This story has been updated here: Alaska’s small-business aid program will launch Monday - with a surprising rule
The state of Alaska will begin taking applications for a $290 million small-business grant program as soon as Tuesday, the directors of the Alaska Industrial Development and Export Authority confirmed Wednesday.
The state-owned corporation’s board of directors unanimously approved the program, which will be operated on contract by Credit Union 1.
“The intent is to provide funding from this program for businesses of 50 employees and less and nonprofits,” said Julie Anderson, commissioner of the Alaska Department of Commerce, AIDEA’s parent agency.
AIDEA’s interim director, Alan Weitzner, told legislators earlier this week that he expects between 5,000 and 7,000 Alaska businesses or nonprofits will receive grants as large as $100,000 apiece. Twenty percent of the $290 million has been reserved for rural businesses, those in communities with 5,000 or fewer residents.
The Department of Commerce has previously said that it tentatively expects to start accepting applications on Tuesday, but Anderson said at Wednesday’s meeting that some late changes to eligibility criteria could change that.
“Our intent is still to get these funds out as soon as possible, but we owe it to our program operator to inform them about these changes,” she said.
Who is eligible?
The program is limited to businesses and nonprofits with an Alaska business license older than March 11, 2019 that also has 50 or fewer employees. The business has to be based in Alaska. Sole proprietorships can apply.
Any business that has already received federal aid is still eligible, Anderson said. That’s a change from earlier plans. Companies can’t “double dip,” though: Any expenses covered by a federal program can’t also be covered by the state program.
A business that has filed for bankruptcy isn’t eligible. Marijuana businesses aren’t eligible. Out-of-state businesses aren’t eligible.
How much can a business receive?
A business is eligible for a grant of between $5,000 and $100,000. There’s only one grant per business license, and subsidiaries cannot apply separately.
The exact amount a business receives is determined by “eligible expenses” in the eight weeks before the application date and the eligible expenses expected during the eight weeks after the application date.
The term “eligible expenses” includes payroll, short-term — less than 24 months — debt that was needed to keep the business afloat during the pandemic, utilities, the cost of personal protective equipment, rent/mortgage payments, or the cost of replenishing inventory needed to reopen (such as replacing expired food).
What’s needed to apply?
Businesses are required to open a business account at Credit Union 1 in order to receive money. The company has said it will donate the $5 membership cost.
To apply, a business needs to complete a copy of the as-yet-unreleased business grant application, a copy of the current business license, all documents needed to open a business account with Credit Union 1, and a completed list of “eligible expenses.”
The state is recommending bank statements/credit card statements, invoices, payroll reports, purchase orders, lease agreements and billing statements to prove the maximum amount of eligible expenses.
How do I apply?
Through Credit Union 1. That company will take both online and in-person applications, but details of how they’ll accept submissions haven’t been released yet. Sen. Natasha von Imhof, R-Anchorage, said the company will have 25 loan officers ready to process the paperwork.
[Because of a high volume of comments requiring moderation, we are temporarily disabling comments on many of our articles so editors can focus on the coronavirus crisis and other coverage. We invite you to write a letter to the editor or reach out directly if you’d like to communicate with us about a particular article. Thanks.]