Littleton approves grants for small businesses

Plan called 'phase one' of economic recovery efforts

David Gilbert
Posted 4/27/20

The City of Littleton will offer grants of up to $2,500 to small businesses impacted by the COVID-19 shutdowns, the city council decided on April 21. The council voted unanimously to allocate …

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Littleton approves grants for small businesses

Plan called 'phase one' of economic recovery efforts


The City of Littleton will offer grants of up to $2,500 to small businesses impacted by the COVID-19 shutdowns, the city council decided on April 21.

The grant application process begins at noon on Monday, April 27, and closes 24 hours later, at noon on Tuesday, April 28. Click here for more information

The council voted unanimously to allocate $150,000 to disburse to local businesses, drawn from $415,000 in funds left over after the city disbanded its urban renewal authority in February. The amount means there are a total of 60 grants available.

With many businesses in dire straits after weeks of either extremely limited sales or total closures, the hope is that small grants can help them stay afloat.

“Small businesses are the backbone of our community,” said Councilmember Kelly Milliman at the meeting. “They've been there for us, and we need to be there for them.”

Council initially discussed using the entire balance of the urban renewal funds for business grants at the April 14 study session, but reduced the amount under consideration to $200,000 by the April 21 meeting. By the time the vote was cast, council had reduced the pot of grant money to $150,000. Council also reduced the maximum grant amounts discussed from $5,000 to $2,500 in order to spread the funds to more businesses.

Much of the remainder of the urban renewal funds could be prioritized for an economic recovery program called Littleton RISE, City Manager Mark Relph told council, sharing plans to convene a panel of business owners and citizens in coming weeks. He called the grant program “phase one” of the city's economic recovery.

The business grants will be limited to businesses with no more than 50 full-time employees, and cannot go to national chains, home-based businesses, medical marijuana businesses, adult services or businesses that make more than a third of their income from gambling.

Businesses will be required to submit balance sheets from the last two quarters to qualify, and their requests will be processed by the city's longstanding grant awards committee.

“We want to make this as efficient as possible, and get this money into needy hands as quick as possible,” Relph said.

The decision to create the grant program came ahead of schedule — council had initially planned to vote on the idea no sooner than May 5, but bumped up the vote by two weeks. Other metro-area cities have had grant programs in place for several weeks.

A city survey of 173 businesses found 94% said city grants would be helpful, according to data presented by Denise Stephens, the city's head of economic development. The survey further found that 92% of businesses surveyed had applied for federal relief funds, but only 17% had received money by April 20. The federal Paycheck Protection Program ran out of funding in mid-April, according to news reports, though Congress was working on a second round of funding for the program as of April 22.

In dozens of anonymous comments, business owners shared how they would use the money, with most mentioning payroll, hiring back laid-off employees, or covering rent.

“I'll be spending money faster than I can earn it for no less than 6 months,” read one comment.

“This business has been a dream come true for us and we are on the brink of closing,” read another.

The city is facing its own budget woes. More than three-quarters of the city's general fund comes from sales tax revenue, and with limited business activity, city officials are bracing for a 25% reduction in sales tax revenue over the next two quarters. The city furloughed 58 employees on April 20.

Relph told council the city will only begin to know the impact of the shutdowns on city finances in early May, when March tax revenue is tabulated. Tax revenue from April is expected to be even worse, and the city anticipates making far deeper cuts.

Councilmember Carol Fey reiterated her skepticism of the business grants, asking if giving away the money would prevent the city government from taking care of its own problems.

“What we don't want to be doing is giving money to a business that is going to fail,” Fey said. “If they're dependent on our $2,500 whether they fail or succeed, they're on a really short lifeline.”

Councilmember Scott Melin pushed back against Fey.

“Why else would you do a grant program?” Melin said. “If businesses are going to survive anyway, they don't need our help ... Maybe $2,500 is enough to sustain them for a month or two in some critical aspect of their finances. I want those businesses supported by the grant program, not denied the grant because of that. It seems deeply ironic to me.”

The grants are part of a suite of efforts to assist businesses, said Stephens, the economic development director. Other efforts include promoting businesses still open through the crisis, and working with the city of Englewood to utilize tax breaks offered by a regional “enterprise zone.”

Relph said the magnitude of the city's looming financial difficulties meant the grant program, in that context, was unlikely to put a harmful dent in city finances, and time is of the essence in assisting local businesses.

“This is reasonable to take on right now,” Relph said. “This policy issue can't wait until June or July.”


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