CITY TO OFFER EMERGENCY BUSINESS LOAN PROGRAM
A business resiliency emergency loan program is being established in Fortuna to help local businesses who are suffering from impacts associated with the COVID-19 situation.
At its meeting on April 6, the Fortuna City Council adopted a resolution that would a program with $150,000 available for business loans.
According to Fortuna City Manager Merritt Perry, this money comes from Fortuna’s Business Loan Fund. “The city has approximately $500,000 in the Business Loan Fund, but I asked the City Council to start with $150,000 to see what the need is,” Perry said.
“We want to get this money to the businesses who need it,” Perry said, “to the businesses we want to help keep going, who are struggling to get through this.”
It’s a way for the city to help the businesses who help the city.
“The city depends on property tax, on sales tax, on TOT (transient occupancy tax), and we hope this can keep some Fortuna businesses going that we want to see around for a long time,” Perry said.
Since the stay at home order was issued by Humboldt County on March 19, a group of regional economic development professionals have connected to form the COVID Economic Resilience Consortium and have been in ongoing discussions about how to help offset the negative impacts affecting Humboldt County businesses.
A regional effort and approach to provide bridge financing to hard hit businesses is in development, and according to Gregg Foster, executive director of the Redwood Region Economic Development Commission (RREDC) the hope is to begin accepting loan applications soon.
“Our program guidelines are still being finalized,” Foster said in an email, “but in general the intention is to provide funding to help cash flow while the business is in the process of applying for SBA funding. The loans will be up to $25,000, 2.5% interest with six months of no payments,” he added, (and) after that, we’d term out the loans over 60 months.”
Perry said Fortuna’s program is going into place immediately, and then be one piece of that regional effort after a process is established.
Perry said he anticipates reviewing applications from Fortuna businesses for loans through the city’s program immediately upon receipt.
“Once we have an accepted application,” Perry said, “the loan can be funded rather quickly.”
For now the maximum loan through Fortuna’s program is $10,000 with a 2.5% APR sim
ple interest. The payments would be deferred for six months from close of loan.
“$10,000 is the cap from city funds,” Perry said, “but that amount may be higher if additional funding is available from other regional sources, such as RREDC.”
Perry also said that the Headwaters Fund and Humboldt Area Foundation have pledged money to a regional program, once one is established.
In addition to RREDC, the Humboldt Area Foundation and the Headwaters Fund, others participating in the COVID Economic Resilience
Consortium are the Arcata Economic Development Corporation, Prosperity, and the County Economic Development Department.
In the meantime city of Fortuna staff have been working closely with the Fortuna Business Improvement District (FBID) and the Fortuna Chamber of Commerce interviewing local businesses to assess needs. Dozens of Fortuna businesses have been interviewed and Fortuna Chamber of Commerce Executive Director Renee Lindsay said she appreciates the City’s commitment to small business and the Fortuna community.
“The Fortuna Chamber of Commerce is pleased to assist FBID and the city of Fortuna with the Business
Resiliency Emergency Loan Program,” Lindsay said. “With federal funding taking longer than expected to receive, these funds will be critical in supporting our struggling businesses. The rapid approval process, facilitated by FBID and RREDC, will put money into the hands of our business owners sooner rather than later.”
“As the executive director of FBID, we are very excited to see some of our city of Fortuna funding set aside to help our Fortuna businesses during COVID 19,” Dianna Rios said. She urged Fortuna businesses to call FBID at 707-725-9261 with any questions regarding services that are available to guide owners through this situation.
Pictured: Downtown Fortuna. The city of Fortuna has set up business resiliency emergency loan program with available financial assistance for businesses negatively impacted by the COVID-19pandemic.