01.05.2021 | Client Alerts | Covid-19

Small Business Relief Program: Massachusetts Relief Available for Small Businesses Including Restaurants and Bars

Governor Baker has targeted small businesses in Massachusetts since October 2020 with the Massachusetts Growth Capital Corporation’s initial funding, but previous stimulus money and budget allocations were insufficient to keep up with the need. Effective immediately, Governor Baker is now allocating more funds to help restaurants, bars, and other small businesses get through the cold Massachusetts winter.

OVERVIEW OF THE GRANT PROGRAM

  • Restaurants, bars, and other small businesses in Massachusetts, can submit applications through January 15, 2021, to take advantage of the additional funds Governor Baker has approved for small business relief
  • Grant awards will be announced in early February
  • Previous applicants who did not receive relief funds the first time around need not reapply. They will be considered without reapplication
  • Amount of relief limited to the lesser of $75,000 or three months’ operating expenses for the business

WHAT IS THE PURPOSE OF THE FUNDS?
The funds can be used for:

  • Employee salary and benefits
  • Rent or mortgage payments
  • Utility bills and other debt service obligations
  • FUNDS CANNOT BE USED FOR expenses already covered by other state or federal funding such as the Paycheck Protection Program or an Economic Injury Disaster Loan

WHO CAN APPLY?
Businesses that:

  • Were in existence prior to June 30, 2019
  • Have 50 or fewer employees
  • Have suffered a loss of income due to the COVID-19 pandemic in at least the amount requested
  • Are open or have intent to reopen, benefitting those restaurants that decided to hibernate for a period of time

WHO SHOULD NOT APPLY?
Businesses that:

  • Are not showing an operating loss due to the COVID-19 pandemic
  • Have access to other sources of relief
  • Have been able to continue to operate without significant financial distress
  • Have adequate available reserves
  • Are chain restaurants
  • Those who previously submitted an application but did not receive funds (no new applications will be accepted from those who already applied)
  • Hotels
  • Non-Profit businesses

WHAT IS THE APPLICATION PROCESS?
How to Apply:

In addition to the on-line application, the following is Required Documentation:

  • Certificate of Good Standing from the Massachusetts Secretary of State’s office
  • Complete 2019 Federal Business Tax Return
  • Complete 2019 Federal Person Tax Returns for each business owner with 20% or great ownership

For additional information on “Required Documentation,” see section of Massachusetts Growth Capital Corporation’s website entitled “Required Documentation” at: https://www.empoweringsmallbusiness.org/covid-19-response/sector-specific-relief-grant-program-massachusetts-businesses.

In addition to the above, the Applicant must maintain the following documentation for audit purposes:

  • Receipts, invoices, purchase orders, contracts, contemporaneous memoranda, and other relevant materials showing obligations and expenses
  • The documents must be stored in an easily accessible and searchable format, in the business’ control, and in compliance with document retention practices

CONCLUSION
This is “sector specific” relief designed to help the most vulnerable sector of small businesses in Massachusetts as we head into the winter months. Though indirect, it is also potential relief to some small business landlords in Massachusetts who are still impacted by a federal eviction moratorium through January 31, 2021. In addition to this limited grant program, there are additional programs available to Massachusetts small businesses. Check out https://www.mass.gov/info-details/covid-19-resources-and-guidance-for-businesses.