Large Grant To Keep Small Cape Charles Businesses Afloat

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By Stefanie Jackson and Jim Ritch – Just two weeks ago, Cape Charles was discussing at its town council meeting an $845,000 grant from the Virginia Department of Housing and Community Development (VDHCD) to help its business community recover from the economic devastation caused by the COVID-19 pandemic.

Last week, the town received approval of the funds, giving small businesses in and near Cape Charles a boost to tide them through the winter.

“I hope that we can have checks to people in November, because that’s when they’ll need them,” said Tammy Holloway, president of Cape Charles Main Street and co-author of the grant application.

A meeting next week with state officials will shed more light on the schedule for applications and awards.

Public comments read at the Aug. 20 Cape Charles town council meeting unanimously supported applying for the funds to help save businesses that don’t qualify for federal aid.

Roxane Ward, who runs a Mason Avenue boutique, wrote, “micro-businesses seem to fall through the cracks. … It appears we are too small for the small business programs. However, this grant provides a light at the end of the tunnel for many of us.”

The Community Development Block Grant for which Cape Charles applied is typically used to improve infrastructure, but this year the money is being made available for COVID-19 relief.

Cape Charles’ economy relies heavily on tourism, an industry that took a huge hit when nonessential retail businesses were closed earlier this year to limit the spread of the coronavirus.

To make matters worse, the shutdown began in mid-March, just ahead of the warmer weather that drives travelers to towns like Cape Charles with its beach and outdoor recreation.

About 84% of Cape Charles businesses earn most of their annual income from mid-May through August, according to town staff.

About two dozen businesses in town are particularly vulnerable because they have been open less than three years, and it takes three to five years to fully establish a new business, the report stated.

The town wants to help micro-businesses, which employ two people or fewer. Those businesses didn’t qualify for small-business loans and now struggle to pay rent, utilities, and other expenses.

Cape Charles applied for the maximum amount of funding of $500,000. As a community with at least 30% small, woman- and minority-owned businesses (more than 80% of Cape Charles businesses are SWaMs), it was eligible to apply for an additional $300,000, bringing its total funding request to $800,000, plus about $45,000 for administrative expenses.

Cape Charles Main Street will administer the grant and distribute the funds, a process that will take about six to nine months.

Five spending categories have been proposed:

• A rent and mortgage relief program that will cover up to six months of rent or mortgage payments, based on need, for qualifying businesses.

• A reopening expense relief program to cover the cost of face masks, shields, sanitizer and dispensers, safety signs, and modifying cashier stations.

• Technology upgrades such as new hands-free, point-of-sale systems.

• Business recovery training, to include a ServSafe class (sanitation training for restaurant employees), social media training to help businesses be competitive in a new environment, and certification training for small, woman- and minority-owned businesses.

• Administrative costs to manage grant funds and plan, coordinate, and implement the recovery training programs.

Businesses may apply for up to $15,000 under the grant.

Cape Charles may also help businesses outside the town limits if it is awarded funds near the top end of its request, and if Northampton County does not also apply for a block grant.

Cape Charles aims to help up to 50 businesses, giving first priority to businesses in town.

The town made its case on the grant application by noting that 18% of the Eastern Shore population lives at or below poverty level, and “it is imperative that the businesses that Cape Charles supports that drive our local economy save jobs for those individuals … to keep the town and surrounding area from falling back into a state of blight.”

The unusual state grant requires no matching funds from the town, Main Street, or businesses involved.

“It’s the smartest thing I’ve ever seen” because the state Department of Housing and Community Development chose to give away funds earmarked for Community Development Block Grants that would have required matching funds, Holloway said.

She complimented the new town manager, John Hozey, and town council for its assistance, which was prepared on short notice around the busy July 4 holiday.

Helping prepare the application were co-author Karen Zamorski, program director; Bill Stramm; and Reggie Widgeon.

Businesses interested in applying should watch the Cape Charles Main Street Facebook page or contact capecharlesmainstreet@gmail.com