Mobile Considers New Grant Program for Small Businesses

On Friday, May 1st, the Mobile City Council held a specially called meeting to discuss the possibility of creating an emergency grant program for businesses inside the city limits which still remain shut down under Governor Kay Ivey’s “safer at home” order. The idea arose during discussions between city officials about how to help barber shops and nail salons that remain closed under the governor’s new order, which took effect at 5:00 p.m. on Thursday. The idea evolved from just barber shops and nail salons to encompass any business affected by the order.

The city wants to take $500,000 from an emergency reserve fund set up by the governing document of the city (known as the Zoghby Act) to spend on this grant program. The way the grant program is being discussed, it would give qualifying businesses $1,500 for businesses with less than 10 employees or $2,500 for businesses with 10 or more employees.

To qualify for this grant program, businesses must hold a city of Mobile business license in good standing and must be a business in one of the industries which are excluded from being allowed to open up under the governor’s “safer at home” order. For a business to qualify for the city’s emergency grant program, they also could not have qualified for or received their paycheck protection program money yet from the federal government.

There was some discussion at yesterday’s specially called City Council meeting, which was held by video conference, about the intended purpose of the grant program. Before the meeting was called, the grant program had evolved into a ‘honor system’ program where the city would just take the business owners’ word that they had not received PPP money from the federal government or been approved for it yet. That honor system would also include trusting that the business owner would share the city’s grant money with their employees.

 It was clear from the discussions during the meeting that several council members were not comfortable with this ‘honor system’ style grant program, and it was said by the administration that some safeguards would be built into the program before the next meeting on Tuesday, May 5th. Among those safeguards includes ensuring there is a clause on the application that the business owner applying for the funds acknowledges that all of the statements made on the application are true to the best of their knowledge under penalties of perjury. Other changes include ensuring that the city will have a process set up to go back and verify against PPP recipient lists that the business receiving the grant was not on the list, and having the grant recipient file paperwork with the city afterwards showing the disbursement of funds from the grant with supporting documents to ensure that the percentage of the grant that the council determines should be sent to employees is actually sent to the employees of the business.

There will be more discussion about this grant program at the city council’s regular meeting on May 5th, and the grant program will most likely be voted on the following week on May 12th. Applications for the grant program will be available for download on the city’s website and from the offices of each individual city council member immediately after Tuesday’s city council meeting on May 5th, with funds hopefully being distributed starting the 12th.