Nearly three dozen small businesses in Columbus impacted by the COVID-19 pandemic have applied for loans under a city-funded program that aims to help keep them afloat during the crisis.
The program, called Columbus INvigorate, allows small businesses within the Columbus city limits the opportunity to apply for a loan ranging from $5,000 to $25,000. The loans have a six-month deferral of interest and principal payments on the three-year terms. The loans do not require collateral but require a personal guarantee from applicants, city officials said. Interest rate after the six-month deferral would be 1%.
As of Wednesday morning, 35 businesses had applied for loans, said Mary Ferdon, the city’s executive director of administration and community development.
The deadline for the first round of applications is 4:30 p.m. today, city officials said. All applications received before the deadline will be considered filed at the same time.
Columbus Mayor Jim Lienhoop has said he expects the program will start disbursing funds to approved applicants during the first week of May.
“So far, (the interest) has been pretty strong,” Lienhoop said on Wednesday. “…I think it’s been reasonably well publicized. Folks are aware of it, and so I’m glad we’re able to hear from them.”
On April 21, the Columbus City Council approved the creation of the program and the use of $1 million in city funds for the program. The following day, the city started accepting applications through its website and received 15 during the first 24 hours, said Eric Frey, executive director of Administrative Resources association, a nonprofit governmental association that is administering the loan program.
To be eligible to apply, companies must have been in business as of Jan. 1, have fewer than 50 employees, no more than $2 million in gross receipts and show a decline in revenue this year due to the pandemic. Priority will be given to small businesses that have higher credit scores, demonstrated financial need, retention of employees, financial capacity to return to or continue operations, among other criteria.
The city money for the loan program will come from $250,000 from the Economic Development Income Tax Fund, $350,000 from the city’s general fund capital improvement fund and $400,000 in city redevelopment funding, city officials said. The $350,000 in capital improvement funding will come from deferring that amount from planned projects in 2020 to next year.
“I wouldn’t be surprised if today and tomorrow we get a flood of applications,” Ferdon said. “…You’re expectation might be that people would be requesting the entire $25,000 available, but they’re not. Some are requesting $5,000, $12,000, $10,000. Some are requesting $25,000, but it’s kind of all over the board.”
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Visit www.columbus.in.gov/columbus-invigorate/ for more information about how to apply for a loan under the Columbus INvigorate program for small businesses within the city limits.
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