Newark approves $400,000 in grants
Programs will be funded by federal CARES Act money
NEWARK >> Some renters and small-business owners feeling the financial pain of the coronavirus pandemic will get a little help after the Newark City Council approved two programs funded with federal CARES Act money.
The council voted 4- 0 Thursday, with Mike Bucci absent, to use about two-thirds of the $604,590 to create a residential rental assistance program and a small-business grants program similar to those run in cities around the region like Fremont and Sunnyvale.
The rent program will provide a $2,500 emergency grant to 80 Newark households having trouble making rent because of the pandemic, according to a city staff report.
Anyone who rents in Newark, has an active lease in his name and can prove that he has “job loss or loss of income directly related to COVID-19 that impacts their ability to pay rent” is eligible to apply, the report said.
However, because the city expects to get a large number of applications, the grants will be prioritized based on need.
Those with incomes at 80% of the area median income or lower will get higher priority, as will those who can show they are “rent-burdened,” meaning they spend more than 30% of their monthly household income on rent.
Single heads of households with children, or anyone who can show special circumstances such as significant medical costs related to COVID-19, also will be given higher priority, the report said.
Steven Turner, the city’s community development director, noted that though the council approved a moratorium on evictions earlier this year after the start of stay- at- home orders, the emergency money is needed by many in the community because rent bills still could be racking up.
“The moratorium doesn’t take away the obligation of the tenant to pay rent and it doesn’t defer or eliminate past due rent,” Turner said in an interview Thursday.
“It’s really an attempt to help bridge that gap between what has been paid and what is owed,” he added. “I think of course in many cases it may not cover the entire gap, but it’s meant to provide at least some assistance.”
The grants would be paid directly to the household’s landlord, the report said.
However, because the city will require applicants to “provide a significant amount of confidential financial information” with their application, Newark is considering having the Fremont Family Resource Center administer the rental assistance program. The center’s involvement could cost up to an additional $40,000, or a fifth of the amount of the total assistance being offered, the city staff report said.
“It may require a lot of discussion or assistance with those residential renter applications to make sure their information is correct and complete,” Turner said. “They work with individuals on an ongoing basis, and they deal with a lot of confidential information, so from our perspective, we thought it was best.”
Newark would pay any administrative costs out of the remaining $204,590 of federal funding, the report said Those expenditures involve masks and sanitizer supplies, enhanced cleanings of facilities and moving much of the city’s workforce to remote work.
For the small-business grant program, the city plans to award 40 non-chain, nonfranchise businesses a onetime $5,000 grant.
“We want to get the money into the hands of businesses quickly, so that they can pay expenses with the hopes of first, remaining open, and keeping their employees employed, if that’s at all possible,” Turner said. The city’s grant will not attach requirements for how the money should be spent.
To be eligible, businesses must have been open for at least a year as of March 17, 2020, demonstrate that they have sustained at least a 25% reduction in revenues due to COVID-19, have no more than 25 employees, have a physical storefront in a commercial facility in Newark and have a valid business license on file with the city.
The program is to be advertised for two weeks, and all eligible applications received during that period will be entered into a lottery from which 40 applications would be selected at random, the staff report said.
City staffers would oversee the process, not a third party.