BANKS TO THE RESCUE?
Written by Solutions Journalism Network Contributor on April 3, 2020
This story is part of the SoJo Exchange of COVID-19 stories from the Solutions Journalism Network, a nonprofit organization dedicated to rigorous reporting about responses to social problems.
By Larry Platt | THE PHILADELPHIA CITIZEN
Earlier this week, the city announced that applications to Philadelphia’s new Covid-19 Small Business Relief Fund would only be accepted in the $5,000 micro enterprise grant category. The fund had recently been established with a mere $9 million, so already there was no more bandwidth for small business grants of up to $25,000 and loans of up to $100,000.
To its credit, the Kenney administration knew that a $9 million fund would be insufficient to deal with the economic fallout of Covid-19. In a press conference, Managing Director Brian Abernathy conceded as much, calling the Fund “a start.”
Policymakers knew we’d soon be awash in a tsunami of layoffs and loan defaults. That’s why the Kenney administration asked Councilperson Allan Domb to convene a meeting with the CEOs of the area’s major banks, to see what, together, they might be able to do in order to stem the oncoming tide.
Time was of the essence. Yes, Congress had passed the Payroll Protection Program as part of the CARES Act, which included some $350 billion earmarked for small businesses. But, as Bruce Katz outlined yesterday, it was unlikely that the federal bureaucracy would be able to get dollars into the hands of those who need it soon enough to keep the proverbial lights on.