With the COVID-19 pandemic devastating small businesses across the state, Pennsylvania has enacted a relief program providing for $225 million in assistance grants.
The COVID-19 Relief Pennsylvania Statewide Small Business Assistance program was announced with strict rules. To be eligible for assistance, a small business must demonstrate that prior to the impact of COVID-19, it had an annual revenue of $1 million or less and employed 25 or less workers in full-time or equivalent positions. Applicants are also required to show that their business was economically impacted by COVID-19.
Applications for grant money are made through community development financial institutions (CDFIs), which are organizations that provide financing options for small businesses. In Allegheny County, these include Northside Community Development Fund and Bridgeway Capital of Pittsburgh. In determining eligibility for grants, special consideration is given to rural businesses, those in targeted redevelopment communities and those owned primarily by women or minorities.
Grants are provided in amounts ranging from $5,000 to $50,000. Of nearly 50,000 applicants who requested financial help during the program’s first two rounds of funding, slightly less than 5,000 received approvals.
If your business is awarded funding through the program, there are a few important stipulations on how to spend the grant money.
Funds received through a CDFI can be used to pay for COVID-19 related losses or expenses, such as:
Grant money cannot be used to pay for:
Grant recipients are required to keep records of grant eligibility and expenditures for at least four years after receipt of the funds. These records may prove invaluable if your business is accused of fraudulently obtaining or spending grant money.
The program requires grant recipients to return any portion of the funds that are not used to cover eligible expenses. In addition, a recipient may be required to return grant funds if they shut down operations after receiving the grant.
The legal team at Feldstein Grinberg Lang & McKee, P.C. in Pittsburgh has advised Pennsylvania small business owners for more than 40 years. If you are in search of guidance on obtaining or spending COVID-19 government assistance funds, our attorneys are prepared to help. To schedule your free initial consultation, call 412-471-0677 or contact us online.