The fledgling Arkansas Ready for Business grant program, intended to provide $15 million in federal funds to businesses, was rolled out prematurely on a state website late Wednesday afternoon, Gov. Asa Hutchinson acknowledged Thursday.
But the Republican governor said he was surprised that in less than an hour after the website went live, more than 2,300 businesses applied for grants, seeking an amount that would top $36 million.
Hutchinson, at a news conference the day before, had announced his plan to use federal coronavirus relief funds to provide grants of up to $100,000 each to help businesses with expenses such as buying protective equipment and reconfiguring their operations to meet public health guidelines.
"While it was rolled out prematurely, we did not have Legislative Council approval, and ... [Wednesday] when I was here, I said there is two things that need to happen first, one is the steering group approval and then Legislative Council," he said at Thursday's daily covid-19 news conference in the governor's conference room.
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"Well, the gun was jumped on that, and the website went live," Hutchinson said. "When we realized it was prematurely put up, it was brought back down."
Hutchinson said the glitch with rolling out the website for the program prematurely "is the result of people working remotely, people working quickly and trying to get the job done, and it was a simple failure of clear communication, which I take responsibility for."
On Facebook, state Rep. DeAnn Vaught, R-Horatio, wrote Thursday that the $15 million grant program "was actually supposed to go live TODAY, but some steps were skipped and it went live yesterday."
One of the steps was for the Legislative Council's Performance Evaluation and Expenditure Review Committee, for which she is co-chairwoman, to sign off on the program, she said.
"They had 2,200 applications in 30 minutes (over $35 million in requests), and if you weren't a part of ... an association, then you didn't know anything about the grant or what documents you even needed to apply," Vaught wrote.
"To me, that was an unfair advantage for all my Mom and Pop shops who are also trying to open back up for business. So, today I will be voting NO until they find more money to support business in rural Arkansas and they go thru the correct process so everyone has a fair shake at getting those funds," she wrote. "Let me be very clear, I am FOR the grant money, but AGAINST the way things shook out yesterday."
Sen. Jonathan Dismang, R-Searcy, wrote Wednesday night on Twitter, "Just curious, anyone know anyone that was able to apply for AEDC's Ready for Business Grant Program? What did the application look like?"
He was referring to the Arkansas Economic Development Commission.
Dismang said Thursday that he is seeking more information about what transpired.
Hutchinson said the rollout of the business grant program was typical "because as you present a new grant program you want to make sure as many stakeholders as possible are aware of that, so those steps were taken, so it was not an issue of favoritism.
"It was a matter of this is how you get information out about a new small business grant program," he said.
Vaught declined to comment Thursday afternoon when asked about Hutchinson's statement that favoritism wasn't involved in who knew about the rollout of the program.
"No one had a head's up," said Department of Commerce spokeswoman Alisha Curtis.
The program was publicly announced at the governor's news conference Wednesday, she said.
At that event, state Commerce Secretary Mike Preston directed the public to the Arkansas Economic Development Commission website and advised that the application would go live that afternoon, Curtis said.
"Anyone watching the briefing had access to this information. Various members of the news media also discussed this in their social media posts," she said.
Beginning at 1:30 p.m., the website provided a summary of the program and notified visitors to return to the website at 5 p.m. to apply, she said. No applications -- paper or electronic -- were received before 5 p.m, she said.
At 3 p.m., Preston hosted a teleconference with 100 local economic development officials from throughout the state to describe the program and answer questions, and they were asked to help get the word out and were told that applications could be submitted beginning at 5 p.m., Curtis said.
At 5 p.m., the system went live and applications commenced, she said.
Each application was electronically date- and time-stamped automatically. The first applicant, from Garland County, submitted its application at 5:04 p.m., she said.
At his news conference Thursday, Hutchinson said 92% of the applicants had fewer than 50 employees; 59% of the applicants had fewer than 10 employees; and 57% of the grant amounts requested came from businesses with fewer than 50 employees.
"We were educated by that response, and now what we have to do is to work with the Legislature to see, are we going to increase the funding for this?" he said.
"I think it shows that it is really going to the people that were targeted, which was primarily those that are struggling, that have had their businesses impacted, the small-business people, and that is who responded to it, as well as we want to have some of the others that have access to it," Hutchinson said.
He said it's important that everybody have an opportunity to go back online and apply for this grant program.
"I do believe it will need to go back up and I would expect that as a matter of fairness for those that might not have had notice of it," Hutchinson said. "Of course, I did announce it here. I didn't say exactly when that website was going to go up."
He said he hopes the website for the program goes back up early next week.
"We won't reopen the website until we know exactly how much money we are putting in there and whether any changes need to be made to the program," Hutchinson said.
On Wednesday, the state Coronavirus Aid, Relief, and Economic Security Act Steering Committee also recommended spending up to $700,000 on a marketing campaign by Little Rock firm CJRW.
The proposal was presented by Stacy Hurst, secretary of the state Department of Parks, Heritage and Tourism, on behalf of the economic recovery task force appointed by Hutchinson to recommend how to relax restrictions imposed to slow the spread of the coronavirus. She said the campaign will focus on providing the narrative that the decisions are driven by science and it is safe to return to the marketplace.
Hurst said Thursday that the department will have a new contract with CJRW for this campaign.
"Originally, I thought we could use the existing contract with CJRW. But it is a safer route [to have a new contract], according to the state Office of Procurement," she said.
After conferring with Office of State Procurement Director Ed Armstrong and Parks, Heritage and Tourism Department General Counsel Jim Andrews, the department's purchasing staff pursued an exemption from procurement law made possible by Executive Orders 20-06 and 20-16, said Melissa Whitfield, a spokeswoman for the department.
"To do so, they posted what regulatory statutes were identified as a hindrance and delay to rendering the maximum assistance to the citizens of the state for the purpose of contracting with an appropriate communications and marketing firm," she said. "That notice is posted here in a banner link at the top of the page: https://www.adptfoi.com/."
A Section on 05/01/2020