City of Chicago Launches Applications for Small Business Resiliency Fund as Part of Unprecedented Effort to Support Local Entrepreneurs Impacted by Covid-19 Outbreak
Applications for $100 million in low-interest loans are available now for small businesses affected by COVID-19 Outbreak
CHICAGO – Mayor Lori E. Lightfoot, Treasurer Melissa Conyears-Ervin, the Department of Business Affairs and Consumer Protection (BACP) and other private sponsors today announced that applications are now open for $100 million in low-interest loans through Chicago Small Business Resiliency Fund, the City’s unprecedented effort to support Chicago's small businesses that are experiencing a temporary loss of revenue as a result of the coronavirus (COVID-19) outbreak. The fund will provide immediate stopgap relief to thousands of small businesses in Chicago. Interested business owners can begin applying for the loans at: www.chicagoresiliencyfund.com.
“These unprecedented times call for unprecedented measures. We know that our business owners and entrepreneurs don’t have the luxury to wait for federal support which is why with the Chicago Small Business Resiliency Fund, we are putting money directly into the hands of our small businesses now so that they can weather this storm,” said Mayor Lightfoot. “When we support small businesses, we support their workers, who in turn help uplift the vibrancy of our neighborhoods and I want to thank our public and private partners who helped make this relief a reality.
The Chicago Small Business Resiliency Fund was created last week through an up to $50 million in capital commitment from the Catalyst Fund to be determined by the Board, a $25 million grant from the City of Chicago, as well as $10 million from Goldman Sachs’ Urban Investment Group, $1 million from Fifth Third, $250,000 from Clayco and $15 million from additional private funding sources. Through additional philanthropic dollars, the City is working toward expanding the reach of this economic relief program.
“We are a city of strong people, neighborhoods and spirit. But all need nourishment and help during this crisis. As was true from the founding of the Catalyst Fund – we are committed to working with all neighborhoods, but particularly with those west and south side neighborhoods which have only recently begun to see the investment that they were so long denied,” said Treasurer Conyears-Ervin. “Working with committed partners like Accion, Chicago Community Loan Fund and CNI Micro Finance Group – we are determined to help them weather this unprecedented storm.”
Five-year loans of up to $50,000 are available today for Chicago small businesses and non-profits with annual revenues of less than $3 million that have suffered at least a 25 percent decrease in revenue due to the COVID-19 outbreak. To be eligible, businesses must employ fewer than 50 employees. Loan proceeds are required to be used for working capital with at least 50 percent of the proceeds applied towards payroll. The fixed annual interest rates on the loan will be 1 percent for the first 18 months, with nominal payments during the first 6 months.
The loans will be administered through a process that also ensures equitable distribution of loans with consideration for at least each of the following:
- Geography: Loans will be allocated across all of Chicago's communities
- Income: Loans will be available to small businesses serving low- and moderate-income residents
- Industry Type: Loans will be available across all industry areas impacted by COVID-19
Furthermore, the City will set aside a portion of the loan pool to ensure an equitable distribution along these lines. For full details on the loan, including how to apply, visit www.chicagoresiliencyfund.com.
“This loan fund will provide immediate and much-needed relief to the small businesses hit hardest by this crisis,” said BACP Commissioner Rosa Escareno. "We know that this is an incredibly challenging time for so many and we need to take extraordinary steps to support our small businesses. We will continue working closely with our local business owners, business organizations and financial partners to identify more ways to help – you are not alone."
The initial intake process for loan applicants will be administered by Accion Serving Illinois & Indiana and Community Reinvestment Fund USA. Both organizations will be supporting the Resiliency Fund in ensuring eligibility requirements are met for eligible loan participants, providing support through the application process as well as connecting borrowers with technical resources. Loan applicants will then be paired with community lenders who will be able complete the loan application. The City continues to work with its other community lending partners to build partnerships in helping further the reach of the Resiliency Fund.
Application support is available through the City’s Neighborhood Business Development Centers - a list of organizations providing support can be found here. For questions on the loan and technical support, interested applicants can ask questions using the form found here.
“Small businesses in Chicago need help immediately,” said Brad McConnell, CEO of Accion Serving Illinois and Indiana. “Accion will continue to work with Mayor Lightfoot and all of our partners to provide low-cost loans to as many entrepreneurs as we can, as quickly as we can.”
The Resiliency Fund is structured to complement the new federal Paycheck Protection Program that the SBA will launch in the coming days. When those federal forgivable loans are available, community lenders will help Chicago businesses access those funds. Small business owners who do not qualify for the federal funds, or who need additional capital once those federal funds have been fully lent, are encouraged to apply for the Resiliency Fund.
“Small business owners and their workers are feeling the impact of COVID-19 in every aspect of their lives, and as community-building partners we want to help them weather the storm,” said Frank Altman, co-founder and CEO of CRF. “We are honored that the City, BACP and all of the public and private partners have worked so hard to bring the Resiliency Fund to life so quickly. Now we can all begin to deliver the help small businesses and their employees need to survive.”
Following the announcement of the Chicago Small Business Resiliency Fund, the City has conducted extensive outreach with the business community to gauge interest and provide educational materials and resources. Through an online interest form, the City has heard from over 6,000 small businesses interested in learning more about available financing. BACP is holding six webinars on the Small Business Resiliency Fund, including one in Spanish and one in Polish.
“At the Chicago Urban League, we know that a vibrant business ecosystem is essential for the strength of our community,” said Karen Freeman-Wilson, President and CEO of Chicago Urban League. “We applaud Mayor Lightfoot for taking this critical step to ensure cash flow to our small businesses during this difficult time.”
“These unprecedented times call for unprecedented leadership. Mayor Lightfoot continues to show her commitment to small businesses by taking this bold step to infuse capital where it is much needed,” said Malcom Crawford, Executive Director of Austin African American Business Networking Association Inc. (AAABNA). “Access to capital has always been an issue in our community and we feel that this is an important step.”
For more information and updates on COVID-19, tune into CDPH’s “The Doctor Is In” Livestream M-F at 11am, for mobile updates, text COVID19 to 78015 or email: firstname.lastname@example.org.