Virus Outbreak-Business Grants

Louisiana Treasurer John Schroder said the state's Main Street Recovery Grant Program has a "long, long way to go" until it runs out of money. The $275 million program was set up to help small businesses hurt by the coronavirus pandemic. It is making reimbursement payments of up to $15,000 to help with expenses. 

As a $275 million grant program for small businesses in Louisiana is set to launch in 18 days, Treasurer John Schroder said Friday while he’s still working through the details of who and what will qualify, businesses will have to submit receipts of actual expenditures, as lost income doesn’t qualify.

Schroder said the grant program is really more of a reimbursement program. If a business wants to get the up to $15,000 grants, which don’t need to be paid back, they must show receipts of coronavirus-related expenses.

He also said he’s discussed the issue of whether landlords qualify with Mayor LaToya Cantrell. He’s encouraging commercial landlords to urge their tenants to apply for the money, because rent is an eligible expense for most businesses.

“The bigger obstacle is residential landlords,” Schroder said in an interview. “Lost income is not a reimbursable expense.”

“It’s a reimbursement program,” he added. “You can only do reimbursable expenses. It’s going to come to you in a grant, meaning you won’t have to pay that back. In order to qualify for the grant you have to prove expenses. You’re going to have to send your actual invoices.”

Schroder said he “doesn’t have that answer” to whether residential landlords will be able to tap into the fund, which consists of $275 million in federal coronavirus aid that Republican lawmakers set aside for businesses with less than 50 employees. He said he’ll have more firm answers on how he is interpreting federal rules for the money in the coming week.

Cantrell spokesman Beau Tidwell said in an email that housing is "absolutely critical" and that the mayor's administration is encouraged the grant program could help for both businesses and tenants. 

"The state Treasurer expressed a willingness to work with us to find ways for residential landlords to qualify — with the understanding that landlords who receive help agree to halt evictions for the properties involved," Tidwell said. "The mechanics are still being worked out, and we look forward to collaborating with Treasurer Schroder to provide relief to our people.”

The state grant program is set up differently than the Paycheck Protection Program. The PPP is a loan given by the federal government, and businesses can get it forgiven if they keep workers on the payroll. Schroder said businesses only need to show coronavirus-related expenses to get the grant money through the state program, and won't have requirements for keeping workers on the payroll. 

The law passed by lawmakers earlier this spring and signed into law by Democratic Gov. John Bel Edwards lays out the broad strokes of what the program aims to do. The law says businesses qualify if they were open in Louisiana as of March 1, suffered an “interruption of business” during the pandemic, are owned primarily by Louisiana residents, had “customers or employees coming to its physical premises,” had no more than 50 full-time workers and more.

Schroder is now tasked with interpreting the state law and federal rules for the coronavirus funding, which was provided through the Coronavirus Aid, Relief and Economic Security (CARES) Act, a stimulus bill passed by Congress. Louisiana’s government received $1.8 billion in aid from the bill. Lawmakers used more than $900 million to plug holes in the state budget, more than $500 million to send to local governments, $275 million on the small business program and $50 million for front line workers.

Schroder’s office on Friday launched a website, louisianamainstreet.com, for businesses to see if they qualify and apply starting July 28. He is encouraging businesses to register at the site.

The Louisiana Legislative Auditor will review all applications to ensure businesses aren’t getting money improperly. In the first 21 days, businesses can only tap into it if they didn’t receive federal aid or insurance money already. After that, businesses that did get aid like the Paycheck Protection Program funds can tap into the state fund, but only if they have a different set of expenses.

Email Sam Karlin at skarlin@theadvocate.com