Help is on the way for small businesses
Walking down a city’s or town’s Main Street often times is a reflection of the place itself. Restaurants, bars, grocery stores, mom-and-pop shops, the local dry cleaner or convenience store come alive along the street. But what happens to a community when those very establishments can no longer afford to keep their doors open?
That’s why a group of Boston business owners have come together to advocate for the city’s Black-owned restaurants and bars. The Boston Black Hospitality Coalition, which includes the owners of District 7 Tavern, Darryl’s Corner Bar and Kitchen, Soleil Restaurant & Catering, Wally’s Café Jazz Club, and Savvor Restaurant & Lounge, works to amplify the issues facing black restaurant and bar owners during the coronavirus pandemic. These businesses hold five of eight Black-owned liquor licenses in the City of Boston, where over 1,200 licenses are distributed. These businesses are neighborhood anchors and pillars, representing a rich legacy of Black-owned business and entrepreneurship that spans 180+ years in the Black community.
Collectively, these businesses have lost a total of $1.2 million in revenue from March to May. Typically, 90 percent of these business’ income comes from onsite consumption that was not possible during the coronavirus emergency. And over 85 percent of the workforce, which is primarily made up of people of color, was laid off, affecting more than 115 households across the city.
Sadly, what we’re seeing is that Black- and minority-owned businesses are being left out and left behind. Minority-owned small businesses have been disproportionally shut out from the existing paycheck protection program (PPP). These businesses that continue to operate during this economic downturn are about 60% less likely to receive 100% of the financing needed to sustain their business.
We cannot allow small business relief to be help for some, and not for all. We cannot afford to leave anyone behind.
This month, Congress passed updates to the PPP program, dropping the payroll expenditure requirement from 75% to 60% and extending the borrower period from eight to 24 weeks. These changes, included to help small businesses bear the burden of this crisis, are just the beginning of the amendments that must be made to protect our business owners.
Legislation introduced by Sen. Markey would carve out $10 billion specifically for minority-owned businesses, ensuring that $5 billion of that funding remains for loans of less than $150,000. The bill also ensures that $2.5 billion of those funds are for loans of less than $75,000. We need to reach the smallest of the small businesses, especially because they employ workers who live in the neighborhoods where the businesses are located.
We need to be intentional about putting the PPP funds into the hands of our minority-business owners. That starts with collecting data on where these funds are being distributed. Sen. Markey sounded the alarm to Treasury Secretary Steve Mnuchin in April after finding out that there was no record of whether PPP funds were reaching the hands of Black and minority business owners. Sen. Markey pushed for this data to be collected and demanded fair and equitable distribution of these funds.
But we also must provide technical assistance to connect small businesses with funding. We have seen how big corporations, and even more-established small businesses, have pre-existing relationships with large lenders which allow them to easily navigate the system. Our Black-owned small businesses need the same assistance from experienced parties to cut through the Small Business Administration (SBA)’s delays and unclear guidance. This is especially true as reopening begins in Massachusetts, leaving Black and minority-owned businesses in a further deficit.
Lastly, we need more grants for these businesses — not loans. Loans mean debt for these small businesses as we come out on the other side of the crisis. That’s why Sen. Markey is a co-sponsor of Congresswoman Ayanna Pressley’s and Sen. Kamala Harris’ Saving Our Street (SOS) Act, legislation that provides direct federal support to microbusinesses throughout the country during the pandemic.
So much is being asked of all of us right now. Our friends and neighbors, co-workers and families are struggling in so many ways. But through all the grief, turmoil, stress and despair, many of our communities have grown stronger together.
Edward J. Markey is a United States Senator representing Massachusetts. Frank Poindexter is the owner of Wally’s Café Jazz Club and a member of the Boston Black Hospitality Coalition.