SANTA CLARA COUNTY, Calif. (KRON)— Santa Clara County Supervisors approved a proposal to consider a $100 million small business loan program to help businesses throughout the county that have been economically impacted by COVID-19 and shelter-in-place orders.
At Tuesday’s Board of Supervisors meeting County Supervisors agreed to return at the November 18 and 20 budget hearings with options for establishing a loan program that would provide low-interest loans to small businesses countywide.
Supervisor Joe Simitian and Susuan Ellenberg proposed the COVID-19 small business loan program as small businesses across the county face continued losses, layoffs, and bankruptcy.
“I am very pleased that the Board of Supervisors agreed to pursue a $100 million dollar loans fund that I and my college Supervisor Susan Ellenberg have proposed,” said Simitian.
“It’s even more about making sure that they can retain their employees, that people can continue to get a paycheck, put food on their table, put a roof over their head and in doing that they’re pumping money back into the economy, so that other folks are getting a packcheck and can take care of their families as well.”
County leaders acknowledged the state and federal government have given very little assistance to help local small businesses — forcing the county to step in to help despite lacking experience in administering loans.
Both Simitan and Ellenberg proposed county leadership partner with community based organizations and qualified professionals to make the program possible.
“County government is the safety net, we are responsible ultimately for the well-being of all of our residents and we don’t usually think about that in terms of small businesses but the reality is that when local businesses are thriving, they’re not only supporting the families who own the businesses but the employees of those businesses “
“Hearing from our constituents since very very early in the shelter-in-place about how challenging it was for small businesses to hold on,” said Ellenburg.
“For a while there were some loan opportunities, there was PPP, some businesses had to unfortunately use built up saving but as the pandemic period prolonged, the options narrowed and dwindled,”
“One way or another we need to take responsibility and my view is that if we can proactively help people maintain self sufficiency, it’s good for them, and it’s good for the economy and it’s good for our social fabric.”
Now — county staff must return with a list of options on Nov. 18 to outline how it will administer the program and present a report of issues to be addressed:
Among the issues to be addressed in the report back are the following:
- Total target for the loan fund (we are hopeful that $100 million is practicable);
- Source of funds;
- Initial thoughts as to eligibility criteria;
- The potential range of loan amounts (we are thinking something on the order of $50,000-$100,000 per business (loans of $2K, $5K or $10K have proven insufficient to the emerging need);
- How and by whom the loans will be underwritten and serviced; and,
- Issues, if any, with legal prohibitions on “gift of public funds” and/or constitutional prohibitions on public banking