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Michigan Bracing for COVID-19 Impact on Small Businesses

By now, many are aware of Governor Gretchen Whitmer’s ban temporarily closing dine-in restaurants, gyms, and movie theaters. Whitmer’s order combined with the CDC’s encouraged social distancing is expected to have an unprecedented impact on Michigan’s economy.

In 2019, the U.S. Small Business Administration (SBA) reported more than 873,000 small businesses in Michigan employed 1.9 million people. That accounted for nearly 49 percent of Michigan employees.

Tuesday, Michigan’s small business entrepreneurial support organizations joined forces with the Michigan Economic Development Corporation (MEDC) to ensure economic support is available to Michigan businesses to overcome anticipated loss of revenue as a result of the COVID-19 virus.

“Small businesses drive the economies of our communities, and we understand that they are facing unprecedented challenges. We are committed to providing vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing,” said MEDC CEO, Mark Burton.

“We are working with small business organizations and partners around the state to ensure that every possible resource is made available to businesses, communities, entrepreneurs and others around the state, and we will continue to provide updates as soon as they’re available.”

Earlier this month, Congress passed legislation that makes $1 billion available to the SBA to provide low-interest loans to small businesses, small agricultural cooperatives, and nonprofits that have suffered substantial economic losses as a result of the COVID-19 pandemic. SBA’s Economic Injury Disaster Loans offer up to $2 million in assistance and can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing.

However, a state declaration must come before funds can be accessed.

On March 16, Governor Whitmer informed the SBA that she is seeking an Economic Injury Disaster Loan (EIDL) Declaration for the state and has initiated the process to receive the declaration from SBA. That application process is expected to be completed this week.

As of Tuesday, March 17, EIDL loans are not yet available in Michigan.

The Michigan Chronicle will provide updates as new developments arise.

 

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