San Francisco announced a new $62 million relief initiative for small businesses, which includes $50 million in zero or low-interest loans and $12 million in direct grants
The funding was sourced from cost-cutting measures across City departments, and will included slightly larger businesses that may not have been eligible for prior City-funded relief programs
In response to a project $650 million deficit over the next two fiscal years, Breed asked City departments to identify ongoing reductions of up to 10%
With small businesses reeling from the latest COVID restrictions, San Francisco Mayor London Breed announced on Tuesday a new $62 million relief program targeting restaurants, entertainment venues and other hard-hit local businesses.
The program includes up to $50 million in zero- or low-interest loans of up to $250,000 each, which encompasses larger San Francisco businesses that may not have been eligible for earlier small business relief programs, with the goal of preserving jobs.
"These are businesses who have not been able to open their doors, or who have been severely limited," said Breed at a press conference on Tuesday. "We're talking about our restaurants, our nail salons, our bars, nightlife and gyms. This plan will more than triple the amount of local support we have provided in grants and loans so far during this pandemic."
The plan also allows for $12.4 million in direct grants, of $5,000 to $20,000 each, with a special focus on high-need neighborhoods and businesses that are unable to access other funding sources.
The $62 million in total funding was sourced from cost-cutting across City departments that is currently underway, said Breed.
Last month, in response to a project $650 million deficit over the next two fiscal years, Breed asked City departments to identify 7.5% in ongoing reductions, along with an additional 2.5% as a buffer, should the budget outlook worsen. Those percentages apply to the Department's support from the City's General Fund.
To date, City-sponsored small business relief has amounted to tax and fee waivers and deferrals, plus some targeted grants for certain categories of small business.
Sharky Laguana, head of the San Francisco Small Business Commission, called the plan "the biggest relief plan we’ve had since the pandemic started."
"I give credit to the Mayor for leaning into this, and turning what could have been a small investment into a large investment," he said.
The City's new relief plan accompanies a new round of federal Paycheck Protection Program loans, which were signed into law late last year. The applications for the new round of PPP loans opened just this week, and small business owners are hopeful that federal, local and state programs will bridge the gap between today's shutdowns and eventual reopenings later this year, after more people have been vaccinated. In late November, California announced $500 million in nonprofit and small business grants.
As of 2018, small businesses — defined as those with fewer than 100 employees —accounted for approximately 359,000 jobs in San Francisco, or 41% of jobs, according to figures from the SF Treasurer and Tax Collector and California Employment Development Department.
Laguana added that it's too early to predict how the new round of PPP loans will impact San Francisco small businesses, given outstanding questions around how revenue is recognized in the application process. Some businesses, desperate to raise cash flow last year, opted to liquidate assets.
"We need to do way more for small business sector in the U.S., and I am confident that the incoming administration understands that and we'll get somewhere meaningful with aid," he said.