For the last year, local businesses have struggled significantly due to the ongoing effects of COVID-19 and mandated closures, restrictions, and mitigation efforts. However, relief is on the way for Pennsylvania business owners through the Commonwealth’s COVID-19 Hospitality Industry Recovery Program (CHIRP).
The application process opens March 15, 2021.
In December 2020, Governor Wolf started a transfer of funds to be secured as grants for businesses. The state legislature approved this initiative and enacted it last month. The Department of Community and Economic Development (DCED) accepted applications from all 67 counties within the Commonwealth and provided block grants to each county based on their population.
This week, Pennsylvania started to put this program into motion. On March 2, 2021, Governor Tom Wolf announced that $145 million will be made available to help Pennsylvania small businesses in need. All 67 counties have been enlisted to help distribute the funds to businesses in their communities through CHIRP, a new grant program created to support struggling businesses during the continuing pandemic efforts.
Each county will distribute the funds through one or more designated Certified Economic Development Organization (CEDO) or Community Development Financial Institution (CDFI). Grants will be administered in $5,000 increments up to a $50,000 maximum per eligible applicant. Local small businesses in need of financial help should apply as soon as the program opens in their county. CEDOs or CDFIs must start accepting applications by March 15, 2021.
How to Apply:
Businesses must apply through their county’s designated CDFI or CEDO.
A business is eligible if:
- It has a North American Industry Classification System (NAICS) designation within the Accommodation subsector (712) or Food Services and Drinking Places subsector (772) and where accommodations, food or drink is served to or provided for the public, with or without charge.
- It has fewer than 300 full-time equivalent employees.
- It has a maximum tangible net worth of not more than $15 million.
- It was in operation on February 15, 2020 and remains in operation and does not intend to permanently cease operations within one year of the date of application.
- COVID-19 has had an adverse economic impact on the eligible applicant which makes the grant request necessary to support the ongoing operations of the eligible applicant.
- Grants may only be used on COVID-19 related costs, and may not be used to pay the same eligible operating expenses for which an eligible business received funding from the CARES Act (PL 116-136, 134 Stat. 281), The Consolidated Appropriations Act of 2021 (PL 116-260, 134 Stat. 1182), or the COVID-19 Emergency Supplement to the General Appropriation Act of 2019 (Act 2A of 2020)
- Applicants who have received a loan or grant issued under the authority of the Federal Government or the Commonwealth shall not disqualify an eligible business from applying for a CHIRPS grant.
According to the Governor’s announcement, priority will be given to eligible applicants that:
- Have not previously received a loan or grant issued under the authority of the commonwealth or the commonwealth’s political subdivisions, or by the federal government.
- Were subject to closure by the Governor’s disaster declaration, or can demonstrate:
- A reduction in gross receipts of 50 percent or more for the period beginning after March 31, 2020, and ending before December 31, 2020, in comparison to the period beginning after March 31, 2019, and ending before December 31, 2019.
- If the eligible applicant was not in operation during the entire comparison period, but was in operation on February 15, 2020, a monthly average reduction in gross receipts of 50 percent or more for the period beginning after March 31, 2020, and ending before December 31, 2020, in comparison to the period beginning after January 1, 2020, and ending before April 1, 2020.
Pennsylvania small businesses have been severely impacted by the pandemic. CHIRP will provide aid and support for those businesses financially burdened by COVID-19. Recently, Governor Wolf relaxed restrictions on gatherings and out-of-state travel, and with the addition of the CHIRP Program, Pennsylvania businesses will be able to receive additional aid to help them get back on their feet.
The application window will open soon. Business owners interested in applying should contact their local county officials or their county’s designated CEDO or CDFI for more information, and program guidelines can be found in this link. If you have a legal question related to your business or would like assistance with applying for the CHIRPS Program, please consult your legal counsel or contact one of KingSpry’s Business Attorneys for further information.