Car Repair on Glebe Road and is in a similar situation.
He received $3,500 from the county’s 2020 program and is also ineligible for the 2.0 program because he received federal aid.
Steele said the original grant from the county “was nice, but it just wasn’t enough.”
His business was considered essential and remained open during shutdowns. He used the $3,500 for payroll.
“You can never tell what the future is to come,” he said. “I worry about what’s coming in the fall season because that’s our downtime in my business.”
Eligible small businesses take advantage of 2.0 program
John Nicholson, co-owner of Company Flowers & Gifts Too!, applied for the county’s program in 2020 and submitted an application for the 2.0 program.
“People want to throw money at you, why not?” Nicholson said.
The funds he received in 2020 covered one month’s rent.
He said his sales have been cut in half since the start of the pandemic, resulting in a reduction of half of his staff. The company continued to deliver flowers throughout lockdowns and modified the front of their shop to sell flowers without customers entering the store.
Nicholson’s wife, Marnie, who is a co-owner of the shop, said the county’s grant programs seem like opportunities that can be used to their advantage.
“I thought that it was good that they were recognizing that small businesses needed help,” Marnie said.
The application window for Arlington County’s Small Business GRANT 2.0 program closes Oct. 20.