The CT Department of Economic and Community Development (DECD) has created a $50 million grant program to assist CT small businesses that have been negatively impacted by Covid-19. Eligible CT businesses and nonprofits can receive a one-time $5,000 grant (no repayment requirements!). Of the $50 million, $25 million will go to businesses/nonprofits located in the state’s distressed municipalities and the remaining $25 million will go to other businesses/nonprofits that meet the general eligibility requirements.
General eligibility requirements are:
- Business must have had no more than 20 total full-time equivalent employees (FTEs) in 2019 across all of their Connecticut locations, or total 2019 payroll of less than $1.5 million. FTE and payroll include affiliated companies.
- Businesses must be able to demonstrate a 20% or more loss in revenue year-to-date as of September 30th, 2020 compared with the same period in 2019. Note: other loans and grants received related to Covid-19 (PPP, EIDL, etc.) do NOT count as income for purposes of determining 2020 revenue.
- Business must have been established by October 1, 2019 and still be active (as verified by DRS).
- Home-based businesses are eligible.
- Eligible entities: for-profit businesses that use any type of incorporation, as well as 501(c)(3), 501(c)(4), 501(c)(6), 501(c)(7), and 501(c)(19) nonprofit organizations.
- The business must remain a viable business, be planning to reopen, and be planning to rehire any workers let go due to COVID as business conditions recover, and have a material financial need that cannot be overcome without the grant of emergency relief funds.
- Companies must be in good tax standing with DRS or current on a payment plan or consent to use a portion and/or all of their grant to remedy the delinquency.
- Sole proprietorships are eligible.
- Those who already received federal CARES Act, PPP or EIDL assistance are eligible, but the grant cannot be used for the same expenses incurred or expected to occur between March 1, 2020 through December 30, 2020.
Businesses that are excluded are:
- Businesses in which the majority of revenue is earned from the following activities:
- Medical marijuana; liquor stores and alcohol distributors; adult businesses such as strip clubs; vape retailers; tobacco shops and smoking lounges; businesses having to do with gambling; gun stores and ranges; cash advance, check cashing, or pawn shops; bail bonds; collection agencies or services; and auction or bankruptcy or fire or “lost-our-lease” or “going-out-of-business” or similar sale.
- Business establishments that are 50% or more owned by another establishment such that the FTE count for the umbrella establishment (when counting the FTEs of all subsidiaries in which the umbrella establishment has 50%+ stakes) is more than 500. For example, this would include non-franchised outlets of major national food and retail chains.
Grant funds can be used for:
- Payroll
- Rent/Mortgage
- Utilities
- Inventory
- Purchase of Machinery and/or Equipment
- Cost associated to ensure compliance with CT Reopen Business Sector Rules
As noted above, these grant funds CANNOT be used for the same exact expenses as other relief funds (PPP, EIDL, Bridge, etc.) have been used for BUT they can be used for the same type of expenses but a different time period. For example, if your business received a PPP loan and used the funds for July & August rent, the CT CARES grant proceeds could be used for rent between September and December 2020. Per IRS guidance, expenses paid for using grant funds, will NOT be tax deductible.