Monday, May 27, 2024

Legislators hope to redirect small business grant program, though treasurer says money is spoken for

by BIZ Magazine

By David Jacobs | The Center Square

Louisiana legislators are looking to carve out money from a $275 million federally funded small-business relief fund, though the state treasurer says the money already has been claimed.

Lawmakers created the Louisiana Main Street Recovery Grant Program earlier this year with money from the federal CARES Act COVID-19 stimulus and relief legislation. Businesses could apply for grants of up to $15,000 for pandemic-related expenses.

On Tuesday, State Treasurer John Schroder, who is overseeing the program, said about $93 million has been awarded. But when pending applications are included, the total obligated comes to about $283 million, which means some people won’t get paid unless other applications are rejected.

“I believe we have more applications right now than what we can pay,” he said.

The program stopped taking new applications about 10 days ago, Schroder said. The program had a high rate of rejections in the early stages but the proportion of qualified applicants increased as the program went on.

Sen. Bret Allain, the Republican who chairs the powerful Revenue and Fiscal Affairs Committee, on Tuesday asked Senate Finance to set aside $30 million of the Main Street funds to cap abandoned oil wells. The change would chip away at an environmental problem while helping struggling oil field service companies put people back to work, he said.

But Finance Chairman Bodi White, citing Schroder’s report earlier in the day, amended the bill so that oil field work only would get a cut if money is left after pending applications are addressed. Allain reluctantly agreed to the change.

On the other side of the Capitol, the House Appropriations committee advanced on a 15-4 vote House Bill 72 by Crowley Republican Rep. John Stefanski, which would reserve at least $25 million of the Main Street grants for bars.

His reasoning was that bars were among a handful of business types that were shut down entirely in hopes of mitigating the spread of the new coronavirus, and that barrooms remain closed for on-premise service now that Louisiana has loosened other restrictions. Rep. Tony Bacala, R-Priarieville, objected to changing the rules after the fact and pointed out that bar owners had their chance to apply just like everyone else.

They also approved House Bill 85 by Rep. Tanner Magee, R-Houma, which would create a similar Bar Assistance Relief program. But while BAR would be managed under the auspices of the Main Street program, the bill does not identify a funding source for the $2,000 grants and as such isn’t necessarily looking to divert any of the money from the general Main Street program.

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