More funding has been committed to Michigan businesses to support the economy as the COVID-19 pandemic continues.
The state has received $15 million in federal CARES Act funding for Michigan farms and agricultural processors to mitigate risks of the pandemic across the food production industry. The funding has gained approval from the Michigan Strategic Fund, the Michigan Economic Development Corp., and the Michigan Department of Agriculture and Rural Development.
Food and agriculture contribute $104.7 billion annually to Michigan’s economy and represents 805,000 jobs statewide, according to MDARD. Michigan also exports about $1.8 billion in food and agriculture products each year.
“Michigan’s food and agriculture sector has been especially hard hit by the COVID-19 virus, and this investment will provide critical resources to ensure the safety of the state’s food production industry and its workforce,” says Gov. Gretchen Whitmer. “We can further our economic recovery in the state by putting federal dollars through the CARES Act to work for the people and business across Michigan through efforts like these grants to farms and food processors.”
The funding was appropriated from the CARES Act funding through SB 690 and signed into law by Whitmer last week. It implemented the Michigan Agricultural Safety Grant Program, which will offer grants to agricultural processors and farms.
About $10 million in grants will be provided to processors statewide in the amount of $10,000-$200,000. The remaining $5 million will be available to farms statewide in grants of $10,000-$50,000.
Applicants must apply as either a processor or a farm, not both, and funds will provide grants of up to $1,000 per employee to fund COVID-19 mitigation costs, including for testing, personal protection equipment, facility needs, sanitation, employee training, and upgraded safety procedures for farm-provided housing.
To qualify for a grant, applicants must be located in Michigan and have a minimum of 10 employees in Michigan with supporting documentation, provide proof of good standing with the state as applicable, and attest that the business is current on all state, local, and real estate taxes or is otherwise contesting them in good faith.
“Employee testing and PPE continue to be a great need both on the farm and in the processing industry,” says Gary McDowell, director of MDARD. “These financial resources will provide much-needed services and equipment to an already struggling sector. Having adequate testing and PPE is critical to ensuring the safety of Michigan’s food and agriculture workforce – whether domestic or migrant labor – as well as maintaining a safe and wholesome food supply.”
The program will cover costs incurred from June 1-Sept. 15. Eligible applicants will be able to apply for funding beginning on July 15. Grants will be awarded on a first come, first serve basis until all funding has been awarded.
Applications will be processed by East Lansing’s GreenStone Farm Credit Services, one of America’s largest rural lenders. It has 31 branches in Michigan. It has been in business for 100 years and offers short-, intermediate-, and long-term loans; equipment and building leases; life insurance; crop insurance; and accounting and tax services.
GreenStone also will host the application portal, which will include an initial screening of all applications and supporting documentation and recommend applications to the MEDC for final approval and disbursements of the grants awarded. GreenStone will provide a report to MEDC of all applications that were denied in the review process. The authorizing legislation for the program also requires reporting on Oct. 15 to the legislature and State Budget Office on the Agricultural Safety Grant program’s results. It will be available on michiganbusiness.org/agsafety.
“We are continuing to leverage every resource available – whether federal, state, or local – to ensure our small businesses across Michigan are able to receive the support they need to not only survive COVID-19, but be in a position to thrive and drive economic recovery moving forward,” says Mark A. Burton, CEO of MEDC. “Working in partnership with MDARD and GreenStone, we are confident we can get this critical support into the hands our farms and agricultural processors quickly and effectively to keep our workers and our food supply safe.”
In related news, MEDC also announced the Michigan Strategic Fund approved a $100 million program that will provide grants to small businesses around the state to help recover from the impacts of the COVID-19 pandemic. This is on top of the $15 million for farms and food processors and was also appropriated from federal CARES Act funding through SB 690.
The funding will implement the Michigan Small Business Restart Program.
The fund authorized distribution of the funding across 15 local or nonprofit economic development organizations covering all 83 counties in the state to provide a base amount of $3.5 million per organization for grants up to $20,000 each to support small businesses that have realized a significant financial hardship due to the virus. Participating organizations include:
- InvestUP – $4,545,455
- Networks Northwest – $4,545,455
- Otsego County Economic Alliance – $3,500,000
- Target Alpena – $3,500,000
- The Right Place – $9,545,455
- Lakeshore Advantage – $3,500,000
- Middle Michigan Development Corp. – $3,500,000
- Saginaw Future – $3,545,455
- Flint and Genesee Chamber – $8,045,455
- Lansing Area Economic Partnership – $5,545,455
- Southwest Michigan First – $7,545,455
- Ann Arbor Spark – $8,545,455
- Oakland County – $11,045,455
- Macomb County – $7,545,455
- Detroit Economic Growth Corp. – $15,545,450
The program applications will be live starting Wednesday, July 15 at michiganbusiness.org/restart and run through Wednesday, Aug. 5. Funds can be used as working capital to support payroll, rent, mortgage, utilities, and more.
To qualify for support, businesses must demonstrate they are affected by the pandemic, need working capital to support eligible expenses, saw an income loss due to the virus, and have not received a grant through the fund’s Michigan Small Business Relief Program. Businesses who have received support through other COVID-19 relief programs, including the Michigan Small Business Relief Program loans, are eligible to apply for restart grants.
At least 30 percent of the funds awarded under the program must be provided to women-, minority-, or veteran-owned eligible businesses. The MEDC expects more than 5,000 businesses across the state will benefit from the program.
“With the outbreak of COVID-19, many small businesses have been faced with significant economic impacts, including challenges with cash flow and resources to support their workforce,” says Burton. “The Michigan Small Business Restart program, combined with other Michigan Strategic Fund programs and services as well as local and federal economic development support, will enable small businesses throughout the state to address the short-term impacts of the COVID-19 crisis while looking ahead to the long-term economic recovery needs of the state.”
A monthly report will be provided to the legislature that includes a listing of grants awarded in the previous month and the name of the recipient of each grant provided under the program.
“The Michigan Small Business Restart grants will be an important part of the economic recovery of small business in Michigan,” says Brian Calley, president of the Small Business Association of Michigan. “This program leverages federal dollars to bring relief to entrepreneurs struggling with the effects of this global pandemic in a thoughtful way, including working through local EDOs to ensure resources are distributed in the most equitable and effective way for each region in the state.”
The Michigan Small Business Restart Program is modeled after the Michigan Small Business Relief Program, approved on March 19 by the fund to support small businesses impacted by the crisis. It included $10 million that was distributed to 15 local economic development organizations to provide grants up to $10,000 to small businesses. The program also authorized $10 million for small business loans of $50,000-$100,000 to eligible borrowers impacted by COVID-19 that were not able to seek alternative financing. More than 2,700 businesses across the state received support and expected to retain about 11,000 jobs. To date, more than 130 small business loans totaling more than $8 million have been approved.
With the new agriculture and small business initiatives, MEDC has launched 17 COVID-19 relief and recovery programs supporting more than 3,100 businesses in the state and helping to retain more than 12,400 jobs. More information on response programs is available here and other resources for economic reopening efforts or difficulties can be found here. MEDC has also developed a frequently asked questions page for Michigan businesses and communities here.