The Arkansas Legislative Council on Friday authorized spending about $100 million in federal coronavirus relief funds, including $48.5 million for grants for service and hospitality businesses affected by the pandemic and $25 million to help match federal funds for additional unemployment benefits.
The state now has $81.6 million in unallocated federal coronavirus relief funds remaining out of the $1.25 billion it was allocated, said Jake Bleed, the state's budget director.
The unallocated funds include $18.9 million returned from the Arkansas Ready for Business program's original allocation of up to $147.7 million, he said.
Businesses eligible for the $48.5 million business interruption grant program will be in the personal care, tourism, travel, recreation and hospitality industries most directly impacted by necessary public health measures and the ongoing covid-19 pandemic, said David Bell, chief financial officer at the state Department of Commerce.
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The program will provide grants to small businesses with up to 250 full-time employees located in Arkansas for expenses associated with covid-19 mitigation and for certain business interruption expenses directly related to local, state or federal government covid-19 directives, according to the Department of Parks, Heritage and Tourism.
The grant application period will open Nov. 16 and close Nov. 25, the department said Friday. Grants will be awarded, likely in late December, on a prorated basis depending on the total number of applicants and the amount requested.
The awards will be limited to $250,000 per application and not all applicants will be approved, the department said in a written summary of the program.
The department said the grant amounts will be based on criteria established by a review committee.
The committee will consider the total amount of eligible expenses; overall impact of covid-19 to the business's industry; and the difference in the sales tax totals paid by the business during March 1-Sept. 30 in 2019, as compared with the same period in 2020.
The review committee will include Parks, Heritage and Tourism Secretary Stacy Hurst; Commerce Secretary Mike Preston; and Finance and Administration Secretary Larry Walther, as well as one designeee from each department.
A goal is to direct at least 15% of the money to minority- and women-owned businesses.
The Department of Finance and Administration will handle applications, expense approval and paying the grants, according to a letter from Bell to Walther.
$2M FOR MANAGEMENT
The Legislative Council approved the finance department's request to pay $2 million of the relief funds to the Center for Toxicology and Environmental Health in North Little Rock for grant management in this business grant program.
The council also signed off on increasing the finance department's contract with the firm from $4 million to $6 million from July 24 of this year through July 23, 2024. The department initially contracted with the firm to develop a database to be used by state and local government agencies to limit the state's risk of paying back relief funds not properly reported or documented.
Sen. Jonathan Dismang, R-Searcy, said one of his initial concerns about creating the business interruption grant program was making sure it wasn't "burdensome with entities that are already strapped for cash and resources and everything else.
"So by utilizing this type of program [through the Center for Toxicology and Environmental Health], we will take some of that away to allow them to freely apply without so much strain that would be created under a burdensome application process," he said.
Sen. Missy Irvin, Mountain View, said in retrospect, "It would have been great to have a company like that from the get-go.
"One of the things that we learned from the Ready for Business program was that businesses that had more people on their staff that had the ability and kind of were plugged into the grant-making process were able to get those submitted quickly, and on time and very easily, whereas small business owners who probably did not have that level of expertise really were behind the eight ball on all of that," she said.
The Legislative Council on Friday approved the Department of Commerce's Workforce Services Division request to spend $25 million in federal coronavirus relief funds to use as state matching funds for other federal funds to pay supplemental federal unemployment benefits.
The division was approved for the Federal Emergency Management Agency's Lost Wages supplemental payment assistance on Aug. 25 and three weeks of $300-a-week payments have been distributed through the program with the state's CARES Act steering committee approving $8 million to satisfy the state match requirement, said Charisse Childers, the division's director.
The CARES Act is the federal Coronavirus Aid, Relief, and Economic Security Act.
The $300 a week was an extension of pandemic unemployment assistance that President Donald Trump called for in an Aug. 8 executive order. The original $600 a week supplemental benefit was approved as part of the Coronavirus Aid, Relief, and Economic Security Act that Congress approved in March. That supplement expired July 31.
In an Oct. 6 letter to Walther, Childers wrote that the Workforce Services Division "respectfully requests to apply for an additional three weeks of assistance" in federal funds for unemployment benefits.
The purpose of the request to spend $25 million more in federal coronavirus relief funds is to ensure adequate spending authority to meet the matching requirements specified by FEMA upon application for more assistance, she wrote.
"If approved, the requested $25 million appropriation will allow [the Workforce Services Division] to utilize previously approved $8 million in CARES Act funding as well as any additional funds to meet the state match required by FEMA for the [lost wages assistance] program for the proposed three additional weeks," Childers wrote.
She said the division estimated the need for additional funds to provide the state match at about $10 million to $15 million.
Childers said Friday in an interview that FEMA has approved the division's request to allow the state to provide three more weeks of supplemental federal unemployment benefits of $300, and now she will ask the state's CARES steering committee next week "to get the money" to pay the unemployment benefits.
She said she hopes the supplemental federal unemployment benefits will be distributed next week or early the following week.
Other requests to spend federal coronavirus relief funds that cleared the Legislative Council on Friday included:
• The Department of Agriculture's request to spend $5.4 million to support an existing cost-share program to help local, small-scale Arkansas meat-processing facilities expand processing capacity to meet increased demand due to the impacts of the covid-19 pandemic.
The department previously received $5 million for the program, which is modeled after similar programs in Missouri and Oklahoma that used federal coronavirus relief funds.
• The Department of Human Services' request to spend $5 million on community outreach investment grants to nonprofit and community organizations providing direct services to individuals within high-poverty areas.
• The Department of Human Services' request to spend $5 million on its veterans issues initiative for behavorial health and suicide prevention with a focus on veterans.
• The Department of Commerce's request to spend $4.24 million to create and administer a short-term rental assistance grant program benefiting Arkansans who have been adversely impacted by the pandemic. This program also will be financed by federal Community Development Block Grants totaling $5.76 million.
The department said its Fresh Start program will partner with Arkansas Community Action Agencies Association to provide grant funding to assist low- and moderate-income individuals and families that have past-due rental expenses or with a notice of pending eviction if the expense was incurred on or after March 18.
The applicant must be able to certify that they were unable to make past-due rental payment due to unemployment, illness or other covid-19 related issue., according to the department. The program will disburse funds directly to landlords for 2½ months of rent, not to exceed fair market rental value.
• The Department of Human Services' request to spend $1.82 million through the Arkansas Hunger Relief Alliance partnership for statewide critical direct feeding services for children, elderly and families.
• The Department of Health's request to spend $1.2 million for mobile units and grants to community-based organizations.