Filling the CARES Act Gap in Hillsborough County FL

August 05, 2020

“We wanted to craft a program specifically to fill the gap that was left by the CARES Act,” said Lindsey Kimball, Director of Economic Development at Hillsborough County in Florida. On June 30, Hillsborough County launched three distinct small business assistance programs to form the Rapid Response Recovery Assistance Program (R3) to do just that.

Each program was designed to provide assistance based on the specific problems small businesses in Hillsborough County were experiencing. Whether it was a rapid infusion of capital, funding to hire more workers, or reimbursements to make your business safer, the R3 programs were created to help businesses keep their doors open after covid-19 forced them to close.

Businesses are eligible to apply to one of the following programs:

1. Kickstart Small Business
Designed to support small businesses by providing a rapid infusion of capital. Funds are intended to be used to cover operational and working capital expenses. This program provides up to $10,000 for businesses under $3 million in revenue, and $7,500 for sole proprietorships and businesses with two or fewer employees.

2. Back to Work
Designed as an incentive to businesses to hire workers. Funds are to be used to reimburse payroll expenditures who hired or rehired employees starting April 30th. This program will provide a maximum of $2,000 per new employee hired up to $20,000. Small businesses must be under $20 million in revenue.

3. Safe at Work
Designed as an incentive to reconfigure office, industrial, agricultural or retail space; fund PPE and technology to modify service delivery or enable remote working; or fund safety and sanitation training for employees. This is a matching fund, which means the county will fund 50% up to 10,000 for expenses related to creating safe working conditions for businesses with revenue under $20 million.

Some of the major gaps in the CARES Act left out businesses who didn’t have an existing relationship with a bank, disproportionately affecting Black-owned businesses. One of the priorities of the R3 was to fill the gap government assistance left, “particularly for communities of color who were left out and disenfranchised by [it]”, said Kimball. Sole proprietors were also left out of the CARES Act, “we wanted to recognize the importance of sole proprietorship in our community...they were left out of the CARES act and other state programs”.

With this in mind, Hillsborough County created R3 to include sole proprietors, did not require a relationship with a bank, and strategically did outreach in communities of color. As this is a financial assistance program, and not a loan, no prior bank relationship is needed, the money will not be paid back, nor is a credit check required.

Setting up the Program

Hillsborough County allocated $125 million dollars out of the $256 million they received from the CARES Act to go directly to small businesses through the R3 program. As far as the county knows, this is one of the largest economic recovery programs for small businesses in the state, if not the nation. Hillsborough County partnered with Ernest and Young (EY) to build the application, website and dashboard. EY also runs the call center to answer questions any small business may have. At the call center, open Monday through Friday, 8am to 6pm, businesses can go through their application and EY associates can help them choose the program that will give them the largest return.

It took the county just four weeks to write the program, approve it, create a website and application. To ensure it was accessible for businesses, the county had about twenty businesses who were beta testers and gave feedback to ensure that the process wasn’t cumbersome or asked for documentation that businesses would have trouble with.

The county wanted the application and entire process to be easy to navigate, while providing businesses with real support that can help them stay open. They wanted to ensure that they had a quality user experience, and did not want the systems crashing or have one of the programs run out of money. They built a program that could handle around 13,000 applications, as of July 27, the program had over 6,000 applications at the end of their fourth week.

Kimball said that the question the county asked themselves as they designed these programs was: “How do we help the most vulnerable first?”.

Who Can Qualify?

In order to maximize the impact of these dollars, and prioritize “the smallest of small businesses”, those who were forced to close, and businesses located in an economically distressed area, applications were accepted in phases. With three phases, the system wouldn’t be overrun with applications, they could ensure the money wouldn’t run out and they could deliver funding to the smallest businesses who were forced to close first.

Businesses who were forced to close, were located in a ‘distressed area’ and had an annual revenue of under a predetermined amount (this number was different for each program), were able to apply in the first phase. The next phase opened up funds county wide but still only included businesses that were forced to close. The final phase opened up funds to all businesses that made under a certain amount in revenue (again, different for each program) and could prove they were ‘economically injured’ by COVID-19. Economically injured businesses were defined by those who saw a reduction of 25% or more in revenue in April 2020 compared to April 2019. A predetermined amount of funding was allocated into each phase to ensure that funds didn’t run out before everyone eligible to receive assistance could apply.

The county worked with each individual business before the application was submitted and while reviewing their application to help them receive the maximum amount of funding the program allowed for. The funding model was structured to give a meaningful amount of assistance to the small businesses while still being able to give funding to as many businesses as possible.

All three financial assistance programs have the same criteria for qualifying:

Be a for-profit business
NOT be publicly traded
Have been in operation since before March 1, 2019
Be currently open for business
Be legally registered, fully licensed (as required by applicable law), and up to date on tax payments/filings
Have been forced to close (deemed non-essential) by the government and/or suffered a demonstrable economic injury (at least a 25% reduction in revenue) due to COVID-19
Be primarily based in Hillsborough County (physical location)

All applicants had to for any funding stream will need to submit at least the following:

Scanned copy of your driver's license
W-9 form
Most recent Form 941, if you have employees (from FY20 Q1, or if you didn't file then, FY19 Q4)
Business tax forms appropriate for your business type

Click here to learn more about Hillsborough County’s financial assistance program for small businesses here.

Getting the Word Out

Ensuring that small businesses across Hillsborough County, from the city of Tampa to the unincorporated areas across the county knew about the programs and could apply was a priority. Hillsborough County held 17 virtual informational sessions, 7 of which were held in Spanish to be accessible to the many Spanish speakers in the county.

As every qualifying business can apply to only one of the three programs, these virtual sessions helped businesses choose the right program for them before the application process opened. After the presentation, businesses were able to ask specific questions directly to the administrators of the programs. Hillsborough County also made this informational video to help businesses know which of the three programs they should apply to.